Edge of Communication -- Executive Interview: Frank Sanda

By Chris Betros

Frank Sanda founded Japan Communications Inc. as the world’s first Data Mobile Virtual Network Operator (D-MVNO).

Frank SandaFrank Sanda, President of Japan Communications, has worked in various industries but is now settled in the digital wireless communications sector.

J@PAN INC: Your work life has included stints in the automotive industry, railroads, banking and technology. How come you have moved around so much in your career? Are you a restless spirit?
Frank Sanda: I like to be challenged. If you want to learn something about a certain area of business, you’ve got to actually do it. In about a year, you can learn about 80 percent of what you need to learn to compete in that industry. The remaining 20 percent will take you 20 years. When you are a kid, people ask you what you want to do when you grow up. Well, I’m still growing up.

JI: Why did you decide to establish JCI in 1996?
FS: I was 46 and didn’t want to work for anybody anymore. I came back to bring a new technology product called the ‘cell phone’ into Japan. I found that being president of an American company in Japan is an extremely frustrating job. You’ve got to justify every little step to your superiors, whereas under the same circumstances in the US, you don’t have to. You are just like a branch manager and I didn’t want to do that anymore. I could have gone back to the US or do something on my own. So I started this business to try to correct the direction in which digital wireless communications was going.

JI: What’s happening in mobile communications now?
FS: The government has deemed this industry and specifically the DMVNO business model as the cornerstone of the future of economic development in this country. As the inventors of this business model, it will be up to us to lead participants in realizing the $20 billion market potential by 2015, estimated by Nomura Research. In wireless networks and technology, Japan holds global leadership, at least by five years over Europe and 10 years over the US. Since the mobile telecommunications industry was deregulated in 1994 in Japan, in just 14 years we’ve seen the development of a trillion- dollar cell phone industry and multi-billion- dollar manufacturing base, contents, and distribution businesses.

JI: What’s going to happen next?
FS: Open access to the fixed line telecommunications networks throughout the world has enabled the development of the current Internet. The impact of Internet has been phenomenal—economically, socially and even politically. Even with this impact, we are only a third of the way there. Since it is enabled by a fixed network, we still have to go to the information for it to impact us. That is, we must go get the information from a computer which is connected to a fixed communication line.

You know that God made man “wireless” and the last wire we were connected to was cut off at birth, right? Man’s normal day-to-day life is about not being in one place. When we are restricted, it makes us unhappy. You envision being in a hospital or a prison. In order for the Internet to truly make unrestricted impact on the human population, the information needs to come to the individual. The next generation Internet will deliver the necessary information to the individual when and where he/she needs it. The only way to do this is through the use of the wireless telecommunication network.

The success of the next generation Internet, wireless Internet, will depend on how soon we can open access to the mobile carriers around the world. Every wireless carrier in the world is vertically integrated closed, with the exceptions being Willcom and now NTT Docomo.

JI: Where are you taking JCI?
FS: We intend on becoming the world’s largest wireless service provider by market access or “footprint” by 2011. We have just penetrated into the US and we are about to go into Europe. As a MVNO, we’re a fullfledged licensed telecommunication carrier with the ability to interconnect. Now we have agreements with Docomo to connect into their network and use them.

JI: What is your management style?
FS: When it has to be hands-on, I am hands on. If I don’t have to do it, I leave it to people who can do it. There is always a tendency to want to do a job myself but that’s not good because employees won’t develop their skills. It’s best if I focus on the projects that I personally have to do. In general, a smart way to manage is to have people good enough to do as much of what you have to do as possible since there is always incrementally things only the CEO has to do.

JI: Where do you get your staff from?
FS: We recruit new hires but haven’t been proactive in trying to bring masses in. Our recruiting has primarily been through people we know and people we bring in. If you have an employee you like and who has done a good job and if they recommend somebody, we would probably give priority to those kinds of people.

JI: What’s your connection with Ireland?
FS: I have long ties to Ireland because I’ve been married to an Irish woman for 35 years and have five Irish/American/Japanese children.

JI: As president of the Ireland Japan Chamber of Commerce, what sort of business opportunities do you see for Japanese companies in Ireland?
FS: Well, JCI, for example, is trying to open up the telecommunications markets in Europe, which will enable Japanese companies to finally sell in Europe. Right now, the only real English-speaking gateway into Europe is Ireland. England is not as accommodating because it still uses the sterling as its currency. Furthermore, Ireland is the HQ of almost every Silicon Valley company in Europe. Google, Intel, Microsoft—any high tech business that wants to get into Europe goes to Ireland.

JI: And for JCI?
FS: What people don’t know is that JCI will accomplish the objective I mentioned and become the largest wireless carrier in the world by gaining access to the European market. So far, we have accessed the whole Japanese market of 130 million and we’ve got access to the US market of 50 states. That’s 300 million people. And the EU is what? 400 million. When we sign the contract before year-end, we will have access to nearly a market of a billion people worldwide. No competitor has that access. So that means that anyone who wants to have access to the communications networks of those countries can come to us and we supply telecommunications to them.

JI: What is a typical day for you?
FS: I do some emails at home and talk to my US guys in the morning. I get here between 9am and 9:30am. Usually, I don’t set meetings before 10. I try to delegate a lot of external things. I spend a lot of time in my office, making myself available. I try and leave by 7pm. Wining and dining has been a big part of the job in the past but I make an extra effort not to do too much these days. When my wife is overseas, I may have dinners out most of the week, not just with outside people but also with staff.

Chris Betros is editor of Japan Today.