No.2378
02/21/2020

IT Market for Social Infrastructure in Japan: Key Research Findings 2019

Yano Research Institute (the President, Takashi Mizukoshi) has conducted a survey on the domestic IT market for social infrastructure and has found out the market size, trend by segment, trend of bidding and technologies, and future perspectives.


Transition and Forecast of IT Market Size for Social Infrastructure
Transition and Forecast of IT Market Size for Social Infrastructure

Market Overview

The research was carried out on IT business in the following eight segments of social infrastructure management: 1) Roads, 2) Railways, 3) Airports, 4) Ports, 5) Rivers, 6) Dams, 7) Water-related (water & sewage, purification plants, and effluent treatment), and 8) Disaster prevention/firefighting/police. The market size for FY2018 reached 608,000 million yen, based on the prices for the orders placed by the infrastructure operators.

The market size for FY2018 turned for the better to rise by 1.2% from FY2017 (in which it declined by 2.9%), and remained the level of 600,000 million yen. When observing the size by segment, IT business for disaster prevention/firefighting/police increased, together with large-scale IT business for roads as well as for railways keeping their stable growth. Although IT business for water-related and airports declined, that for social infrastructure as a whole have turned for the better. For FY2019, with IT business for disaster prevention/firefighting/police likely to continue being steady, the overall IT business for social infrastructure is projected to grow by 1.0% to attain 614,000 million yen.

Noteworthy Topics

Perspectives of IT Solutions for Social Infrastructure

IT solutions for social infrastructure in this research are defined as IoT services (services using cloud), AI services, AR/VR services, and drone-used services that are provided by IT vendors, among all the IT business for social infrastructure. Social infrastructure management by IT has currently been carried out by the existing (legacy) systems. The size of IT solutions for social infrastructure, the services that newly support the worksite by using the above-mentioned new technologies, is likely to be only around 5,000 million yen, less than 1% of the entire IT market for social infrastructure. 

While the IT market for social infrastructure is likely to grow steadily, the market segment may fluctuate hereafter: Legacy systems for social infrastructure are projected to be replaced by new technologies such as IoT, AI, AR/VR, and drones, which are expected to enter on the implementation phase. IT solutions for social infrastructure are projected to start being widely accepted by 2024.

Future Outlook

IT investment in social infrastructure (i.e., highways, arterial roads, railways, airports, etc.) in Tokyo metropolitan areas has somewhat subdued, as the Rugby World Cup ended and Olympic/Paralympic imminent. On the other hand, not a few areas can expect investment in social infrastructure such as Kinki area, preparing for EXPO 2025 OSAKA, and JR Tokai areas waiting for Linear Chuo Shinkansen Line to start operating.

While public investment is likely to decline hereafter, investment in IT for social infrastructure is expected to maintain the existing pace, or to decline slightly, bringing about the domestic IT market for social infrastructure for FY2024 to be 602,000 million yen, based on the prices for the orders placed by the infrastructure operators. By the way, by around FY2024, IT solution business is likely to be fully launched to form the market with the size reaching some tens of billions.

Research Outline

1.Research Period: June 2019 to January 2020
2.Research Object: Public offices (MLIT, METI, MIC and etc.,) local governments, public institutions (AIST, PWRI, NILIM, other industrial organizations,) providers of IT solutions/SIers, telecommunication carriers, construction businesses, heavy electric machinery manufacturers, construction consultants, etc.
3.Research Methogology: Special literature research by the experts, face-to-face interviews, surveys via telephone, and general literature research

IT Market for Social Infrastructure

The IT market for social infrastructure in this research refers to the IT business introduced for the management of the following eight segments of social infrastructure: 1) Roads (including traffic control), 2) Railways, 3) Airports, 4) Ports, 5) Rivers (river management, control of soil erosion), 6) Dams, 7) Water (water & sewage, purification plants, and effluent treatment), and 8) Disaster prevention/firefighting/police. The market size includes hardware, software, engineering works (electric installation, communication equipment), SI, consulting, network usage fees, service support, maintenance support, and dispatching of personnel, which are calculated based on the prices for the orders placed by the infrastructure operators (i.e., the government, local governments, highway businesses, railway businesses, etc.)


IT Solutions for Social Infrastructure
IT solutions for social infrastructure in this research refer to IoT services (services using cloud), AI services, AR/VR services, and services using drones that are provided by IT vendors, among all the IT business for social infrastructure. Therefore, the IT solutions market for social infrastructure is included in the IT market for social infrastructure.

<Products and Services in the Market>

IT Market for social infrastructure, IT solutions for social infrastructure

Published Report

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