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Trends in Emerging Information ServicesTrends in Emerging Information Services
September 14, 2000September 14, 2000
ToshiharuToshiharu AokiAoki
President & CEOPresident & CEO
NTT DATA CORPORATIONNTT DATA CORPORATION
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OutlineOutline
1. How we should recognize the Internet era
2. How we should recognize the change in services
3. How we should recognize the change in business mechanisms and rules
4. How we should recognize the change in intellectual creation
5. Summary
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1. How we should recognize 1. How we should recognize the Internet erathe Internet era
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Perception of development - in a span of 20 yearsPerception of development - in a span of 20 yearsPerception of development - in a span of 20 yearsPerception of development - in a span of 20 years
1990 20001980
1980s 1990s
The Internet eraBefore PC PC era
1981 1983
PC Gold Rush
InternetGold Rush
1994 1996
1981PC Year O
ne
1994Internet Year One
Analog circuits Digital circuits
1982Network digitizati
on start
1997Complete network d
igitization
SPC
Optical fiberloop
27%
Optical fiberloop
36%
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Progress of digitization and creation of new marketsProgress of digitization and creation of new marketsProgress of digitization and creation of new marketsProgress of digitization and creation of new markets
The Internet
Satellite TV
Optical fiber
xDSL
Network
Computer
Information appliances
(TV and PC)
Content
Encouraging rise of new markets
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B to C
Manufacturing
Non-manufacturing
Business climate in 2000 (Forecast)Business climate in 2000 (Forecast)Business climate in 2000 (Forecast)Business climate in 2000 (Forecast)
B to B
0
$ 50
$100
$150
$200
$250
$300
$350
$400
Japan Europe U.S.
130
186
360
10 10 39
(billion)
[Source: Electronic Commerce Promotion Council of Japan (Ecom)]
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The Internet Changes Society and IndustryThe Internet Changes Society and Industry
The Internet frees us from unconscious limitations, and “Consumer-oriented” concept appears
Perfect market
Perfect community
Perfect value
Free fromtime and space limitations
Free fromunified common value
Free frominformation imbalance
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Perfect MarketPerfect Market
With the information imbalance between suppliers and consumers rectified, we move closer to optimal markets– Consumers can get the information they need to make their own comparisons and selections– Suppliers get information about consumers, enabling them to offer better goods and services– Greater freedom is available in the setting of prices (ex. Internet auctions)
Internet
Consumers Suppliers
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Perfect CommunityPerfect Community
Communities are formed that transcend time and space limitations– People can join global communities anytime– People can carry individual private space around with them wherever they go– Transformation takes place from closed communities to active communities that influence society
(ex. development of Linux) Individual activities influence communities and society in real time
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Perfect ValuePerfect Value
Diversity is recognized with regard to people's
sense of value– Mega-trends and niche coexist
• Mega-trends arise easily• Business opportunities arise out of the niche
– Individual differences in people's lifestyles are acknowledged.– Saving time for / Taking time for ・Internet shopping vs. Going to the mall
・Personalized newspapers vs. Traditional newspapers
Mega-Trends
Niche
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2.How we should recognize the change2.How we should recognize the change in services in services
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Change in service creation processChange in service creation processChange in service creation processChange in service creation process
Difference in perception of service between consumers and suppliers
Service
New Service
Internet
----- Browser-----
◆Chart ~…………………………………………………………………
◆Graph ~ ……… ……… ……… ………
News deliverySales of goods on homepages
Building e-mail environmentDeveloping and providing Web browser
Consumer Supplier
Gap
Environment
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Impacts on the marketImpacts on the market
The Internet has caused a significant change in the market
Change in quantity
Change in quality
Change in environment
The 1st phase
The 2nd phase
The 3rd phase
Efficiency
Exploration
Creation
ChangePhase Key Word
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Impacts on the marketImpacts on the market
The Internet has caused a significant change in the market
Change in quantity
Change in quality
Change in environment
The 1st phase
The 2nd phase
The 3rd phase
Efficiency
Exploration
Creation
ChangePhase Key Word
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Change in quantityChange in quantity
New markets generated by the improved efficiency made possible by the network
– Change in communications• E-mail
– Networking of B to B transactions • EDI
– B to B marketplace• From intermediary to info-mediary
(The use of the Internet increases efficiency of intermediary service and distribution)
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Impacts on the marketImpacts on the market
The Internet has caused a significant change in the market
Change in quantity
Change in quality
Change in environment
The 1st phase
The 2nd phase
The 3rd phase
Efficiency
Exploration
Creation
ChangePhase Key Word
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Change in qualityChange in qualityChange in qualityChange in quality
The business emphasis shifts from quantity to quality.
The three perfect states made the formerly untouched area a new market.
Manufacturing cost
Market needs
Fewer consumers General public
New market
Mass production
Order production
Existing market
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Impacts on the marketImpacts on the market
The Internet has caused a significant change in the market
Change in quantity
Change in quality
Change in environment
The 1st phase
The 2nd phase
The 3rd phase
Efficiency
Exploration
Creation
ChangePhase Key Word
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Change in environmentChange in environment
The Internet establishes itself and changes business.
– Business mechanisms were replaced
– Changes in market principle create new businesses
– New businesses taking advantage of the potential of the new environment are expected to emerge
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i-Mode Servicei-Mode Servicei-Mode Servicei-Mode Service
Game
Shopping
Ticketing
Entertainment
News, information
Ticketing, billing
Financial services
Maps
Dictionary
Travel information
Dining, cooking
Distribution of accesses by content category
i-Mode Mobile Phone
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Appearance of new servicesAppearance of new servicesAppearance of new servicesAppearance of new services
The i-mode, which integrates the Internet with a cellular phone, is bringing a great change to our life style.
Internet??
!!
Mobile and portable.Get necessary information on the street(train time table, guide on restaurants, etc.)
i-Mode
Cellular phone functions
123
456
789
*0#
℡ ℡
Rapid and accurate decision making
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3. How we should recognize the change in 3. How we should recognize the change in business mechanisms and rulesbusiness mechanisms and rules
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Hype CycleHype CycleHype CycleHype Cycle
Cycle of e-business (business service)
Degree of exp
ectation
InternetWeb
Start of “.com”
The U.S. 1997-1998Initial Public Offering( IPO)
The U.S. 1998“e-Christmas”
Europe 1999 IPO
Plummeting of .com company stocks
Dwindling interest by inventors
Failure of conventional “stores”
Collapse of .com company stocks
Disclosure of e-business failure
Dwindling interest by companies
Rise of real e-business
Optimization of e-business
Post-Internet business
Disillusionment Awareness activity Stable productionOver-expectation at its peak
Dawn of the technology
[ Source: Gartner]
1990-96 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
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Business, technology and rulesBusiness, technology and rulesBusiness, technology and rulesBusiness, technology and rules
Waves of e-business rules
1990-96 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
Dawn of the technology
Degree of exp
ectation
Disillusionment Awarenessactivity
Stable productionOver-expectation at its peak
Creation of a new framework as a base for real e-business
Technology pull
Provision of a stable baseTechnology revolution on usage
Base=Technology, rules
・ ASP・WebSI・ Security・ RASIS•・ etc….
Establishment of life style in which technology and business, as well as technology and service, converge and are in harmony
“Real” e-business
Rules
Technology
Business
Base=Technology
Market demand push
・ Business model・ International agreement (GBDe 、 WTO)
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Approach to new service creationApproach to new service creationApproach to new service creationApproach to new service creation
Technology alone cannot solve service creation problems.It becomes important to devise business mechanisms and rules if new businesses are to be created.
- From technology-based service proposal to creation of real services
Technology
Business model Rules (legal system, regulations)
• Protocol/procedure• Encryption and authentication• Standard codes and format, etc.• Billing and transaction
• Change in procedure• Change in business practice
・ Information disclosure・ Intellectual property・ Prevention of unauthorized
access・ Protection of privacy
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What rules areWhat rules areWhat rules areWhat rules are
Rules as viewed from market push.
Crime preventionEncouraging people
to do new biz.
Promote and help advancement of the Internet society Market mechanism
Rules
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Market consensus in the consumer-driven eraMarket consensus in the consumer-driven eraMarket consensus in the consumer-driven eraMarket consensus in the consumer-driven era
Generation of new consensus suitable for the network society – Basic consensus– Consensus on value
The network society moves forward as mechanisms are put in place
Internet(bazaar)
Perfect value
Perfect community
Perfect market
$
Consensus
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To build a consensus To build a consensus To build a consensus To build a consensus
System for building a consensus in the network community
RASIS*
Common functions
Business/service
Physical assurance for services on the networke.g.) No system failure
Essential functions in transaction processe.g.) authentication, settlement of payment
Creation of new services
RASIS: Reliability, Availability, Serviceability, Integrity and Security
Standards and
specifications
Unification of data format, transaction rules, etc.e.g.) EDI, XML legal system, rules (GBDe, WTO)
Technology
Rules
Business modelMechanism
MethodologyConsensus on value (Price vs. value of services)
Basic consensus(Mechanism for smooth information sharing and distribution)
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4. How we should recognize the change 4. How we should recognize the change in intellectual creationin intellectual creation
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Basic technology and theory
Changes in intellect creationChanges in intellect creationChanges in intellect creationChanges in intellect creation
R&D responding to needs of the new era is required
Exp
ansi
on o
f R
&D
are
a
Era
Hardware technology(Optical, digital and LSI)
Software technology(Applications, architecture)
Business model(E-commerce mechanism)
Base = Technology and rulesBase = Technology
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5. Summary5. Summary
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SummarySummarySummarySummary
The development of the Internet has greatly changed the business environment
From supplier-driven to consumer-driven environment
Convergence of technology, service and rules builds new business infrastructure
Consensus suitable for the network era (creation of new values) is essential