Japan wireless industry boom driven by smartphones. Japan adds about two Finlands worth of wireless subscriptions per year.

SoftBank and Masayoshi Son

Japan wireless industry adds 11 million subscriptions/year currently

Softbank targets ¥ 1 Trillion operational income

Japan wireless industry is growing, and Japan’s mobile operators add 11 million subscriptions/year currently: Japan adds about two Finlands worth of wireless subscriptions per year.

Softbank entered the telecom arena in 2001 with Yahoo BB, Nagoya Metallic and later Osaka Metallic and Tokyo Metallic Communications. However, when Softbank announced the acquisition of the ailing Vodafone-Japan operations, few telecom professionals outside Japan had ever heard about Softbank, and major telecom equipment makers approached our company to help start business with Softbank.

Today, Softbank has acquired Japan’s eAccess/eMobile, is sponsoring the rehabilitation of Willcom, founded Wireless City Planning, and is in the processes of gaining regulatory approval to acquire the US operator SPRINT – on the way to become one of the world’s largest telecom operators.

Japan wireless industry operators have combined operating profits of US$ 24 billion/year – Softbank targets operating profits of YEN 1 Trillion (= US$ 11 Billion) for financial year 2016

Softbank targeting YEN 1 trillion operating income by FY2016
Softbank targeting YEN 1 trillion operating income by FY2016

Will Softbank overtake NTT-docomo?

NTT-docomo and Softbank could not be more different. While both are public companies, traded on the Tokyo Stock Exchange, about 21.7% of NTT-docomo’s shares are owned by Japan’s Ministry of Finance via their holding of NTT shares.
On the other hand, Masayoshi Son owns about 21.4% of Softbank shares – almost the same ratio.
One of Softbank’s targets is to achieve YEN 1 Trillion (= approx. US$ 11 Billion) in annual operating income.
Softbank recently acquired US operator SPRINT, and to stimulate cooperation between Japanese employees of Softbank, Softbank is now offering YEN 1 million (US$ 11,000) bonus to those Softbank employees clearing a certain level of English language test.

Japan's mobile subscriptions growth by 11 million/year
Japan’s mobile subscriptions growth by 11 million/year

Smartphones drive a boom in Japan’s mobile communications sector

Smartphones drive a boom in Japan’s mobile communications sector: while growth has been fading over the last 10 years, iPhone and other smart phones accelerate growth. Currently Japan adds about 11 million mobile subscriptions every year: Japan adds about two Finland’s worth of mobile subscribers per year.
Read detailed analysis in our Japan-Telecommunications-Industry Report

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Japan trends for 2013 (New Year post)

New Year trends Japan

Japan replaced nuclear electricity generation by LNG, by imported gas

Japan trends for 2013: Nuclear reactor restarts are on their way

Japan trends for 2013 Japan’s energy sector: Japan has essentially replaced the 30% of its electricity energy supply which was from nuclear power plants, by electricity produced in aging thermal power plants from urgently arranged LNG purchases at very high prices. Prime Minister Abe said that he wants to restart all nuclear power stations, which receive safety clearance by the new Nuclear Regulation Authority (NRA), and asks for these safety examinations to be completed within 3 years – however the NRA said, that 3 years is far to short to complete the safety assessment.

Given that any discussion about Japan’s energy mix, and “new” renewable energy (except for water power), liberalization and development of free energy markets were suppressed for many years in Japan, Japan now urgently needs to start innovating many components of the energy landscape including insulation and smart grids, and a new energy mix. PM Abe thinks that it will take about 10 years to settle on a new energy mix for Japan.

Japan trends for 2013: Japan is now waking up to innovation and changes of it’s energy and electricity sector

Japan’s electronics manufacturing sector is about as large as the economy of the Netherlands, but collectively showed no growth and lost money over the last 15 years, and therefore will either fade away, or very urgently needs new business models (see interview on BBC). PM Abe’s push for a lower YEN might soothe the symptoms a bit, but does not solve the fundamental problems. Hitachi’s “smart transformation” are steps in the right direction, but its really too early to tell – also “smart transformation” does not solve Japan’s traditionally low emphasis on software and other non-hard-ware-producing crafts.

Telecoms: Masayoshi Son, master of the midas touch and founder and master mind of SoftBank, acquired what was left of Vodafone-Japan and turned it around successfully within weeks, said reportedly: “I am a man – and want to be Number 1”. Now he aims to apply his midas touch to SPRINT. Expect more acquisitions by Son on the way to Number 1 in global telecoms.

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