Wired
On June 10, the Japan Fair Trade Commission released a report investigating and examining measures to promote competition in the mobile phone market and make it easier for users to switch. In addition to complete separation of terminal charges and communication charges, verification based on trends such as new rate plans, we are requesting correction of agency evaluation methods by major carriers.
Follow-up of 2018 report + consideration of new issues
The “Competition Policy Issues in the Mobile Phone Market (FY3 Survey)” published by the Japan Fair Trade Commission was published in August 2016 and February 2018, and after the publication of the report, the Telecommunications Business Law Follow-up survey based on changes in the competitive environment such as revision and entry of Rakuten Mobile as the fourth carrier, and survey / examination on issues such as new competition policy issues and the relationship between MNOs (carriers) and distributors It is a summary of the contents.
Follow-up survey
The following 7 items are the targets of the follow-up survey.
- Communication and terminal set sale
- Contract with period binding and automatic renewal (2-year binding)
- A program that assumes future trade-in of terminals and subscription to the same program
- SIM lock
- Distribution of used terminals
- Repair of mobile phone terminals
- Institutional measures to secure a competitive environment for MVNOs, etc.
1. Communication and terminal set sale
The revised Telecommunications Business Law stipulates that if a communication contract and terminal purchase are a set, the maximum discount for the terminal price will be 20,000 yen.
KDDI and SoftBank’s device purchase support program are not subject to the communication contract, so the upper limit of 20,000 yen does not apply.
However, it is difficult to understand that the program can be used without a communication contract, as 87.1% of consumers answered that they did not know it. In addition, non-line subscribers cannot apply for the program online (KDDI has announced that it will be available online by the summer of 2021 and SoftBank will be available online by the end of 2021).
The JFTC is acting as a discount that exceeds the de facto limit for line subscribers, and if it makes it difficult for other operators to do business, it could be an antitrust issue. It points out that there is.
2. Contract with term binding and automatic renewal (2-year binding)
Under the revised Telecommunications Business Law, the penalty for contractors who cancel the contract during the contract period has been reduced to 1,000 yen.
However, about 60% of the contracts that were signed before the revised law came into effect and are not subject to the reduced penalties remain. Also, in consumer surveys, the majority of respondents are unaware that penalties have been reduced.
The JFTC is urging users to move to a new tariff plan, while evaluating that the environment is being created to make it easier for users to switch due to lower switching costs.
3. A program that assumes future trade-in of terminals and subscription to the same program
With the enforcement of the revised Telecommunications Business Law, the so-called four-year tie-up that requires re-subscription to the designated rate plan when replacing a terminal is prohibited.
However, as a result of a consumer survey, 75.8% of users of the device purchase support program provided by MNO3 did not know that the program could be used without a communication contract.
The JFTC has pointed out that imposing a device repurchase as a condition for exempting the remaining debt of the terminal purchase support program is functioning as a switching cost in the current situation, and it is necessary to repurchase the terminal to exempt the remaining debt. I’m asking you to remove the condition.
4. SIM lock
According to the SIM lock guidelines released by the Ministry of Internal Affairs and Communications in November 2019, MNO3 companies have taken measures such as unlocking the SIM lock for free when purchasing a device.
However, the Japan Fair Trade Commission points out that SIM lock is a barrier to transfer, with 24.2% of MNO users answering that the procedure is troublesome as a reason for not unlocking the SIM lock in the consumer questionnaire.
Therefore, the JFTC is requesting MNO3 companies to unlock the SIM for free at stores as well as when purchasing the device.
5. Distribution of used terminals
The fact that MNOs and second-hand handset intermediaries are restricting the distribution of used handsets has not been confirmed.
As a result of the consumer survey, 80% of MNO3 users answered that they do not want to use used terminals, and the top reasons were “battery life seems to be bad” and “unsanitary image”.
The FTC has pointed out that if the MNO imposes unreasonable restrictions on the sellers of used handsets, such as specifying selling prices or not selling handsets, it could be a problem under antitrust law. ..
6. Repair of mobile phone terminals
The report evaluates that Apple’s launch of an IRP program in March 2021 to provide genuine parts to independent repair providers around the world, including Japan, is desirable for competition policy.
In the future, we plan to keep an eye on whether genuine parts are supplied by Apple to independent repair providers.
7. Institutional measures to secure a competitive environment for MVNOs, etc.
As an action plan, the Ministry of Internal Affairs and Communications has indicated that the frequency allocation of 5G radio waves will reflect the status of efforts by MNOs to reduce connection fees for MVNOs.
The MNO connection fee has been reduced, and the forecast value for the third year of Reiwa is almost half of the reported value for the first year of Reiwa.
The JFTC is asking MNO3 to make efforts to reduce the difference between the predicted and actual connection charges. In addition, we are requesting the Ministry of Internal Affairs and Communications to create an environment in which MNOs can actively trade with MVNOs.
New competitive challenges
The following five points have been raised as new issues due to changes in the mobile phone market environment.
- Creating an environment that makes it easy for consumers to choose the optimal rate plan
- Issues related to mobile phone terminals, etc.
- To secure a competitive environment for MVNOs
- Sales agent
- Promotion of competition by new entry into MNO
1. Creating an environment that makes it easy for consumers to choose the optimal rate plan
He points out that it is misleading to consumers when the price that must meet multiple conditions is emphasized in the advertisement, and demands that the display be easy for consumers to understand.
As for the reason why the transition from MNO to MVNO is not progressing, we analyzed the results of consumer surveys and compared four factors, and found that “reliability, satisfaction, and attachment to MNO” had the greatest impact. I understand.
2. Issues related to mobile phone terminals, etc.
Although it was found from interviews that the reason why cellular communication of wearable terminals such as Apple Watch can be used only by MNO3 is a technical reason, it is desirable to make it available to companies other than MNO3. The FTC is asking.
3. To secure a competitive environment for MVNOs
We are requesting MNOs to introduce eSIMs for smartphones at an early stage, reduce voice wholesale charges to MVNOs, and release functions to MVNOs for the full-scale spread of 5G.
4. Distributor
Since the number of contracts for high-priced large-capacity plans is emphasized as an evaluation standard that influences the management of distributors, the distributors lead to high-priced plans, which may prevent consumers from choosing the optimal plan. We are requesting a review of the evaluation system.
The sales method called “Ahamo Hook” and “povo Hook” that guide consumers who are interested in the new rate plan to a high-priced plan is adopted because the agency’s evaluation is positive even if the new rate plan is sold. It is believed that this is because it does not lead to profits.
In addition, the fact that the MNO effectively restrains the selling price of handsets of distributors may pose a problem under the Self-Defense Prohibition Law, and we are requesting a review.
5. Promotion of competition by new entry into MNO
Rakuten Mobile’s entry as an MNO has changed the competitive environment, and even looking at overseas cases, it is preferable to have four MNOs rather than three.
Source: Fair Trade Commission
(hato)
Source: iPhone Mania