DoCoMo chief ‘upset’ at Softbank tactics

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The gloves came off on Friday in the war for Japan’s 94m mobile customers, as the chief executive of NTT DoCoMo, Japan’s biggest mobile company, said he was “very frustrated and mad and upset” at the tactics of Softbank, its smaller rival.

Masao Nakamura, chief executive of NTT DoCoMo, accused Masayoshi Son, Softbank’s high-profile head, of “manipulating the numbers to state what he wanted to state” when attacking rival companies’ profits.

Mr Nakamura also accused Softbank of misleading the public with “unfair advertising”.

His comments, made as he unveiled a 7.4 per cent decline in DoCoMo’s first-half operating profits, illustrate the pressure faced by the heads of Japan’s mobile carriers as they compete for market share following the introduction of number portability on Tuesday. For the first time consumers are able to switch carriers without changing their number. Some analysts think this could greatly increase defections by customers from one company to another.

Mr Nakamura also admitted that KDDI, DoCoMo’s biggest rival and the carrier regarded as most likely to gain market share, had been “doing well” in the first few days of number portability, though he added that the rate of switching between carriers was so far lower than he had expected.

Operating profit fell to Y516.9bn ($4.4bn) in April to September from Y558.4bn the year before, hit by disappointingly low revenue from handset sales.

DoCoMo’s poor results, which were slightly worse than analysts had expected, contrasted with strong results from KDDI, which last week reported a 38 per cent rise in operating profit to Y229.5bn. After taking questions from reporters, Mr Nakamura became angry when discussing Softbank’s new strategy to shore up its subscriber base, outlined by Mr Son on Monday evening hours before number portability arrived.

Mr Son accused Softbank’s rivals on Monday of making excessive profits, and said he would guarantee the availability of mobile pricing packages that were Y200 cheaper than Softbank’s rivals. He also outlined another pricing plan that included unlimited calls to other Softbank users at a zero-yen flat rate.

Some telecoms equity analysts have described Softbank’s offers as misleading when looking at the details. Some suggested that Softbank services might remain more expensive than its rivals’ for many users, after allowing, for example, for calls made from Softbank phones to other phones.

Mr Nakamura said Softbank offered “no benefits at all” to defecting DoCoMo customers. He added that DoCoMo had “no plans whatsoever” to follow Softbank’s tactics.

Softbank declined to comment on Mr Nakamura’s assertions.

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