Situation in Japan

 The IT industry is a leading industry driving the Japanese economy. The IT market is forecasted to grow to nearly USD130 billion by 2019. Large changes are occurring in the IT market in Japan, such as the growth of mobile communications and other new platforms. It is believed that these trends will be driving future market growth.

1. Intensified competition among IoT related companies
IoT (Internet of Things: Technology for automatic control and remote operations by giving things the ability to communicate with each other via the Internet, etc.) has been used by the manufacturing and distribution industries, but it is now anticipated that it will be used in various industries, such as the power sector for more efficient use of energy. Traditional applications of IoT have basically been limited to monitoring the operations of machines, detecting problems, and other such applications, but with expectations on its future use in various situations such as customer analysis and remote management of industrial equipment, it is projected that competition between IoT companies will intensify even more.
2. Advancements in cloud native
Businesses are moving to cloud-native *1application architectures. Cloud-native applications excel for collaboration with outside services and for add-on development *2, and it is projected that many new services will be born. It is anticipated that the cloud-based applications market will expand.
*1 Services that assume provision in the cloud, or companies providing such services
*2Development by companies introducing an enterprise resource planning system to add functions that the package lacks
3. Growth of new platforms
Up to now, client-server systems linking multiple computers over a network served as the main platforms, but today, mobile, social technology, big data, cloud and other new platforms are becoming mainstream. It is projected that many services will develop on these new platforms, and that needs will increase for security measures tailored to their respective features.

The Japanese market size is shown in US dollars based on a conversion rate of USD1.00=JPY120

Sources: Gartner “Gartner Market Databook 1Q15 Update” (2015)
IDC “Japanese IT Market by Product for 2014 4Q and Forecasts for 2015-2019” (2015)

【IoT *3
*3 IoT related devices, communication modules, platform software, analytics, infrastructure, services, and security
Market size
  • Market size: JPY 9.00004 trillion (2014)
  • Device diffusion: 560 million units (2014)
Market growth potential
  • Market size: JPY 16.4 trillion (2019 forecast)
    Average annual growth rate (2014-2019) 12%
  • Device diffusion: 960 million units (2019 forecast)

【Cloud services】
Market size Market size: JPY 383.1 billion (2014)
Market growth potential
  • Market size: JPY 1.1879 trillion (2019 forecast)
    Average annual growth rate (2014-2019) 25%
  • Future market expansion is expected through diffusion of cloud services and developments such as the emergence of hybrid cloud *4 .

*4A cloud computing environment that combines public cloud, a cloud environment in which resources such as data centers are made available to the general public, and private cloud, an in-company cloud environment.


【Security related】
Market size
  • Market size: Products JPY 256.4billion (2014)
    Services JPY 645.7 billion (2014)
Market growth potential
  • Market size: Products JPY 315.5 billion (2019 forecast)
    Services JPY 820.2 billion (2019 forecast)
    Annual average growth rate (2014-2019) 4.7%
  • Expanded use of cloud services and mobile devices is expected to increase needs for security software.
  • The birth of new platforms such as cloud and social technology demands optimal security. It is expected that demand will increase for overall services from consulting services to system building and operation management.

Advantages of setting up business in Tokyo

  • As many companies have their headquarters and offices located in Tokyo and its vicinity, you will be able to approach companies from various sectors. By advancing into Tokyo, you will expand your opportunities to partner with companies in sectors with high affinity for IoT.
  • Many IT-related companies also have their offices in Tokyo, with over 20 percent of the companies in Japan situated in Tokyo. Tokyo thus has a good environment for finding partners in the same sector. Tokyo also has a rich pool of talent in the software and information processing industries, making it easy to secure the manpower to develop applications and fulfill other needs.
  • With the need to bolster the security of the telecommunications infrastructure and other important infrastructure in Tokyo in preparation for the Tokyo 2020 Olympic and Paralympic Games, and it is projected that demands for related products and services will grow.
  • Source: Ministry of Economy, Trade and Industry “2014 Survey of Specified Service Industries”