VIEWPOINT

Is Rakuten Mobile Off To A Slow Start?

543views

Japanese telecommunications newcomer Rakuten’s  4G unlimited  free offer appears to have failed to attract 3 million users  even as the telco sets eyes on 5G, writes JOSEPH WARING.

More than seven weeks after Rakuten Mobile started accepting applications for its free unlimited 4G data offer for the first 3 million customers, the fourth mobile operator in Japan is apparently yet to hit the target.

Equity analyst at Jefferies, Atul Goyal said in a research note the newcomer’s unlimited offer seems to have failed to attract 3 million users despite being free, since its homepage shows the first-year free plan appears to still be available.

The operator didn’t respond to questions from Mobile World Live on uptake of the free offer, targets for 2020 or 5G plans.

In early March, the newcomer unveiled its long-awaited pricing plans and then launched 4G service on 8 April after a six-month delay. Under a tariff dubbed Un-Limit, a JPY2,980 (US$27.81) per month plan offers unlimited data when using its network (for those who don’t sign-up before the free offer reaches its 3 million limit), but a 5GB cap when roaming on partner KDDI’s network.

Bad timing

A week after the launch, the government declared a nationwide state of emergency until 6 May due to the worsening Covid-19 (coronavirus) outbreak. The prime minister previously put in place a month-long state of emergency in seven regions.

Chief analyst at Japan-based research company ITR, Marc Einstein told Mobile World Live the operator’s timing couldn’t have been worse. He explained the concept of registering everything online is foreign to most people in Japan and those who are interested would still need to go to a physical store to cancel an existing plan.

He also noted he hasn’t seen a lot of marketing around the launch and doesn’t think the average person understands the difference between its new service and existing MVNO offering.

Its loss-making MVNO service is estimated to have 2.3 million subscribers.

Coverage

A big obstacle to uptake is network coverage is limited to specific areas of just three cities: Tokyo, Nagoya and Osaka. Outside those areas it must rely on KDDI’s network, as part of a roaming deal with the company.

The newcomer was scheduled to have 4,400 base stations up and running for the official launch, a small fraction of its rivals.

A survey by MMD Research Institute conducted in late March found while 40 per cent of those contacted viewed the low-cost unlimited plan as attractive, less than 10 per cent said they have or plan to sign up. Of those not interested in the service, 37 per cent said the main reason was concern about the limited coverage area and another 30 per cent worry about the stability of the new service.

The company, a unit of e-commerce giant Rakuten, claimed it is the first operator with a live service based on fully virtualised infrastructure.

Rakuten Mobile has also been quiet on the status of its much-hyped 5G rollout, which is scheduled to go live in limited areas in June.

NTT Docomo, KDDI and SoftBank all turned on 5G services in selected areas during the week of 22 March.

Einstein noted that with the Summer Olympics pushed back a year, the incumbents have more time to create a compelling consumer 5G offering, as few customers would have devices supporting 5G by the middle of this year. For trials during the Rugby World Cup in September 2019, the operators loaned handsets to customers at stadiums.

He added the one-year delay could be a godsend for Rakuten Mobile, as the operator might be under less government pressure and have more time to work on its 5G rollout.

* Waring is Asia Editor at Mobile World Live.

* Editor’s Note: The editorial views expressed in this article are solely those of the author and will not necessarily reflect the views of the GSMA, its Members or Associate Members.

Leave a Response

bahis canlı casino siteleri canlı bahis siteleri