To stimulate competition in the mobile phone industry, the Internal Affairs and Communications Ministry officially announced a reform plan on Tuesday, which includes in principle scrapping the fee to switch mobile phone carriers as well as making the procedure to change to low-cost smartphone service operators easier.
Prime Minister Yoshihide Suga has been eager to lower mobile phone fees. All eyes will be on the plans to lower fees being considered by the three major mobile carriers: NTT Docomo, Inc., KDDI Corp.'s au and SoftBank Corp.
"We will quickly realize fees and services that are on par with those of major countries," Internal Affairs and Communications Minister Ryota Takeda said at a press conference on Tuesday. "Procedures for switching [to low-cost] carriers are too complicated. We will break the current situation where there is no fair competition."
The reform proposal released by the ministry consists of three pillars: (1) realizing clear and convincing fees and services; (2) promoting fair competition; (3) making it easier to switch back and forth among mobile carriers.
Specifically, a guideline will be amended so that the 3,000 yen fee generally charged for keeping the same mobile phone number when switching carriers can be made free in principle from next fiscal year. As for mobile phone email addresses, development of a framework to continue to use the same address after switching mobile carriers will start by the end of this fiscal year.
The use of an eSIM, which does not require replacing SIM cards when changing mobile carriers, will also be promoted. An eSIM stores user information just as a SIM card does, but is built into the mobile device. Thus, when changing carriers, the procedures can be done remotely, which will save the time from visiting shops and switching cards.
The ministry hopes to stimulate the shift to low-cost smartphone service operators by eliminating the fees and complicated procedures involved.
Reforming mobile phone rates has been a signature policy for Suga, who has called for significant price cuts, saying that the fees can be reduced by 40%. He has also criticized the oligopoly of the three major carriers, which account for about 90% of the market.
The government, however, has no direct control over mobile phone fees. Therefore, it will take a series of measures to create an environment that encourages competition among the carriers.
Up to now, mobile phone carriers have indicated that they will take concrete measures after the Internal Affairs and Communications Ministry's policy is announced. Following Tuesday's announcement, the three major carriers will start considering reduction plans in earnest.
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