Digital Landscape in Japan

PROSPECTS

Preparing for 5G

Japan is set to be an early adopter of 5G mobile internet connectivity, with a number of local telecom operators trialling the new technology with an eye to introducing it by the 2020 Olympics in Tokyo. Japan hopes to use the global spectacle of the Olympic Games to showcase its expertise and leadership in the development and commercialisation of 5G technology.

Ongoing shift towards smartphones

According to a study conducted by the Ministry of Internal Affairs and Communications, the number of Japanese people accessing the internet via smartphones exceeded the number accessing via PCs for the first time in 2017. Smartphones have become increasingly embedded in Japanese daily routines, bolstered by the fact that longer, more flexible working hours, increasing female participation in the paid workforce and rise in the number of single-person households have led to more hectic, on-the-go lifestyles.

Ageing population has the potential to boost IoT development

On one hand, the fact that Japan has the world’s oldest population, with 28% aged 65 or over, acts as an obstacle to the development of the digital landscape in that older people are less open to adopting new technologies. However, on the other, the challenges raised by Japan’s demographic profile are spurring interest and investment in the development of a more connected environment.

COMPETITIVE LANDSCAPE

Local players looking to introduce 5G

In February 2019, The Japan Times reported that local telecom operators, NTT DoCoMo, SoftBank, and KDDI, and e-commerce player, Rakuten, had all applied to the Ministry of Internal Affairs and Communications for a share of mobile phone frequencies to introduce 5G wireless services. NTT DoCoMo has been collaborating with Chinese company, Huawei, in a number of trials, including partnering with Tobu Railway to test a 5G millimetre wave system at Tokyo Skytree Town.

Soracom and the “Democratization of IoT”

Japanese company, Soracom, significantly enhanced the potential for small companies and start-ups to utilise IoT in products and business by developing “a platform for cloud native IoT connectivity-as-a-service” that removes the obstacle of the considerable initial investment required for a core physical IoT infrastructure.

Mobile carrier competition under scrutiny

In 2018, the three dominant mobile carriers, NTT DoCoMo, SoftBank and KDDI, came under scrutiny by the Japanese Government for their high phone bills. While Japanese regulators have no mechanism for directly setting prices, the government has a number of options at its disposal for boosting competition.

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