In light of recent move by rival Yahoo Japan to eliminate vendor fees, Rakuten Chairman and CEO Hiroshi Mikitani defended his company’s pay-model that charges merchants using Rakuten’s e-mall. The multi-millionaire owner of Japan’s largest online retail outfit says that he is largely ignoring Yahoo Japan’s announcement, as business experts are seeing what could be a sustained challenge by Yahoo Japan owner Masayoshi Son on Rakuten’s no. 1 position.
“Our basic policy is to offer good services for online tenants, so that they can make profits and customers can buy good products conveniently for reasonable prices,” Mikitani said, speaking at a Tokyo business forum. “That is the way in which we can also make reasonable profits. We want to build this win-win-win relationship. Having said so, I don’t really care about the recent announcement (by Yahoo Japan),” he added. Yahoo Japan had earlier this month revealed their new strategy for e-commerce business, announcing that the online retail company would eliminate all fees and royalties for merchants in the Yahoo Shopping e-mall and make it free to sell items. Son is riding the crest of a wave of overseas buyouts which has gained his companies worldwide attention, including a US$21.6 billion takeover of US telecom giant Sprint by Son’s SoftBank. He is hoping that by making Yahoo Japan vendor services free of charge, a sudden increase in the user population of Yahoo Japan will allow him to charge advertisers more.
As of the moment though, Son’s Yahoo Shopping still id very much plays second to Rakuten in the Japanese online mall market, with the former boasting 20,000 tenants against the more than 40,000 Rakuten Ichiba has. Speaking to the Nikkei Global Management Forum in Tokyo on Monday, Mikitani said that it would be better if the Japanese government deregulated the Internet. “We should make it free completely, because it would create innovations that we have not seen,” he said. “We should change the way of thinking from making money by charging for the Internet communications to making new (online) service and exporting the service.”
[via Yahoo News]