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SoftBank invests in smartphone rental service for hotels

Tink Labs' handy device joint venture expands as visitors to Japan increase

Tink Labs founder and CEO Terence Kwok, left, and SoftBank mobile unit CEO Ken Miyauchi pose at a news conference in Tokyo on Monday. (Photo by Ken Kobayashi)

TOKYO – A rapidly growing smartphone rental service for tourists in Japanese hotels will get a boost as SoftBank Group invests in the "handy Japan" joint venture of Tink Labs, a mobile travel device startup based in Hong Kong.

SoftBank's mobile unit will make the investment in handy Japan Holdings through a third-party allotment. Details and terms were not disclosed. The holding company formed in 2016 through a joint venture with Sharp, following an investment in Tink Labs by Taiwan's Hon Hai Precision Industry.

“SoftBank’s support for handy Japan is a true testament to our success in Japan,” Terence Kwok, founder and CEO of Tink Labs, said at a press conference on Monday announcing the investment. “We would like to build an integration of products which provides a single technology platform for travel with our handy, incorporating the 'internet of things' and blockchains solutions.”

Tink Labs, founded by 24-year-old Kwok in 2012, provides a smartphone rental service known as a "handy." The devices come with built-in travel applications and offer free internet access, combined with unlimited local and international calls. The company counts Ritz-Carlton, Hyatt and other luxury and budget hotels among its clients. It charges hotels telecom and service fees, but advertising is one of its major revenue sources.

Synergies with SoftBank's business are expected in three main areas. To hoteliers, the handy serves as a tool to increase operational efficiency by reducing the workload of hotel staff. It enables hotel clients to use an automated check-out process, keyless room entry or even control the air conditioning or lights in their rooms.

Handy can be used as a key to unlock the door of a room. (Photo by Ken Kobayashi)

The handy can be used outside of hotels as well. Travelers will be able to pay at restaurants and shops, book taxis or buy tickets online for sightseeing by charging their bills to their room. The aim is that handy will also be used as a communication tool to provide entertainment content or tourist information, with the potential for market data to be sold on to other companies.

Since its launch in July 2017, handy Japan has grown rapidly. It is now available in 1,700 hotels and 240,000 rooms in Japan. “We cover 30% of hotels in Japan, even 60% in Tokyo just in a year since we started our operation,” said Hiro Katsuse, CEO of handy Japan. “We can revolutionize the travel industry with handy.”

The rapid expansion can be explained by a sharp increase in the number of foreign tourists arriving in Japan. The figure reached 28.7 million in 2017, a rise of more than three times in five years, at a time of employee shortage in the hotel industry as a whole.

Kwok said Japan has become the company's biggest generator of business, but he believes there is still room for growth. “Several infrastructures in Japan need to be improved, including technology, language and payment, so that foreign tourists can enjoy their stay with comfort,” Kwok says. “Our penetration in Japan is still low, compared to Hong Kong and Singapore’s 50-80%.”

Partnering with SoftBank will allow handy Japan to use the technology conglomerate’s fast Internet network, especially when fifth-generation wireless networks are expected to be commercialized in 2020. SoftBank meanwhile can widen its hotelier client base and leverage its cooperation with restaurant booking site Ikyu -- owned by Yahoo Japan in which it is a controlling shareholder.

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