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Softbank to give up cellphone license if it buys Vodafone Japan unit+
[March 10, 2006]

Softbank to give up cellphone license if it buys Vodafone Japan unit+

(Japan Economic Newswire Via Thomson Dialog NewsEdge)TOKYO, March 10_(Kyodo) _ Softbank Corp. would return the license to use a mobile phone frequency band for newcomers it obtained from the government last December if it successfully acquires Vodafone K.K. as the Japanese unit of Britain's Vodafone Group PLC has its own license, sources familiar with the matter said Friday.

The Ministry of Internal Affairs and Communications last December assigned to Softbank a license to use a frequency band around 1.7 gigahertz to start offering mobile phone services.

But Softbank is ready to surrender the license if it succeeds in negotiations with Vodafone Group to obtain a controlling stake in the Japan unit, the sources said.

If Softbank gives up the license, the ministry is expected to solicit applications from other business entities for the license.

The sources said if Softbank opts to build up its own mobile infrastructure across Japan from scratch, it would cost the firm some 500 billion yen, adding an extra financial burden on top of the over 1 trillion yen needed to get the controlling stake in Vodafone Japan unit.

Softbank would not be able to shoulder costs for both purposes, they said.

Asked on the purported plan to give up the new license, a Softbank spokesman said, "We will consider whether or not to return the new license after the purchase is successfully negotiated."

The sources said that the acquisition negotiation is expected to come to a successful conclusion by the end of March, so the license will likely be surrendered in early April.

Since Softbank last Saturday revealed the acquisition talks for the Vodafone Japan unit, the third-biggest mobile phone carrier in Japan after NTT DoCoMo Inc. and KDDI Corp., its rivals have been demanding that Softbank surrender the license for the 1.7 gigahertz band.

Although Softbank was planning to start offering the new service using the band in April, it apparently had second thoughts on putting emphasis on starting to offer mobile service as quickly as possible, the sources said.

Since Japan is to introduce a mobile phone numbers' "portability service" in November under which subscribers would be allowed to switch mobile service providers without changing their numbers, Softbank has decided to bring forward the start of its mobile service on the basis of the planned Vodafone acquisition, they added.

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