Japan has long been a world leader in mobile communications. Its history of innovations includes the first commercial mobile browser-based web service, the first mobile email and the first mobile phones with built-in cameras. In recent years, however, Japan’s mobile landscape has suffered from capacity limitations, and Japanese hardware developers have fallen behind global phenomena like the iPhone.
Where are we today?
A few years ago, Japanese companies committed to investing more than $45 billion in 5G deployment, the intention of which was having 5G coverage in place ready for the 2020 Summer Olympic Games. The COVID-19 pandemic has obviously led to the postponement of the games, but Japan still intends to push ahead with its 5G plans. The Olympics will return to Japan, hopefully in 2021, and the country intends to have the infrastructure in place to manage it successfully.
The possibilities and opportunities
The deployment of 5G presents a big opportunity for Japan for several reasons. Japan’s mobile network capacity is currently relatively full, so 5G could help operators alleviate capacity constraints and better handle future growth in data traffic and connections. Further to that, it presents companies with new opportunities in high-growth areas such as virtual and augmented reality (VR and AR) and the Internet of Things (IoT), which until now have been dominated by global competitors.
5G will also enable Japanese companies to be more innovative and competitive in fields like autonomous vehicles and robotics. It will also allow them to launch new value-add services such as remote patient monitoring in healthcare and disaster alerts in smart cities. The potential value to be had is huge, with the GSMA predicting that 5G could add more than $2.2 trillion to the global economy.
New use cases emerging
Japan has the opportunity to reap the benefits of 5G networks in other areas, too. In manufacturing, plants can harness 5G to power IoT solutions that create smart factories, which deliver increased productivity and ROI. According to Forrester, the global industrial IoT (IIoT) market will grow steadily to reach a value of $123 billion by the end of 2021, and Japan will be a part of that. The entertainment industry will benefit, with TV viewers potentially able to personalize how they watch professional sports and other content. Japan is home to almost 70 million gamers, who will benefit from 5G’s extremely low latency while playing cloud-based games.
5G network slicing has the potential to present new use case opportunities, letting companies slice the network into flexible layers that can deliver precise business use case requirements. Surgery, gaming and autonomous vehicles could be areas where 5G network slicing comes into its own in Japan.
5G and the new normal
All of these things were true pre-COVID-19, but are they still? I believe so: none of the potential use cases for 5G have gone away, and 5G could in fact become a more important technology in our newly-disrupted world.
5G can play a key role in powering the economic recovery Japan and the world will need as we attempt to get back to some degree of normality. If you think about industries that have actually thrived during the COVID-19 lockdown, you think first of online retail: Amazon’s first quarter revenues in 2020 grew $13 billion to $145 billion, and its share price hit new highs.
Online shopping and robot deliveries will be 5G use cases that will grow, and Japan had already deployed robots to deliver products to consumers in 2019. The COVID-19 situation and potential aftermath could see 5G enabling many new robot delivery use cases, and Japan is well-placed for it. Japan is the world’s leading manufacturer of robots, and during the pandemic so far, Japanese start-ups have been developing robots for medical use cases and contactless deliveries.
5G will also support enterprise grade broadband, which some consider a viable alternative to fiber connectivity and the potential backbone for IoT. 5G also enables distributing computing capabilities to the network edge, meaning all kinds of potential new revenue opportunities. Real-time services that need the combination of 5G and edge computing, including use cases like automated vehicles, precision robotics, mission-critical AI applications and mobile virtual reality, could all become a reality. With so many people probably still working from home due to COVID-19, enabling new remote ways of working and services will be significant.
A major step forward
By 2025, GSMA Intelligence predicts that 49% of Japan’s mobile connections will be 5G. It was already a potentially huge, transformative business enabler before COVID-19, and 5G’s speeds, latency and capacity look set to be even more vital in powering business resilience and our overall recovery.
Business and science leaders from G20 member states recently wrote to the G20 calling for it to urgently improve digital infrastructure in response to the COVID-19 pandemic – highlighting that 5G is key to future economic recovery. Building a new type of infrastructure can support and drive economic momentum that will benefit Japan in the short and long term.
To read more about how Orange can help your organization remain resilient and mitigate the risks of disruption during the COVID-19 crisis and beyond, read our ebook: Be resilient at all times – 5 strategies forward.
Head of Cloud Asia Pacific, Orange Business Services
As Head of Cloud in the region, Christophe is responsible for driving and supporting APAC country teams to grow pipeline and win new and large transformational deals for cloud. He has lived in Japan for more than 10 years, and as head of Orange Business Services Japan for over seven years, is well versed in the Japanese market.