Could Society 5.0 bolster Japan's technology credentials?
Was it a coincidence that my podcast co-host Rick Huckstep and I should share similar technology as our respective "tech of the week" choices? Perhaps not. Progress in transport technology is rapid, with new autonomous vehicles, EVs, smart bicycles and maglev trains freshly minted seemingly each day.
My choice was the Sky OV, an AI-controlled plane that its designer claims could one day transport 200 passengers from London to New York in just three hours. That’s a timescale I would appreciate, especially having just sat nearly 16 hours from Japan to London. Groan. Rick's choice was the driverless electric aircraft from a Chinese firm called Ehang.
But let's get to the noodles of this post, which is about technology in Japan. My partner and I just returned from a 12-day trip to Tokyo, Kyoto and Osaka, and were suitably impressed. It was a special holiday for many reasons. Kyoto stands out for us as a place we could live given half a chance. Set us up with a bottle of Catena Malbec one day and I'll talk you through my personal feelings about Japan. As regards the country's technology scene, Rick and I explore this topic in episode 38 of Big Tech Little Tech. I hope you can squeeze in a listen.
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Let’s begin these notes with a brief overview of Japan’s technology industry. Here’s a few interesting facts to kick things off:
Statista says Japan’s software industry accounted for sales of almost 16.7 trillion Japanese yen as of 2020.
What is Society 5.0?
Society 5.0 is a concept developed by the Japanese government that aims to create a human-centred society that incorporates the innovations of the fourth industrial revolution, such as the Internet of Things (IoT), big data, artificial intelligence (AI), robotics, and the sharing economy, into every industry and social life.
The term refers to the idea that Society 5.0 will follow Society 1.0 (hunter-gatherer), Society 2.0 (agricultural), Society 3.0 (industrialised), and Society 4.0 (information). (Unesco)
The Japanese government says Society 5.0 is a vision of a society in which cyberspace and the physical world are increasingly interconnected.
Society 5.0 is supposed to help in mitigating several challenges faced by Japan’s society, such as demographic ageing, labour shortages, and the depopulation of rural areas.
A number of technological developments factor into this, such as AI, the Internet of Things (IoT), and robotics.
Historical context
Japan's postwar economic model is often referred to as the "Japanese economic miracle" due to its rapid and sustained economic growth from 1945 to 1991. The Japanese economy was left in ruins after World War II, but it recovered at an incredible speed.
The Japanese government invested heavily in education and research & development, which helped to create a highly skilled workforce and foster technological innovation. It is now one of the leading nations in the fields of scientific research, technology, machinery and medical research.
Japan's large firms have played a significant role in the development of the country's startup ecosystem. Many have established venture capital funds and incubators to support startups, and they have also provided mentorship and other resources to help startups grow.
Japan's economy faces several challenges in the 21st century. One of the most significant challenges is demographic change, including an aging population and a low birth rate, which has led to a shrinking workforce and a strain on the social security system.
Japan's technology industry in 2023
Japan established the Digital Agency, which aims to coordinate the digital transformation effort across government departments and the private sector.
According to the 2022 IMD World Digital Competitiveness Ranking, Japan ranked 29th out of 64 countries examined in terms of know-how, development of digital technologies and their preparedness to exploit digital transformation.
Japan's public sector is notoriously stuck in the analogue age, with its endless paper-shuffling reliant on manual stamping.
Key players in Japan's technology industry
FANUC is one of the largest makers of industrial robots in the world, and it had its beginnings as part of Fujitsu developing early numerical control (NC) and servo systems.
Panasonic is a multinational electronics corporation that provides a wide range of products and services. The company is involved in various initiatives, such as the development of AI drug discovery technology using generative AI to predict structural changes in proteins. It's also expanding 5G networks to cover 90% of the population by 2023.
Toyota is one of the largest car manufacturers in the world, producing about 10 million vehicles a year.
Paidy is a Japanese deferred online payment service that offers a buy now, pay later service for online shops. I think PayPal acquired Paidy in 2021.
Preferred Networks is a Japanese startup focused on the research and development of deep learning for IoT applications. It has partnered with Toyota to develop autonomous driving technology.
Japan has the highest density of industrial robots in the world, with 631 robots per 10,000 workers in manufacturing as of 2021. This reflects Japan's focus on automation to address acute workforce shortages due to an aging population.
Challenges and opportunities
Competitors include:
China (automotive, electronics and tech)
the US (automotive, electronics and tech)
South Korea (electronics and tech)
Germany (automotive)
Taiwan (electronics).
What did I notice?
I saw many opportunities to adopt technology for more efficient payments. There’s a lot of cash flying around, and perhaps too many ways to pay for something other than the one you want to use. Wanting to use contactless seemed like an imposition.
These notes may help you understand the tech landscape in Japan a little better, as our actual podcast chat stuck by and large to anecdotal evidence. There's lots more to know about the country's road to a better society via technology, and I'll keep a close eye on this subject to see what learnings we could take here in Britain. I'm thinking many.
Until next time, stay safe, keep smiling and enjoy the details.