KDDI Corp. unveiled Wednesday the cheapest plan for 20-gigabyte data usage among major Japanese mobile carriers in a price-cutting competition fueled by government pressure to drastically lower fees.
KDDI, the operator of the "au" brand, is launching in March a new service called "povo," offering a 4G plan from that month and enabling the use of 5G technology from the summer, both for 2,480 yen ($24) a month.
The price is 500 yen lower than the 2,980 yen that rivals NTT Docomo Inc. and SoftBank Corp. have set for their respective 20-gigabyte plans to be launched in March.
For even larger data usage, KDDI will offer a 6,580 yen plan for both 4G and 5G, largely on a par with its rivals and 1,070 yen lower than the carrier's existing plan for 4G and 2,070 yen cheaper than the 5G plan, according to KDDI.
Major mobile operators in Japan have faced intense pressure in recent months as the government of Prime Minister Yoshihide Suga has stepped up calls for fees, which are higher than in other countries, to be cut.
In a government survey as of March last year, the monthly fee in Tokyo for 20 gigabytes of data was more than twice as high as that in London and more than three times as high as that in Paris. It compared the lowest fee among service plans offered by the top three or four carriers in the respective countries.
The domestic mobile market is dominated by NTT Docomo, KDDI and SoftBank, with smaller newcomers like Rakuten Mobile Inc. vying for a larger share.
"We are offering simple and easy-to-understand services," KDDI President Makoto Takahashi told a press conference. The "povo," offered online, is mainly designed for people who do not make many phone calls.
In March, industry leader NTT Docomo plans to launch the "ahamo" service and SoftBank is joining hands with messaging app operator Line Corp. under a new brand, both charging 2,980 yen a month for 20 gigabytes of data. Rakuten Mobile has a 2,980 yen plan for unlimited data use.
Heeding government pressure, NTT Docomo has announced a plan to offer unlimited 5G data usage for 6,650 yen a month while SoftBank has set its unlimited data usage plan at 6,580 yen, whether it be for 4G or 5G, the same pricing as KDDI's.