Japan’s cosy telecoms firms are being told to lower prices

WHEN SUGA YOSHIHIDE emerged as the likeliest to succeed Abe Shinzo as Japan’s prime minister, telecoms bosses in Tokyo let out a collective groan. As Mr Abe’s chief cabinet secretary, Mr Suga urged operators to cut prices by as much as 40%. “They are using our public airwaves, an asset of the people,” he said in 2018. “They should not be generating excessive profit.” Since replacing Mr Abe last month, Mr Suga has made competition in mobile services a signature issue. The share prices of Japan’s three big carriers—NTT DoCoMo, SoftBank Corp and KDDI—fell by 10-15% between late August and late September. 

Mr Suga’s calls were also the soundtrack to a pair of blockbuster announcements. On September 29th Nippon Telegraph and Telephone (NTT) said it was taking NTT DoCoMo, its listed mobile subsidiary, private. The tender offer, of $40bn for the 34% of shares it does not already own, is Japan’s biggest ever. The next day Rakuten, a Japanese e-commerce giant with ambitions to shake up mobile telephony, launched its much-awaited 5G network. An entry-level plan costs ¥2,980 ($28) a month, about half as much as comparable offers from rivals. 

The government reckons that data-heavy users in Japan pay more than in other developed countries. For users of plans with 5GB of data, prices in Tokyo are three times higher than in...

via Business Feeds

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