“A smart community is a community where various next-generation technologies and advanced social systems are effectively integrated and utilized, including the efficient use of energy, utilization of heat and unused energy sources, improvement of local transportation systems and transformation of the everyday lives of citizens.” - Japan Smart Community Alliance (JSCA)

The Japan Smart Cities Market is projected to expand at a CAGR of 13.1% during the forecast period 2022-2027. In terms of revenue, the market was valued at US$ 44,851.2 Mn in 2021 and is estimated to reach US$ 93,718.9 Mn by the end of 2027. The expression “Smart Community” is more widespread than “Smart City” in Japan. A smart city uses different types of electronic methods, voice activation methods and sensors to collect specific data. It includes data collected from citizens, devices, buildings, and assets which is processed and analyzed to monitor and manage traffic and transportation systems, power plants, utilities, water supply networks, waste, crime detection, information systems, schools, libraries, hospitals, and other community services.

The growing impetus of the market is attributed to rising need for public safety and communication infrastructure, increasing number of government initiatives & PPP models for smart cities, need of faster communication technology and increasing adoption of robotics in public services. Smart city technology has been widely adopted in recent years to improve public safety which can range from monitoring areas of high crime rates to improving emergency preparedness with sensors and many more. In May 2020, the Super City Law was enacted in Japan. This new law aims to improve the collaboration between the public and private sectors for the digital transformation of cities. Cities selected as Super Cities will deploy AI and big data in medical care, education, energy, crime prevention and transportation, including the development and use of autonomous vehicles. Further, Japan’s national vision for a data-driven, human-centric, next-generation society that uses AI, big data, and IoT is known as Society 5.0, which will provide appropriate solutions using such technology. Moreover, private companies in Japan are also propelling the market growth. For instance, Panasonic was one of the first companies that successfully built a smart city in Japan in Kanagawa Prefecture. Also, AI and IoT driven technologies are being used in smart cities to maintain a healthier environment, improve public transportation, and improve safety. In addition, increasing environmental concerns and demand for green initiatives are the emerging opportunities for market expansion. However, the privacy and security concerns over Internet of Things (IoT) is a restraint for market growth. 

Key Insights of the Report: 

• Latest study published by Astute Analytica analyzes the Japan Smart Cities Market for the study period of 2017-2027; where historical years are 2017-2020, base year is 2021 and forecast period is 2022-2027.
• The research report offers detailed study of market determinants including market drivers, restraints, opportunities, and trends; along with attractive presentation in the form of impact analysis to gain a simpler and easy comparison view of all market determinants.
• The research study is a compilation of 8 chapters distributed across 104 pages with 10 list of tables and 24 list of figures.
• The market is segmented based on component, applications, and city topography.
• The market estimates are presented in terms of value (US$ Mn).
• Along with market estimations, the market study was conducted on the basis of various economic models such as PESTLE and Porter’s five force models.
• A detailed value chain analysis of the industry was conducted. It includes component/technology providers, hardware manufacturers, system integrators/service providers, and end users.
• The Competitive dashboard section includes analysis on the basis of Concentration Ratio (CR), based on market size and market presence of key companies.

Key Takeaways from the Japan Smart Cities Market Report:

• Based on component, communication infrastructure segment holds the highest share in the Japan Smart Cities Market in 2021. However, the hardware component is estimated to dominate the market in 2027. Hardware components plays a significant role in smart homes and building solutions, as these components are mostly procured for security and surveillance purpose.
• In terms of applications, the utilities segment dominates the smart cities market of Japan in 2021 and is further estimated to continue its dominance over the projection period 2022-2027. However, the administration segment holds the highest compound annual growth rate over the forecast period.
• Based on city topography, the developed economies lead the Japan Smart Cities Market in 2021. Japanese population adds up to a total of 127.2 Mn inhabitants, of whom 117 million live in cities. Further, the existing segment holds the highest market share under the developing economies segment in 2021.

Impact of COVID-19

During the COVID-19 pandemic, the demand for smart city technologies slightly reduced in Japan due to the reduced spending by government and private companies in smart city development, which led to cutbacks in service infrastructure. Furthermore, strict lockdown due to Covid-19 led to the shutdown of manufacturing industry thereby disrupting the supply chains. This has created stress on the supplies of the several products and services offered by this industry. However, the adoption of smart cities is expected grow during the post pandemic times as regulatory authorities of Japan are majorly focused on monitoring the health, safety, and living standard of their citizens.

Competitive Landscape

The key players in the Japan Smart Cities Market are Thales Group, Nokia Corporation, Qualcomm Technologies Inc., Huawei Technologies Co Ltd., Chunghwa Telecom Company Ltd., CISCO Systems Inc., Verizon Communications Inc., Telstra Corp Ltd., and Telstra Corp Ltd. among others. Through extensive research, it is found that big players have adopted various competitive strategies such as merger & acquisition in order to have a grip in the stabilized market scenarios. Furthermore, leading companies are expanding their geographical boundaries by acquiring small brands and domestic companies. 

Segmentation Overview

The following are the various segments of the Japan Smart Cities Market:

By Component segment of the Japan Smart Cities Market is sub-segmented into:

• Communication Infrastructure (Telecom Network)
• Hardware
  • Camera
  • Sensors/Detectors
  • Meters
  • Vehicles
  • Smart Robots
  • Others
• Software
  • Cloud (IoT) Platform
    • Public
    • Private
  • Data Management & Analytics
  • Cyber Security
  • Remote Monitoring
• Services
  • Consulting
  • System Integration and Deployment
  • Support and Maintenance
  • Managed Services

By Application segment of the Japan Smart Cities Market is sub-segmented into:

• Administration (Smart Governance)
• Buildings
• Commercial (Enterprise)
• Construction
• Education
• Energy
• Environment
• Health
• Homes & Living
• Logistics
• Manufacturing
• Mobility (Transportation)
• Retail
• Safety & Security
• Utilities (Public services)
• Street Lighting
• Waste
• Water

 By City Topography segment of the Japan Smart Cities Market is sub-segmented into:

• Developed Economies
  • New
  • Existing
• Emerging Economies
  • New
  • Existing