Japan mobile wars: KDDI teams with newcomer Rakuten

Nov 02, 2018 | News On Japan

Nov 02, 2018 (Nikkei) - KDDI and Rakuten said Thursday they will share each other's assets while competing to offer services in their respective fields, as the telecom operator debuts e-commerce services and the online retailer enters the mobile space.

The deal will allow Rakuten to use KDDI's network for its entry into the mobile market next fall, while KDDI can employ Rakuten's e-payment and logistics infrastructure.

Rakuten initially considered a tie-up with NTT Docomo, one of Japan's other two carriers along with SoftBank, but ultimately seems to have chosen KDDI because their businesses are more complementary.

"If we did not team up with Rakuten, they probably would have partnered with NTT Docomo," KDDI President Makoto Takahashi said. "Rather than that situation, it is better if we team up with them ourselves."

KDDI is Japan's second-largest mobile phone carrier, with about 53 million subscribers. Rakuten boasts about 98.7 million registered users for its virtual mall and other websites with financial, payment and logistics resources that appealed to the mobile service provider.

KDDI, a latecomer to increasingly popular smartphone payment services, will roll out QR code-based "au Pay" in April 2019. The company aims to recover lost time by leveraging Rakuten's network of stores to launch nationwide from the start.

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