While many telcos have tried to become internet platforms, few companies have moved in the opposite direction. “There is no single OTT (over-the-top) player who has even tried to get into the mobile layer,” Rakuten’s founder and CEO Mickey Mikitani told attendees at Mobile World Congress 2019 (MWC19), the mobile industry’s biggest event. But Rakuten is taking the radical step of rolling out its own mobile network in Japan.
In his keynote presentation, Mickey explained that Rakuten’s mobile network will be entirely virtualized and running in the cloud. As a result, he estimated that Rakuten’s investment in 4G is going to be less than half that of traditional telecoms companies, and with the inclusion of 5G, it could achieve a 70% to 80% reduction. He said Rakuten will be able to easily connect AI services, translation services, IoT solutions and other services because the new network “is internet from day one… we can change at anytime, in real-time, as much as we want… our architecture is completely different.”
No more spaghetti: simplifying mobile networks
That kind of flexibility is almost unheard of in telecoms. “The mobile network has always been a mystery,” Mickey added. “For me, coming from the internet world, it looked like spaghetti.” Those words resonated with a subsequent speaker, Hatem Dowidar, CEO of Etisalat International, who said: “Even legacy operators like us don’t like the spaghetti, and we are doing more and more virtualization.”
During his keynote presentation, Cisco CEO and Chairman Chuck Robbins recounted how he and Mickey had agreed to work together on the new network one year earlier at the same event in Barcelona. He said Cisco, one of several key partners in the venture, subsequently deployed 60 to 70 technology specialists in Japan to develop the cloud-native network with Rakuten. The high level of interest in the new network was evident in an almost continuous flow of visitors to the demos, presentations and panel discussions held at Rakuten’s booth during the show.
Communications that cross networks and devices
In one such presentation, Bejoy Pankajakshan, the Chief Strategy Officer of Mavenir, explained how Rakuten’s new network could use the Rich Communications Services (RCS) specification, which adds greater multimedia capabilities to mobile messaging to provide a wide range of communications services, including everything from chat to video calls, that will be interoperable across networks in Japan.
As part of the long-term vision, Pankajakshan said that Rakuten’s customers could sign on to the service using their Rakuten ID, potentially enabling them to benefit from RCS across multiple devices, regardless of whether they have a SIM card. “The speed of deploying this is amazing,” he added. “As it will all be done in software, we are able to make changes a lot faster.”
Instant messaging cuts through the clutter
For businesses and brands, mobile messaging presents a way to cut through the marketing noise. Speaking in a panel discussion about AI in advertising, Cristina Constandache, chief revenue officer at Rakuten Viber, highlighted how AI-enabled chat bots can go far beyond banner ads to provide holistic customer care. “People have started to shy away from social media,” she said. They “have started to go into a more private space where they choose to engage in conversations, rather than be out there and exposed to all the noise and chatter.”
In a presentation at the Rakuten booth, Momchil Elenkov, telecom & B2B partnerships director of Rakuten Viber, echoed that sentiment, outlining how businesses and brands such as Coca Cola are increasingly using chat apps to reach consumers. “With this endless bombardment of messages and alerts, notifications are under a dark spell, losing value,” Momchil pointed out. “It’s about the transformation of customer communication, and how to find the best way to do it — and right now, instant messaging is taking over.” According to Adweek, 72 trillion messages were sent via chat apps in 2018, compared with 1.6 trillion searches on Google. About 1.3 billion people in more than 190 countries use Rakuten Viber, underlying the global reach of the Rakuten ecosystem.
An expanding presence in Europe
Both the breadth and depth of Rakuten’s European ecosystem were on display at MWC19. Also speaking at the Rakuten booth, Olivier Alluis, CEO of Rakuten Aquafadas, announced there are now more than 45,000 accounts using Aquafadas software for their digital projects, with more than 25 million user libraries stored on its cloud service. Based in Montpellier, France, Aquafadas is now relaying more than two million push notifications to customers every day.
Later in the week, Fabien Versavau, CEO of Rakuten France, presented the growth of Rakuten France’s online shopping platform, which now handles between 30,000 and 50,000 transactions every day, connecting more than 11 million consumers with 5,000 merchants. Versavau outlined how Rakuten France has now joined the group’s Club R Everywhere loyalty program, gathering more than 500 brands and enabling customers to benefit from rewards across Rakuten’s services, including Rakuten TV, Rakuten Viber and Rakuten Kobo.
For more about Rakuten’s presence at MWC19, visit here.