cloud impact in japan - government carriers and vendors
TRANSCRIPT
May 6th
, 2013
Harry Takeichi
1
ATIE 2013
New Delhi
Cloud Impact in Japan
~ Government, Carriers and Vendors ~
2
Can Japan end ‘Lost Decades’?
ABENOMICS is making psychological upturn
J-Yen/1USD Rate
79 99
(Nov.13, 12) (Apr.24, 13)
NIKKEI Stock Average
8,661 13,766
(Nov.13, 12) (Apr.23, 13)
LT Interest Rate
0.73% 0.32%
(Nov.13, 12) (Apr.5, 13)
Fiscal: Big Gov’t Investment in infrastructure
( 2 Trillion USD for Resilient-Japan Project)
Monetary: BOJ targets 2% inflation by 2years
BOJ supplies double money to market
Growth: PM leads growth measures & deregulation
TPP, EPAs (EU, RCEP, China/Korea)
3
Economic Growth Scenario
Unprecedented Experiment
Kuroda, the Governor of BOJ explains 2%
(inflation) in 2years, 2 times of money supply.
Ends Deflation? Promote ICT Solutions for issues i.e. Energy,
Aging, Food and Environment
Government makes big public Investment
to social Infrastructure
ICT Deployment to
Social Infrastructure
Spending & Investment maybe stimulated…. but
Will competitive products & services emerge??
TPP, Japan-EU EPA
Japan/PRC/Korea
RCEP(ASEAN+6), TISA
- Drastic De-regulation?
- Lower Corporate Tax?
Government Task
Forces for Growth
4
Mikitani-Paper
~ New Japan KPI Proposal ~
Mr. Mikitani, president of Rakuten, proposes new national KPIs for
new business innovation by IT at the Council for Industrial
Competitiveness
Repeal ‘Face to Face’, ‘Written Document’ Rules WEF
‘ICT Regulation Ranking’ 42 10 or upper
New KPI
Internet/ICT ‘Autobahn’ Policy - Speed (Fixed/Mobile) - Autobahn=no speed limit/no fees
LTE 7.1M/s World Fastest
Almost Free (or Nationalized)
Cloud Service Expansion - Cloud Service % to Government IT spending
- Government Service Cost /GDP
25% by 2018
23.1% 20% or less
Encourage Engineers & Ventures in Number / Quality / Tax
-Number of IT engineers - Foreign IT Experts entry
with working visa/year - Start-ups ratio
0.9mil 2mil
2,85220,000
3.2% 10%
Present Target
5
Mikitani-Paper
~ New Japan KPI Proposal ~
Mr. Mikitani, president of Rakuten, proposes new national KPIs for
new business innovation by IT at the Council for Industrial
Competitiveness
Repeal ‘Face to Face’, ‘Written Document’ Rules WEF
‘ICT Regulation Ranking’ 42 10 or upper
New KPI
Internet/ICT ‘Autobahn’ Policy - Speed (Fixed/Mobile) - Autobahn=no speed limit/no fees
LTE 7.1M/s World Fastest
Almost Free (or Nationalized)
Cloud Service Expansion - Cloud Service % to Government IT spending
- Government Service Cost /GDP
25% by 2018
23.1% 20% or less
Encourage Engineers & Ventures in Number / Quality / Tax
-Number of IT engineers - Foreign IT Experts entry
with working visa/year - Start-ups ratio
0.9mil 2mil
2,85220,000
3.2% 10%
20.3%
20.3%
25.3%
21.2%
Government Service Cost /GDP
Designate 25%($20Bil) of government services to shift to cloud in 2011 By 2015, 50% of Central Government’s new IT spending must be shifted to cloud
Present Target Present Target
By 2015
11.1%
11.5%
Start-ups % (2008)
Telecom Operators make Good Profits,
Electronics Makers make Huge Losses
(15)
(10)
(5)
0
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10
15
20
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Profits of listed companies for Apr-Sep, 2011 vs 2012 (not including Power and Monetary industry)
2011 2Q 2012 2Q
US$ Billion
Manufacturing non-manufacturing
(Source: Nikkei)
7
Who is your rival?
~ Interviews with Carrier Tops ~
‘Customers’ as a fast-changing marketing target
‘Silicon Valley’ as a innovative group of synergy
‘Verizon Communications’ as a cloud servicer
8
Verizon Show at CES 2013
~No Phones There~
Running shoes that
Uploads runners data
without smartphone
Foot ball helmet that
uploads detailed data
of shock for players
so that a team can
monitors their health
Trash can in Allentown, PA, advises city
sanitation department of the suitable
timing to be emptied so that garbage
truck routes can be optimized Heads-up PC that makes
a worker`s both hands free
Plug-in On Board Diagnosis
(OBD) module that gathers
various car data so that
rental-car company monitors
for efficient maintenance
9
NTT DoCoMo keynote at MWC 2013
~ $11B revenue from New Business in 2015~
Mr. Kaoru Kato
(President, 2012- )
10
Why carriers move toward Cloud
1. Network Concept has changed.
Services are provided by Data Centers (not by network nodes)
IAAS
SAAS
DC
DC
DC
PAAS
Cache Server for popular video contents
2. Major OTT players own & operate dedicated DCs and backbone network, that
push telecom carriers down to access conduit and deprive their revenues.
Global WAN to connect own DCs
DC IX
IX
Peering with ISPs
ISP
ISP
ISP
Telecom Carrier Job Scope
DC
DC
11
NTT Invests to transform
themselves to a CLOUD Player
‘Be A Valued Partner of Inter-service’
Focuses ‘Global Cloud Services’ as its core business
Supports Business Model Innovation and Quality Life Style
Further expands Overseas business (US$20B revenue by 2017) Acquired
Mr. Satoshi Miura
(President, 2007-2012)
Mr. Hiroo Unoura
(President, 2012- )
‘Driving for Service Creation Group’
Focuses on Solution Services Creation
Expands Overseas Business (US$10B revenue by 2012)
Acquired
Acquisitions to be a Cloud Player
Ms. Meg Whitman
(President & CEO)
US$1.6Billion by HP
(2007)
US$13.9Billion by HP
(2008)
Mr. Glen F. Post
(CEO)
US$2.5Billion by Century Link (2011)
Mr. Lowell McAdam
(Chairman &CEO)
US$1.4Billion
by Verizon (2011)
US$0.445Billion
by Verizon (2007)
13
ICT Value Shifts Rapidly
Connecting A with B
Easy Access to Information
Search Information
Sharing Information
Mobile BB Internet
with intuitive UI smartphone
Utility IT Service (Public Cloud)
Convenient Shopping
Behavior / Preference Analysis & Target Marketing
Solution - Single Answer ( find my best one from crowdsourcing) - Intelligent Answer (avoid known failures)
Delightful Experience - Impossible to Possible - Unaffordable to Affordable - More Human-front Services (ICT-innovated analogue services) - High Social Value
Game Changer, Black-box
- Creation of Industry, Market, Social Structure - Users can be Servicers by sharing their own resources
14
Competition of Customer Experience
~ Retail Market in Japan~
Pleasure like mall window shopping
Logistics Centric
- minimum delivery time by its own huge warehouse
- Support purchase decision by personalized line-up
Active Tenants Centric
- Ultimate support to tenant shops
Pleasure to make the simplest shopping with the quickest delivery and long-tail line up.
Face to face interaction with real human clerks ease and pleases net- phobia customers
Human Service centric value
- Shop clerks’ face to face support service
- Internet order with pick-up / layaway at shop
- outsourcing for home kitchen/fridge & store
- Multi-purpose hybrid terminal
(ATM, Government Service, Entertainment tickets etc)
Cost and After-Sale Service Centric
- Networking local SMCs as decentralized warehouse
and sales-support resource
- Strong ASKUL’s B2B (wholesale and logistics)
- Yahoo’s attracting portal and auction
Pleasure to make the most economical shopping
Telecom Operators make Good Profits,
Electronics Makers make Huge Losses
(15)
(10)
(5)
0
5
10
15
20
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ile
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Text
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bu
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me
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Trad
ing
Tele
com
Serv
ice
Re
al E
stat
e
Ret
ail
Gas
Co
nst
ruct
ion
Lan
d T
ran
spo
rtat
ion
Mar
ine
Tra
nsp
ort
atio
n
Profits of listed companies for Apr-Sep, 2011 vs 2012 (not including Power and Monetary industry)
2011 2Q 2012 2Q
US$ Billion
Manufacturing non-manufacturing
(Source: Nikkei)
16
FY2011:1us$=80yen
FY2012:1us$=94yen
0
20
40
60
80
100
120
140
Revenue 2011 2012 (Forecast)
US$ Billion
-10
-8
-6
-4
-2
0
2
4
6
Net Profit / Loss 2011 2012 (Forecast)
US$ Billion
All-Rounder ICT Consumer Electronics
All-Rounder ICT Consumer Electronics
Japan Electronics - Financials
17
Panasonic
Net loss
2011 ($9,652M)
2012 Forecast ($9,562M)
Sharp
Net loss
2011 ($4,700M)
2012 Forecast ($5,625M)
1US$=80yen
Mr. Tsuga, president of Panasonic,
targets $20Billion automobile related
revenue in 2018. Assuming $70-80B
of total Panasonic revenue in 2018,
automobile and house related revenue is
expected to consists its majority.
Mr. Okuda, president of Sharp, tries to change its culture of
growth by one-strong-product. He aims to become a leading
hitter from being a slugger (home-run hitter).
2012 Financial Fiasco Drives Them to Different Places
Sony
Net loss Net Profit
2011 ($5,708M)
2012 Forecast $250M
Mr. Hirai, president of Sony, commits to revive original Sony DNA,
which product stimulates peoples curiosity and move users
emotionally.
Marketing Real Value oriented Differentiate from competitors Statistic Analysis of Point of Use (Big Data) Co-creation with partners
Software Developer / Systems Integrator Vendors deliver service Deliver complete software No more huge scale effort basis contract Vendor continue to develop while it is on service (No
user requirements. Nobody knows final specification) Mashup and Customization service business will grow
18
Tough Paradigms for Vendors
Servers / Storages 20% of servers sold world-wide is
bought by design servers and manufacture them by ODM Low power consumption is a key ARM processor server Intel, SSD (Flash memory drive) HHD
Network Platforms Generic LSI Customized LSI make 10GPS
OpenFlow switch by themselves
Data Centers Standardize specs of DC => DC as commodity DCs Interworking and service
orchestration is key technology Scale-out Scale up ( 15,000 servers/ 1 operator)
DC
DC
DC
PAAS SAAS
IAAS
Terminals Voice I/F on all things Terminals For illiteracy (48% of Indian people )
Conclusions
- Government: - Regulation reform for
new business emergence &
government cost reduction
- Telecom: - Cloud-infra (DC/Platform) Provider
Total Application Servicer
- Service: - Social value oriented
- Human-oriented service
- ICT Vendors: - Tough time for restructuring ….
- Higher Technology Service Value
- Seeking for new value by
vertical integration
