Softbank net profit dented by tax demand

TOKYO — Japanese mobile phone operator Softbank Corp. said Thursday net profit fell 29 percent in the April-June quarter on a tax burden that included a payment by subsidiary Yahoo! Japan.However, brisk sales of Apple's iPhone and iPad lifted operating profit for the California company's exclusive partner in Japan.Softbank's net profit stood at 19.4 billion yen (222 million dollars) after the Tokyo Regional Taxation Bureau slapped 26.5 billion yen in extra charges on Yahoo! Japan, related to an acquisition of a Softbank data centre.Softbank owns 40 percent of Yahoo! Japan.CEO Masayoshi Son denied the authorities' claim of tax evasion and said Yahoo! Japan will file a suit, with its decision to buy IDC Solutions necessary as the industry shifts towards cloud computing."The tax bureau is behind the times," Son told a press conference.Softbank, which is the iPhone and iPad's exclusive cellular carrier in Japan, said its total revenue stood at 700.84 billion yen (8.02 billion dollars) during the first quarter, up 5.2 percent from a year ago.The company posted 156.60 billion yen in operating profit, up 44.6 percent from a year earlier, after winning nearly 700,000 new subscriptions during the April-June quarter.Such demand helped Softbank's share in Japan's highly saturated mobile phone market expand to 19.9 percent, the company said.The telecom group is banking on next-generation Internet technology, and forecasts the electronic book market to grow to 130 billion yen in 2014 and mobile data traffic to surge forty-fold within the next five years.The company also Thursday announced it will invest 150 million dollars in a joint venture with California-based Zynga Game Network to develop and distribute games in Japan.Zynga makes FarmVille, Mafia Wars and Treasure Isle which are hugely popular on Facebook, MySpace and the iPhone. It has 230 million monthly active users and six of its creations are listed in Facebook's top-ten games.Softbank has been aggressively tying up with foreign companies as it seeks to expan

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