News brief: Rakuten Mobile still struggling to attract customers

Rakuten Mobile's next steps (Source: Rakuten Group FY2022 results presentation)

Rakuten Mobile's next steps (Source: Rakuten Group FY2022 results presentation)

  • Rakuten Mobile continues to invest heavily in its network
  • But it is still struggling to sign up customers
  • It is launching more services
  • Its enterprise offer is now live and it is planning to launch an ISP
  • Symphony vendor offshoot is growing, mainly due to its engagement in Germany

Rakuten Mobile may be lacking customers, but it’s certainly not short of confidence. After a year in which its customer numbers declined and its operating losses increased (with more capital still to be pumped into its network), the company is still pitching 2024 and beyond as the era when it will be “on the road to becoming the number one mobile carrier” in Japan. 

The operator ended 2022 with just 5.06 million customers, of which 4.49 million are connected to its own network (and the remainder via its legacy MVNO service offering). That total is down from the 5.18 million it reported at the end of the third quarter of 2022, though the company is at pains to point out that it has now had two consecutive months of on-net subscriber growth and ended January 2023 with 4.52 million revenue-generating on-net customers. By contrast, NTT Docomo has more than 87 million mobile customers. 

For the full year, the Rakuten Mobile division (including its Open RAN vendor unit Rakuten Symphony) reported revenues of ¥368.7bn (US$2.8bn), up by 62% year on year. 

But its operating loss was ¥492.8bn (US$3.73bn), even greater than the previous year’s ¥421.2bn, as it invested ¥296bn (US$2.24bn) in further mobile network expansion, and expects to invest a further ¥300bn (US$2.27bn) in its networks this year, before its capex numbers reduce by about 50% for 2024. 

The operator says it has now deployed more than 52,000 4G base stations and has only 15% of its 4G rollout to go, and should reach 60,000 base stations by the end of 2023, by which time it will reach more than 99% of Japan’s population with its 4G services. It currently has just over 7,000 5G base stations deployed. 

In the meantime, Rakuten Mobile is aiming to boost its customer numbers and sales with the launch of new services. At the end of January it went live with its Rakuten Mobile Business Plan for enterprise users, which had more than 600 companies signed up at launch for a range of services that all include 5G (where available) as well as 4G services. 

Next to launch will be its ISP broadband services, initially for consumer customers (to go live before the middle of the year), followed by an enterprise broadband offering (dark fibre broadband services). 

As for Rakuten Symphony, its revenues hit $476m in 2022, boosted by $231m in the fourth quarter alone. It has 14 customers – five in the Americas, two in Asia/Pacific, and seven in Europe – the largest of which is 1&1 in Germany, and says it’s in the process of closing a further eight deals, while another 56 are in earlier stages of engagement. Symphony says it has a US$4bn pipeline of business currently and is aiming for 40% year-on-year sales growth in 2023.     

 - Ray Le Maistre, Editorial Director, TelecomTV

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