Rakuten worker arrested for alleged SoftBank 5G secrets leak

[NEW YORK] A former SoftBank Corp employee has been arrested in Japan on suspicion of illegally bringing 5G trade secrets to his new employer, Rakuten Mobile Inc, as it was preparing to launch its own mobile network.

The arrest was first reported by Kyodo News, which said the worker is a man in his 40s. SoftBank issued a statement saying that confidential 4G and 5G networking plans and technology were among the information compromised, though no client data had been exposed.

Rakuten Mobile confirmed the person is an employee of the company, which is fully cooperating with the police investigation, according to spokesperson Yuta Mizuno.

Rakuten Mobile parent company Rakuten Inc was down as much as 2 per cent in Tokyo Tuesday, while SoftBank Corp was up just over 1 per cent.

The incident underscores intensifying competition in one of the world's most lucrative telecom arenas. Rakuten has been the big disruptor in the space, launching the fourth major network in the country last year and pushing unlimited mobile data allowances. Its breakthrough pricing has put pressure on incumbents SoftBank, NTT Docomo and KDDI.

That's added to a period of unusual upheaval, with mobile carriers urged by new Prime Minister Yoshihide Suga to make their consumer contracts more flexible and affordable while also making the transition to fifth-generation wireless networking.

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5G networks and devices are hotly contested ground, promising to open up new applications, business opportunities and, crucially for carriers, supercharge demand for bandwidth.

SoftBank has been among the earliest adopters, though its coverage remains patchy, as it is across most of the globe. Rakuten, whose 5G service launched several months after SoftBank's, aims to undercut the market with a single-price offering that's less than half what its rivals charge and still offers all-you-can-eat data.

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