Japanese companies are grappling with the transition to the Internet of Things (IoT), a concept that connects everyday objects to the internet, enabling them to send and receive data. Despite their technological prowess, Japan’s firms are struggling to adapt. The issue arises from the country’s approach to manufacturing, which is traditionally hardware-focused. The IoT requires a shift to software and data analysis, a transition that Japanese companies find challenging.

Fujitsu, a leading tech firm, has had to cut thousands of jobs in its hardware divisions, shifting its focus to software and services. Similarly, Panasonic is also moving away from hardware, investing in software and data analysis for its IoT products. Despite these efforts, Japanese firms lag behind their American counterparts like Google and Amazon, who have been quick to seize the IoT opportunity.

The Japanese government recognises the struggle and has launched a programme to support the transition, aiming to double the country’s IoT market to ¥30 trillion (£210bn) by 2020. Despite the challenges, there is a sense of optimism. Many believe that Japan’s manufacturing expertise, combined with its technological capabilities, could eventually give it an edge in the IoT market.

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