IT Sector
Situation in Japan
The IT industry is a leading industry driving the Japanese economy. The IT market is forecasted to grow to nearly USD 5,100 billion by 2024. 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.
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- 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.
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- 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
*2 Development by companies introducing an enterprise resource planning system to add functions that the package lacks
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- 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.
Sources：Gartner "Gartner Market Databook 2Q23 Update" (2023)
IDC "Domestic IT Services Market Forecast" (2023)
IoT *
*IoT related devices, communication modules, platform software, analytics, infrastructure, services, and security
- Market size
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- Market size: JPY 5.8948 trillion (2021)
- Market growth potential
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- Market size: JPY 9.118 trillion (2026 forecast)
Average annual growth rate (2021-2026) 9.1%
Cloud services
- Market size
- Market size: JPY 4.2018 trillion (2021)
- Market growth potential
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- Market size: JPY 10.9381 trillion (2026 forecast)
Average annual growth rate (2021-2026) 160.32%
- Future market expansion is expected through diffusion of cloud services and developments such as the emergence of hybrid cloud*4.
*4: A 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
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- Market size: Products JPY 436 billion (2021)
Services JPY 296.3 billion (2021)
- Market growth potential
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- Products JPY 269.9 billion (2015) → JPY 436 billion (2021)
Services JPY 436 billion (2021) → JPY 344.5 billion (2026 forecast)
- 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.
