Japan: Tablet Computing Market
Japan: Tablet Computing Market Japan: Tablet Computing Market Page 1 of 6
Rika Saito July 11, 2011
Summary The recent explosive growth in popularity for tablet computing devices in Japan shows these devices are attracting more and more interest in both Japan’s business and consumer markets. Although the penetration rate for tablet devices within the overall mobile device segment in Japan is still relatively low, unit sales in 2011 reached 1.42 million units, nearly triple the number sold the previous year. Some local industry researchers are even predicting tablet devices will totally replace notebook computers in Japan by 2015. There is also increasing demand for tablet devices within the Japanese e-book market. For U.S. firms interested in the Japanese tablet device market, market-proven entertainment, education and business applications for such devices are in particularly high demand.
Market Demand According to the market research firm IDC Japan, tablet device shipments in Japan totaled 500,000 units in 2010 but are expected to increase to 1.42 million units (see chart 1) in 2011, a nearly threefold increase in just one year. The Japanese mobile device market is led by smartphone devices but tablet devices are attracting ever increasing industry attention. The market share for tablet devices is still relatively small within the Japan mobile device market; however, if a greater variety of attractive tablet applications and models become available, this would provide an impetus for the growth of the overall tablet device market in Japan. About 80 percent of current Japanese tablet users are consumers, according to a November 2010 survey conducted by the Mobile Computing Promotion Council in Japan. The rise of the mobile device market, including tablet devices, is also driving growth in Japan’s e-book market. Impress R&D, a local research company, estimates that the e-book market in Japan grew 13.2 percent to 65 billion yen ($813 million USD) in fiscal 2010 and is expected to really begin taking off after fiscal 2013 as more content becomes available and standardization of distribution platforms progresses. This market is projected to expand further to 200 billion yen ($2.5 billion USD) in fiscal 2015 (see Chart 2 in the following section). Online sites offering e-book downloads are springing up to service the growing number of people who own smartphone and tablet devices. Several leading traditional Japanese publishing companies are also digitizing all their new book title releases. In fiscal 2010, nearly 90 percent of Japan's e-book market consisted of comics and other content delivered to standard cell phones, while content for smartphone and tablet devices accounted for less than 4 percent of the market. By fiscal 2015, however, the content for smartphone and tablet devices is expected to comprise 80 percent of the market. Major traditional publishers are losing money from existing business models. A total of 189 magazines were discontinued by major publishers in Japan during 2009, the second worst year in history for this sector. Factors behind this decline included the recent rise of companies like Amazon (which started in Japan in 2000) and Rakuten whose home delivery of publications ordered online poses a threat to traditional book stores. Traditional publishers are therefore now trying to exploit new revenue sources in digital publishing. (Note: Exchange rate used in this section:80 yen/1 US dollar)
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Japan: Tablet Computing Market Page 2 of 6
Market Data Chart1. Mobile Device Market in Japan
Chart 2.E-book market in Japan
Source: Impress R&D
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Japan: Tablet Computing Market Page 3 of 6
Best Prospects For U.S. firms interested in the Japanese tablet device market, market-proven applications for entertainment, education, and business are in high demand. Demand is high not only for such applications, but also for new business models that employ tablet devices. Regarding platforms for tablet devices, Microsoft, RIM, HP and others are struggling for supremacy in the smartphone and tablet device markets, but as with smartphones, Apple and Google are currently leading the market for tablet platforms (see Chart 3 below). As the number of tablet business users increases, however, the demand for the Windows platform is expected to increase. Japan’s mobile phone household penetration rate totaled over 90 percent in 2008 according to the Japanese Government so Japan is a good market for devices and device applications that enable computing formerly done at the office on desktop computers to be done anywhere on mobile devices such as tablets.
Chart 3. Tablet PC OS Share in Japan
Source: Bilcom, January 2011 Survey.
Key Suppliers Many foreign suppliers are currently leading players in the Japanese tablet device market, but leading Japanese laptop suppliers like NEC, Fujitsu, and Toshiba are following suit and have recently released their own tablet devices. Category Android Tablet
Model Optimus Pad
Supplier NTT Docomo/LG
Apple Tablet
Motorola XOOM Galaxy Tab DELL Streak iPad
au KDDI/ MOTOROLA NTT Docomo/ Samsung Softbank Mobile/ DELL Apple/Softbank
The U.S. Commercial Service – Your Global Business Partner.
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Japan: Tablet Computing Market Page 4 of 6 Windows Tablet
eBook reader
N/A in Japan
Eee Slate ICONIA Tab TW 317 Kindle
ASUS Acer ONKYO Amazon
Reader Galapagos Playbook Touchpad
Sony Sharp RIM HP
Prospective Buyers As discussed in the sections above, the major user segment for tablet devices in Japan is currently consumers. For U.S. firms interested in the Japan tablet device market, market-proven applications for entertainment such as gaming or social networking are currently in high demand. Tablet use in the Japanese business segment is currently not so common but is expected to increase in the future. Enterprises are therefore also prospective tablet buyers since thin and light tablet devices are more portable than current laptop models. Additionally, the digital text market for the education sector offers other potential opportunities. In December 2011, the former Japanese Minister for Internal Affairs and Communications, Mr. Kazuhiro Haraguchi, endorsed the digitalization of Japanese school textbooks by 2015 in his so-called ‘Haraguchi Vision’, included as part of the Japanese government's new economic growth strategy.
Market Entry There are three key elements to launching mobile device applications into the Japanese market: (1) localization — localization includes Japanese translation, testing, and customization. Application suppliers are required to provide not only translations but to consider Japanese business customs and culture to meet local client needs; (2) support capability - Japanese language support is mandatory; and (3) product quality — quality control is one of the most important considerations for Japanese users. Many American exporters use agents or distributors to pursue business in the Japanese market. However, finding prospective partners takes a long time. Japanese firms are always seeking new technologies from the United States but building long term relationships and trust are key factors to opening a partnership in Japan. Prospective exporters to Japan should be aware that competition is strong and that buyers expect a high level of after sales support. It is also important for U.S. companies to regularly visit their representatives in Japan and maintain a good relationship with them.
Market Issues & Obstacles There are no significant regulatory issues for this market. The current low level of tablet device awareness among potential Japanese corporate customers, however, is a factor hindering potential growth in the Japanese tablet device market. Expected increases in the number of tablet device application stores and/or marketplaces and the provision of new services such as integration services for tablet platforms and programs should increase the level of tablet awareness among Japanese business users. The recent emergence of cloud computing services may provide further impetus to the use of mobile devices such as tablets, but at the same time, security concerns should also be considered. Tablet usage overlaps that of smartphones, and the relatively high price for tablets ($500 versus $300 for the average smartphone) may hinder the expansion of tablets into certain sectors such as education.
The U.S. Commercial Service – Your Global Business Partner.
export.gov 800-USA-TRADE
Japan: Tablet Computing Market Page 5 of 6
Trade Events Smartphone & Tablet 2011 Fall Date: October 12-14, 2011 Venue: Tokyo Big Sight Exhibition Website: http://expo.nikkeibp.co.jp/sma/ (Japanese Only) eBooks 2012 Date: July 5-7, 2012 Venue: Tokyo Big Sight English website for the event: http://www.ebooks-expo.jp/en/Home/
Resources & Contacts Impress The core business of the Impress group is digital publishing and IT research. http://www.impressholdings.com/info/index.htm Mobile Computing Promotion Consortium (MCPC) Established in 1997, MCPC was organized to promote the mobile computing business and foster cross-industry relationships among mobile service operators, computer hardware/software suppliers, systems integrators, and related media. http://www.mcpc-jp.org/index_e.htm Japan External Trade Organization (JETRO) JETRO is an independent administrative agency that provides information and support to foreign companies entering the Japanese market. The organization has six offices in the United States. http://www.jetro.org Industry Associations Japan Electronic Publishing Association (JEPA) http://www.jepa.or.jp/ (Japanese only site) The Electronic Book Publishers Association of Japan (EBPAJ) http://www.ebpaj.jp/ (Japanese only site) Digital Textbook and Teaching (DiTT) http://ditt.jp/ (Japanese only site)
For More Information The U.S. Commercial Service in Tokyo, Japan can be contacted via e-mail at: [email protected]; Phone: +81 3 3224 5060; Fax: +81 3 3589 4235; or visit our website: http://export.gov/japan/
The U.S. Commercial Service — Your Global Business Partner With its network of offices across the United States and in more than 80 countries, the U.S. Commercial Service of the U.S. Department of Commerce utilizes its global presence and international marketing expertise to help U.S. companies sell their products and services worldwide. Locate the U.S. Commercial Service trade specialist in the U.S. nearest you by visiting http://www.export.gov/eac.
The U.S. Commercial Service – Your Global Business Partner.
export.gov 800-USA-TRADE
Japan: Tablet Computing Market Page 6 of 6 Comments and Suggestions: We welcome your comments and suggestions regarding this market research. You can e-mail us your comments/suggestions to: [email protected]. Please include the name of the applicable market research in your e-mail. We greatly appreciate your feedback. Disclaimer: The information provided in this report is intended to be of assistance to U.S. exporters. While we make every effort to ensure its accuracy, neither the United States government nor any of its employees make any representation as to the accuracy or completeness of information in this or any other United States government document. Readers are advised to independently verify any information prior to reliance thereon. The information provided in this report does not constitute legal advice. International copyright, U.S. Department of Commerce, 2011. All rights reserved outside of the United States.
The U.S. Commercial Service – Your Global Business Partner.
export.gov 800-USA-TRADE
Rika Saito July 11, 2011
Summary The recent explosive growth in popularity for tablet computing devices in Japan shows these devices are attracting more and more interest in both Japan’s business and consumer markets. Although the penetration rate for tablet devices within the overall mobile device segment in Japan is still relatively low, unit sales in 2011 reached 1.42 million units, nearly triple the number sold the previous year. Some local industry researchers are even predicting tablet devices will totally replace notebook computers in Japan by 2015. There is also increasing demand for tablet devices within the Japanese e-book market. For U.S. firms interested in the Japanese tablet device market, market-proven entertainment, education and business applications for such devices are in particularly high demand.
Market Demand According to the market research firm IDC Japan, tablet device shipments in Japan totaled 500,000 units in 2010 but are expected to increase to 1.42 million units (see chart 1) in 2011, a nearly threefold increase in just one year. The Japanese mobile device market is led by smartphone devices but tablet devices are attracting ever increasing industry attention. The market share for tablet devices is still relatively small within the Japan mobile device market; however, if a greater variety of attractive tablet applications and models become available, this would provide an impetus for the growth of the overall tablet device market in Japan. About 80 percent of current Japanese tablet users are consumers, according to a November 2010 survey conducted by the Mobile Computing Promotion Council in Japan. The rise of the mobile device market, including tablet devices, is also driving growth in Japan’s e-book market. Impress R&D, a local research company, estimates that the e-book market in Japan grew 13.2 percent to 65 billion yen ($813 million USD) in fiscal 2010 and is expected to really begin taking off after fiscal 2013 as more content becomes available and standardization of distribution platforms progresses. This market is projected to expand further to 200 billion yen ($2.5 billion USD) in fiscal 2015 (see Chart 2 in the following section). Online sites offering e-book downloads are springing up to service the growing number of people who own smartphone and tablet devices. Several leading traditional Japanese publishing companies are also digitizing all their new book title releases. In fiscal 2010, nearly 90 percent of Japan's e-book market consisted of comics and other content delivered to standard cell phones, while content for smartphone and tablet devices accounted for less than 4 percent of the market. By fiscal 2015, however, the content for smartphone and tablet devices is expected to comprise 80 percent of the market. Major traditional publishers are losing money from existing business models. A total of 189 magazines were discontinued by major publishers in Japan during 2009, the second worst year in history for this sector. Factors behind this decline included the recent rise of companies like Amazon (which started in Japan in 2000) and Rakuten whose home delivery of publications ordered online poses a threat to traditional book stores. Traditional publishers are therefore now trying to exploit new revenue sources in digital publishing. (Note: Exchange rate used in this section:80 yen/1 US dollar)
The U.S. Commercial Service – Your Global Business Partner.
export.gov 800-USA-TRADE
Japan: Tablet Computing Market Page 2 of 6
Market Data Chart1. Mobile Device Market in Japan
Chart 2.E-book market in Japan
Source: Impress R&D
The U.S. Commercial Service – Your Global Business Partner.
export.gov 800-USA-TRADE
Japan: Tablet Computing Market Page 3 of 6
Best Prospects For U.S. firms interested in the Japanese tablet device market, market-proven applications for entertainment, education, and business are in high demand. Demand is high not only for such applications, but also for new business models that employ tablet devices. Regarding platforms for tablet devices, Microsoft, RIM, HP and others are struggling for supremacy in the smartphone and tablet device markets, but as with smartphones, Apple and Google are currently leading the market for tablet platforms (see Chart 3 below). As the number of tablet business users increases, however, the demand for the Windows platform is expected to increase. Japan’s mobile phone household penetration rate totaled over 90 percent in 2008 according to the Japanese Government so Japan is a good market for devices and device applications that enable computing formerly done at the office on desktop computers to be done anywhere on mobile devices such as tablets.
Chart 3. Tablet PC OS Share in Japan
Source: Bilcom, January 2011 Survey.
Key Suppliers Many foreign suppliers are currently leading players in the Japanese tablet device market, but leading Japanese laptop suppliers like NEC, Fujitsu, and Toshiba are following suit and have recently released their own tablet devices. Category Android Tablet
Model Optimus Pad
Supplier NTT Docomo/LG
Apple Tablet
Motorola XOOM Galaxy Tab DELL Streak iPad
au KDDI/ MOTOROLA NTT Docomo/ Samsung Softbank Mobile/ DELL Apple/Softbank
The U.S. Commercial Service – Your Global Business Partner.
export.gov 800-USA-TRADE
Japan: Tablet Computing Market Page 4 of 6 Windows Tablet
eBook reader
N/A in Japan
Eee Slate ICONIA Tab TW 317 Kindle
ASUS Acer ONKYO Amazon
Reader Galapagos Playbook Touchpad
Sony Sharp RIM HP
Prospective Buyers As discussed in the sections above, the major user segment for tablet devices in Japan is currently consumers. For U.S. firms interested in the Japan tablet device market, market-proven applications for entertainment such as gaming or social networking are currently in high demand. Tablet use in the Japanese business segment is currently not so common but is expected to increase in the future. Enterprises are therefore also prospective tablet buyers since thin and light tablet devices are more portable than current laptop models. Additionally, the digital text market for the education sector offers other potential opportunities. In December 2011, the former Japanese Minister for Internal Affairs and Communications, Mr. Kazuhiro Haraguchi, endorsed the digitalization of Japanese school textbooks by 2015 in his so-called ‘Haraguchi Vision’, included as part of the Japanese government's new economic growth strategy.
Market Entry There are three key elements to launching mobile device applications into the Japanese market: (1) localization — localization includes Japanese translation, testing, and customization. Application suppliers are required to provide not only translations but to consider Japanese business customs and culture to meet local client needs; (2) support capability - Japanese language support is mandatory; and (3) product quality — quality control is one of the most important considerations for Japanese users. Many American exporters use agents or distributors to pursue business in the Japanese market. However, finding prospective partners takes a long time. Japanese firms are always seeking new technologies from the United States but building long term relationships and trust are key factors to opening a partnership in Japan. Prospective exporters to Japan should be aware that competition is strong and that buyers expect a high level of after sales support. It is also important for U.S. companies to regularly visit their representatives in Japan and maintain a good relationship with them.
Market Issues & Obstacles There are no significant regulatory issues for this market. The current low level of tablet device awareness among potential Japanese corporate customers, however, is a factor hindering potential growth in the Japanese tablet device market. Expected increases in the number of tablet device application stores and/or marketplaces and the provision of new services such as integration services for tablet platforms and programs should increase the level of tablet awareness among Japanese business users. The recent emergence of cloud computing services may provide further impetus to the use of mobile devices such as tablets, but at the same time, security concerns should also be considered. Tablet usage overlaps that of smartphones, and the relatively high price for tablets ($500 versus $300 for the average smartphone) may hinder the expansion of tablets into certain sectors such as education.
The U.S. Commercial Service – Your Global Business Partner.
export.gov 800-USA-TRADE
Japan: Tablet Computing Market Page 5 of 6
Trade Events Smartphone & Tablet 2011 Fall Date: October 12-14, 2011 Venue: Tokyo Big Sight Exhibition Website: http://expo.nikkeibp.co.jp/sma/ (Japanese Only) eBooks 2012 Date: July 5-7, 2012 Venue: Tokyo Big Sight English website for the event: http://www.ebooks-expo.jp/en/Home/
Resources & Contacts Impress The core business of the Impress group is digital publishing and IT research. http://www.impressholdings.com/info/index.htm Mobile Computing Promotion Consortium (MCPC) Established in 1997, MCPC was organized to promote the mobile computing business and foster cross-industry relationships among mobile service operators, computer hardware/software suppliers, systems integrators, and related media. http://www.mcpc-jp.org/index_e.htm Japan External Trade Organization (JETRO) JETRO is an independent administrative agency that provides information and support to foreign companies entering the Japanese market. The organization has six offices in the United States. http://www.jetro.org Industry Associations Japan Electronic Publishing Association (JEPA) http://www.jepa.or.jp/ (Japanese only site) The Electronic Book Publishers Association of Japan (EBPAJ) http://www.ebpaj.jp/ (Japanese only site) Digital Textbook and Teaching (DiTT) http://ditt.jp/ (Japanese only site)
For More Information The U.S. Commercial Service in Tokyo, Japan can be contacted via e-mail at: [email protected]; Phone: +81 3 3224 5060; Fax: +81 3 3589 4235; or visit our website: http://export.gov/japan/
The U.S. Commercial Service — Your Global Business Partner With its network of offices across the United States and in more than 80 countries, the U.S. Commercial Service of the U.S. Department of Commerce utilizes its global presence and international marketing expertise to help U.S. companies sell their products and services worldwide. Locate the U.S. Commercial Service trade specialist in the U.S. nearest you by visiting http://www.export.gov/eac.
The U.S. Commercial Service – Your Global Business Partner.
export.gov 800-USA-TRADE
Japan: Tablet Computing Market Page 6 of 6 Comments and Suggestions: We welcome your comments and suggestions regarding this market research. You can e-mail us your comments/suggestions to: [email protected]. Please include the name of the applicable market research in your e-mail. We greatly appreciate your feedback. Disclaimer: The information provided in this report is intended to be of assistance to U.S. exporters. While we make every effort to ensure its accuracy, neither the United States government nor any of its employees make any representation as to the accuracy or completeness of information in this or any other United States government document. Readers are advised to independently verify any information prior to reliance thereon. The information provided in this report does not constitute legal advice. International copyright, U.S. Department of Commerce, 2011. All rights reserved outside of the United States.
The U.S. Commercial Service – Your Global Business Partner.
export.gov 800-USA-TRADE
