Former SoftBank employee leaks 5G secrets to rivals

A former SoftBank Corp. employee has been arrested under the suspicion of illegally sharing 5G trade secrets with new employer, Rakuten Mobile, before the former was planning to launch their very own mobile network.

Tokyo Metropolitan Police have arrested Kuniaki Aiba who allegedly leaked classified company information, breaching the Unfair Competition Prevention Law as well as a non-disclosure agreement signed with SoftBank, according to local media.

Aiba is suspected to have sent trade secrets of his initial employer from his company email to his personal one, relating to SoftBank’s 5G technology on December 31, 2019, Tokyo Police stated.

“Even though the former employee had signed a non-disclosure agreement with us, during the period from resignation to departure, information related to our network technology corresponding to our trade secret was illegally taken,” a statement from SoftBank said, highlighting that it had consulted with the Metropolitan Police Department, reported the damage, and cooperated in the investigation.

It remains unknown whether Aiba has admitted to the allegations.

According to the statement, the information leaked pertained to the company’s 4G and 5G base station equipment, and fixed communication networks that connect base stations to each other, though no client data had been exposed.

In parallel, a Rakuten Mobile spokesperson told reporters that Aiba is indeed an employee of the company, which is fully cooperating with the police investigation.

SoftBank suspects that the leaked data has already been put to use by Rakuten, which may be stored on Aiba’s company computer, with plans to file a lawsuit to force its rival to destroy the information.

“We recognize that our trade secrets are stored on Rakuten Mobile’s business PCs used by the former employee, and that it is highly likely that Rakuten Mobile has already used our trade secrets in some way,” the statement read.

Rakuten Mobile, a subsidiary of Rakuten Inc., was down as much as 2 percent in Tokyo on Tuesday, while SoftBank Corp. was up just over 1 percent.

SoftBank stressed that information relating to the confidentiality of communications, and business partners of corporate customers who provide communication services to the company are safe.

“Until now, we have regularly concluded non-disclosure agreements and conducted security training for all employees,” the statement said.

This act of corporate espionage highlights the growing rivalry in one of the world’s most competitive telecom countries.

Rakuten’s strong presence within the local sector – launching the fourth major network in the country last year and pushing unlimited mobile data allowances – has put pressure on competitors such as SoftBank, NTT Docomo Inc. and KDDI Corp.

5G networks and devices have been a contested group within the country since they open up new applications, revenue streams, and opportunities. While SoftBank was one of the first to adopt 5G technology, its coverage remains shaky at best, as it is across most of the globe.

Rakuten, on the other hand, launched their service months after their rival and has consistently aimed to make large gains within the market using a single-priced offering at half price of its competitors.