Posted by: Kenji Hall on October 30, 2006
A week ago, Softbank CEO Masayoshi Son practically taunted his bigger rivals in the wireless telecom biz. Now, he’s eating crow. On Oct. 30, Son acknowledged that he was a victim of his own strategy to lure subscribers to his wireless carrier service.
It all started a week ago, when Son announced special discounts on the eve of a new rule, called number portability, which lets consumers in Japan switch carriers without having to change their phone numbers. He’d bashed NTT DoCoMo and KDDI for sky-high connection rates and said they “made too much money” at the expense of consumers.
Apparently, the pitch worked too well. Over the weekend, Softbank was flooded with new orders from customers—and the company’s overworked computers crashed. What’s more, workers at Softbank’s shops ran out of brochures or hadn’t enough time to bone up on all the details of the company’s services to be able to explain things to customers. After two days, the service was finally restored, but the confusion and long lines continued. “We miscalculated the volumes,” said Son. He apologized for the glitch, which may have caused millions of dollars of losses for the Internet and telecoms giant. It seems he hasn’t yet managed to get beyond the problems that plagued Vodafone, which sold its wireless biz to Softbank in April for more than $15 billion.