Tech Tycoons in Japan and China

Nationwide digitalization efforts cannot be achieved by the state alone—corporates have played a critical role in both Japan and China’s technological development. Corporates, rather than universities have been the driving forces for patent filings. Among the 950,000 international patent applications published between 2011 and 2015 under the Patent Cooperation Treaty, Japan alone counts for 14% of patents filed worldwide. Investors in Tokyo-Yokohama tech cluster filed 94,079 patents in four years, ranking No.1 among all the tech clusters in the world. This record almost doubled the number of patents filed by the second runner, Shenzhen-Hong Kong cluster in China and nearly three times the amount in Silicon Valley. The top three patent applicants are Tokyo-based Mitsubishi Electric, Shenzhen-based ZTE, a Chinese telecommunications equipment manufacturer and network solutions provider, and Silicon Valley-based Google.[1] 

Apart from their own researches, tech tycoons are also actively investing in advance technologies—both domestically and overseas. One prominent example is Japan’s SoftBank, a $68 billion telecommunications and tech investment giant who has invested in more than 300 companies, including China’s e-commerce behemoth Alibaba and U.S. carrier Sprint. In 2016, it allied with Saudi Arabia to build the largest-ever $100 billion technology investment fund to aggressively invest in the Internet of Things. 

Meanwhile, under progressive Chinese government policy to develop its “Internet Plus” industry,  IT companies are becoming much more critical to the country’s economy. In 2016, Tencent and Alibaba ranked top 1 and top 3 among all the Chinese public-listed companies in terms of market value. In 2015, Tencent announced its plan to invest $1.57 billion in cloud computing in the next five years (on a side note: it seems that making plans with a five-year span seems to be popular). In October 2017, Alibaba, which now controls 80% of China’s e-commerce shoppers, unveiled its plan to invest $15 billion in R&D projects worldwide, which include areas like IoT, data analysis, as well as artificial intelligence and even quantum computing. Baidu, China’s equivalent of Google, has devoted its resources in autonomous driving. Baidu’s “Apollo Fund” will invest $1.5 billion in 100 autonomous driving projects from 2017 to 2020.  

Nonetheless, these are merely a few cases of Japan and China’s corporate-level competition to shape the future technological landscape. In the next section of this project, we will also examine a more exhaustive set of data on both government-led and corporate-led investments in digital technologies to understand how the states and corporates synergy in digital development and the underlining narrative of the two countries’ digital competition.