The Wall Street Journal has reported Apple is subsidising operators in Japan to offer discounts on its phones because they’re not shifting as quickly as it would like.
After claiming that the new iPhone models are moving slower than planned through its supplier and manufacturer checks, WSJ reported again that Apple is going to offer discount to its XR model in Japan, which is said to be falling short of plan the most. Due to channel price protection, it needs to compensate the mobile operators to do so.
The fact that XR, the cheapest of the three new iPhone models, was the worst performer may come as a surprise, though it is to do with Apple’s positioning. One could only speculate that those going for the premium would rather buy the more expensive models (the XS and XS Max). While those who are not after the newest would go for the older models.
Since last year’s premium model the iPhone X was stopped when the new models were launched in September, to avoid cannibalisation of the new XR, some consumers went back to the older models, the iPhone 8 series. The WSJ reported that Apple may resume the X both to move consumers to more premium (therefore higher margin) model and to fulfil its OLED display commitment to Samsung. The X is said to be cheaper to make than the XS and XS Max, said the WSJ.
Japan was one of the harder to crack markets for Apple when the iPhone was first launched. The country was dominated by DoCoMo’s internet-enabled iMode phones. It took Apple a couple of years before it could convince the Japanese users of the advantage of smartphones and app stores. It looks that Apple is once again having a difficult ride in Japan again.
Tech conglomerate SoftBank wants to raise a few trillion yen by offering some of its Japanese operator up for public consumption.
Around a third of SoftBank Japan’s shares will be served up in an initial public offering that is expected to raise around 2.4 trillion yen (21 billion bucks). If things go really well it could even challenge Alibaba for the biggest ever IPO, which would come in handy for a group that is especially exuberant in its spending.
“Through the listing of SB shares, SBG expects that the respective roles and valuations of the two companies will be clear,” said the announcement. “SBG is accelerating investments on a global scale, while SB is a core company to the Group’s telecommunications business. It is hoped that each of the two companies will be able to provide information regarding their businesses to the market with greater clarity and thereby better respond to the various needs of investors.
An alternative way of looking at it is that SoftBank Group is a bit short of cash and has decided that a sport of equity release from one of its subsidiary companies is the best way to get hold of the kind of cash it needs. As well as big acquisitions such as ARM, the group seems more concerned with general tech investment these days. This IPO seems to have been on the cards for a while, but it remains to be seen how much, if any, of the cash raised will be reinvested in SoftBank’s, Japanese network.
Hot on the heels of the Australia ban it is now being reported that Japan is thinking of taking similar action.
This definitely needs to be filed under ‘unsubstantiated rumour’ at this stage, but is also far from inconceivable, given the current momentum acting against Chinese kit vendors. GB Times reported in English about a Japanese language story alleging the Japanese government is thinking of blocking Huawei and ZTE from bidding on public contracts for building information systems.
Last week Australia decided the risk of the Chinese state exploiting the presence of kit from Chinese vendors in telecoms networks to get up to no good was too great and decided to err on the side of caution. There has been no hard evidence published that this happens, and Huawei thinks it has become a scapegoat in a growing economic and political battle between China and the West, but Western governments are increasingly opting to shoot first and ask questions later.
Chinese state-run media has apparently questioned the validity of the report, apparently blissfully unaware how imperative it is to question the validity of anything published by state run media. Having said that it could well be nothing, but it seems very likely that other countries allied to the US will seriously consider a similar move.
Last week, research from Deloitte placed China at the front of the pack in the race for the 5G dream, so we asked Telecoms.com readers in a snap poll who they thought was winning.
Deloitte’s reasoning was built on the progress of network densification programmes across the country, its throwing sites up all over the place, and also future investment allocations. It seems Telecoms.com readers agree with the consultancy as well.
We suspect the ‘someone else’ option was directed at a European nation, though considering only 6% decided to select this one, it is not looking good for the continent.
Softbank and Yahoo Japan have announced the formation of a new joint venture, PayPay, to launch a QR-based smartphone payment services in Japan by November.
The joint venture will lean on the experience of Paytm, India’s largest digital payment brand and a SoftBank Vision Fund portfolio company, for technology and expertise in mobile payments in the latest efforts to move Japan away from a cash-based society. As it stands, less than 20% of payments across the country are cashless, one of the lowest worldwide for a ‘developed’ economy.
“The Japanese government is taking measures to raise the cashless payment ratio to 40% by 2025, with a long-term goal of 80%, the highest level globally,” Softbank said in a statement. “To aid these efforts, SoftBank and Yahoo Japan established PayPay Corporation in June 2018 and will launch its user-oriented payments platform in the fall 2018.”
With the experience of Paytm, the brand has 300 million customers and 8 million merchants, combined with the presence of SoftBank and Yahoo Japan, the PayPay business certainly has a promising to start to disruption. The Yahoo! Wallet which has approximately 40 million accounts, will act as the foundation, with Softbank leading the sales strategy, while also developing a localised service leveraging Paytm’s technology. Once the new service has been launched, Yahoo Wallet will cease to exist, though a time-frame has not been laid out.
While the adoption of this technology is far from given, the venture does demonstrate the power of the Softbank ecosystem. While it might have looked like a side-project to keep billionaire CEO Masayoshi Son busy, the Softbank Vision Fund offers a wealth of technology expertise for family members to lean on and launch new services. Of course, Vision Fund employees will be looking to find investments which will make money in the long-run, but complementary businesses and technology to aid the progression of current new services would certainly play some role in the decision making.
Japanese operator NTT Docomo bought some baseband gear from Nokia. That’s it – nothing else happened – sorry.
It was great gear though, with all the bells and whistles like antenna and flashing LEDs and that. In fact, as far as baseband gear goes, it wouldn’t be an overstatement to call it legendary. KDDI and Softbank are going to be sooo jealous when NTT installs these paragons of shininess. They’re going to want to just chuck their basebands in the bin.
And as if that’s not enough these basebands are totally 5G as well. You know you get some basebands that say they’re 5G but you can just tell their heart isn’t in it? This isn’t one of those times – these are 110% 5G to the max. They’re the 5G-est basebands you’ll ever see. If you said ‘4G’ to them they’d be like: “I don’t even know what you’re talking about bruv, I’m all about the 5G innit.”
“We have been collaborating with partners such as Nokia on various 5G technology and use case trials since 2014,” said NTT CTO Hiroshi Nakamura. “With this agreement with Nokia, we are now proceeding to the next step to launch 5G mobile services by 2020, and accelerate co-creation of new services and businesses with vertical industry partners.”
“The agreement with NTT Docomo is a major milestone in bringing 5G to commercial reality, especially in a country with a long and proud history of technological achievements and early technology adoption,” said Marc Rouanne, President of Mobile Networks at Nokia. “Together we have worked hard in recent months to commence preparations for NTT Docomo’s eventual launch of its operational 5G service by 2020, which we have now set in motion by this very exciting announcement today.”
In other news Nokia got some new curtains at its HQ that really brighten up the place and it found a great new sushi place in Helsinki. Furthermore Nokia’s new trainers cost loads more than Ericsson’s, it has a PlayStation 4, an Xbox One and a Nintendo Switch with loads of games and steering wheels and stuff, and its dad could totally batter Ericsson’s dad in a fight.
In response to a report claiming it’s going to flog $18 billion of shares in its Japanese mobile units. Softbank has said it might, but no decision has been made yet.
The report was brought us by Japanese business title Nikkei, which chatted to someone who reckons SoftBank Group aims to list its Japanese mobile phone unit in Tokyo and overseas this year. The un-named source also reckons the amount of money raised by such an IPO is likely to be in the region of two trillion yen, which is about $18 billion.
Softbank felt moved to respond to this piece of rumour-mongering, issing the following statement: “With regard to today’s Nikkei report on the listing of SoftBank Corp., a subsidiary of SoftBank Group Corp., we are always studying various capital strategy options. The listing of SoftBank Corp. shares is one such option, but no decision has been made to officially proceed with this course.”
SoftBank is the third of three major Japanese MNOs with around 24% subscriber market share according to Ovum’s WCIS service. Narrowly ahead is KDDI and the market leader is NTT DoCoMo. But SoftBank Group also owns Sprint, ARM and a bunch of other stuff, as well as being hyperactive in the general tech VC space. So it’s perfectly plausible that it might want to raise a few extra yen, but right now nothing has been decided. You can read further analysis on Light Reading here.
Huawei and NTT Docomo have jointly announced a field trial on the 28GHz millimeter wave (mmWave) spectrum cruising past 4.5 Gbps.
Taking place in Tokyo Skytree in downtown Tokyo, the trial consisted of a base station working over 28GHz was located on Tokyo Skytree’s viewing deck at a height of 340 metre above the ground, while user equipment was placed on the roof of a shopping facility at Asakusa Station. During the test the pair achieved a 4.52 Gbps downlink throughput and a 1.55 Gbps uplink throughput with a coverage range of 1.2km.
“The high-speed and long distance support is one of important technical challenges for 5G mmWave conditions,” said Gan Bin, VP of Huawei 5G Product Line
“This successful long distance live-demo on a 5G mmWave is a ground breaking achievement in our joint effort with NTT DOCOMO to build a fundamental 5G commercial environment. This success makes us more confident in realizing the goal of commercializing 5G by 2020.”
The base station supported Massive MIMO and beamforming technologies, to support long distance data transmission over the 28 GHz mmWave. As part of the trial, visitors experienced next generation video communication using a Microsoft HoloLens over the end-to-end 5G network. Huawei has said during the demonstration the voice calls were clear, and the video footage was free of any freezing.
This is not the first time the pair have worked together though. Last year, another field trial was conducted in Yokohama Minato Mirai 21 District over the 4.5GHz spectrum band, where 11.29 Gbps throughput speeds and latency of less than 0.5 millisecond were achieved.