MNP – Is Son-san the real “Yoso-Guy” at Softbank Mobile?

Masayoshi SonLess than one hour ago, Softbank Mobile‘s charistmatic CEO, Masayoshi Son, just completed an unexpected (予想外) press conference at the New Ohtani. Just as stippy.com reported last week, Mobile Number Portability (MNP) is starting this week in Japan and promises to upset the comfortable duopoly of DoCoMo and Au.

Stippy.com recevied a lot of email from readers suggesting that MNP would be a non-event, but it appears as though that is not the case. Son-san wants to join these two giants in the big technological sand pit they call success.

Following on from his amusing 予想外 TV commercial series featured last week, Son-san has made an even more unexpected announcement today. Anyone who signs up for Softbank’s new “Gold Plan” will be entitled to a Yosogaiwari (予想外割):

  • Free email,
  • Free SMS,
  • Free voice to other Softbank subscribers…
  • and as an extra teaser the first two months are completely free (including the monthly fee).

Good-bye to hard to understand teigaku (fixed price) plans, the only thing that you will have to pay for are calls to non-Softbank subscribers and access to internet sites. Better yet, the entire package will only cost you 2,880 yen per month. Given that the average person spends about 7,000 yen per month on their phone bill, that could save you about 50,000 yen a year. (Multiply that by a family of four!!)

So, you say (As I would expect any cynical reader of stippy.com to ask), what is the fine print? Son mentioned in the press conference that this deal is only available until January 15, 2007. Interestingly, Son claims that everyone who signs up between now and Jan 15 is entitled to the 2,880 yen / month plan for ever (this guy is serious).

Clearly the other “catches” have to do with what is not free. Son didn’t go into details about the pricing of calls to other carriers or the packet charge rate for accessing the internet, but absent of a large hidden price rise, this should be cheap too (Softbank is well known to be the cheapest carrier in Japan). Furthermore, Son made it very clear that it is his intention to win both the battle and the war. If either DoCoMo or Au announce reactory price cuts, he’s promised to respond with a similar package – only 200 yen per month cheaper – within 24 hours.

sbkeitailogoThe only potential “catch” that we could think of was to do with area coverage/bandwidth. After Willcom introduced unlimited free calls and email between Willcom users, their network suffered serious capacity issues and had to rapidly speed up their infrastructure expansion plans. No doubt Softbank will suffer the same problem. Son has promised to double Softbank’s area coverage (number of base stations) by next March which should help stem some of the increased usage, but who knows if he will complete it in time?

Eyes and ears are now focused on Au and DoCoMo to see how they will react to such a move. yosogaiwariSon made it very clear in his presentation tonight that he had no intention of letting DoCoMo and Au continue to earn their monopoly profits. (Remember these companies made a total of 15 billion US dollars of profit between them last year!!) And so, may the games begin!

58 thoughts on “MNP – Is Son-san the real “Yoso-Guy” at Softbank Mobile?”

  1. Huge!

    I started on the Wilcom all you can talk plan as soon as it came out, and just getting my wife and a couple of mates on the same plan made a huge difference to my monthly bill.

    I was wondering when one of the keitai companies was going to do this, but I really wonder if they have thought it thru – its gonna mean a huge downturn in their monthly revenues, though I guess data is where these guys are looking to make their money now!

  2. I agree. With that minimal amount of revenue per customer, they’re going to be pushing their financing even further. The objective appears to be sheers numbers of users and market share in the quickest time possible.

    As a Vodafone/Softbank user (Gold, in fact), apart from the maxed out bandwidth, what are the catches to joining? Why would I not?

  3. You got it JT. And it is no coincidence that the announcement of yosogaiwari was delayed until the day after Son-san convinced a syndicate of banks to lend him 1.45 trillion yen to refinance the loan he used to purchase the business! You gotta feel sorry for the banks. (see the list here)

  4. Interestingly, the service doesn’t start until the 26th. You can see the details (and the fine print) here.
    Someone asked exactly the same question at the press conference last night. Son was so paranoid about keeping this new plan top secret (so it would be 予想外) that they didn’t even tell their marketing managers about it. Because it will take a full two days to roll out the information, systems and training nationwide, they couldn’t start it until Thursday. Apparently they only started filming the CM yesterday…

  5. Can’t read the fine print. That was soutei-nai.

    Interesting move by Son given that if we remember back to the Broadband Big Bang when Yahoo BB came out with a similarly cheap, flat-rate plan. That subsequently won them leading market share I believe?

  6. Fine point JT! It looks like we might need to take a closer look at the conditions for 予想外② the item claiming メール代¥0 (free email) ⇒

    ※3 無料対象はSMSのみ(国際サービスを除く)。

    Surely the definition of ‘mail’ is not only SMS. That is a little deceptive. How many people use SMS in Japan anyway? Sure, maybe you want to SMS back to your Mum at home some times, but this plan doesn’t even include international SMS. Hmmm… Son-san your conditions are a little rongai.

  7. My favorite comment today was from an economist, who will remain nameless, who was suggesting that this new plan could be enough to “restart deflation” in Japan and that old Fukui at the BoJ wouldn’t be too happy as it might force him to revise his monetary policy. hmmmm…

  8. I was at yodobashi camera at Akihabara today, and you should have seen the crowd there.

    ALL of the big three companies were having 乗り換え (changeover) campaigns. But the AU and Docomo counters only had an average number of people, whereas the Softbank area was so crowded that I couldn’t get near any phones to check them out.. If that is any idication, I think Softbank stocks may head up again soon..?

  9. Or it could mean the capital strain will break their back and the stock will plummet.

    Kind of off topic, but I noticed DoCoMo is offering an unlimited Napster service for about 2000 yen/month. Does anybody even use Napster any more? Is 2000 yen a decent deal just for use on a phone, or can the files be run on other hardware as well? Nevertheless, access to all of those DoCoMo users must be a real coup for Napster, but I still have my doubts about music phones in general. I don’t even have a fancy ringtone.

  10. According to the Nikkei this morning (page 11) it looks like Son-san realised his comment about free mail was misleading and has agreed to make normal emails (between other Softbank users) free, too. I wonder why he doesn’t include emails to other carriers/normal internet addresses – does it really cost Softbank that much more?

  11. Thanks. So now Son-san has generously included S! mail (MMS) in the package (not to be confused with snail mail). Does anybody actually use that? Looks to me like regular email is still not included in the package. Son was right when he used the word 中途半端…

  12. What does S! mail refer to? On my Vodafone, SkyMail is SMS between Vodafones, and SuperMail is email.

    Anyway, I reckon I might take on a research project for stippy.com and sign up with the programme. Especially after they cut off my phone this morning for not paying a 15,000 yen phone bill. Who pays that much for a cell phone bill! (These days.)

  13. I found this user-friendly explanation here on the Mobile Phones UK site. The short answer is that you don’t use it. It is essentially a souped up version of SMS which allows you to send voice and picutres as attachments. It is slowly taking off overseas but is no good unless you have (a) 3G and (b) a handset that can decipher it. I think the Vodafone black ships introduced it to the company when they were trying to “internationalize” Vodafone Japan with all of their 時代遅れ technology from the West.

  14. I just checked at the very bottom of that press release.. It has a strange comment that if you call someone with a softbank phone at night for more than 200 minutes a month, it will be charged.. wtf is that?

  15. That’s right MP. All free calls between 9PM-1AM are maxed out at a total of 200 minutes a month. At first I thought that was pretty sneaky, but it turns out that the average Softbank mobile user only uses their phone for 160 minutes of voice per month (irrespective of the time of day). So even if you thought that half of that time was after 9PM, you can still double the amount of time you spend on your keitai at night before you get charged for it. At the end of the day, I think the true answer is that their network might not be ready for it just yet.

  16. I went to Softbank on Roppongi corner today to try and change over to the new plan.

    However it was completely chokka with people. I waited for about 15 minutes, and wasn’t even close to getting served. I went and had lunch and came back, and the same people were waiting at the counter.

    Looks as though new phones are also going at a premium, with Softbank offering them for 0 yen up front, and they payments of a few hundred yen over 24 months etc.

    Great marketing idea and seems to be drawing the right attention. However delays in service are never good, and I still have concerns about their network capacity.

  17. The way they set up the payments for the phones is actually an ingenious way of locking customers in. I am tempted to be locked into one of those smartphones…

    Also, I just noticed that they have stopped accepting switchovers because their computer system is about to burst. Perhaps its just a ploy to slow the inevitable tide of customers while they work out whether the numbers actually add up?

  18. or maybe it is just Softbank’s tactic to skew the numbers in their favour for the first week after MNP. Surprise, surprise, there won’t be many people shifting away from Softbank if the system breaks down on a Saturday…

  19. Yeah, could be. I guess smart people would wait for a few weeks, to see how their system handles the actual increased stress of millions of new users. So they will likely have another wave of people in a month or two if they handle it well enough.

  20. I think people are missing the fine print here, because 予想外 is truly 中途半端. You get no minutes for calling anything outside of softbank, and actually they have the highest rate per minute currently under that plan. for a 3 minute call to a phone line it will be 120 yen with softbank, while docomo is 70 yen and au is 80 respectively.

    Also, it really isn’t going to be 2880 yen a month. To get all that and the 0 yen phone you have to sign up for super bonus and all this stuff that will lock you in a 27 month contract. so yeah, you’ll be paying an additional 1000 yen or so for that a month. Ok, so still cheap you say? Well you’re locked into this contract, if you cancel, or even change phone models they will slam you with the full cost of the phone along with the remaining months you haven’t paid. So you have the potential of a 4~7 man charge.

    I think most people are entranced with the big fat 0 advertised not realizing they’re going to not get much out of it, and the moment they change softbank is going to stick it to them. For youth in japan who tend to change phones fast, or even those who do it on a yearly basis (since most places give major discounts after one year), you’re getting screwed bottom line with yosougai and gold plan.

  21. I knew this would be the case… theres going to be a heap of not happy people when they get a new phone, and a cheap contract, and the first bill turns out to be well over what they thought it would be…

  22. The plans don’t seem all that appealing considering all the family and loyalty discounts I have with AU, but DAMN I want that phone.

  23. Well, there is even more news from Son-san today!
    He has just announced that he is answering to the critisism about being more expensive than AU and Docomo for calls to non-softbank phones, and during certain times of the day.. He has come out again with another 予想外発表! He is now saying that he will lower the rates to match the other companies at all times when calling non-softbank! Wow..

    Anyway, I walked past the softbank shop in Roppongi today, and peeked in. I didn’t need a phone, but just took a ticket anyway.. I was the 60th person in line!

  24. As you can read in the article (in Japanese), the SB’s server went down because there are too many people porting OUT from SB.
    http://itpro.nikkeibp.co.jp/article/NEWS/20061030/252213/

    Plus, as you can see, AU incrased by 80 thou, DoCoMo lost 60 thou.. so that makes SB lost at least 20 thou.

    http://www.bloomberg.com/apps/news?pid=90001002&sid=aefO7Jiq0VH8&refer=jp_home

    And this article describes how much SB’s rate plans rip-off.
    http://plusd.itmedia.co.jp/mobile/articles/0610/30/news052.html
    http://arena.nikkeibp.co.jp/col/20061024/119401/index2.shtml

  25. Basically what it has come down to, and Son has been criticized for this, thus the backpedaling, is that they shoved out the 0円 signs, with extremely small disclaimers. Everyone goes, wow, 0 yen! and miss the fine print. Give it a few days, anaylize the small print, whoa wait a second, this is a really crappy plain! Thusly Son has been backpedaling and revising the plan almost daily. I think at this rate they’ll drive what’s left of j-phone/vodafone/softbank into the ground because they’re going to run out of money.

    I guess when you realize that J/V/S is a very distant third place, they’ve got to do some rash things to catch up. While I appreciate the idea of someone finally introducing a flat-rate plan for the major carriers, it’s still half-ass, and unfortunately I don’t see it revitalizing the cell phone industry like willcom’s revitalized the PHS market.

  26. Well Robert, it looks like you were one step ahead of the pack. Last night our friend Mr. Son has come out with his third revision to the plan:
    “New Voice charges for the Gold Plan”

    After this many changes, It’s a little hard to call it 予想外 but at a flat rate of 20 yen / 30 seconds it is slowly starting to look more attractive.

  27. Red,

    Slowly, but considering the fact that when you add it up, that it won’t be 2880 a month. Most likely it will end up around 5000~6000 a month, with superbonus payments on top, and other services. When you think about it you’re better off with another service. Son’s plan is starting to look more and more desperate as he buckles to critics and revises. While I like the style of the Sharp models available for Softbank, I’m happy with Docomo, as I approach my 5th year and a steadily increasing discount percentage.

  28. I noticed that Son-san has come out and apologized this morning for blatant miscalculations of how many people would apply, causing problems in the system.

    I dont believe it for a second.

    With all the dramas unfolding, I hope he hasnt shot himself in the foot with this.

    That would be yoso-guy.

  29. I still believe they will come through. This is exactly what happened to Google Mail (gmail) when it came out.

    Everyone critisised them, saying their systems will never handle giving 2GB mail accounts, or that there is no privacy as they scan your mails to display ads etc etc… in the end, if you have a good product, and you manage to sustain it, all the critisism and woes at the start blow away – as long as people use it.

  30. I think in this case though, it’s a rough comparison. Softbank is advertising a 0 yen price for a lot of these services when it really isn’t that way once your go through the fine print hurdles. As Red mentioned, now they’re potentially going to get in trouble for false advertising. They might have a large influx of people coming in (which is still in the air, since the database problems were caused by the amount of people LEAVING, not coming) but they’ll have even more leaving if this comes down to false advertising. Son could burn the hand of the people who are feeding him at this rate. Son himself said his number one goal was to increase subscription numbers, and figure out everything afterwards. Maybe in a western environment, but that’s a wrong thing to do in Japan, because he’ll end up bending over backwards to appease people who get upset.

  31. >fuckedgaijin
    Having worked at Vodafone on an IT project before softbank brought them out I can tell you that comparing their systems to google is big stretch.

    Around four years ago, Vodafone KK started a project with a certain consulting firm that shall remain nameless, spent two years and x hundreds of million dollars on building new core systems then threw all that development away early last year mainly because the project was never going to go live in time to meet the deadline for MNP. So Softbank is still running systems built by DEC for J-Phone in the late 80s, running on VAC machines.
    Certainly not somethign you’d want to compare to Google!

    What vodafone and it seems softbank are experts in though is advertising, huh?

  32. I went to the local Roppongi Sotfbank yesterday to begin my “field-work” work for Stippy.com and change over to the new Super Happy Gold Bonus Plan.

    Obviously I should read the news more- All new phone subscriptions, as well as plan changes have been stopped from Nov 1- Nov 6 due to the influx of registrations/changes since the introduction of number portability.

    And I still had to wait 30 minutes in the queue to be told that…

  33. I think Son is getting desperate (or he fired his PR people). He was just on the TV comparing the 薄さ (thinness) of his latest keitai with the thinness of hair cover on his head. hmmm… I hope they don’t turn that into a CM…

  34. Thanks ex-consultant. Wow – you seem to be spot on. Tonight, Son was blaming the different systems that you mentioned for their IT problems over the last 2 weeks. He didn’t say whether they had fixed it yet or not (although he certainly implied that they had).

  35. Regardless of plans, new phones and hype, Softbank is still Vodaphone is still Jphone which means the connectivity sucks. I have been waiting for portability to get out of this company without sacrificing my phone number for years.
    Now, to add insult to injury, they cut off my phone service for being one month late on my payment. This is after 4 years of suffering with these a-holes. The fact is their billing is the latest of any utility, coming after the first of the month for the previous months usage. I never allow direct debit from my bank account as Iユve had trouble with this before (i.e. people taking out money before service is rendered without any chance of canceling-“I’m sorry but we turn this over to a billing service so you will have to pay even if you don’t want to continue the contract” line of bull). I always wait till everything is in for the month and then trot down to the convini and pay it in one shot. a week later, softbank/vodaphone/jphone shows up so I roll it into the next month and pay it then. This has always been cool in the past but guess what? So now I will be spitting fire as I say to Son san itユs all about service service service!

  36. This looks like some good news for you, Joseph. Ericsson’s homepage is talking about speeding up the roll-out of Softbank’s HSPA network. Sounds great but does anyone know what a “future-proof” network is?

  37. Hey those new phones out by KDDI look pretty cool. Has anyone seen them? Apparently one has an organic EL for the display…

  38. Sorrydaijin, did you ever buy one of those HTC phones from Softbank? Sorry that we were so tardy in looking into the details but the new product release from E-Mobile was enough to convince me to get my act together and do an official comp of the two. Check out our stippy.com version of “Softbank vs. E-mobile” here. (Oh, and it looks like Matushita Nao chose the Sharp smartphone 😛 )

  39. Great thread. yeah SB are Voda and that means J-phone, still losing hand over fist and this fook up is really gonna add to their problems. I also have been waiting for portability to change to a better carrier.

    But which one? Also as far as handsets go I heard those HTC ones are really really cool. Is Stippy planning a test run? I have a mate who bougt one online from London and it is pretty slick, though pretty bulky and “slim is in” as Son-sama says.

  40. There’s an interesting article in the FT the other day about Softbank’s colourful accounting policies. Look at this quote they were able to get from Shigeki Suzuki, the government’s director of telecoms policy:

    Mr Suzuki voiced concerns about the financial predicament of Japan’s third biggest mobile carrier. “At this moment their financial situation is not so good. I’m worried about it. They have very big debts after buying Vodafone. They’re lending their own shares, selling affiliates, so they have been making every effort [to raise money]. So I am not sure Softbank has any more measures.”

  41. Son-san is slowly getting there. It isn’t up on their English page yet but it looks like Softbank Mobile is now offering real free 24 hour a day unlimited voice use on the white plan for family members. As is always the case with these clowns there is fine print which says that you have to prove that the person is a family member if they don’t live at the same address as you but otherwise it seems pretty genuine. Son-san must be getting a little cocky after doubling the profit at Softbank Mobile in his first year at the steering wheel. All good, all good!

    Softbank Mobile Press Release

    * cunning note for all you Baldrics out there: au does not ask you for proof that you are family.

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