Softbank (Sonus's customer) Shows Power
Softbank BB Shows Power of On-Demand Broadband Bundles
Internet Firm Shakes Up Japanese Market with Data, VoIP and Other Services
JANUARY 01, 2005
By Alan Breznick, editor, Cable Digital News
No matter how pesky the Bells may be in the U.S. and Canada, North American cable operators should thank their lucky stars they're not competing for broadband customers in Japan.
That's because Softbank Corp., a slick, brash Japanese Internet and telecommunications firm, has taken over the broadband market in its home territory by offering innovative services, aggressively pitching its products, undercutting its rivals on prices and snapping up other companies. In just three short years, the one-time software distributor, computer-magazine publisher and trade show producer has already transformed itself into the largest broadband provider in Japan and the biggest voice-over-IP (VoIP) operator in the world.
A few numbers tell much of the story. In a nation of about 47 million households, Softbank closed 2004 with more than 5 million DSL subscribers to its Yahoo Broadband service, edging out Japanese powerhouse and former monopoly phone company Nippon Telegraph & Telephone (NTT). Softbank also racked up about 4.4 million VoIP customers, easily outstripping any of its DSL rivals. Now Softbank is charging into the IP video business to deliver a full triple-play bundle.
In contrast, the entire Japanese cable industry ended the year with no more than 4.5 million cable modem subscribers, despite strong growth by leading MSO Jupiter Communications (J-Com) and other MSOs over the past two years. And, in a nation with much lower basic cable penetration than the U.S. or Canada, Japanese cable operators closed 2004 with just a few hundred thousand VoIP customers, after launching the service in 2003.
"The VoIP market in Japan right now is dominated by Yahoo BB," said Daniel Newman, a communications market analyst for IDC Japan in Tokyo. "DSL basically rules the nation. The cable providers are lagging everyone else."
Even in the much bigger North American market, only Comcast Corp. and SBC Communications can rival Softbank on the high-speed data side with about 7 million cable modem and 5 million DSL subscribers, respectively. And on the VoIP side of the ledger, no U.S. or Canadian broadband provider can close to matching Softbank.
Indeed, in a report issued last month, the British market research firm Point Topic found that Softbank's Yahoo Broadband unit accounted for "around 80%" of the world's estimated 5 million VoIP subscribers at the end of June.
And the Tokyo-based company isn't stopping there. In a press conference in October, Softbank President Masayoshi Son said he's aiming for the company to hit 6 million broadband data subscribers by the end of next September. That would mean a 16% jump in the company's customer base in just nine months.
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