Japan AI Market

Around the world, Artificial Intelligence is constantly expanding, as it finds its way into different areas like security, manufacturing, marketing, healthcare, education, agriculture and infrastructure. This article looks at the state of AI in Japan and how foreign investors can break into the market.

Technological progress in Japan has been made possible through studies produced by research centres like AIST (the National Institute of Advanced Industrial Science and Technology) and RIKEN, Japan’s largest comprehensive research institution, where different projects relating to Artificial Intelligence in Japan are regularly carried out.

Japan’s AI Sector has been mainly focused on robotics as sub-domains of artificial intelligence, developing AI especially in the areas of technology for medical and industrial purposes. Using machine-intelligence and human-thinking abilities, Artificial Intelligence is a technology that can process various data to make predictions, recommendations, and decisions.

While the AI market in Japan has been focusing on robotics, overseas companies have concentrated more on software development, an area of opportunity for overseas businesses looking to enter the AI market in Japan.

What are the challenges faced by AI developers in Japan?

The latest trends of Japan AI Market are moving towards the production of self-driving cars, drones, smart cities and factories, besides continuing the development of AI oriented to the service industries, including healthcare and long-term care services.

Smart Cities have appeared as one of the most ambitious projects in the AI market in Japan. The development of Smart Cities responds to a growing concern about environmental issues and the creation of local solutions for energy management. The Japanese Ministry of Economy, Trade and Industry (METI) has been investing in the increasing numbers of Smart City projects since 2010, and independently subsidised projects have emerged too, increasing the research in the field of renewable energies and sustainable lifestyle solutions. 

The construction of Smart Cities represents a business opportunity for European companies that are expert in power transmission technology and data management, which are areas that have not been exploited in Japan’s AI Sector. 

Japan’s AI-powered robots during Covid-19

Due to Covid-19, the AI market in Japan has provided several technological solutions for remote access, automation, and social distancing. To contribute to social distancing requirements, use of e-payment and video analytics services incorporating AI have increased. Additionally, remote working has given rise to the need for digitisation solutions, including e-document management and IoT systems where connected sensors are automatically able to gather and analyse business data.

In the healthcare industry, for instance, teleconsulting and virtual consultations have become increasingly popular as many people find it preferable to stay home rather than going out to visit a doctor. Furthermore, AI is also providing alternatives for the reduction of manual labour. In this area, robots which can replace human work, are being implemented across many business areas such as manufacturing, retail, hospitality and healthcare.  

European Companies Developing AI Technologies

Now is a good time to consider cooperation between Japanese and European companies, making the most of the respective strengths. European AI companies that have developed deep learning algorithms could contribute to the Japanese automotive and video game industries, providing software solutions that have not yet been explored within Japan’s AI market.

There is also a trend towards software platforms becoming open-sourced since multi-party collaborations can research and utilise AI more efficiently than working alone. This will bring about further contribution opportunities between European and Japanese AI companies in areas such as automated driving technology, marketing, information services, security, and image recognition.

For these reasons, European companies developing AI technologies can provide attractive solutions within these fields in Japan. Setting up partnerships with local industry players can represent a positive step forward.