Softbank Too Successful

October 30, 2006 - source: BWCS

Japanese mobile phone company Softbank, which took over Vodafone's operations earlier this year, is reportedly in trouble with the country's telecoms authorities after it promised to slash prices by up to 70% last week. In a worrying development for Softbank's rivals, it seems the price promise may have been too successful, causing a system crash this weekend.

The country's third largest (of three) mobile operator was forced to stop accepting new customers on Saturday, after its computer systems buckled under the weight of new applicants. While Softbank may take some satisfaction from the number of mobile customers trying to switch to it, the Japanese government has warned the company that it must make sure its systems can handle the expected rise in applications in future.

Softbank's president, Masayoshi Son, has issued an apology to present and would-be customers, promising that his company has now taken measures to increase its system capacity. The company would not divulge if it knew how many customers it had turned away.

Softbank, an ISP of long-standing in Japan, hopes to use the cheap prices to better its lowly position in the Japanese mobile market, which is dominated by NTT DoCoMo. The recent arrival of mobile number portability, which allows mobile users to keep their own number when switching operators, had encouraged the company to launch its new cheaper tariffs.