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Japan unveils plan to prod carriers to cut cellphone charges

10/26/2020 | 10:48pm EST

* Govt aims to boost competition in mobile market

* Govt wants to realise charges in line with other nations, internal affairs minister says

* PM Suga has made carrier fee cuts a policy priority

TOKYO, Oct 27 (Reuters) - Japan on Tuesday laid out a plan for reducing consumers' cellphone charges, as the government stepped up its bid to promote competition in the country's telecoms market.

Lowering cellphone charges has been among Prime Minister Yoshihide Suga's policy priorities since becoming the country's leader last month, as he shakes up a highly protected industry.

The internal affairs ministry called on carriers to offer easy-to-understand fee plans and services in a proposal for promoting competition in the telecoms market, such as by making it easier to switch providers and lowering the costs associated with doing so.

The ministry called for stepping up efforts to sell unlocked SIM cards this autumn, as well as coming up with a policy by next summer for giving consumers the option to switch carriers online without replacing their SIM cards.

Internal Affairs and Communications Minister Ryota Takeda said he wanted to reduce fees to nothing for carrying over a cellphone number when switching providers, which usually costs about 3,000 yen ($29).

"We hope to quickly realise cellphone charges that are in line with other major nations," Takeda told reporters at a news conference.

The plan aims to push the country's mobile network providers to be more competitive, with the three biggest ones being NTT Docomo Inc, KDDI Corp and SoftBank Corp .

"If companies are strongly put under pressure by the government, they can't help it but to move towards lowering fees," said Takumi Tsunoda, senior economist at Shinkin Central Bank Research Institute.

"While it will lead to inflation pressures, I don't think actual fee cuts will be large enough that consumers will feel they're really benefiting from it."

Suga instructed Takeda in September to consider how to cut charges, after calling that month for a roughly 40% reduction of such fees from current levels.

Takeda said the government should seek to create an environment in the telecoms market that was favourable for consumers, while declining to give a specific target or timeline for cutting charges.

($1 = 104.7100 yen) (Reporting by Daniel Leussink; Editing by Chris Gallagher, Gerry Doyle and Sherry Jacob-Phillips)

© Reuters 2020
Stocks mentioned in the article
ChangeLast1st jan.
KDDI CORPORATION 0.91% 3212 End-of-day quote.4.76%
SOFTBANK CORP. -0.33% 1350.5 End-of-day quote.4.45%
SOFTBANK GROUP CORP. 2.90% 8946 End-of-day quote.11.02%
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