Softbank Corp. President and Chief Executive Officer Masayoshi Son, the Internet entrepreneur who revolutionized Japan’s broadband market, is threatening to do the same to the country’s wireless communications business, and is prepared to sue the government if it gets in his way, he said on Monday.
Son is trying to snag unused spectrum in the 800MHz cellular band to launch his own mobile communications services, which he has sketched out plans for in the past. Japan’s Ministry of Internal Affairs and Communications (MIC) said earlier this month that it intended to allocate that spectrum to NTT DoCoMo Inc. and KDDI Corp., Japan’s two biggest mobile phone carriers.
“Free competition and capitalism, this was the proven mechanism of the 20th century, so Russia changed and China changed,” he said in an address Monday at the Foreign Correspondents’ Club of Japan. “So how can the ministry explain a planned economy? It’s almost like communism. … How can they defend this?” he asked.
The MIC, he implied, was abrogating its responsibility under Japanese telecommunication laws. According to Article 1 of Japan’s Radio Law, the MIC must promote “fair and efficient usage of radio waves,” he said. Japanese consumers are paying too much for their mobile phone services, and Softbank wants to introduce services that result in lower prices and faster data speeds, he said.
Son has been talking about Softbank entering the Japanese mobile communications industry over recent months. Softbank is reportedly interested in offering Code Division Multiple Access (CDMA) service based on the technology developed by Qualcomm Inc. Son did not say Monday when such a service could be launched if Softbank gets approval from the MIC.
Son stopped short of directly accusing the MIC, NTT DoCoMo and KDDI of acting in collusion against Softbank. Clutching a piece of paper showing the names of six former vice-ministers and seven former director generals who retired from the MIC to executive positions in DoCoMo and KDDI, he suggested that the companies’ close ties to the ministry acted as an effective barrier that prevented transparency in decision making and served to stifle newcomers.
“Even a grammar school student can understand that if you hire someone, if you give them a salary job, a secretary, and a car … it’s almost the same thing as giving (them) cash. If you get caught by the police, you go to jail,” he said.
“I don’t think it is justice,” he said.
In Japan, the practice of senior bureaucrats retiring from their government jobs into corporations they were formerly regulating is called “Amakudari” which can be translated as “Descent from heaven.” Softbank will not accept any Amakudari appointments for the next 100 years, Son said.
Son said he had been discussing the possibility of legal action against the MIC, but declined to comment on exactly what developments might have to occur in order for Softbank to take such action.
Softbank revolutionized Japan’s broadband industry when it entered the market in June 2001 with its Yahoo BB Asymmetric Digital Subscriber Line (ADSL) service. At that time, most Internet service providers (ISPs) were charging about