Page 44 - Forbes - Asia (April 2019)

Japan’s 50 Richest

R akuten CEO Hiroshi Mikitani doesn’t shy away from

risks. His $5.5 billion bet is his biggest one to date: a
startup using a new technology to disrupt the nation’s
entrenched, three-way mobile phone oligopoly. Rakuten
wants to build a new telecom network in Japan in as little
as half the time and at a cost of up to 40% less than what
it would take to build a conventional system.
The new service, Rakuten Mobile, aims to attract about 10 mil-
lion customers over nine years—and 15 million over a longer
period—by providing what it claims will be a cheaper, faster and
more reliable network. That $5.5 billion capital outlay is roughly
the equivalent of what Japan’s two largest incumbent players, NTT
Docomo and KDDI, each spend in a single year. “Exactly. That is
the point,” says Mikitani, 54, who ranks No. 5 on this year’s list,
with a net worth of $6 billion.
Mikitani plans to leverage the 100 million customers in Japan
already using Rakuten’s e-commerce, credit cards, internet bank-
ing, online trading and content to also sign up for the mobile
service, which will start initially in October in major Japanese
cities and then expand nationwide. “Using our ecosystem, we can
acquire customers at a relatively lower cost,” Mikitani says. “Our
operation is much leaner than our competitors, and we can enrich
the service using the existing Rakuten ecosystem. And I don’t
think people really care whether it’s NTT, SoftBank or Rakuten
that much. It’s primarily about connectivity, speed, price and what
kind of extra services we can provide.”
While Rakuten’s initial public announcement to build the
network dates to December 2017, the first trial run of the service
wasn’t conducted until February, with Mikitani on hand to test it.
While Rakuten rolls out the service, KDDI will provide coverage
in areas where it’s not yet present, and the company already has a
virtual mobile service with lines leased from incumbent carriers
NTT Docomo and KDDI.
CLOUD KIM KYUNG HOON/REUTERS/NEWSCOM

HIROSHI MIKITANI AIMS TO DISRUPT

JAPAN’S TELECOM INDUSTRY

WITH RAKUTEN MOBILE.

B Y J A M E S S I M M S

40 | FORBES ASIA APRIL 2019