Vodafone, Softbank to join on handsets, content
By working together Softbank hopes to be able to exert more pressure on handset makers to develop leading edge devices for its services
Follow @infoworldVodafone Group Plc. and Softbank Corp., the Japanese Internet company that recently acquired Vodafone's Japan unit, have agreed to establish a joint-venture to develop and procure handsets and content.
The two companies will each invest €39 million (US$50 million) in the venture, which will work in three main areas, said Masayoshi Son, president of Softbank Corp. at a Tokyo news conference Thursday.
The first will involve joint development and procurement of key cellular handsets, Son said. By working together Softbank hopes to be able to exert more pressure on handset makers to develop leading edge devices for its services because potential sales volumes are much higher than those for its Japanese domestic competitors.
Additionally the venture will develop a mobile portal and basic software for use in cell phones and the joint procurement of mobile content such as sports, movies and films.
"So far most information has been text based but from now on we think it will be more video based," Son said. "If we can work together and procure content it will be very good in the future."
While Softbank stands to benefit from the much greater size of the Vodafone group, Vodafone will gain from access to new technologies developed for the Japan market. This was a major reason why Vodafone came to Japan in the first place and the deal will allow the company to remain active in Japan, said Arun Sarin, chief executive officer of Vodafone Group Plc.
The deal reached Thursday places Vodafone in a position that is reminiscent of its place in Japan several years ago. It previously held stakes in local carriers and was able to gain access to technology through those stakes. Vodafone's acquisition of a local carrier gave the company a much deeper stake in the Japanese market but the company found it difficult to compete in Japan.
"Japan is a leading market so we believe Vodafone can utilize the strengths of the Japanese market," said Son.
Softbank acquired Vodafone's Japan unit in a ¥1.8 trillion (US$16.4 billion) deal announced in March this year.
