Softbank Mobile victim of own popularity
October 30th, 2006 - Posted in WirelessJapanese mobile phone carrier Softbank Mobile Corp., which slashed its prices last week to undercut rivals, said it had to stop taking new applications Sunday because it was flooded by new customers wanting to switch to its service.
It is a bitter victory for Softbank, which had rolled out the aggressive price cuts in a last-ditch effort to score on last Tuesday’s arrival in Japan of number portability — a system that lets people keep the same numbers when they switch carriers.
It is expected to bring big changes to Japan’s mobile phone market.
Softbank, which bought British carrier Vodafone’s mobile business in Japan earlier this year and is run by technology mogul Masayoshi Son, had been looking for ways to catch up with larger competitors like NTT DoCoMo and KDDI Corp.
Softbank stopped accepting new customers shortly after noon Sunday when its computer system couldn’t handle the load, the company said in a news release. It apologized to customers and promised to resume taking switch-over business when it readies the system for increased volume.
The company did say how many customers had tried to enroll.
It was the second time in two days that Softbank had to suspend taking switch-over customers.
On Saturday, it suspended applications for fear the huge number would paralyze its computer system, Kyodo News agency reported.
The system was temporarily resumed Sunday before being shut down again, Kyodo said.
The new fee system unveiled by Softbank features free calls and instant messages between subscribers, and lowers basic monthly fees, in some cases by 70 percent.
Softbank will also underprice any bargain offer by competitors within 24 hours, ensuring that its monthly service charges will always be 200 yen ($1.69; 1.34 euros) cheaper than those of its rivals.
Tokyo-based Softbank, which leads Japan as a broadband services provider and owns a 41 percent stake in Yahoo! Japan, has been going all-out to shake off the image — from the carrier’s Vodafone days — that it offers only unfashionable, bulky handsets.
Softbank has promised 15 new handset models in 64 colors by the end of the year, with some phones as thin as a coin.
The phones will come with an easy link to the Yahoo! Japan mobile portal, allowing people to access Web-based information for free instead of having to pay content providers.
Softbank’s other businesses include Internet Protocol telephoning, online gaming, electronic stock trading, Net broadcasting, and an investment arm. It also owns the Fukuoka Softbank Hawks professional baseball team.