Softbank Corp. Integrated Report 2020 Section 1
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SECTION 1 SECTION 2 SECTION 3 SECTION 4 Appendix SECTION1 Who We Are 4 The SoftBank Story 6 Group Structure 8 Value Creation Process 12 Priority Issues (Materiality) 20 Performance Highlights SoftBank Corp. INTEGRATED REPORT 2020 3 Who We Are SECTION 1 SECTION 2 SECTION 3 SECTION 4 Appendix The SoftBank Story SoftBank’s DNA Business growth driven by accurately anticipating the future brought about by the information revolution Ability to change continuously Ability to grow businesses Ability to overcome adversity SoftBank has led the information revolution in Japan by spreading the internet and high-speed broadband ser- By anticipating the paradigm shift caused by We have achieved growth in previously unex- Even as a latecomer to the mobile market and the information revolution and continuing to plored areas such as the internet and have the smartphone payment service market, we vices across the country and by launching new innovations in the mobile communications industry one after change in an agile manner, we have generated expanded our business through corporate demonstrated our “venture spirit” and estab- new business models and new value-added revitalization. lished a leading position in the industry. another. Today, as we enter the 5G era, in which everything is connected to the network, and as digital transfor- products and services one after another. mation (DX) accelerates further, SoftBank aims to become more than a telecommunications carrier as we strive to enrich people’s lives and solve a variety of social and industrial issues. 2001 2007 2008 2014 2016 2018 Launching the Yahoo! BB, Entering the Mobile Communica- Starting Sales of iPhone as Sole Rolling Out Marketing High-volume, Introducing High-speed Broadband Service tions Business and Launching Domestic iPhone Distributor Y!mobile Flat-rate Data Plans LINE MOBILE Services To make the internet in Japan cheaper and White Plan Direct negotiations with U.S. company Ahead of competitors, we began catering We rolled out the 20 GB Giga Monster SoftBank added LINE MOBILE as a third faster, we began offering broadband Apple Inc. conducted by then president of We entered the mobile communications to diversifying customer needs by offering data plan in 2016, followed by the 50 GB brand by entering into a capital and service featuring almost twice the speed for the Company Masayoshi Son succeeded, business through the acquisition of Voda- Y!mobile as an inexpensive new brand Ultra Giga Monster in 2017 and the Ultra business alliance with LINE MOBILE Corpo- almost half the price, thereby contributing and the Company was able to begin selling fone K.K. In 2007, the Company revolu- with undiminished communication quality. Giga Monster Plus, which allows subscrib- ration. This brand has gained strong greatly to the penetration of the internet in the iPhone 3G ahead of other carriers in tionized Japan’s telecommunications ers unlimited use of certain video services support, mainly among young customers Japan. Japan. This played a major role in triggering industry by marketing White Plan, a flat- and social media, in 2018. who use social media frequently. Japan’s iPhone boom. rate voice call plan. (Trillions of yen) (Millions of subscribers) 5 50 Revenue Mobile subscribers (right axis) • Shows the number of main subscribers, which up to fiscal year ended March 31, 2012 covers all devices 4 (including communication modules, etc.), and from fiscal year ended March 31, 2013 onwards covers 40 smartphones, feature phones, tablets, mobile data communication devices, Wireless Home Phone, and others. • Figures for fiscal year ended March 31, 2005 and fiscal year ended March 31, 2006 show Vodafone K.K. subscribers prior to acquisition Revenue (left axis) • Fiscal year ended March 31, 1982 shows revenue of SOFTBANK Corp. (currently SoftBank Group Corp.) • Fiscal year ended March 31, 2006 and fiscal year ended March 31, 2011 show revenue of SOFTBANK Corp. 3 (currently SoftBank Group Corp.) minus revenue of Yahoo Japan Corporation (currently Z Holdings 30 Corporation) • Fiscal year ended March 31, 2016 and fiscal year ended March 31, 2020 show revenue of SoftBank Corp. Mobile subscribers 2 20 1 10 0 0 1981 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 Establishment of Acquired Vodafone (Japanese subsidiary) Merged four telecom operators*1 Made Yahoo Japan a subsidiary An Expanding SOFTBANK Corp. Business Base Acquired JAPAN TELECOM Made WILLCOM a subsidiary, Entered capital and business acquired eAccess alliance with LINE MOBILE *1 The four companies are SoftBank Mobile Corp., SoftBank BB Corp., SoftBank Telecom Corp., and Ymobile Corporation. 4 SoftBank Corp. INTEGRATED REPORT 2020 SoftBank Corp. INTEGRATED REPORT 2020 5 Who We Are SECTION 1 SECTION 2 SECTION 3 SECTION 4 Appendix Group Structure SoftBank Group Corp., which is a strategic investment company, manages group companies as an investment portfolio. As a core operating company in the information revolution, SoftBank is pursuing an independent and SoftBank is an operating company, expanding beyond the agile growth strategy while taking advantage of being a member of the SoftBank Group. Against this backdrop, SoftBank made Z Holdings, one of Japan’s largest internet companies, a subsidiary in 2019, and with a Group- confines of a conventional telecom carrier to make the wide effort, successfully launched PayPay, a smartphone payment service. In addition, by leveraging cutting-edge technologies such as AI, IoT, and robotics, we are continuing to expand the scope of our business beyond the information revolution happen confines of a conventional telecommunications carrier. 1 Position of the Company in the SoftBank Group* Strategic investment company Mobile communications Revenue other than mobile charge 29%*4 71%*4 communications charge Masayoshi Son To cater to customers’ diverse needs, we offer mobile communications SoftBank’s businesses include broadband services for home use; the Chairman & CEO services for consumers under three brands, SoftBank, Y!mobile, and Enterprise business that provides solutions in addition to telecommuni- LINE MOBILE, each with different features. cations services; the Yahoo business, which provides e-commerce, financial and payment-related services, and advertising services; and 40.2%*2 the Distribution business. Consumer Enterprise Enterprise SoftBank Vision Fund [Main business] [Main business] • Mobile communications Mobile • Mobile communications services for individual communica- services for enterprise consumers tions Distribu- customers tion • Broadband services charge • Fixed-line communications • Sale of mobile devices services Ken Miyauchi • Cloud, IoT, and other solution President & CEO services The Group Revenue for the (selected subsidiaries and affiliates) fiscal year ended March 31, 2020 Yahoo, etc. Distribution 3 50.0%* 44.6% 100% Warranty, [Main business] (Including indirect ownership by Z Holdings) security, broadband, sales of goods • Supplying ICT products to and others enterprise customers • Supplying ICT products etc. to Smartphone payment service Holding company Payment service provider *4 Pro forma (non audited) information calculated using certain assumptions individual consumers by the Company, based on sales to external customers. Mobile communications charge for Enterprise is included in “Enterprise.” 100% 100% 50.1% Core internet business Financial holding company Online fashion retailer company Kentaro Kawabe Ichiro Nakayama President and Representative Director, President Corporate Officer, CEO President & Representative Director, CEO, Corporate Officer [Main business] [Main business] • Commerce-related services • Financial and payment-re- • Smartphone payment service • Membership services lated services • FinTech services *1. This is a simplified representation of the Group’s structure, with percentages based on shareholder voting rights. Figures as of September 30, 2020. • Advertising-related services *2. The Company is directly owned by SoftBank Group Japan Corporation, a wholly owned subsidiary of SoftBank Group Corp. The stated 40.2% is the percentage of the total number of shares issued by the Company (excluding treasury stock). *3. PayPay Corporation is an equity method associate of the Company. The stock holding distribution is SoftBank Group Corp. : the Company : Z Holdings Corporation = 50:25:25. The stated 50.0% includes the 25% held by Z Holdings Corporation. 6 SoftBank Corp. INTEGRATED REPORT 2020 SoftBank Corp. INTEGRATED REPORT 2020 7 Who We Are SECTION 1 SECTION 2 SECTION 3 SECTION 4 Appendix Value Creation Process Input Business (source of compet- itive advantage) For more than 30 years, SoftBank has grown significantly through a series of challenges and innovations. Having model Our Beyond Carrier strategy aims to further grow our core telecommunications business while leveraging 5G, AI, integrated various companies during this period, we have a wealth of tangible and intangible management IoT, and big data to create new businesses. Concurrently with implementing our growth strategy, we are also 1 resources, including a diverse workforce. By investing these management resources in a variety of businesses, we 2 working to improve cost efficiency through structural reforms such as the digitization of business processes using are creating new value. AI and RPA. Yahoo Japan New business fields Making Yahoo Japan a subsidiary in June 2019, we aim to allocate and Through collaboration and establishment of joint ventures