Japanese Mobile Market in 2016

The end of 2015 brought a number of interesting updates, mainly in the MNVO market.

The MNCs have felt pressure from the MVNOs and from the government.  Softbank announced it would launch a "budget" plan with 2 GB of data for around 5000 yen.  That's not even remotely competitive to the lines of OCN and Mineo.

Movement in the Au Space
Whereas Mineo used to be the only MVNO using Au's network, there have been two interesting developments:
1. Mineo started offering Docomo SIMs in addition to Au SIMs.  What this means to consumers is that if they can have more choice in phone models while staying with the same carrier.  
2. UQ Communications also started offering Au MNVO service under the name UQ Mobile.  This is interesting because KDDI is both the parent company of Au and a major shareholder in UQ Communications, which makes UQ Mobile a competitor to Au owned by the same parent company.  This is similar to how both Docomo and OCN are owned by NTT.  Another similarity is that both UQ and OCN are the internet branches of their respective conglomerate, so the Internet companies are closing in on the mobile companies.  Technically, UQ already offered MVNO services in that you could purchase a WiMax router which also had LTE support - which was provided by Au.  This is the first time, however, that UQ is selling Voice SIMs.

Higher End Plans
One common complaint about MVNOs was that they went after the low end users, and while you could save money if you didn't use your phone much, there was nothing in it for the high end user.  The idea was that the total cost could be lowered, but the unit cost could be higher.  This is certainly true with respect to the per minute rates for native 080 calling.  Looking at the higher end data plans, however, this did not seem to be the case.  Specifically, OCN offered 5 GB for around $15 per month.  That would mean 10 GB for around $30, which is cheaper than the MNCs.  However, you would need two SIM cards in order to enact that plan.  MVNOs offering quotas of over 5 GB generally offered only limited speeds.  Recently, however, OCN came out with 10 GB for 2300 JPY (~$20).  Plans with 10 GB of mobile data from the MNO carriers generally cost close to twice as much.  

It's interesting to see how OCN has gradually been phasing in more and more.  First, they released data only SIMs, then they increased the data amount for each plan (for the same price).  Next, they started offering voice SIMs.  Later, they added roll-over data.  Now, they are offering a 10 GB plan.  Obviously there is probably no technical reason for these limitations, so I am guessing the reasons are mainly political.

Public Consciousness
Companies like B-Mobile basically don't do any advertising.  Meanwhile, OCN has gone all-out on posters in the trains, etc.  UQ Mobile ads, can be seen at family restaurants, etc.  Some people are oblivious to anything, but more and more people are realizing there is an option.  More to the point, more and more people are starting to feel screwed by the MNCs and looking for an option.  Besides the price difference, MVNOs offer more transparent pricing, and short contracts lengths with no auto-renewal.

People who are not technical and don't pay attention to ads are still starting to notice the revolution via social influences.  People will say "Hey my friend only pays $15 per month for his phone service, and I pay $100... I wonder why?"  What used to be the domain of geeks and cheapskates is starting to become mainstream.  

Even people who were skeptical will be inclined to take a look after a while when many around them are using cheaper options with success.

I have to wonder how long it will be until the MNOs start bleeding or lash out in some way to try to decrease the value of the MNVOs.

Hikari Bundling
It has long been the case that the company which provides the physical internet line and the company that routes your data were separate.  In most cases, the default option meant that they were both subsidiaries of the same parent company.  For example, if you signed up for "Flet's Hikari" fiber service in Tokyo, your line provider would be NTT East, and your internet provider would normally be OCN - which is the ISP arm of NTT.  Likewise, if you signed up for Sony's Nuro service, Sony would run the line, and So-net (Sony's ISP) would provide the service.  You can, however, choose a different ISP in order to save on costs, etc.  In most cases, customers would still get two bills, especially if the went with a non-default option for their ISP.  Starting in mid 2015, there was a change in law or policy that meant that the ISP is allowed to take over all servicing/billing from the line provider - and everyone is pushing this.

Firstly, the mobile phone companies are pushing this hard.  Docomo wants you to sign you migrate your internet to your Docomo account.  Softbank, etc. wants the same.  This is very clearly a trap to make it even more difficult for customers to switch providers.  Further, if you really examine the deals, they don't appear to save anyone much money.  Normally you can cancel your fiber internet (or DSL) any time after two years with no penalty - but once you migrate it to one of the mobile carriers, that is no longer the case.  

Secondly, the normal ISP companies are also pushing this.  For example, OCN sent out emails encouraging users to migrate their split accounts entirely to OCN.  In this case, the cost saved is significant, but with a catch - They set you up for an auto-renew two year contract much like the mobile carriers.  No thank you.  

Retail Presence
One of the reasons MVNOs are cheaper is that they don't have thousands of retail stores across the country.  

Until now, signing up for an MVNO means one of two things:
1. Buy a SIM card package from a store like BIC Camera or online from a place like Amazon and then register it online when it arrives.
2. Sign up for the service online from the MVNO's web site, and then they will mail you the card.
In either case, once you received the SIM card, you typically have to do some set-up on your router or phone in order for it to work properly.

In many cases, if you wanted to port your number, you needed to do option #2.  For people in love with their mobile number, the prospect of doing something by mail and then having to set up everything themselves is scary - especially if they are used to being hand-held at their Docomo store.  In fact, the prospect of being without their number for several days can be enough to turn them off.

Now, there are more and more options with same day turn-around.
Some of the MVNOs have often had temporary booths or concept stores.  Mineo has had several storefronts.  
OCN has taken a different approach, partnering with Geo and other storefronts.  These stores allow you to sign-up in person.  They check everything and help make sure you haven't (for example) selected the wrong SIM card size, etc.  They may offer to set up the networking for you as well.

What all of this means is that people who wouldn't have considered it before will give it a try now.