Japan's 5G Networks
Japan is an attractive market for U.S. suppliers of 5G equipment and related services.
Over the next five years, the four Japanese mobile carriers will spend more than $14 billion combined in capital expenditures to build out their 5G networks. This includes investments in base stations, servers, and fiber optics. In 2019, U.S. suppliers exported more than $720 million in telecom equipment (HS 8517.62) to Japan.
The establishment of 5G is a high priority for the Japanese government. The Ministry of Internal Affairs and Communications (MIC) is the lead agency on 5G. Four companies submitted plans to MIC for the development of 5G networks. All four plans were approved based on certain conditions, including: 1) focusing on the needs of both urban and rural areas; 2) maintaining appropriate and sufficient optical fibers to provide 5G service; and 3) taking adequate cybersecurity measures, including measures against supply chain risks.
Three of the four companies — NTT DOCOMO, KDDI au, and Softbank — are established carriers, while the fourth, Rakuten Mobile, is relatively new. All four were assigned 5G spectrum by the Japanese government on April 10, 2019.
According to Fitch Research, 4G subscriptions in Japan will start declining in 2022, with 5G becoming the dominant technology by 2026. Fitch forecasts that by 2029, there will be roughly 45 million 4G subscriptions and more than 151 million 5G subscriptions in Japan.
NTT DOCOMO is Japan’s oldest mobile carrier with the largest number of subscribers. It currently has roughly 78 million subscribers and an Average Revenue Per Unit (ARPU) of about $44.
DOCOMO launched limited 5G commercial service on March 25, 2020 in the major cities in Japan. By 2025, the company plans to invest over $7 billion to expand its network to 97% of the populated areas of the country. It plans to install 8,001 base stations in the 3.7GHz and 4.5GHz spectrum bands, and 5,001 base stations in the 28GHz band.
DOCOMO has an English language website that explains the company’s two main procurement procedures. The first is through a Request for Proposal in which DOCOMO conducts the procurement by requesting a supplier’s proposal based on procurement information. The second is for New Proposals and Products in which DOCOMO welcomes proposals from suppliers that introduce a new product or technology. A link to this DOCOMO website can be found here.
KDDI au is Japan’s second largest mobile carrier, with roughly 55 million subscribers and an ARPU of about $54. KDDI au launched 5G commercial service on March 26, 2020 in a limited area of Japan. By 2025, the company plans to invest over $4 billion to expand its network to roughly 93% of the populated areas of the country. It plans to install 30,107 base stations in the 3.7GHz and 4.5GHz spectrum bands and 12,756 base stations in the 28GHz band.
SoftBank is Japan’s third largest mobile carrier. It has roughly 44 million subscribers with an ARPU of about $41. SoftBank launched 5G service on March 27, 2020 in limited areas of Japan. By 2025, the company plans to invest over $1.9 billion to expand its network to roughly 64% of the populated areas of country. It plans to install 7,355 base stations in the 3.7GHz and 4.5GHz spectrum bands and 3,855 base stations in the 28GHz band.
Rakuten Mobile’s original plan was to launch 5G service in June 2020, but due to the impact of the global COVID-19 pandemic, the company expects a delay of approximately three months. According to media reports, the company has over 2 million subscribers and an ARPU of about $27. By 2025, Rakuten Mobile plans to invest over $1.8 billion to expand its network to roughly 56% of the populated areas of the country. It plans to install 15,787 base stations in the 3.7GHz and 4.5GHz bands and 7,948 base stations in the 28GHz band.
For additional information or specific commercial assistance please contact the Department of Commerce’s office at Office.Tokyo@trade.gov.
For more information about doing business in Japan, visit the Country Commercial Guide, Japan.