Let’s Learn Easily About Japanese IT Industry Structure!

Japan’s manufacturing technology is well known in the world, but how much do you know about the Japanese IT industry? In this article, for foreigners who are interested in the Japanese IT industry, we would like to explain the structure of the Japanese IT industry with well-known companies in each field making it easy-to-understand.

Basic Information about Japanese IT Industry

Before classifying the IT industry, we would like to explain some basic information about the Japanese IT market.

Market Size of Japanese IT Industry(2019): 12,493 billion yen
Reference: Forecasting calculation conducted by Yano Research Institute Ltd

Growth rate of Japanese IT Industry: 2018 increased 2.8%、2019 increased 3.4%、2020 increased 1.6%
Reference: Forecasting calculation conducted by Yano Research Institute Ltd

Areas where IT Investment will increase in the next 3 years in Japan: No.1 ERP, No.2 Security-related Software, No.3 SFA (SalesForce Automation)
Reference: Questionnaire survey for corporates conducted by Yano Research Institute Ltd

Number of IT engineers in the World and Japan: Japan ranks 4th in the world with an approx of 1.09 million engineers
※1st USA with 4.77 million, 2nd China with 2.72 million, 3rd India with 2.12 million engineers.
Reference:
Human Resocia/Number of IT engineers around the world (North & South America)
Human Resocia/Number of IT engineers around the world (Asia & Oceania)

Details are summarized in this article, so please have a look when you have some time.

Japanese IT Industry Market Size Compared to the World

Japanese IT Industry Structure

From now on, we would like to explain the structure of the Japanese IT industry.

The Japanese IT industry is generally divided into the 4 categories below.

  • Internet/Web Industry
  • Information Processing/Information and Communication Service Industry
  • Software Industry
  • Hardware Industry

Now, we would like to explain about these four industries with their representative companies.

Internet / Web Industry

The Internet / WEB industry includes B2B companies that provide services for companies such as network construction, website production, Internet advertising, and B2C companies that provide services for individuals such as SNS, portal sites, and EC.

We are going to explain below the 5 types of services in this industry.

Web Portal

The web portal serves as an entrance to the Internet and is a multi-purpose website that has varied services and useful pages for users such as obtaining online information, news, auctions, and shopping.

    Well-known Companies

  • Google
  • Yahoo!JAPAN, etc

SNS

SNS (Social Networking Service) is a service that allows you to build relationships and share information over the Internet. It is one of the typical services that has expanded with the spread of smartphones.

    Well-known Companies

  • Facebook
  • LINE
  • LinkedIn, etc

E-Commerce

E-Commerce, also known as electronic commerce or internet commerce, is a service which allows you to shop online. Some representative e-commerce services easily to recognize are the web sites we use while online shopping, but e-commerce is more than “online shopping”. In addition to business-to-consumer transactions, it also includes business-to-business transactions, customer-to-customer transactions such as auctions and flea market sites.

    Well-known Companies

  • Amazon
  • Rakuten
  • Mercari, etc

Web Ads

All services that provide agencies and systems that handle advertising on the Internet belongs to the WEB advertising industry. There are many types of ads, such as “listing ads”, “ad network ads”, “SNS ads”, “article ads”, “banner ads”, etc.

    Well-known Companies

  • Cyber Agent
  • OPT
  • Adways, etc

Curation site

A curation site is a site that collects the necessary information and puts it together in an easy-to-read manner.

    Well-known Companies

  • Gunosy
  • Smart News, etc

Information Processing / Information and Communication Service Industry

Information Processing Industry

A company of information processing services is responsible for the development and operation of information systems in a company and services used on the cloud, which is generally called “System Integrator (SIer)”.

SIer receives an order from a customer, hears the customer’s needs, considers how to realize those needs as an information system, and outsources the system development and operation to cooperative enterprises. Also, there are cases when the SIer should advice client companies on how to use IT to do a better performance, working as a consultant too.

    Well-known Companies

  • Fujitsu
  • NTTData
  • SCSK, etc

Information and Communication Service Industry

This industry is divided into two categories, “fixed communication” and, “mobile communication services”.
Fixed communication is a communication service in fixed environments such as fixed-line phones, IP phones, and public phones.
Mobile communication means a communication service represented by mobile phones.

    Well-known Companies

  • NTT
  • KDDI
  • Soft Bank, etc

Software Industry

This industry is to develop ​​a software such as application software and operating system. And also engineers can also play an active role with wide range in the industry from the software package to the system construction that manages the infrastructure.

    Well-known Companies

  • Oracle Japan
  • Microsoft
  • Cybozu, etc

Hardware Industry

Hardware means “machine, device, equipment”. This refers to physical objects such as electronic circuits and peripheral equipment that make up a computer, such as servers, storage, and mobile phones.

    Well-known Companies

  • Apple
  • NEC
  • Sony, etc

Conclusion

In this article, we explained the main structure of the IT industry in Japan, but in the next article, we would like to explain the occupations in the IT industry in Japan.

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