ICT Industry in Japan: General Profile and Insights

The Information and Communications Technology (ICT) industry in Japan is touted to be the top industry in the country. In 2018 this sector was worth USD 2.2 trillion. The Japanese government aims to take this number to 3.4 trillion by 2025.

In fact, with the government steadily coming up with innovative ideas and efforts to significantly impact and contribute on a global scale, the industry is expected to exceptionally boom in the upcoming years. Both the public and the private sectors are aware of the importance of the latest, most innovative ICT solutions to advance the economy and are taking steps towards this. Hence, this sector holds immense business potential.

Why working with Japanese IT companies

Based on the country data of Japan, there are various opportunities in the ICT Sector. Firstly, the country ranks 3rd as the biggest market with average revenue per user in Asia. This means that local IT companies from Japan have adopted a mixed business model, and adjusted it under both local and international IT market requirements. Shortly, Japanese IT companies approach international and local clients differently keeping the longstanding business tradition but at the same time offering high-quality services and digital products to foreign markets under the rules of Western business style. 

What to be aware of when working with Japanese IT companies

Since tech giants established business connections in Japan, local IT companies faced the need of changing and adjusting their approach to international requirements, ending the era of a “closed market”. This has brought both benefits and challenges for Japanese IT companies and web and software providers. 

The biggest challenge still remains the human resources for IT companies, since the legislation does not allow outsourcing professionals from other countries and rely only on native talents. Taking into consideration the demographics and the continuously ageing population, fewer young professionals are enrolled in the IT sector, which automatically means less flexibility and capacity to adopt new technologies and implement them into local digital business environments. 

How reliable are Japanese IT companies

Japan has built a reputation for its highly skilled professionals and trustworthy country, especially after WWII, when the US invested and developed under its umbrella the Japanese business environment. The Japanese IT companies, web and software agencies take full advantage of this position by promoting their services and digital products on the international market. 

How does the Japanese IT industry relate to the neighboring countries

Japan has probably the most developed IT industry in the region and a proven high potential for providing the entire spectrum of ICT services at the highest quality. Nonetheless, South Korea and China are coming close to the 2nd and respectively 3rd position in terms of IT industry and infrastructure development.