Rakuten to delay the start of wireless network service

By | September 10, 2019

Shares of Japanese internet firm “Rakuten” fell 6% on Friday after media reports that it is pushing back the commercial launch of its wireless carrier service by six months because of delays in building the network.

Rakuten will offer services to just 5,000 customers without charge from October which was the original date for the full rollout. Reports said the commercial launch would take place next spring.

A delay would mark a major setback to billionaire founder and Chief Executive Hiroshi Mikitani’s ambitions to shake up Japan’s telco market.

The unproven new network has been talking point of the industry with analysts saying the technology, if successful, could lower barriers for new entrants in other markets.

Rakuten says it’s radically cut the value of building a replacement network by victimization cloud-based software system and commoditized hardware rather than proprietary wireless radios.

However, it’s run into delays, constructing the network’s base stations and has been told by Japan’s telecoms ministry to accelerate the build-out.

Rakuten last month rumored associate sudden operative loss for the April-June quarter because it endowed heavily within the wireless network and took a success from the depressed price of its stake in ride-hailing firm Lyft Iraqi National Congress.

A delay within the wireless network launch would relieve potential downward worth pressure on its larger incumbent rivals NTT Docomo, KDDI and SoftBank firm. Rakuten incorporates a roaming agreement with KDDI to assist fill its coverage insufficiency.