Report

PSA IT Services / Application Software: Spending on Business Services in Japan Looks Set to Continue to Grow Rapidly

In this review on Japan’s spending on business software, Pelham Smithers notes how small it is as a percent of GDP. This trend is likely to change with sharp growth expected ahead.
Underlyings
Hitachi Ltd.

Hitachi and its subsidiaries are engaged in the development, manufacture and sale of diversified product mix ranging from electricity generation systems to consumer products and electronic devices. Co.'s businesses are diverse, and include information and telecommunication systems, social infrastructure and industrial systems, electronic systems and equipment, construction machinery, high functional materials and components, automotive systems, life & eco systems, financial services, and others including logistics services, optical disk drive, as well as real estate business.

Internet Initiative Japan

Internet Initiative Japan is engaged in the provision of a comprehensive range of Internet connectivity services, WAN services, outsourcing services, systems integration and equipment sales to Co.'s customers mainly in Japan. Co.'s principal services are full-spec IP service, closed-network services, security-related outsourcing services, web server hosting and e-mail security service, as well as systems construction and systems operation and maintenance. Co., through its subsidiary, is engaged in the operation of ATMs and its network systems and receives a commission for each bank withdrawal transaction when a customer uses its serviced ATMs. As of March 31, 2018, Co. has 1,096 ATMs.

PKSHA Technology Inc.

PKSHA Technology Inc is a Japan-based company mainly engaged in algorithmic license business. The Company operates through two business segments. The Cloud Intelligence segment is engaged in the sale of algorithm modules, and algorithm software BEDORE and CELLOR in the area of intelligent processing in the digital space. The Mobility & MaaS segment is engaged in the sale of algorithm modules related to image/video analysis and sales of algorithm software Hrus in the area of intelligent operation of real space for smart city. The algorithm modules include text understanding modules, dialogue modules, image/video analysis modules, recommendation modules, prediction modules, anomaly detection modules, and reinforcement learning modules.

Sakura Internet

Sakura Internet is mainly engaged in the internet services. Co. operates in three business segments. Data Center Operation segment provides housing services, specialty server services, rental server services, Internet connection services, as well as domain services, equipment sale and server construction consulting services, maintenance services, secure sockets layer (SSL) services and net news services. Content Distribution segment introduces and operates online games, as well as provides video contents. System Solution segment develops Web systems, as well as constructs systems engineering service system and application service provider (ASP) solution service systems.

Provider
Pelham Smithers Associates Ltd
Pelham Smithers Associates Ltd

Founded in 2009, Pelham Smithers Associates (PSA) provides market intelligence on Asian technology, focusing in particular on Japan. The industries covered by our team of specialists are: consumer electronics, telecomms, pharmaceuticals, internet, electronic parts and materials, automotive technology, retail and capital goods. 

PSA produces both company and sector reports. The focus of PSA’s research is to identify winners and losers as new technologies impact the top and bottom lines of corporations. Critical to our research is the clear explanation of how these new technologies work and how they impact companies and industries. 

The founding partners have worked closely together for twenty years and the team has more than doubled in size since 2012. 

Analysts
Pelham Smithers

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