What is the reason behind Oracle and other mega cloud vendors making huge investments in Japan one after another? – ZDNET Japan

In this series, “Isao Matsuoka’s “This Week’s Statement,”” every week we highlight some words proclaimed by key figures in the ICT industry at press conferences, events, etc., and explain their meaning and background.

This time, we will introduce the “statement” of Mr. Safra Catz, CEO of Oracle, and Mr. Norihiro Shimogaki, Chairman and President of ZVC JAPAN.

“Japan’s demand for new technology is now increasing significantly.”
(Oracle CEO Safra Catz)

Oracle Japan held its annual event “Oracle CloudWorld Tour Tokyo” on April 18th at a hotel in Tokyo. The opening remarks were made by Oracle CEO Safra Catz, who was visiting Japan for the first time on this occasion, and spoke about the announcement of a huge investment plan in Japan, and the keynote speech at the event. The reason was stated at a press conference.

On the same day, Oracle announced through Oracle Japan that it plans to invest more than $8 billion (1.2 trillion yen) over the next 10 years to meet the growing demand for cloud and AI infrastructure in Japan. Regarding this, Catz said in his keynote and press conference:

“After the coronavirus pandemic, Japan’s economy has started to gain momentum. Under these circumstances, demand for new technologies is increasing greatly in Japan. In particular, there is a need for IT modernization using the cloud and the use of AI in various fields. Oracle has made significant investments in Japan over the past 40 years, and we look forward to continuing to invest and support the activities of our Japanese customers and partner companies.”

The opening statement is an excerpt from this comment.

At Catz’s press conference, U.S. Ambassador to Japan Rahm Emanuel made a surprise appearance and said, “Japan and the United States are currently working closely together in the field of advanced technology. I highly commend the United States for its investment plans in Japan. This is proof of the trust that the United States has in Japan.”

Emanuel’s remarks gave the impression that Oracle is a key player in Japan-US relations. Please see the related article for the contents of Mr. Catz’s press conference.

What caught my attention at Mr. Catz’s press conference was that mega cloud vendors that compete with Oracle have recently announced a series of huge investment plans in Japan. Specifically, Amazon Web Services (AWS) will generate $14.96 billion (2.26 trillion yen) from 2023 to 2027, and Microsoft will generate $2.9 billion (440 billion yen) over the next two years.

What was impressive, as well as the huge size of each investment, was that at the AWS press conference, Takuya Hirano, a member of the House of Representatives who served as the first Minister of Digital, took the stage and gave a compliment, and Microsoft made an announcement in conjunction with Prime Minister Fumio Kishida’s recent visit to the United States. Kishida met with Microsoft Vice Chairman and President Brad Smith in the United States and expressed his gratitude for the investment plan.

What is behind this series of movements? The author felt that the level of national security cohesion had changed, along with the strengthening of cooperation in technology and economic areas in the Japan-U.S. relationship. Cloud and AI are also technologies with such characteristics.

In addition, what we need to think about in the future is not just cheering on mega cloud vendors’ huge investment plans in Japan, but also how this will affect them. For example, there are concerns about whether Japan’s IT industry will change (some say it has already changed) and what to do about Japan’s ever-increasing “digital deficit.”

This is a major theme for Japan in the future. Mr. Catz’s press conference made me think about this.

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