Japanese e-commerce operator Rakuten said it received approval from the Minister for Internal Affairs and Communications to operate 4G service on the 1.7GHz band, giving it the green light to become the country’s fourth mobile operator in 2019.
The company said in a statement its mobile unit, Rakuten Mobile Network, will accelerate preparations in line with the approval, with the aim of launching service in October 2019.
Rakuten, which currently offers mobile service as an MVNO using NTT Docomo’s network, announced plans in December 2017 to raise funds and apply for a spectrum licence.
The company said it aims to raise a maximum of JPY600 billion ($5.6 billion), with JPY200 billion to be raised by Rakuten through hybrid financing and other methods. The remainder will be raised by Rakuten Mobile Network through bank loans and others means.
Rakuten’s entry into the market is expected to put pressure on mobile tariffs, with Nikkei Asian Review reporting the company’s data plans will be 30 per cent lower than the existing three mobile players.
Hiroshi Mikitani, Rakuten’s chairman and CEO (pictured), said at Mobile World Congress in February it is set to challenge established mobile operators by using its huge customer base as the foundation to build its own network operations.
The Radio Regulatory Council, an advisory body to the communications minister, allocated the 4G bandwidth to Rakuten: official ministry approval was expected yesterday (9 April), Nikkei Asian Review said. The clearance requires Rakuten to secure funding to build out its own mobile network to compete in a market dominated by NTT Docomo, KDDI and SoftBank, which together had about 180 million mobile connections (excluding cellular M2M) at end Q1, GSMA Intelligence data shows.
Japan’s Ministry of Internal Affairs and Communication put pressure on the three major players in recent years to encourage them to offer a wider variety of data plans and reduce tariffs. In late 2015 the ministry said it was looking to prohibit handset subsidies and would ask operators to use the money they save to reduce charges.
In June 2017, the ministry agreed to allow the private sector access to frequencies allocated to government agencies and is now working out how to proceed.