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Rakuten doubles down on global export of low-cost 5G technology

  • March 2, 2022
  • , Nikkei Asia , 2:59 p.m.
  • English Press

MINORU SATAKE, Nikkei staff writer

 

BARCELONA — Japanese tech company Rakuten Group will make a full-scale global push to market its low-cost 5G technology in a bid to turn around its loss-making telecommunications arm.

 

The group on Monday highlighted Rakuten Symphony, its new telecom solutions subsidiary established in January, during the Mobile World Congress trade show in Barcelona. Tareq Amin, the CEO of the unit, touted the advantages Rakuten has to offer over the competition.

 

“We run our network at 40% less cost than traditional infrastructure,” said Amin.

 

Rakuten employs 5G virtualization that does away with most of the specialized telecom hardware other than antennas found in current networks, and instead uses data processing on the cloud to handle telecommunications functions.

 

Last August, German wireless startup 1&1 agreed to adopt Rakuten Symphony’s mobile platform. About a dozen more clients have signed contracts, and the company anticipates about 100 more deals. It has opened offices in the U.K., France and Germany.

 

“I think there are significant opportunities in Latin America,” said Amin. “We could have a really big role to play on emerging economies and emerging markets to help them out.”

 

Rakuten reported a record net loss of 133.8 billion yen ($1.15 billion) for 2021, due to the massive base station investments poured into subsidiary Rakuten Mobile, Japan’s fourth major cellphone carrier. The success of Rakuten Symphony will likely determine if the group will climb out of the hole.

 

Rakuten Group Chairman and President Hiroshi Mikitani speaks to reporters March 1 during the Mobile World Congress in Barcelona. (Photo by Minoru Satake)
 

“We’ve finished taking in orders worth hundred of billions of yen,” said Hiroshi Mikitani, chairman and president of Rakuten Group. “I believe earnings will rise” going forward, he added.

 

During the Mobile World Congress, Rakuten announced partnerships with carrier AT&T and U.S. network equipment supplier Cisco. The group also publicized the purchase of U.S. cloud technology startup Robin.io.

 

The open radio access network, also known as open RAN, is being embraced by telecoms the world over. The concept integrates virtual networks with access to base stations from multiple suppliers.

 

As an early adopter of open RAN, the Dish Network in the U.S. is using cloud servers provided by Amazon Web Services to build a 5G network. This trend suggests that Rakuten may face stiff competition even in emerging markets.

 

When asked if Rakuten will continue to provide service in Russia for its voice and text messaging app Viber, Mikitani declined to elaborate on a decision.

 

“I think definitely I have a very big sympathy about Ukraine but I just want to focus on Rakuten symphony,” he said.

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