April 2020 to March 2021

Motoyuki Matsunaga(Senior Fellow, Institute for International Socio-Economic Studies)

   Amid the increasingly smart economy and society, the market environment for businesses in Japan has become more digitalized, wherein the concept of digital transformation (DX) toward a new information environment has become the keyword to national and corporate transformation efforts.

　The digitalization we have thus far seen began in the Internet connecting personal computers and has evolved into cloud computing connecting smartphones. From now on, however, digitalization will also cover edge computing, the network of which includes sensors throughout cities, industrial equipment, and other devices now being used as information terminals in addition to computers and smartphones. Information platforms made up of both edge computing and cloud computing, which leverage cutting-edge technologies such as artificial intelligence (AI) and the Internet of things (IoT) and process information where it is generated, are entering an entirely new phase of evolution.

　Through DX, we have envisioned a society that fosters a dynamic global economy, where people, things, money, and information and other management resources are connected more seamlessly. The COVID-19 pandemic that started at the end of November 2019, however, has completely changed the situation around the world. The flow of people and goods are being restricted, and the world economy is in the midst of a turmoil that surpasses the global financial crisis triggered by the collapse of Lehman Brothers in 2008. Isolated from each other, nations and societies have to deal with challenges on their own, forcing society to rethink and come up with new approaches for social infrastructures that are vital to human life.

　Meanwhile, the fluidity of information is increasing, and ways to create information systems pertaining to infection prevention and economic recovery are now also being explored. The COVID-19 pandemic has brought about fundamental changes in interpersonal relationships, work styles, hygiene awareness, education, distribution of goods, healthcare, and many other aspects of human society. New social and urban infrastructures are driving a major shift toward human-centered innovation. In the 20th century, human lifestyles were shaped through monozukuri, while in the 21st century, lifestyles are being shaped through the spread of diverse social values across digital platforms. We are now heading towards an era where approaches to social infrastructure are being redefined under the global concept of sustainability.

   In this research, we studied the evolution of AI, IoT and blockchain platforms as well as the progress of DX and how it will change after the pandemic, while understanding the trends in increasingly sophisticated digital infrastructure technologies.