Why Softbank buying Sprint is a big deal

Last week, the FCC gave their blessing on the Softbank purchase of Sprint. I consider this a very big deal and one that could have dramatic ramifications for the Wireless industry in the future. The leader of Softbank is a brilliant thinker and is never lacking in vision.

I have had the privilege of interacting with their founder and CEO, Masayoshi Son on numerous occasions and in fact did Fireside chats with him at two conferences in the late 1990’s. At that time, he became prominent because he bought Comdex, the largest PC show in the world in those days, and for his statement that he had a 300 year business plan for Softbank.

I got a chance to understand a bit about his business acumen and tenacity during one of our fireside chats. It took place at the Phoenix Technologies Conference at Spanish Bay in Monterey. Mr Son explained that in Japan, the telecom industry, which was basically controlled by the Japanese Govt. needed shaking up. It was controlled by NTT and the Japanese Govt dragged their feet when it came to open competition. This led to very low bandwidth Internet connections as well as a wireless infrastructure that, in his mind, was going nowhere.

So he approached the telecom Minister of the Japanese Govt, which regulated the telecom industry, and kept pushing him to present a plan that would open up the their telecom laws for more competition. He went to see this person at least 4 times and each time he was either rebuffed or was told he would look into it but nothing happened. So, on his 5th visit, he barged into this telecom Minister’s office with a full can of gasoline in tow. He told the Minister that if he did not agree to take his proposal to their ruling body that he would pour the gasoline over himself and light it on fire.The telecom Minister got the message and agreed to start the process of discussing opening up their telecom industry to competition. Because of that push by Mr. Son, Japan’s broadband and wireless industry began to explode. Softbank was the first to give users 50+ megs of download speed and I hear his goal is to get them to 1 gbps in the very near future. Softbank is now the #2 wireless company in Japan.

When I first heard that Mr. Son and Softbank had bid for Sprint, I had a vision of him walking into the offices of the FCC with his gas can in hand. However, given his success in Japan, everyone I talked to about this took his bid for Sprint very serious and knew that he would be tenacious in his desire to own this American Wireless company. However, his ownership of Sprint has to be watched very closely. He is not content with the status quo. One thing he could do is try and bump Sprint to 5G sooner than later and leapfrog ATT and Verizon. He could also utilize these assists, which includes Clearwire’s wireless spectrum, to create some type of mesh networks that blend wired and wireless in some areas to boost speeds for their customers.

Bottom line is that Mr. Son will not be a conventional wireless CEO. He is likely to be a firebrand within the wireless industry and do things that will irk and frustrate the competition. He wants to win, not just be a bit player in the US wireless market. Look for him to shake things up at the govt and industry level and perhaps surpass the competition and delight his customers along the way.