Rakuten delays 5G launch as Indian vendors halt software testing

Japan’s Rakuten Mobile said on Friday the launch of its 5G services planned for June has been delayed by three months due to disruption caused by the coronavirus outbreak.
Rakuten Mobile 5G networkSoftware testing by Rakuten’s Indian vendors has been impacted by a lockdown in place there since March 25, a spokeswoman said.

The delay is the latest setback for Rakuten, which was forced to push back the start of commercial services for its mobile network to April.

Rakuten is trying to carve out a share of a market currently dominated by three competitors, and drive traffic to its ecommerce and financial services.

Rakuten on Thursday reported operating losses at its mobile business. Rakuten Chief Executive Hiroshi Mikitani has said the network cut costs by using cloud-based software instead of proprietary hardware.

The carrier launched with aggressively low priced plans. But it has fewer base stations than its competitors and numbers trailing incumbents, and Rakuten is paying KDDI for roaming services.

Rakuten has not disclosed how many user numbers it has garnered during the first few weeks since the launch, increasing uncertainty over its performance as the coronavirus halts economic activity across Japan.

Revenue for the Mobile segment rose 54.7 percent to ¥39,233 million, while segment loss stood at ¥31,828 million, compared to a loss of ¥6,684 million in the three months ended March 31, 2019.

5G investment in Japan

Japanese mobile operators — NTT Docomo, KDDI, SoftBank and Rakuten – aim to make an investment of 1.6 trillion yen or $14.4 billion over the next five years to build 5G network in the country.

NTT Docomo plans to invest a minimum of 795 billion yen for building 5G network.

KDDI plans to invest a minimum of 466 billion yen in 5G.

SoftBank has earmarked 206 billion yen for setting up 5G network.

Rakuten plans to spend 194 billion yen to build 5G network.