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Telecommunication

Rakuten's mobile network faces delays ahead of October launch

Japan tells e-retailer to speed up base station installation

Rakuten Mobile is slated to become Japan's fourth mobile carrier in October.   © Reuters

TOKYO -- Japanese e-retailer Rakuten is behind schedule on installing wireless base stations, likely forcing the new mobile carrier to limit the scope of its service at the October launch, Nikkei has learned.

Its mobile unit, Rakuten Mobile, aims to build 3,432 bases mainly in Tokyo, Nagoya and Osaka by the end of this fiscal year. It plans to launch nationwide service on Oct. 1, using peer KDDI's network in other areas.

But the company was less than halfway to its goal as of the end of June, leading the Ministry of Communications in July to order Rakuten to revise its plans and speed up its efforts.

"We are having trouble with getting the wiring done," a Rakuten Mobile source said regarding the delay. The shortage of construction workers ahead of the Tokyo Olympic and Paralympic Games in 2020 has been a setback as well.

Newcomers often face delays when building their own mobile network from scratch, since they need to negotiate with landowners at potential sites. They also lack expertise in connecting to optical-fiber cables.

"We will absolutely have the bases ready in time for October," Rakuten Chairman and CEO Hiroshi Mikitani told reporters last week. But he suggested that the carrier could start with a "small launch" with limited number of users and services.

"We will have Tokyo, Nagoya and Osaka generally covered, but we don't have enough bases in city centers that have a high concentration of users," a Rakuten source said. Limiting the number of initial users could prevent customers from experiencing bad reception.

Rakuten Mobile is expected to create more competition in Japan's mobile market, which has been long dominated by NTT Docomo, KDDI and SoftBank Corp.

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