NTT Touts ‘Smart City’ Project in Bid to Take on Tech Giants
12:05 JST, December 18, 2020
This is the final installment of a series examining the businesses and future prospects of telecommunications giant NTT Corp.
Since 2018, NTT Group has been developing a “smart city” platform in Las Vegas, a city famous for its casinos and entertainment.
Utilizing advanced technologies, smart cities have been pitched as a next-generation concept to solve social problems.
The NTT system can detect and predict vehicle and pedestrian traffic and listen out for unusual noises using cameras and acoustic sensors placed around the popular tourist city.
In the event of an emergency, the police and fire department are alerted immediately.
Where, for example, vehicles had often been detected traveling in the opposite direction of ordinary traffic, a local authority installed road signs to display messages to warn drivers. Such measures have been effective in reducing accidents.
NTT Corp. President Jun Sawada visited the city in April 2018 when he was vice president to show off the group’s technology to about 10 city executives.
His declaration that “The data we collect belongs to the city” was said to be the deciding factor in winning the contract.
Tech giants such as Google and Facebook have come under fire for locking in personal and social data, while some countries, such as China, have taken a state-led approach to data management.
NTT’s contrasting approach to data helped them win the trust of the city’s executives.
“Other companies wanted the data. NTT was the only company that proposed offering the data to the city,” a city executive said.
NTT’s research facility in Musashino, Tokyo, is conducting research and development for a concept it has dubbed Innovative Optical and Wireless Network (IOWN), next-generation communications standards.
The goal is not only to achieve communications that are much faster than the high-speed, high-capacity 5G standard, it is also an ambitious attempt to reduce the burden on the global environment by achieving energy efficiency and finding a solution to the rapid surge in power consumption that typically accompanies drastic increases in data volume.
The company is hoping to roll out the technology in the 2030s.
Japanese companies have been slow in developing and commercializing 5G. Sawada thinks IOWN will be a “game-changer.”
Since the late 1990s, NTT group has largely failed in its efforts to expand overseas.
Internet Initiative Japan Inc. Chairman Koichi Suzuki, who launched Japan’s first commercial internet services, said “Japanese companies are used to doing business in the small Japanese market.”
“NTT has always been strong in technological development but poor in business,” said Shinji Moriyuki, a senior analyst of SBI Securities Co. Ltd.
However, he said things have started to change. “They’ve realized that it’s difficult to compete on their own, and they’ve begun to collaborate with companies with stronger sales capabilities.”
In March, NTT announced a capital and business tie-up with Toyota Motor Corp. The two companies will jointly promote Toyota’s smart city concept, Woven City, in Susono, Shizuoka Prefecture.
Toyota President Akio Toyoda first visited Sawada after the unveiling of the smart city system in Las Vegas in January. “NTT, which plays a fundamental role in society, would be a major artery if it were part of the human body.”
NEC President Takashi Niino, who announced a partnership in June, said, “By joining forces, the two companies would be able to help strengthen Japan’s industrial competitiveness and secure the safety of its telecommunications infrastructure.”
As well as NEC, Intel Corp., Microsoft Corp. and Sony Corp are also involved in the IOWN initiative.
Sawada said NTT made NTT Docomo Inc. a wholly-owned subsidiary because of a “sense of crisis over the emergence of strong overseas companies such as GAFA [Google, Amazon, Facebook and Apple].”
Such tech giants are generally regarded as IT services company, but they have expanded into telecommunications, such as submarine cables, and are now competing with NTT in core fields.
The coronavirus pandemic has reaffirmed the need for technology that enables people to communicate remotely.
The importance of the technology will increase even after the virus is contained.
The major challenge for NTT Group will be whether it can increase its presence in the world with the technology it is developing.
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