NRI Papers
No.73   February 1, 2004
  Japan's IT Market: Racing Towards the Second Phase of Growth  
Masahiro KAJINO, Takafumi KINOSHITA and Takashi KOBAYASHI
       Japan's IT (information technology) market as a whole is expected to expand at an annual average rate of 15.6 percent up to 2008. As the trend towards increased IP (Internet Protocol) utilization is rapidly surging throughout the overall IT market, 2003 will be a year that will mark a clear distinction between expanding and declining market segments.
       The communications segment, which has so far been the driving force behind IT market expansion, will reach maturity through accelerated rate reductions for communications infrastructural services stemming from the impact of IP-focused moves. On the other hand, a relatively high growth rate can be expected for the e-business and digital contents segments, which can be classified as so-called upper-layer businesses. Indeed, e-business will replace communications as the largest IT market segment by 2008.
       The keys to success in the IT market have become clear. "Securing access lines" and "Becoming a major contractor through a deep relationship with the customer" will become the important elements in order to achieve success in a market that is moving towards maturity.
       The role of the platform segment is extremely important in the IT market. It is no exaggeration to say that success or failure in starting platform businesses will likely impact the growth of such upper-layer businesses as the e-business and digital contents segments. However, there are many cases that will require the continued input of management resources over a long period of time in order to achieve success in the platform business area. Accordingly, it is necessary to develop a perspective on what effects can be expected by combining platform businesses and company activities at other business layers, rather than evaluating the platform business alone.
Contents
I E-Business and Digital Contents as the Driving Force in the IT Market
  1 The IT Market Continues to Expand in the Future
  2 Surging IP Usage
  3 E-business Becoming the Market Driving Force
  4 The IT Market--Where Dynamic Growth Coexists with Lethargy
  5 Competitive Domains Becoming Borderless
II Keys to Success in the IT Market
  1 Securing Access Lines
  2 Importance of Customer Contact and Development of Primary Contractor Relationship
  3 Concentrated Input of Resources Needed to Acquire Market Share
  4 Return From General Purpose to Dedicated Usage
  5 Incorporating Platform Functions
III IT Market Trends by Business Layer and the Importance of the Platform Segment
  1 Communications Segment Entering Maturity Phase
  2 Broadcasting Market Promoting Multi-Channel Capabilities and Digitization
  3 Platform Market Showing Increased Presence
  4 E-Business Market Assuming Role of Driving Force in Future IT Market
  5 Digital Contents Market for Mobile Services Taking the Lead

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