Data lights the way
Best Asian Telecom Carrier
|Last year's winner:||Softbank Mobile|
|Business segments:||3G mobile voice, data|
|Chairman & CEO:||Masayoshi Son|
|Key stats:||24.4m subs (end 2010); profit up 50% to $1.74b (9 months ended Dec 2010)|
Softbank Mobile may still be basking in the glow of the iPhone's success, but the firm is far from resting on its laurels. Like all carriers, Japan's telcos are seeing a decline in voice ARPU, so it is every carrier's destiny to move from being a mobile phone company to a mobile internet company, says Ted Matsumoto, senior EVP of Softbank.
"The strongest carrier is the one who makes the transit to data the fastest. Those who can't manage that will lag behind."
Softbank's strategy to focus on data has been a major success, perhaps owing to its roots as an internet provider. "Japan loves the iPhone, and it's the young consumers who are more aggressive than the business customers in Japan. The iPhone took the enterprise market by storm even before the BlackBerry gained a respectable base," says Matsumoto.
The firm's roadmap includes pulling out all the stops where data is concerned. Softbank shut down its 2G network last March to focus its energies on data, which accounts for more than 50% of ARPU, excluding text messages. The decision, while costly, has paid off. "It was painful to pay to shut down our 2G network, but opex has since gone down significantly," he says.
Aggressive marketing for the iPhone continues, but Softbank intends to broaden its portfolio to include more data-intensive devices. More than 70% of phones sold by Softbank are smartphones, and this figure is expected to rise. The firm is setting its sights on Android, with the Sharp Galapagos its most popular Android device.
"The Android wave is just beginning in Japan," says Matsumoto, adding the firm still believes in the quality of Japanese hardware despite no longer focusing on Japanese feature phones with disparate operating systems. Softbank is also contemplating Android device offerings from Chinese vendors.
Devices supporting LTE are also on the cards for Softbank. The carrier plans to launch PC dongles supporting a network technology standard it labels Advanced XGP by the end of this year, along with a commercial LTE service. Smartphones based on the same standard will be unveiled in 2012. Advanced XGP is a home-grown Japanese standard based on OFDMA and similar to TD-LTE. Most network components for Advanced XGP are TD-LTE compatible. Matsumoto claims Softbank's decision will contribute to TD-LTE's proliferation globally, as large carriers such as China Mobile and Bharti Airtel have expressed support for the standard.
First revenue drop in 13 years signals that smartphones and tablets are reaching market maturity