Market Trends of Japan Location-based Services Industry
The Increasing Adoption of Mobile Devices
- In recent times, Japan has witnessed a significant rise in the overall usage of mobile phones. It is primarily due to its affordability, integrated with various advanced technologies. This surge in the usage of mobile phones, especially smartphones, has a vital impact on the adoption of location-based services within the country.
- Also, popular navigation apps like Google Maps in Japan provide real-time traffic information, accurate turn-by-turn directions, and alternative routes to assist drivers in navigating efficiently. Smartphones enable drivers to search for nearby points of interest, such as restaurants, gas solutions, hotels, and other attractions. These apps provide detailed information about these places, including user ratings, reviews, directions, and contact details.
- Location-based services on smartphones deliver real-time traffic updates as well as information on road conditions in Japan. This helps the drivers plan their routes and avoid road closers or congested areas, especially during park travel times or in case of road maintenance. Moreover, finding parking in busy cities like Tokyo can be difficult. However, several smartphone apps specifically designed for parking services in Japan help and assist drivers in locating available parking spaces, provide information about fare rates and even enable digital payment.
- As per the Ministry of Internal Affairs and Communications (Japan), as of March 2022, NTT Docomo, Inc. held the largest market share in terms of mobile phone subscriptions in Japan, which totaled around 41.7 percent when added with the subscriptions recorded by the mobile virtual network operators (MVNOs). The KDDI Group positioned second with an overall market share of around 30.5 percent.
- As per the JEITA, in December 2023, Japan saw a monthly domestic shipment volume of approximately 490,000 smartphones, constituting 73.4% of the total mobile phone shipments.
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Transportation and Logistics Sector Expected to Witness Significant Growth
- The transportation and logistics sectors are vital in augmenting location-based services in Japan. Transportation and logistics companies accumulate massive amounts of geospatial data through their shipping routes, fleet of vehicles, and delivery networks. This data involves traffic patterns, GPS coordinates, transportation hubs, and delivery points. This data forms the basis for location-based services.
- The transportation and logistics sector provides reliable location data, essential for location-based service applications. This data enables return tracking, precise mapping, and face routing of goods and services. Moreover, location-based service providers can help transportation logistics companies optimize their supply chain distribution network and warehouse locations. This optimization improves operational efficiency, reduces costs, and better overall logistic performance.
- As per e-Stat (Japan), In 2022, the private sector entities in Japan signed construction contracts for warehouses and distribution facilities amounting to around 1.94 trillion Japanese yen. In contrast, it was around 1.55 trillion Japanese yen in the previous year. Such a rise in the total count of contracts is expected to drive the market's growth exponentially during the forecast period.
- The transmission industry employs monitoring and tracking systems to manage shipments and fleets effectively. This system uses GPS and other location-based technologies to deliver real-time information about vehicle and cargo's location conditions and status. Also, the Location-based service providers can tap into this real-time data to provide live tracking services to consumers allowing them to track the overall movement of their transportation or shipment options.
- According to the Ministry of Internal Affairs and Communications (Japan), in 2022, Japan's road freight transport industry employed around 2.01 million people on average. The transportation industry's second-strongest workforce was noted in the road passenger transport segment, further highlighting the significance of road transport for the Japanese economy.
- According to METI (Japan), in 2023, Japan's transportation facilities services industry activity index rose to 102.9 points, up from 95.3 points in the preceding year. The Tertiary Industry Activity Indices track business trends in Japan's service sectors. The Indices of Tertiary Industry Activity aim to reveal the trends of business in service industries in Japan.
