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SoftBank seeks to win, where Docomo failed – taking Japan’s telecoms know-how global

Japan telecom sector financial results: very very healthy

With SoftBank and DISH battling for US mobile operator SPRINT, the eyes are on Japan’s very healthy mobile phone sector, which a few days ago announced financial results for FY 2012. Japan’s mobile operators combined achieve about US$ 120 billion in revenues and income margins are among the highest globally.

The size, success and extremely advanced state of Japan’s mobile phone sector, SoftBank’s excellence, and Masayoshi Son’s midas touch give SoftBank the strength to go for an acquisition of SPRINT – and to aim for the large scale globalization which DoCoMo tried, but could not achieve about 10 years ago.

Japan’s mobile operator revenues are about US$ 120 billion and growing

Japan’s mobile operators DoCoMo, KDDI and SoftBank are growing steadily

Japan’s mobile phone operators are protected by government licenses, but within this scope, there is passionate competition and there are many M&A actions. With high investments in infrastructure, Japan’s mobile phone sector is among the most advanced in the world. Japan initiated the global mobile internet revolution.

Combined, Japan’s mobile operators achieve about US$ 120 billion in sales annually

Combined, Japan’s mobile operators achieve about US$ 120 billion in sales annually, and the size of Japan’s mobile industry has been growing steadily ever since mobile phones started in Japan.

The Figure above clearly shows the growth of SoftBank from a small venture to one of the world’s largest telecom operators, and the acquisition and turn-round of Vodafone-Japan.

SoftBank aims for US$ 10 billion operating income/year
SoftBank aims for US$ 10 billion operating income/year

SoftBank is on track to achieve the target of YEN 1 Trillion operating income/year by FY 2016

FY2012 financial results announced a few days ago show that SoftBank has overtaken KDDI in terms of operating profits, is on track to overtake DoCoMo and to achieve its target of YEN 1 Trillion (US$ 10 Billion) in operating profits by 2016 – this while investing heavily in infrastructure in Japan, and paying down debt remaining from the acquisition of Vodafone-Japan.

Operator Operating income/year
China Mobile US$ 24.4 Billion
Vodafone US$ 17.4 Billion
Verizon US$ 13.2 Billion
SoftBank US$ 7.5 Billion, 2016-target: US$ 10 billion

More in our report on Japan’s telecom sector

Preview – SoftBank today and 300 year vision report:

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