Section 2 The Implications of Info-Communications Infrastructure As indicated in the preceding section, Japan needs to achieve sustained economic growth, while at the same time deal with a variety of issues including the ongoing aging of its population and rectifying the overconcentration in the Greater Tokyo Metropolitan Area. This section discusses the benefits of an improved info-communications infrastructure in overcoming these problems and building the intellectually creative society. 1. The Benefits of Info-Communications Infrastructure Consensus has been building among European, American and Asian countries in recent years that establishing a high-performance info-communications infrastructure will represent one of the most important measures they can take to solve the various problems they face. The NII (National Information Infrastructure) being accelerated in the United States by the Clinton administration, for example, emphasizes a range of socio-economic benefits accruing from a high-performance info-communications infrastructure, including stronger international competitiveness, expanded employment opportunities, and enhanced educational and medical services. Singapore's "IT 2000--the Vision of the Intelligent Island" and Korea's "Super-High-Speed Information Networks Plan" indicate that other nations too fully recognize the important role of a high-performance info-communications infrastructure in strengthening international competitiveness and improving people's lives. High-performance info-communications networks offering broadband, interactive services and the development of applications that makes maximum use of the networks' capabilities, along with a reform of the socio-economic system, could trigger the shift essential to ushering in the next century. A number of examples will now receive consideration to show concretely the role that info-communications infrastructure will play in resolving the various issues confronting Japan. 1) Dealing with the Aging Population A high-performance info-communications infrastructure could be used in various ways to promote more extensive participation by the elderly in society at large. It could also provide effective support for elderly people who require nursing care, which is expected to become a much more serious problem in the years ahead. a. Participation by the elderly in society By using info-communications systems, Japan's older citizens could maintain active contact with society without having to leave their homes. Helping them overcome their physical disabilities, these systems would permit them to perform work, capitalizing upon their unique knowledge and experience, as well as to participate in hobby circles and pursue other interests. b. Support for nursing services for the aged According to estimates made by the Ministry of Health and Welfare, the number of the aged requiring nursing care will increase from 1,000,000 in 1993 to 2,000,000 by the year 2010. This means that the efficient provision of high-quality home nursing services will become a major issue. High-performance info-communications systems will enable regular "home visits" to the elderly by nurses using TV monitors installed in the older citizens' homes, remote diagnosis using high-definition video, and remote monitoring of blood pressure and electrocardiograms. The systems will reassure the elderly that they can receive medical and health care without the need to leave their homes. Example: Home communications system for the elderly Trials are being conducted on a commercial home care system that permits 24-hour contact by patients and immediate responses plus regular visits by nurses. In the city of Oita, a home telephone communications system is being built for the aged who live alone. The system permits a faster response to sudden illnesses and other emergencies. High-performance info-communications networks that are capable of interactive video transmission could markedly enhance the quality of such services and increase convenience. 2) Rectifying Overconcentration in Urban Areas There are presumably a number of factors behind the concentration of the population in the Greater Tokyo Metropolitan Area. These include the plentiful opportunities for jobs that are attractive to younger people; convenient access to services in fields like education, medical and health care, and fashion; and the ready availability of information on the latest trends in these fields. A high-performance info-communications infrastructure and the building of regionally decentralized systems will expand opportunities for employment as well as access to high quality services in other regions of Japan while also providing information services that are as up-to-date, abundant, accessible, and responsive to demand as those offered in Tokyo. This should act as a powerful incentive for a more even distribution of population and high value-added industry in Japan's regional areas. a. Assurance of employment opportunities in Japan's regional areas Improved info-communications capabilities will encourage industries to locate in areas with lower land prices. To the employees, telecommuting and the use of satellite offices will open up opportunities for employment in desirable occupations while living elsewhere than in the Greater Tokyo Metropolitan Area. Example: Networked companies A certain company selling computer software has found that it does not need office buildings. Instead, its employees, who live in areas throughout Japan, work and stay in contact with one other via personal computer telecommunications. Such work-at-home networked "companies" are expected to swell once advances in info-communications networks make interactive visual communications possible. b. Maintenance and improvement of medical and educational services in depopulated areas When populations decline, it becomes difficult to maintain an adequate level of medical and educational services, and this, in turn, accelerates the depopulation. The application of remote medical and health care and education systems could do much to halt depopulation by helping to maintain and improve the level of such services. Example: Tests of remote medical and health care Hoping to facilitate faster and more accurate diagnoses by providing instructions from medical experts regarding treatment, Wakayama Prefectural Medical University is transmitting X-ray photos and CT scans from clinics in depopulated areas to its university hospital. This type of remote medical and health care system is expected to see broader application following further technological development and the creation of a more suitable environment for its use. c. Filling the information disparity The virtually one-way flow of information from the Tokyo Metropolitan Area to other areas is thought to be one of the factors behind the concentration of the younger population in this area. According to a study conducted by the Ministry of Posts and Telecommunications entitled "Information Distribution Census (Fiscal 1993)," which contains indices for the quantitative analysis of information circulation, approximately 34% of the volume of information broken down by source region, as of fiscal 1991, was concentrated in this greater urban area. A high-performance info-communications infrastructure should dramatically increase the flow of information between Tokyo and other regional areas. In addition, interactive capabilities would allow users anywhere in the country to equally access a rich supply of the latest information suited to their needs. This would greatly reduce the motivation to reside in Tokyo. Building regionally decentralized systems is expected to correct the information disparities between regions and to encourage the development of regional areas corresponding to their own actual situation. 3) Reforming Japan's Economic Structure A more sophisticated info-communications infrastructure could substantially add to the value of intellectual creativity in Japan's economic structure and at the same time contribute to the transition toward a resource-saving economic framework. This is expected to promote an evolution away from a socio-economic framework that favors the producer to a framework that favors consumers. In connection, it could also enable changes in business and lifestyle to conform more closely to the changing work attitudes among employees. a. New Leading Industries As the automobile and home electronics industries mature, next-generation industries will emerge, especially in the info-communications area. Centered on this core, existing industries will increasingly focus on higher added value, and the entire industrial structure will change. The newspaper and publishing industries will change from being typeset media, taking advantage of info-communications networks to evolve into new types of electronic publishers. Moreover, new services will emerge, such as home shopping, tele-education, and video-on-demand utilizing high-performance info-communications networks. It is envisioned that the multimedia industry, which will be the nucleus of these info-communications networks, will grow to take its place as the leading industry of the 21st century. In parallel with this development, high-performance info-communications will encourage re-engineering of business management in such existing sectors as distribution, manufacturing, and services. The objectives would be to improve productivity and respond accurately to consumer needs. b. Greater efficiency in office work as well as research and development Office work could be performed more efficiently through the extensive use of databases and the introduction of information tools. In research and development as well, the use of info-communications networks could promote more efficient allocations of work loads and promote joint development. The spread of satellite offices and telecommuting supported by info-communications networks would give employees a more flexible choice of locations and types of employment. Example: Internet Internet, which started out as a research-support network in the United States, now links over 100 countries, including Japan, and facilitates a broad spectrum of applications. These include the exchange of research information, database access, communication by E-mail, and the shared use of computer resources. The U.S. is also forging ahead with the NREN (National Research and Education Network), which will link a broad range of research and educational institutions and promote research and development. It is imperative for Japan to upgrade its research and education environment by building and encouraging the spread of research/educational networks. 4) Realizing a Comfortable Lifestyle The spread of telecommuting and similar arrangements is expected to alleviate commuting congestion and housing problems in major cities. In addition, the upgrading of Japan's current social systems to take advantage of info-communications capabilities could enrich the living environment throughout the country and provide a fuller range of recreation opportunities during leisure hours. a. Streamlining of public services Dramatic improvements in public services would result from the introduction of advanced info-communications functions into such fields as medical and health care, education, government administration, counter-disaster systems, and transportation. This would make the living environment more efficient, more pleasant, and safer. In the field of medicine, telepathology and symptom databases are expected to lead to better quality medical and health care and to the improved utilization of medical specialists; "medical treatment simulation systems" could lead to better training of physicians; and health information databases on individuals could lead to the establishment of a better system for preventive medical treatment. In the field of education, the increasing utilization of multimedia educational systems is expected to improve the learning curve; the provision of life-long learning programs and the networking of universities and other institutions could broaden the choices available. According to a study of public opinion carried out by the Prime Minister's Office, 65.9% of persons aged 20 or more expressed a desire for life-long learning. The most often cited suggestion for measures to promote such life-long learning was to expand the availability of lectures in which anyone can easily participate. Example: Easing the burden of medical expenses In the United States, the increase in medical expenditures is putting pressure on the government's fiscal policy, making the reform of the medical insurance system an important administration issue. The U.S. government reported calculations that the introduction of medical and health care systems utilizing telecommunications could cut medical outlays in the United States by $36-100 billion annually. Example: Road Traffic Information Systems At present, a variety of traffic information systems are being developed in Japan as elsewhere. These systems are ushering in services that notify drivers of traffic congestion and other matters by TV monitor. According to research conducted in the United States, it is expected that such systems could cut driving time by 10-15% and driving distances by 30%. An effect of this magnitude is calculated to be equivalent to a 10% expansion of the road network. b. Expanded leisure The future spread of satellite offices and other flexible employment schemes will reduce time spent in transit. This will result in more time available for home and leisure activities. Once broadband, interactive networks are widespread in the home, it will be possible for people to view movies, sporting events, concerts, and other programs of their choice at any time they wish, as well as to enjoy the latest games and "Karaoke," all at home while conversing with friends. This will significantly expand the availability of ways to spend leisure time. Example: Reservation system for sports facilities The city of Kakogawa in Hyogo Prefecture has inaugurated a sports facility reservation system that can be used from terminals on city streets. Under the previous system, reservation windows were only open until 5:00 PM and the number of users was limited. Under the new system, reservations can be made until 9:00 PM and the usage has increased five-fold due to the ready accessibility of the terminals. Example: Advanced entertainment services Although the main medium for Karaoke used to be laser discs, constraints on storage space and the need for rapid availability of the latest hits led to the provision of distribution systems via networks. Similarly, CATV and other video transmissions used to be limited to one-way transmission. However, user demand has led to trials of "video-on-demand," in which users can select and operate the video of their choice. 5) International Community-oriented Cooperation Throughout the world, countries are acting vigorously to improve their info-communications infrastructures. Japan too should act promptly to launch programs of its own as well as contribute to the construction of international info-communications networks in order to build a society that is more open to the outside world. a. Transition to an economy led by internal demand A high-performance info-communications infrastructure would help shift Japan's economy from dependence on exports to an internal demand-driven economy, thereby contributing to the rectification of Japan's trade surplus. Improved info-communications systems would increase the transparency of Japan's markets by replacing a certain portion of the distribution industry's functions. This may be expected to facilitate overseas access to Japan's markets. The creation of an environment allowing access to large amounts of information from other countries could serve, for example, as the basis for international on-line shopping systems that would expand imports of foreign products. b. International Contributions International info-communications networks would enable the provision of information on Japan to foreign countries, in keeping with their wish to receive such information. Example: International medical cooperation via satellites The Ministry of Posts and Telecommunications has since 1992 been using the Engineering Test Satellite-V (ETS-V) to promote a program of joint international experimentation (Partners Program) to carry out technological transfer and exchange with developing countries. Under one part of this program, university hospitals in Japan have been linked with hospitals in the Asia-Pacific Region (15 hospitals in four countries), in order to support physicians in developing countries where medical information may be inadequate. Prototype trials of information exchange are under way to determine how well the system works for providing advice on medical treatment and AIDS therapy. 6) Addressing Environmental Concerns High-performance info-communications systems would make it possible to reconcile the goal of sustained economic growth with the preservation of the environment. a. Shift away from an industrial structure based on the massive consumption of resources The advance of info-communications would lead to the building of systems that make more efficient use of resources and energy in every field of industry. This would promote a shift away from an industrial structure dependent on the massive consumption of resources. Moreover, the realization of a "paperless society" through the extensive use of electronic media for communication throughout society will become a key aspect of protecting forest resources in the 21st century. b. Transport-substitution effect A high-performance info-communications infrastructure would help to reduce CO2 and NOx emissions and other pollutants by replacing the transportation of people and goods with the flow of information. In the United States, government bodies at both the federal and state levels are enacting legislation that encourages telecommuting. At the same time, there is growing interest in placing constraints on energy consumption and atmospheric pollution. Example: CO2-reduction effect The concentration of carbon dioxide in the atmosphere, which was about 280 ppm before the industrial revolution, is now over 350 ppm and rising at a rate of 0.5 percent annually. Emissions from automobiles and other forms of transportation account for some 19 percent of this increase. According to calculations performed by MPT, the diffusion of teleconferencing, telecommuting, and other uses of info-communications infrastructure could absorb roughly 1 percent of the increase. The diagram below illustrates representative examples of the benefits of info-communications infrastructure in public services, industrial, and individual areas, as described above. Benefits of Info-Communications Infrastructure 2. The Development of Multimedia Markets 1) Estimated Market Size To understand the economic effects to be expected from the establishment of broadband, interactive info-communications infrastructure, we took a specific approach to estimating the size of future multimedia markets. a. Estimation premises It was assumed that the fiber-optic network enabling broadband, interactive communications would be available nationwide for use by 2010. b. Estimation results Building the nationwide fiber-optic network for broadband, interactive communications will generate immense economic effects not only by expanding the size of the info-communications industries, but also by creating new businesses in other industries as well. Size of multimedia markets New markets related to the fiber-optic network: approximately 56 trillion yen (Markets newly created by program distribution, production of terminal devices, network operations and others related to the development of the fiber-optic network.) Expansion of existing markets: approximately 67 trillion yen (Existing markets not directly related to the fiber-optic network, including video equipment, telecommunications equipment, computers, and video software) Total multimedia market: approximately 123 trillion yen Job creation: 2.43 million jobs (New jobs created by the ripple effects of building the fiber-optic network.) c. Evaluation of economic effects Market size In 2010, the multimedia markets are expected to surpass such current mainstay fields as the automobile and the electronics/communications equipment industries. It is forecast to grow to become a leading industry of the future. Due to the nature of the multimedia industry, it will offer a wide variety of business opportunities to small- and medium-sized companies as well as to large corporations. Comparison with Market Size of the Multimedia Industry Job creation The new jobs created by building the fiber-optic network would outnumber those in today's automobile industry. Comparison with Jobs Created by Building the Fiber-Optic Netword 2) Issues Important to Building an Intellectually Creative Society As indicated above, the construction of a high-performance info-communications infrastructure would contribute greatly to resolving many of the problems that Japan faces. At the same time, the shift in perspective from tailoring industrialization to information processing would be likely to engender a new set of issues. It is essential that Japan overcome these concerns and proceed with the creation of its own info-communications infrastructure in step with the entire international community as it continues to develop new economic and social systems through info-communications. a. Effects on Existing Industries and Employment Although the development of info-communications infrastructure would generate new markets, it would also affect existing jobs and industries, reducing their scale or forcing them to change or endangering their existence. These potentially adverse effects imply a shift to higher productivity in industry and changes in the structure of employment, which will help to invigorate the economy as a whole. However, policies formulated to ensure smooth transitions will be essential. b. Adapting to Workstyle Changes Brought About by Info-Communications Industry The high-performance info-communications infrastructure is anticipated to induce marked changes in work- and life-styles. To enable the middle-aged and the elderly to adapt smoothly to these changes, appropriate countermeasures will be needed such as the development and diffusion of user-friendly terminals and applications in conjunction with the formulation of ways to eliminate effectively techno-stress. c. New Barriers to Participation Due to Info-Communications The widespread application of info-communications functions will lead to a more streamlined, open economic system. However, if steps are not taken to ensure the openness of the network infrastructure and the application system, this could essentially generate new barriers to participation and have the effect of impeding the streamlining of industry at large. d. The Protection of Privacy and Response to Consumer Issues The rapid progress of the information use is expected to increase the dependence of the Japanese people on info-communications. As a result, there should be a stepping-up of measures to ensure privacy and preserve security and reliability. It will also be necessary to give full consideration to consumer issues that may be expected to ensue from the ongoing information use.