Benchmark 5G in Japan - November 2019 - Global5g
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Benchmark 5G in Japan November 2019
Authors Fabrice Clari, INNO and Global5G.org partner Lisa Poucher, INNO and Global5G.org partner Editors John Favaro, Trust-IT Services and Deputy Global5G.org coordinator Stephanie Parker, Trust-IT Services and Global5G.org coordinator Graphic Design Gianluca Savini, Trust-IT Services
Overview
T
his report aims at analysing 5G in stadiums, in trains or in cars. The next
deployment in Japan. As it was the step will be to focus on the security of
case for 3G, the ambition of Japan Japanese citizens’ telecommunication
is to be a leading country in 5G networks system. By 2020, after the Tokyo Olympics
deployment. The country wishes to once and Paralympics Games, the goal will be to
again become a global leader as it was until turn those tests into commercial offerings.
the dawn of China and the US. In Japan, the 5G in Japan focuses on areas where there is
research and development of 5G is highly potential for creating new applications and
BENCHMARK – 5G IN JAPAN
driven by the historical culture of innovative markets: automotive and public transport,
technology in the country. This innovative smart manufacturing and cybersecurity,
culture first developed in the 1970s when wireless cloud-based office and healthcare.
the Japanese government activated the The Japanese strategy of relying on the
specialization of the country towards know-how of its main operators to carry
telecommunication and more generally, out a large-scale deployment of 5G across
with cutting edge technologies. Ever since, the country is enabling an evolution of the
the country put efforts into remaining a already dense 4G infrastructures towards
global leader in technology advancement. 5G. Japan is advancing on its objective to
Today, Japan occupies the fourth position deploy 5G for the Olympic Games 2020, and
in the global 5G race. Tests in several cities on a large scale afterwards. However, this
have already been implemented, but deployment can be jeopardized by several
mainly with other telecommunication issues (environmental, political, etc.).
actors or in specific conditions such as
1
Table of contents
Overview...................................................................................................................................................................................... 1
Glossary of Terms...................................................................................................................................................................3
Executive Summary.............................................................................................................................................................5
Introduction.............................................................................................................................................................................. 7
5G market in Japan........................................................................................................................................................... 9
Telecommunication market overview............................................................................................................. 9
5G in Japan..........................................................................................................................................................................11
5G implementation .....................................................................................................................................................13
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Market Size & Growth..................................................................................................................................................15
Pestel Analysis........................................................................................................................................................................17
Political.....................................................................................................................................................................................17
Economic............................................................................................................................................................................... 18
Societal................................................................................................................................................................................... 20
Technological.......................................................................................................................................................................21
Environment........................................................................................................................................................................22
Legal..........................................................................................................................................................................................23
Key market trends impacting 5G.............................................................................................................................24
Ageing of population.....................................................................................................................................................24
Connectivity ........................................................................................................................................................................26
High Tech and Manufactural Industry...............................................................................................................27
Applications of 5G : Verticals......................................................................................................................................28
Automotive ......................................................................................................................................................................28
Autonomous vehicles................................................................................................................................................29
Connected cars...............................................................................................................................................................29
Infrastructural Security.............................................................................................................................................29
Cyber-security................................................................................................................................................................ 30
Wireless cloud-based office.................................................................................................................................. 30
Robotics ...............................................................................................................................................................................31
Healthcare...........................................................................................................................................................................31
Implementation Strategy: Key vendors .............................................................................................................33
NTT DOCOMO.................................................................................................................................................................... 34
KDDI..........................................................................................................................................................................................35
Softbank..................................................................................................................................................................................36
Challenges for the 5G Market in Japan................................................................................................................37
Efficient coverage of the territory.........................................................................................................................37
The Cyber-security ..........................................................................................................................................................38
Conclusions.............................................................................................................................................................................39
2
Glossary of Terms
3GPP 3rd Generation Partnership Project
4G Fourth Generation of mobile network technology
5G Fifth Generation of mobile network technology
AI Artificial Intelligence
AR Augmented Reality
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ASIC Application-Specific Integrated Circuit
CAGR Compound Annual Growth Rate
CEO Chief Executive Officer
C-RAN Centralized Radio Access Network
CU University of Colorado Boulder
EPB Electronic Parking Brake
FC Fiber Channel
FCC Federal Communications Commission
GBps Gigabits per second
GDP Gross Domestic Product
GHz Gigahertz
IoT Internet of Things
ITS Institute for Telecommunication Sciences
LTE Long-Term Evolution
M2M Machine-to-Machine
MEC Multi-access Edge Computing
MHz MegaHertz
MIMO Multiple Input, Multiple Output
mmWave Millimetre Wave
MSOD Measured Spectrum Occupancy Database
NFV Network Functions Virtualization
NIST National Institute of Standards and Technology
NL Nonlinear
NSF National Science Foundation
3
NTIA National Telecommunications and Information Administration
ONF Open Networking Foundation
ONRC Open Networking Research Center
QAM Quadrature Amplitude Modulation
RAN Radio Access Network
RFIC Radio Frequency Integrated Circuit
SASAC State-owned Assets Supervision and Administration Commission
SDN Software-Defined Networking
TMT Technology, media and telecoms
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URLLC Ultra-reliable low latency communications
USCIB United States Council for International Business
VR Virtual Reality
WTO World Trade Organisation
4
Executive Summary
5G is the next telecommunication cellular sites must be implemented.1
generation, the fifth generation. It Today, 5G is in the development phase:
succeeds the 4G systems and should meet no country has yet implemented 5G at a
the needs of society for increasing data national scale except Switzerland. Yet, some
and connectivity. 5G should be faster (10 countries like South Korea, USA, Germany,
times more than 4G), enable low latency Spain, Italie, Bahrein, the Lesotho, Finland
and high reliability, allow to connect more and Estonia, have launched it in some areas.
people and more devices, able to use more All major world economies are aiming at
BENCHMARK – 5G IN JAPAN
connected objects (such as IoT devices), an early and strong implementation of 5G
and it should be more cost-effective. Major in their country, they are either competing
innovations are expected to come from or collaborating on this topic. Multiple
vertical industries, from automotive and countries are implementing diverse
transport to health and energy. The key strategies for the 5G development and
element of the 5G technology is the use of launch – whilst some focus on acquiring the
high frequencies in the spectrum, which largest amount of licences and spectrum,
are more powerful but have less reach then others aim at a wide-spread integration in
previous telecommunication generations different applications.
(4G, 3G). Therefore, a significant number of
Figure 1: 5G characteristics (Source: Gemalto.com)
1 The 5G era in the US (2018) GSM Association.
5
The Global5G.org project is dedicated to › Understand how the development
international technology advances in 5G, process of this technology is defined in a
with a focus on standardization, regulations, country, such as Japan;
market verticals and identification of existing › Have an overview of the 5G’s driving forces
gaps in technology. Whilst the project (trends, public authorities, industrial
particularly supports the implementation players and Universities) in Japan;
of EU-supported 5G projects and their
› Identify the verticals prioritized by
collaboration and outreach, it also looks at
the Japanese government and which
international initiatives: as seen above, the
applications of the 5G are foreseen;
5G development is a global one. In addition
to the Global5G Mapping Tool released › Understand the link between vertical
on the project’s website, benchmarks are industries, standardisation and research
undertaken on the 5G Network in selected in an important country as Japan;
countries in order to compare their strategies › Understand how the implementation of
BENCHMARK – 5G IN JAPAN
and implementation modes to those in the 5G is enabled, which are the key actors of
EU. In this context, the information gathered this implementations and what is their
in this benchmark is relevant for the project strategy;
because it allows the identification of some › Understand the potential challenges
good practices and important information of this technology’s development and
related to the 5G implementation in China. implementation;
More specifically, this analysis allows you to: › Identify which aspects could potentially
› Identify the potential benefits and be applicable in Europe.
advantages the 5G’s implementation will
enable in the next years;
6
Introduction
F
rom the 1G to the now widely used 4G and play. The following figure gives an
and the debut of 5G, a lot has changed, overview of the shifts and changes across
notably in the way people work, live the various generations.
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Figure 2: Evolution and key development in cellular technology from 1G to 5G
(Source: 5G Americas)
With the arrival of 3G came the possibility and services of telecommunication whilst
to use basic mobile Internet service. reducing energy consumption. 5G should
Further mobile equipment improvements allow:
capitalized this Internet service and text › 1,000 times more capacities
messages (through phone displays of
› 10 to 100 times more connected objects
higher quality, advanced chipsets, digital
cameras integration). 4G has capitalized on › 5 times more responsiveness
smartphones and increased consequently › 90% energy savings
the data speeds. Moreover, it enabled the › Everywhere the same efficiency2
development of a mobile broadband service The various countries are at different levels
which is capable of delivering streaming of 5G development. The ambition of Japan
video and multimedia experiences. is to be a leading country in 5G commercial
Post 4G, a new area is about to arrive: the services, like it was until 3G. The country is
5G Network. The ambition of the future currently well positioned as showed by the
5G Networks is to increase usage, speed table hereafter.
2 5G PPP Video: https://youtu.be/bfNmiYtG9Cg (accessed 19/08/2019)
7
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Figure 3: Winning countries in the race for 5G (Source: Analysys Mason)
NTT Docomo, KDDI and Softbank, the three describe the Japanese market trends using
main mobile operators in Japan, some of the 5G and the projected increase through the
main telecommunication operators in the nationalisation usage of 5G. The driving
world, already committed completely in the forces of 5G in Japan will be explained in a
race launched by the Japanese government fourth part, including the initiatives from
and have undertook actions to implement the public authorities and the industry that
5G by 2020. Indeed, the Olympics 2020 in offers to 5G a favourable environment for
Japan should be the official launch of 5G in development. The fifth part will focus on 5G
Japan. The commercialisation of 5G phones implementation strategy of the Japanese
will be ready in 2020 and by then – NTT key telecom providers. The challenges
Docomo, KDDI and Softbank will provide that will have to be faced regarding 5G
mobile 5G services. implementation will be discussed in a
In the first part, this document will describe sixth part. Finally, a conclusion will allow
the 5G market in Japan followed by an to identify the differences regarding 5G
analysis of the Japanese market environment between Japan and other countries. Good
through a PESTEL analysis. A third part will practices will be presented throughout the
whole document.
85G market in Japan
The Japanese telecommunication industry › Increasingly serve as an alternative for
is at a crossroad. While sectors of telecom are fixed broadband connectivity.
increasingly converging, new technology The Japanese environment provides good
domain like Internet of Things (IoT) and assets for the development of the 5G:
Artificial intelligence (AI) are moving towards
› The Japanese government continuously
mainstream adoption. This convergence is
supports the 5G progress through
coupled with technological progress that
allocation of new spectrum, infrastructure
offers opportunities for innovation, growth
and employment;
and productivity improvements. Over the
next decade, 5G will be the instrument of › World-class events are planned in the
these major trends’ development. 5G is years to come like the Rugby World
BENCHMARK – 5G IN JAPAN
expected to: Cup 2019 and the Olympics 2020, which
are good opportunities to display 5G
› Deliver increasingly integrated video on
advancements;
mobiles;
› Existing infrastructures which density
› Spur further developments and scale in IoT;
favouring new types of technologies.
› Support growth in augmented reality, virtual
reality (VR), industrial automation and AI;
Telecommunication market overview
Japan has been a leader in the information This loss in leadership was initially due to
and communication technology (ICT) sector incentives from the Japanese government,
for many years. Until the mid-1990s, the which developed strong Research and
country was behind on the wireless market Development resources and capabilities since
but implemented high-speed networks’ in the 1970’s. The monopoly of the Japanese
the late 1990s. The rapid deployment of the government over infrastructures and R&D
second and the third telecommunication vanished with the Japan telecommunication
generation, supported by the Japanese laws in the mid 1980’s, which opened
government gave the country a central place the telecommunication sector to the
in the global telecommunication market. international market3. It also marked the
Japan was even one of the first country in arrival of new equipment and services, and
the world to implement 3G at a large scale. the beginning of Japanese specialisation in
However, the country lost its leading position telecommunication technologies. Japanese
in the mid 2000s, due to two main factors: telecommunication carriers developed
the choice of their cellular standards, and rapidly and became leaders on the global
their domestic market dynamic. These two telecommunication market within twenty
specific reasons caused the country’s loss of years. They lost their leading position when
competitiveness since Japan failed: came the third and the fourth generation,
› On one hand, to follow the general because they failed to overcome the
dynamic of the digital cellular standards, challenge posed by global major players in
by the creation of a single and specific terms of network equipment. Japan notably
cellular standard for the 3G deployment; deployed the Freedom of Mobile Multimedia
Access (FOMA) standard, which was not fully
› On the other hand, to have the means to
compatible with the widely used Universal
get the manufacturing access to develop
Mobile Telecommunications System (UMTS)
sophisticated devices as was doing the
protocol.4
rest of the world.
3 Reform of Japanese Telecommunications Law: Panacea or Placebo, D.W.Colber, 1987.
4 Jo Best, “The race to 5G: Inside the fight for the future of mobile as we know it,” TechRepublic, December 14, 2014,
techrepublic.com
9The Figure below highlights the chronology
of the new technology deployment in
Japan:
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Figure 4: Deployment of new technology in Japan
(Source: Expert interviews, Ovum, World Cellular Information Service)
As showed in the figure, the Japanese market financial health, high know-how in innovation
has grown quickly over the years and was technologies, number of subscriptions)
large enough to sustain companies without according to sources such as OECD or
the need to expand abroad. The domestic Statista, but it falls behind in the global race
mobile penetration was higher than in the to telecommunication leadership. One of
rest of the world and Japan was ahead of the main causes is because the domestic
the global telecommunication market until telecommunication policy has become
the arrival of the iPhone. With the iPhone, a constraint: the density of the Japanese
Apple came with a brand-new concept of network is leading now to serious connexion
telephone, capable of displaying videos, speed issues notably during peak hours,
maps and act like an iPod music player. Its and Japan’s lack of technical means to
touchscreen and its power, enabled by a adapt to the new global telecommunication
new range of standards, contributed to the framework6 (not because of a technological
substitution of computers through iPhones. delay, but because of the specificities of its
This technological revolution had a massive telecommunication infrastructures). Data
impact on the global market, to which the traffic growth is one of the main drivers
Japan didn’t not successfully adapt to.5 for the implementation of 5G. Moreover,
Moreover, the country has some of the best if Japan wants to stay competitive in the
indicators regarding telecommunication telecommunication industry, it will have to
(system viability, network density, carriers’ follow its evolution.
5 Forbes.com.
6 https://www.recode.net/2017/6/26/15821652/iphone-apple-10-year-anniversary-launch-mobile-stats-smart-phone-steve-
jobs
10Nevertheless, the situation can be reversed are economically stable and willing to invest
as the Japanese telecommunication giants in the next telecommunication generations.
5G in Japan
As technology is evolving in domains like new technologies (augmented reality or
the Internet of Things (IoT) or Artificial artificial intelligence for instance) to break
Intelligence (AI), it offers opportunities through and to become mainstream. These
for innovation, growth and productivity new technologies represent development
improvements. As Japan has been behind opportunities for Japanese companies:
regarding the 5G’s implementation through the development of innovative
(compared to the US and China) in the and competitive technologies and services
past years, the Japanese government which could have significant outcomes for
has decided to create incentives with the Japanese economy.
BENCHMARK – 5G IN JAPAN
the aim to reposition Japan as one of the Nevertheless, the following indicators show
telecommunication leaders. that Japan remains competitive on the
As 5G is expected to support growth in telecommunication market:
the mobile video, the IoT, the AR, the VR, › Japan is the third country with the largest
the automation and the AI markets, the R&D expenditures (behind the US and
Japanese government wants to make the China): USD169,554 M R&D spending per
necessary efforts to reach excellence in year. It accounts for 3.4% of Japan’s GDP.
these areas. On the one hand, because the
› Japan is one of the world leaders in new
economic impact of 5G is expected to be
technologies, it is the world reference in
significant. Indeed, according to a recent
industrial robotics.8
estimate, the global economic impact
of 5G will be USD12.3 trillion generated › Japan has an existing dense network which
by 2035 (similar to China’s GDP in 2017, will be upgraded through investments of
and 4.6 percent of estimated global real USD14 billion in new telecommunication
output in 2035)7. Such financial stakes networks (forecasted by Japanese carriers).
justify the race to a strategic position in the Already, it represents the densest network
global market share of 5G. On the other in the world as illustrated in the following
hand, the planned capabilities of 5G will figure (even though the country would
provide the infrastructure necessary for the need a greater infrastructure according
to the market’s needs).
7 Results based on IHS Markit, The 5G economy: How 5G technology will contribute to the global economy whitepaper.
Information is not an endorsement of McKinsey & Company. Any reliance on these results is at the third party’s own
risk. Visit www.technology.ihs.com for more details
8 Estimated from a report of the International Federation of Robotics which states that Japan provides 52% of the global
robotic supply.
11BENCHMARK – 5G IN JAPAN
Figure 5: 5G network density (Source: Deloitte)
125G implementation
Japanese telecom providers intend to Forum (BBWF) 2013 by NTT Docomo. In
implement 5G by the end of 2019. The 2014, the 5GMF (Fifth Generation Mobile
Japanese government expects the fifth Communications Promotion Forum) issued
generation to be available for the 2020 a roadmap for the 5G implementation in
Summer Olympics in Tokyo. This idea has Japan (illustrated in the following figure).
been submitted at the Broadband World
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Figure 6: 5G development roadmap towards 2021 (Source: MIC)
The plan established by Japanese carriers relation to the 5G development is divided
(on behalf of the Japanese government) in into several phases:
13Until 2020: Implementation
Research and development, new build sites (complementing the densified small
cells sites) and cooperation
Internal: Promotion of External: International Technical:
R&D projects collaboration and Identification
cooperation of the spectrum
and developing
technical
specifications
Since 2016, the main Japan and European Trials carried out
BENCHMARK – 5G IN JAPAN
Japanese mobile operators authorities have signed a on specific fields
have carried out several collaboration agreement: (automotive,
5G system trials with they will collaborate with robotics)
other telecommunication European carriers as
operators such as Huawei Ericsson and Nokia for 5G
or Nokia. trials.
Around 300 million USD
have been dedicated by
the Japanese authorities to
promote the industrial IoT
and related technologies
such as big data, artificial
intelligence and robotics.
Beyond 2020: Commercialisation
The Tokyo Olympic Games are expected to showcase the Japanese 5G
advancement and the launch of 5G at a large scale.
14Market Size & Growth
Worldwide, 5G is expected to yield a rapidly and 2G of 4%.9
growing market share. According to The following figure illustrates the fast
Statista, the worldwide market share of 5G evolution of the mobile telecommunication
is expected to be of 14% in 2025, whereas 4G technologies worldwide.
will have a market share of 53%, 3G of 29%
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Figure 7: Market share of mobile telecommunication technologies worldwide from 2016 to
2025 by generation (Source: Statista)
Japan is expected to follow the worldwide that in Japan, 5G connections will reach 88
trend. The share of mobile connections billion of all national mobile connections
from all other generations are expected by 2025 which represents 7.2% of all 5G
to decrease, whereas the share of 5G is connections worldwide, as shown in the
expected to increase rapidly. It is predicted graph below.
9 https://www.statista.com/statistics/740442/worldwide-share-of-mobile-telecommunication-technology/.
15BENCHMARK – 5G IN JAPAN
Figure 8: Forecast of 5G connections in 2025 (Source: GSMA.com)
16Pestel Analysis
A
PESTEL analysis allows you to the description of the political, economic,
identify the environment in which social, technological, environmental and
5G research and deployment in legal aspects in Japan.
Japan are evolving. The analysis includes
Political
BENCHMARK – 5G IN JAPAN
The political environment is full of risks delay stresses multiple political issues:
for the telecommunication sector. The › Within the country: Japan’s
traditional political risks are those related telecommunication infrastructure’s
to regulations, network licensing, national specificities led the country to a dominant
radio spectrums. position but became a burden several
In the case of Japan, a key aspect is the years later as the country failed to follow the
strong involvement of the Japanese evolution of the global telecommunication
government in the development strategy framework. Now, Japan have to negotiate
of the country’s telecommunication sector. with strategic partners (i.e. India and
The Japanese government has quickly Europe) to develop a strategy for the next
established tight links with the main generation of cellular telecommunication.
Japanese telecommunication carriers. This strategy already relies on a high
Japan has seen significant developments standard organizational structure of the
during the second half of the 20th century and Japanese market, led by NTT Docomo
has become a leader in some cutting-edge which fosters the catching up process
technologies. It was the first non-Western initiated with western economies, leading
country to include western technological the country towards more openness and
and scientific traditions. Therefore, the more standardization, notably regarding
country developed into a super-power in 5G telecommunication implementation.
advanced technologies. The government’s › The economic clash between US and China
incentives and policies regarding science puts Japan in a difficult situation because
and technology have played an important of the importance that both giants have
role in this industrial development10. in the Japanese economy. Japan has
Japan’s specialisation in science and always had tense relations with China
technology was focused specifically (due to historical rivalry) and that rivalry
on the information technology sector, has become even more intense lately as
which played a key role in the Japanese China replaced Japan as the political and
industrial development in the 1970s. The economic leader in Asia. Nevertheless,
country is now one of the leaders of the maintaining close relations with Beijing is
telecommunication industry, and notably important for Tokyo for two reasons:
of the wireless telecommunication industry, › China remains Japan’s main trading
thanks to massive investments in R&D. But partner;
still, compared to the significant expansion › Neither China nor Japan wish to start a
of China as well as the advancement of the political conflict.
USA in R&D, Japan is lagging behind in
Nevertheless, Japan has decided to seize
terms of technological advancement. This
the opportunity represented by 5G to
10 SCIENCE AND TECHNOLOGY POLICY IN JAPAN, Fukasaku
17reimpose itself as the leading country in the Abe held a speech during the G-20 summit,
telecommunication sector. The Japanese highlighting the importance of data for
government puts a lot of efforts in Science the future of Japanese economy and
& Technology investments with the aim to the necessity to enhance the quality and
lead the 5G market in the next few years, intensity of data regulation, particularly
making telecom industry one of its main in the frame of a significative raise in the
levers for economic development. The data data flow. Abe also showed his support for a
traffic growth and the global competitive model called Data Free Flow with Trust: the
environment may also explain this initiative. governance of data should be a “great gap
On February 2019, Japanese Prime Minister buster’’ 11.
Economic
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The Japanese GDP oscillates between 0% economic health represents a favourable
and 2% since the end of the 2008 economic environment for the consumer spending on
crisis. It has been increasing constantly over telecommunication products and services
the past few years and reached 2.4% in the as in general the stronger the economy
second semester of 2018 (as illustrated in the of one’s country is, the higher will be the
figure below), a rate which is still below the consumer spending on telecommunication
US and the Chinese GDPs. Nevertheless, this products or services.
Figure 9: GDP Annual Growth Rate in Japan (Source: tradingeconomics.com)
Moreover, the number of smartphone users increase can also be observed. Indeed,
increased from 2017 with 68.7 million to in 2017 the percentage of the population
70.8 million in 2018 and is expected to grow which were smartphone users was of 54.4%
to 76.3% in 2022 (as shown by the figure and in 2022 it was expected to reach 61.2%,
below). These figures represent a growth which represents a growth of 12,98%. In 2018,
from 2017 to 2022 of 11.8%. Regarding the the smartphone users and penetration rate
penetration rate of smartphone users, an in Japan was the 7th highest worldwide12.
11 https://thediplomat.com/2019/02/japan-calls-for-global-consensus-on-data-governance/.
12 https://newzoo.com/insights/rankings/top-50-countries-by-smartphone-penetration-and-users/.
18BENCHMARK – 5G IN JAPAN
Figure 10: Smartphone users and penetration rate in Japan (Source: eMarketer)
In addition, some other indicators show a traffic is expected to more than triple in
profitable environment for the development Japan between 2016 and 2021 as illustrated
of telecommunication technologies in in the following figure.
Japan. Indeed, the mobile device data
Figure 11: Mobile device data traffic in Japan between 2016 and 2021 (Source: GSMA)
19Societal
Globally, the use of internet-based services opportunity to people to connect each
has grown. People are now using them to other. The phenomenon accelerated as
various purposes: technological devices gained in efficiency
› Entertainment. The enhancement of the and sophistication. Today, social medias
quality of telecommunication devices are important in people’s everyday life
coupled with the 4G expansion enabled a and are also used as political tools14.
significant raise in the use of smartphones Overall, these trends show the key role played
to access television or entertainment via by internet-based services which could be
platforms like YouTube or Netflix; enhanced through the implementation of
› Business. Internet-based services 5G.
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lead to new opportunities of business Japan is one of the countries with the most
development. The use of a new panel of mobile internet users with 66.6million in
of services like streaming, videos 2018.15 This figure is projected to rise to 71.9
broadcasting or mobile computing was million in 2023. Regarding the use of social
eased by technological enhancement and medias, in Japan social media has become
created new ranges of work methods and an important part in people’s everyday
jobs (i.e. the ‘’Youtubers’’ phenomenon life: in 2018, approximately 51.3 million
allowing some of them to earn a good people actively used social media16 which
wage13); represent a 40% social media infiltration
› Social. The advent of Facebook rate (as shown by the graph below). In 2023,
and other social medias gave the this figure is projected to reach about 61.8
million social network users.
13 https://www.forbes.com/sites/natalierobehmed/2018/12/03/highest-paid-youtube-stars-2018-markiplier-jake-paul-
pewdiepie-and-more/#4cd665ee909a.
14 Facebook Use in the 2012 USA presidential campaign, Social Media in Politics: Case Studies on the Political Power of
Social Media, Bogdan Patrut & Monica Patrut, 2014.
15 https://www.statista.com/statistics/239086/forecast-of-mobile-internet-users-in-japan/.
16 https://www.statista.com/statistics/278994/number-of-social-network-users-in-japan/.
20BENCHMARK – 5G IN JAPAN
Figure 12: Social network user penetration in Japan from 2017 to 2023 (Source: Statista)
In 2017, 92.08%17 of the Japanese population In contrast, the share of smartphone users
had a daily internet access. It is the second in the overall population, is lower in Japan
highest rate of the Asian area after South than in Western countries. As showed by
Korea, and one of the highest rates in the the graph below, the overall number of
world. This high figure can be explained by smartphone users accounts for 57.6% of the
the quality and the density of the Japanese population in 2019 (see figure 10). In the US
telecommunication infrastructure, and for instance, smartphone users account for
it shows the excellence of Japan on 77% of the population18.
technological advancement.
Technological
Japan has been specialized in science and aspects of technological sectors like
technology since the second half of the autonomous driving, IoT, connected cars,
20th century. The arrival of the Japanese smart homes and businesses and smart
telecommunication industry enabled cities, which will rely on the next generation
major technological advancements, telecommunication system to work
making Japan a world leader in several efficiently.
sectors such as automotive or robotics. Regarding advancement expected on the
But Japan’s excellence addresses other telecommunication aspect, 5G will play a
17 https://data.worldbank.org/indicator/it.net.user.zs?name_desc=false.
18 https://www.pewinternet.org/fact-sheet/mobile/.
21key role in the smartphone sector. The trend Japanese sales are still expected to grow
of smartphone sales in Japan is increasing, in the next years, with the wide-scale
notably with Apple dominating the market, implementation of 5G network and devices.
with more than 50% of the market share19.
Environment
As time goes on, environmental consciousness climate disaster. He also positioned Japan as
progresses. European countries seem to a potential leader for climate change and
be the keenest to tackle environmental repeatedly highlighted the need to abandon
issues but Japan also considers seriously the the massive production of greenhouse gases.
question, notably regarding the recent history Indeed, as shown in the figure below, the
BENCHMARK – 5G IN JAPAN
of the country (Fukushima nuclear reactor concentration of greenhouse gases in Japan
explosion, tsunami in 2011), and its tricky is high20 – although not as much as the US
relation with nature in general (a country and China. Moreover, the country suffers from
familiar with earthquakes). The growing cost an important waste management problem.
of extreme weather hazard forces politicians With the economic and demographic growth
to reflect better on solutions regarding the of the 20th century came an increase of waste
environment. in Japanese modern society and the growing
In 2018, the Japanese Prime Minister Shinzo shortage of lands rapidly posed a challenge
Abe during a UN General Assembly urged regarding waste management in Japan.
nations to put ‘promises into practice’ to avoid
Figure 13: Annual CO2 emissions in 2016 (Source: fortune.com21)
19 According to a Canalys study issued on February 2019.
20 https://ourworldindata.org/co2-and-other-greenhouse-gas-emissions.
21 https://fortune.com/longform/global-co2-emissions-2018/.
22To tackle these environmental issues, Japan implemented in Japan24. These new kinds
has chosen the path of technology. Whether of factories will integrate more and more
through the innovation of its automotive the environmental management aspect
industry22 or of its recycling technologies23, at every stage of products’ life cycle. It
5G combined with IoT is expected to bring will notably contribute to the decrease
a substantial help in implementing more of factories’ footprint. Moreover, through
efficient facilities to deal with environmental their expected rationalisation, connected
problems Japan is facing, such as highly factories will help to accelerate the cycle of
connected factory which should be widely recycling.
Legal
BENCHMARK – 5G IN JAPAN
The Telecommunication Business25 Laws coverage required, the following conditions
and the Nippon Telegraph and Telephone have been mentioned:
Corporation Act in 1985 marked the opening › The expansion of optical fibre networks;
of the Japanese telecommunications
› The improvement of safety measures
system to the global market, and the arrival
to reduce outage risks during natural
of supergiant telecommunication actors
disasters;
like NTT Docomo.
› The improvement of prevention measures
Nonetheless, on the eve of 5G wide-scale
against interferences between existing
implementation, Japan has established
radio licensees;
a legal framework in which 5G would be
implemented and developed. Operators are › The improvement of cybersecurity
free to deploy 5G throughout the country, measures.
but the Japanese government ask for These conditions established by the
some minimum requirements regarding Japanese government, gave a framework to
regulation. the three main telecommunication carriers
Regarding network coverage, the Ministry – NTT Docomo, KDDI and Softbank - and to
of Telecommunications has divided the Rakuten to deploy 5G networks in 2020. In
country into 4,500 parcels, and operators practice, each carrier is awarded 400MHz
are asked to cover at least 50% with base spectrum on the 28GHz frequency. The
transceiver stations (BTS) by 2025. three main carriers are awarded 200MHz
on 3.7GHz, except Rakuten, which has
The Ministry also incorporated some
requested 100MHz.
conditions in the deployment framework
of 5G on the territory. In addition to the 50%
22 Japan at a crossroads – The 4G to 5G (r)evolution - How Japan can leverage next-generation networks to boost
industries, spur innovation, and regain technology leadership for a prosperous telecommunications sector Research
report January 2018, McKinsey&Company.
23 https://www.env.go.jp/en/recycle/smcs/attach/swmrt.pdf.
24 https://www.meti.go.jp/english/publications/pdf/journal2015_05a.pdf.
25 http://www.soumu.go.jp/main_sosiki/joho_tsusin/eng/Resources/laws/2001TBL.pdf.
23Key market trends impacting 5G
Ageing of population
J
apan is one of the world’s countries only a high ratio of seniors but also a sharp
with the highest rate of elderly people. downturn in its total population as showed
Indeed, 25 percent of its population by the graph hereafter. From roughly
is aged 65 or more. By 2040, this ratio is 126 900 000 citizens in 2019, this figure is
BENCHMARK – 5G IN JAPAN
estimated to rise to an unprecedented level expected to decrease to 110 000 000 by
of 36 percent. The Japanese population 2050. An accumulation of reasons may put
has nearly tripled in the 20th century, increasing pressure on Japan’s ability to
peaking at 128 million in 2010. But with a manage its rising debt and social security
falling birth rate, one of the world’s longest obligations, and could trigger a growing
life expectancies, and a close to zero net shortages of skills26 .
immigration, the country is heading for not
Figure 14: Projection of the Japanese population (Source: United Nations WPP)
26 https://www.japantimes.co.jp/opinion/2019/01/10/editorials/face-challenges-shrinking-aging-population/#.
XLmG4jAzaUk.
24The Abe administration has vowed to address seize. The country is already implementing
this national issue by launching initiatives to several devices relying on IoT in order to face
support young couples in having children, this demographic challenge. Mitsufuji for
as for example making preschool education instance, a Tokyo based company, developed
free. The Abe administration has also set a a wearable clothing brand which products
target of raising the fertility rate back to 1.8 are made of silver-metalized conductive
by 2025 and anticipates welcoming up to fibres and filled with sensors. Aimed
345,000 foreign workers in five years under primarily at elderly persons, these products
the fertility programme that started in April have been on the market since 2016 and are
2019. used to monitor health information (such
The ageing population and declining birth as breathing and heart rate, temperature,
rate are fundamental aspects to consider humidity) through sensors28.
when addressing the future of 5G in Japan. Considering that more efficient healthcare
The ‘’silver market’’27will be significant in will be the key for Japan to reduce the
BENCHMARK – 5G IN JAPAN
Japan within the next few years and will economic impact of ageing population
influence the 5G’s development in the and to maintain the quality of life for its
country. Indeed, experts in economics and citizens, Japan seeks to be a frontrunner
social sectors consider ageing population who can provide solutions answering to the
in Japan as an economic opportunity to challenges presented by ageing population.
27 Referring to the recent concept of ‘’silver economy’’. The Silver Economy refers to the economical markets, activities
and stakes related to people aged 60 or more.
28 https://www.tematicaresearch.com/japan-is-harnessing-iot-technology-to-support-its-aging-population/.
25Connectivity
In recent years, Japanese networks are everyday life: the capacity constraints and
starting to show signs of capacity constraints. exponential growth in data traffic and
Moreover, the domestic vendors’ landscape connections have considerably slowed the
has been disrupted by global innovations speed capacity of telecommunications in
and they have difficulties to fully adapt highly dense Japanese areas and especially
and benefit from new features such as the at peak hours, as illustrated in the graph
Internet of Things. It materialises in people’s below.29
BENCHMARK – 5G IN JAPAN
Figure 15: Japan 4G ability and speed: the country has a very high 4G availability but lags
in speed (Source: Japan at crossroads, p930)
Softening the data traffic congestion in technological experience through a more
Japanese major cities will be a key driver efficient telecommunication network is the
of 5G development in Japan. Congested challenge they want to tackle – in order to
networks, especially during peak hours get a return on the important investments
affects end-users’ experience and for the made for the deployment of 5G.
main Japanese carriers, providing the best
29 Japan at a crossroads – The 4G to 5G (r)evolution How Japan can leverage next-generation networks to boost
industries, spur innovation, and regain technology leadership for a prosperous telecommunications sector Research
report January 2018.
30 https://www.mckinsey.com/industries/technology-media-and-telecommunications/our-insights/japan-at-a-
crossroads-the-4g-to-5g-revolution.
26High Tech and Manufactural Industry
5G will be important for the telecom sector the manufacturing industry. For example,
but it will also have an impact on the entire Toyota, an important manufacturing
Japanese industry. For decades, Japan has company is the largest Japanese company
focused on high precision manufacturing in terms of turnover, and the 12th largest in
and high-tech items such as hybrid vehicles, the world, with an annual profit of USD22.5
robotics, and optical instruments. These billion in 2018. Sony, an important player in
sectors are strategic for Japan and 5G is the electronics and robotic sector made an
expected to help the country maintain its annual USD 4.4 billion profit in 2018 and is
vigour. the 7th largest Japanese company.
Of the ten Japan’s largest companies, The table below highlights the importance
seven are either related to electronics or to of these sectors in the Japanese economy.
BENCHMARK – 5G IN JAPAN
Figure 16: Japan export by category (Source: Tradingeconomics.com)
Japan is currently in second position in the the leading edge of innovation, they will
world in terms of automation according need a globally competitive infrastructure
to the Automation Readiness Index31. on which to build their future products and
But according to the same index, it is competitiveness. Connectivity becoming
the first in the potential of its favourable even more implemented in society,
environment for Research & Innovation32, mobile networks may be one of the core
meaning that it has the tools necessary to infrastructures on which industries will base
deploy innovations and in consequence their new products and services. Therefore,
is one of the front runners to for example the success of many industries outside the
take the lead in Automation in the future. telecommunication sector will depend on
Nevertheless, for companies to remain in the mobile network infrastructure.
31 http://www.automationreadiness.eiu.com/.
32 http://www.automationreadiness.eiu.com/#overview.
27Applications of 5G : Verticals
T
he implementation of 5G will result of risk but also low latency which should
in a lot of transformation. 3G and enable people to control objects remotely,
particularly 4G increased the use ensure the ultra-rapid responsiveness of
of mobile devices and brought an all new objects and a lot more. The following figure
range of possibilities. 5G will allow the show what the 5G is expected to enable and
transformation of several vertical industries. which verticals will emerge through these
Moreover, 5G will offer ultra-reliability which opportunities.
aims at effectively eliminating any element
BENCHMARK – 5G IN JAPAN
Figure 17: Future use of 5G (Source: Stratfor 2018)
Automotive
For years now, Japan has been focusing to boost these figures. Internet connectivity
on the advanced automotive industry should become integrated to the car of
and hosted some of the most cutting- the future and should bring technological
edge automobile technologies (notably, advancements in GPS, automated driving,
at Toyota). For the Japanese economy, the and other features. New manufactural and
automotive industry is a crucial asset. It business models are expected and coming
accounts for 16 percent of exports33 and with it, as are new jobs and business
employs more than 800,000 people in opportunities. Japanese automakers’
production alone34. 5G and IoT are expected significant presence on the global market
33 Japan’s International Trade in Goods, Japan External Trade Organization, 2016, jetro.go.jp.
34 The motor industry of Japan 2016, Japan Automobile Manufacturers Association, 2016, jama.org.
28(exporting nearly four million cars in 2015), Two main use cases of 5G have been
puts them in a strategic position to capture identified among automotive industry35:
these opportunities.
Autonomous vehicles
Although the development of self- more efficient and safer use of existing road
driving cars is still in the early stages, car infrastructure. If all the vehicles on a road
manufacturers are making significant were connected to a network incorporating
progress: creating cars able to drive a traffic management system, they could
themselves for extensive periods without potentially travel at much higher speeds
human intervention. Considered as the and within greater proximity of each other
future of driving, autonomous vehicles without risk of accident36. Autonomous cars
present a significant expectation in Japan: are expected to reduce the potential for
BENCHMARK – 5G IN JAPAN
enabling vehicles to communicate with the human error.
outside world could result in considerably
Connected cars
Connected vehicles are expected to is a service which provides drivers in Japan
enhance significantly functionalities of with real-time traffic information and
vehicles, notably for the remote-control lets them book a restaurant via a human
key aspects of everyday life (i.e. control of concierge. Nissan announced in 2018 that
household functionalities). Besides, some the company would offer connectivity for
concrete initiatives have been launched all new Nissan, Infiniti and Datsun cars sold
in the sector of connected cars. Toyota for in key markets by 2022.
instance launched Toyota T-Connect, which
Infrastructural Security
All over the world, governments have taken significant number of problems37(in terms
infrastructural security into consideration of environmental issues).
and 5G is expected to bring more security › Seismic risk: This use case is particularly
for infrastructures at the cyber-level, but important for Japan as earthquakes
also at physical level (i.e.: better control over are very frequent. The country being
seismic risk) levels which is crucial for Japan. located at the intersection of four tectonic
For Japan, such an implication is crucial plaques, Japanese authorities have to
considered two aspects: take into consideration this factor. 5G
› The country nuclear reliability: 5G would should provide better means to address
bring more security in nuclear installations such issues in the future.
thanks to an enhanced control enabled Japan is unfortunately well known for
by connected factories, able to rapidly disasters, whether they have natural
communicate information. In the origins (earthquakes, typhoons…) or
frame of the “Society 5.0”, the Japanese human origins (the nuclear explosion
Government have already announced the of Fukushima for example), Japan is not
development of “Connected Industries”. spared by catastrophes. The country’s
This new industrial concept combined population is already familiar with extreme
with global evolution toward ‘’industries conditions, and the country has developed
of the future’’ is expected to solve a infrastructures adapted to face natural
35 https://www.mckinsey.com/industries/technology-media-and-telecommunications/our-insights/japan-at-a-
crossroads-the-4g-to-5g-revolution
36 Understanding 5G: Perspectives on future technological advancements in mobile, GSMA Intelligence, 2014.
37 https://www.meti.go.jp/english/policy/mono_info_service/connected_industries/index.html.
29disasters. The Japanese society will benefit disaster management: they have deployed
from possibilities brought by 5G in security across Japan mobile power supply vehicles
management, like the dramatic reduction to provide power to base stations in case
of the latency period for an information of power shutdown after a disaster38 and
transmission from a place to another. The systems for warning people just before the
Japanese government already provides arrival of seismic waves are already used.
its citizens with alerts across TV, radio and But these existing systems are often not
mobile phones. These alerts are managed fast enough. 5G should mitigate this issue,
by the main telecommunication carriers through the significant increase in the
(NTT Docomo, KDDI and Softbank). telecommunication speed.39
Softbank for instance is well advanced on
Cyber-security
BENCHMARK – 5G IN JAPAN
The strengthening of cybersecurity has (MIC) launched the Cybersecurity Action
become a real priority as the growing Program, aiming to accelerate the
amount of data is becoming more difficult reinforcement of national cyber-security.
to manage for companies and industries. A National Cyber Training Centre was also
The rising number of cyberattacks proves established, to train new skilled and young
that the digitality can also be used as a professionals specialized in cyber-security
weapon. and national defence40.
Japan has been falling behind in terms of The significant raise in data brought by
cyber-security for decades due to cultural, 5G triggers an enhancement of need for
governmental and organizational reasons. cybersecurity policies, in order to prevent
Famous for its public-safety and its any hypothetical threat for National
preference to avoid risk, Japan missed the security or individuals. Considered the
opportunity to foster home cyber-security delay accumulated by Japan over the years,
policies. Nonetheless, in 2017, the Ministry catching up with most advanced countries
of Internal Affairs and Communications is a genuine challenge.
Wireless cloud-based office
As technological development comes with have a significant impact on the Japanese
new means to increase the efficiency of economy when considering the cost-
companies’ working process, a wide range efficiency this change in working habits
of opportunities are appearing. Cloud should bring.
computing introduces a significant shift Japan is already ranked as the second
in how technology is obtained, used, and largest cloud computing market amongst
managed. It also shifts how organizations the top markets41, and it will seek to maintain
budget and pay for technology services. The its position thanks to 5G. Indeed, 5G will
advantages of using the cloud includes: the increase the possibilities of the cloud to
growth of data storage and of computing carry out business tasks and for the storage
power it offers, coupled with a decline and the use of data.
of servicing costs. Cloud networking will
38 https://www.softbank.jp/en/corp/csr/reconstruct/restoration/.
39 https://eandt.theiet.org/content/articles/2018/10/japanese-researchers-develop-machine-learning-technique-for-
natural-disaster-detection/.
40 https://wisdom.nec.com/en/technology/2017120601/index.html.
41 2016 Top Markets Cloud Computing Report, US Department of Commerce
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