Acceleration of B2B2X Businesses

Last updated : December 27, 2017

Drastic Transformation of Business Structure

NTT Group has continued to transform its business structure in response to changes in markets and in technologies. Such transformations have included the development of broadband operations and global businesses.
We are currently exploring new business fields with the potential to drive the ongoing growth of NTT Group with an eye to 2020 and the vitalization of local economies.
We are combining our broadband operations, which are being developed across Japan, with our information systems, which boast strengths in various fields, to make comprehensive value proposals and develop businesses with various aims. Such aims include developing sports and other fields into growth industries; boosting the competitiveness of the agricultural, manufacturing, and service industries; resolving social issues arising from the declining birth rate, aging population, and other causes; and transforming people's lifestyles.
As we develop these operations, NTT Group's business structure is undergoing a drastic transformation, evolving from its former telecommunications-centered business-to-consumer structure to adopt a structure focused on B2B2X businesses.
B2B2X businesses are a step forward from the business-to-business model. In these businesses, NTT Group supports service providers, represented by the second B, in supplying various services to end users, represented by the X, through smartphones and network-connected sensors.
NTT Group strives to serve as a catalyst for service providers falling under the second B, stimulating transformations in the business models of companies and in the services for residents offered by local governments as well as supporting information-grounded decision making by consumers and community members through these transformations. The ultimate goal of these efforts is to aid in lifestyle transformation.

Aims of B2B2X Model Initiatives

The digitization of information will allow for a variety of data to be collected, processed, and distributed via networks, making it possible for previously under-utilized information assets and expertise to be used more effectively.
The advancement of the IoT, meanwhile, will enable for the conditions of various articles to be monitored in a timely fashion through smartphones and other mobile terminals as well as through network-connected sensors and monitors attached to machinery, buildings, and infrastructure.
In addition, artificial intelligence (AI) will greatly increase the ability to support service providers (the second B) in creating new value by instantaneously processing and analyzing massive amounts of collected data.
Accelerating the development of B2B2X businesses is a strategy designed to transform NTT Group's business structure so that it may evolve from a model of providing services directly to individuals and businesses to a model of supporting service providers in various fields to deliver value to end users. The Group will advance this transformation while at the same time taking advantage of digitization, the IoT, AI, and other social and technological developments.

Major Initiatives in the Fiscal Year Ended March 31, 2017

In the fiscal year ended March 31, 2017, NTT Group accelerated several concrete projects together with various partners, including companies, organizations, and local governments.
The results of some of these initiatives were introduced at CEBIT 2017, which was held in Germany in March 2017, and at Niconico Chokaigi 2017, which was held in April 2017 in Makuhari, Japan, as part of our proactive drive to explain these efforts.
NTT Group will strive to continue being an entity with which second B service providers want to collaborate.

Examples of B2B2X Model Initiatives

B2B2X Model Collaboration with a Sports LeagueContribution to the Development of the Sports Field into a Growth Industry with J.League Club Teams

Recently, we have been witnessing the expansion of the sports content industry on a global scale along with other market changes. At the same time, the advancement of the IoT, AI, virtual reality (VR), and other technologies has become ever more apparent. In response to these trends, the Japanese government is spurring forward a drive to develop the sports field into a growth industry in light of 2020.
In the midst of these trends, NTT Group has concluded a collaboration agreement with the J.League and Perform Group with regard to the Smart Stadium project. This project, which is aimed at promoting the advancement of ICT in J.League stadiums and club hometowns, represents one of our first B2B2X model initiatives.
In the fiscal year ended March 31, 2017, NTT Group began converting Yurtec Stadium Sendai and Kashima Soccer Stadium into smart stadiums, joining NACK5 Stadium Omiya, which has already undergone this conversion. We plan to expand smart stadium initiatives going forward. In addition, we are collaborating with Perform Group to make it possible to view sports events anytime, anywhere through DAZN for docomo, a revolutionary live sports viewing channel, and through Hikari TV.

Furthermore, NTT DOCOMO has concluded a top partner agreement with the J.League, while NTT Group has entered into an official technology partner agreement. By building upon our cooperative relationship with the J.League, we will utilize NTT Group's ICT services and assets to promote the B2B2X model.
Looking ahead, NTT Group will strive to encourage greater engagement with current J.League fans and supporters and to step up communication with prospective soccer fans. To this end, we will utilize Group assets, such as NTT DOCOMO's d POINT service, while also holding user-participation events linked to social networking services (SNSs).
We aim to deliver higher levels of satisfaction to current J.League fans and to create new fans by leveraging NTT Group's augmented reality (AR), VR, and other technologies to create new entertainment experiences and by making effective use of J.League's archive of past videos.
In addition, we will help invigorate J.League club hometowns by enhancing relationships between local fans and supporters and the J.League and its club teams through coordination among Group company branches and docomo shops located throughout Japan.

B2B2X Model Collaboration with Entertainment CompaniesMerger of Kabuki and ICT to Create New and More Moving Experiences

NTT is collaborating with SHOCHIKU Co., Ltd., in a joint test aimed at proposing completely new ways of viewing Kabuki by merging Kabuki with state-of-the-art ICT. As the first step of this test, we delivered a real-time, ultrahigh-presence live viewing experience of the KABUKI LION SHI-SHI-O: The Adventures of the Mythical Lion performance, which took place at Japan KABUKI Festival in Las Vegas 2016, to Haneda Airport by using the Kirari! immersive telepresence technology and other cutting-edge technologies.
At the Las Vegas event, an exhibition was held displaying such technological feats as a system that used angle-free object search technology to recognize specialized masks simulating the unique kumadori makeup featured in Kabuki. When a mask was held up to one's face, it would be recognized, and the Kabuki makeup mask would be superimposed onto the individual's face on a monitor using AR technologies. In addition, projection mapping was applied to a giant three-dimensional face object in conjunction with the distinctive pauses and expressions and other dynamic performances for which Kabuki is known. At the same time, deformation lamp light projection technologies were used to present the appearance that still kumadori images on a wall were actually moving, injecting an added degree of human emotion into the exhibit.
Furthermore, the KABUKI LION SHI-SHI-O Las Vegas Performance Returns in Kumamoto event was held to give form to the desires of NTT, NTT West, Kumamoto Prefecture, and SHOCHIKU to support the recovery from the impacts of the 2016 Kumamoto earthquakes. This event included Kabuki Theater Virtual Performance and other exhibits that enabled visitors to experience the potential of merging Kabuki with ICT.
Through these events, we are conducting R&D ventures for utilizing ICT to realize next-generation Kabuki. As we advance these ventures, we will leverage the insight into entertainment expressions gained through these events in future efforts for providing new and more moving experiences.

B2B2X Model Collaboration with Local Governments and CompaniesContribution to ICT Community Development Utilized Publicly Available Data and Real-World Data through Collaboration with Sapporo City and Local Distribution Companies

NTT Group is supporting Sapporo City's efforts to build an advanced model for ICT community development.
We have joined the Sapporo City ICT Utilization Platform Study Panel, a public-private-academic partnership established by Sapporo City. Through participation in this committee, we aim to contribute to ICT community development in a wide range of fields, including sports, tourism, transportation, snow countermeasures, health, childcare, regional economic development, and resident services.
Our first initiative through this partnership was conducted in conjunction with the Sapporo Snow Festival and the 2017 Sapporo Asian Winter Games. We worked together with Sapporo City and local distribution companies to collect and analyze real-world data related to travel, preference, and purchasing trends among domestic and overseas tourists. This information was used to deploy measures for stimulating consumption, including mutual customer referrals by hotels, tourist spots, and shopping facilities, and to help communicate the appeal of Sapporo City.
These data-based marketing initiatives led to substantial year-on-year increases in the sales of the local distribution companies with which we partnered. Furthermore, we were able to analyze industry-wide data on purchases by product category and nationality, data that normally would not have been shared with competitors. These analyses allowed for the rediscovery of markets that individual companies had failed to discover and made it possible to implement marketing measures from new perspectives. These benefits served to verify the advantages of sharing data with industry peers.
By increasing the number of companies participating in these initiatives, we hope to provide further support for consumption-stimulation measures.
NTT Group will also continue aiding the ICT community development efforts of Sapporo City and cities in the fields of transportation, snow countermeasures, health, and childcare.

B2B2X Model Collaboration in Manufacturing IndustryAgreement with FANUC to Work toward Quick Establishment and Commencement of Service of FIELD System for Optimizing Manufacturing with the IoT

An agreement has been reached between FANUC CORPORATION, NTT, NTT Communications, and NTT DATA to engage in collaboration pertaining to edge computing technologies and ICT platform utilization, both areas of focus for all parties, to quickly establish and commence service of the FANUC Intelligent Edge Link and Drive (FIELD) system. This system is an open platform being developed by FANUC that is meant to be connected to computer numerical control devices, robots, peripheral devices, sensors, and other equipment to perform sophisticated analyses for optimizing manufacturing.

FANUC is a global supplier in the field of factory automation and robots. This company is currently engaged in the development and commercialization of the FIELD system. This open platform is designed to be linked to the various equipment used at manufacturing sites to enable smart processing and utilization of the big data produced by such equipment in order to realize unprecedentedly smart manufacturing sites.
Through our partnership with FANUC, the cutting-edge technologies of NTT Laboratories and the ICT platforms and management solutions being deployed on a global basis by NTT Communications will be incorporated into the FIELD system scheme to realize the quick establishment and commencement of service of this system. We will also seek to make this system the de facto standard. At the same time, NTT DATA's application development experience and expertise, which entails using analyses of big data to resolve various issues seen at factories, will be utilized to support the work process reforms of organizations adopting the FIELD system.
Acting as the "Value Partner" that customers continue to select, NTT Group will collaborate with various partners in the field of ICT to promote co-innovation initiatives. NTT Group has positioned manufacturing industry as a priority field. In this field, NTT Group is united in its goal of creating new, high-value-added services and business models together with its partners.

B2B2X Model Collaboration in Livestock IndustryProvision and Testing of Beef Cattle Life Cycle IoT Services for Realizing Stable Supply of Wagyu Beef

In primary industries in Japan, such as agriculture and fishing, the IoT, AI, and other ICT are anticipated to contribute to the resolution of serious issues faced in these industries, including the lack of practitioners stemming from population aging. In addition to helping increase production efficiency and stabilize and improve quality, ICT is expected to make it possible for practical know-how to be represented visually and passed on to others.
In the Wagyu beef industry, the aging and decline of cattle farmers are causing an ongoing shortage of calves. Looking to address this issue, NTT Group has turned its attention to the overall beef cattle life cycle. We hope to reduce the labor requirements for successfully breeding calves, fattening them, and eventually shipping them using the IoT and to offer IoT services that support stable shipments of Wagyu beef.
NTT DOCOMO is working together with the ZEN-NOH Group to advance initiatives targeting cattle farmers for reducing the amount of labor associated with the birth of Wagyu cattle.
In these initiatives, sensors for the cattle body temperature monitoring system developed by REMOTE, INC., are attached to cows that are expected to deliver calves in the near future. The body temperatures of these cows are monitored closely, and graphs are produced, which can be viewed via a smartphone or tablet connected to NTT DOCOMO's communications network. Accordingly, cattle farmers are able to easily maintain an understanding of the cows' conditions. E-mails are sent to farmers 24 hours before the expected delivery or when the cow's water breaks so they can have sufficient time to prepare. Through these features, the system reduces the need for farmers to check up on cows day and night.
In addition, NTT East is engaged in a verification test together with Zenchikuren and Computer Associated Laboratory, Inc., aimed at preventing falling-related deaths of beef cattle prior to shipment.
In this verification test, we have deployed a system in which infrared motion sensors are installed in cattle barns. The image data from these sensors is collected via Wi-Fi and uploaded to a cloud server by means of a milli-wave network capable of long-distance, wireless communications. This data is utilized to identify when beef cattle have fallen, and e-mails are sent when a fallen cattle is detected.
Every year, between 1% and 2% of procured calves die before being raised to a shippable state due to their lungs collapsing as a result of going undetected after having fallen down. This initiative is designed to prevent such deaths.

Realization of Society5.0

The Cabinet Office is promoting "Society5.0" initiatives with the goal of creating an ultra-smart society as part of its initiatives for building industries and transforming society for the future. These initiatives are being advanced through public-private partnerships to transform society for the future. The IoT, big data, and AI are expected to be key technologies and concepts for the realization of Society5.0.

(Reference) Definition of an Ultra-Smart Society

An ultra-smart society is one in which people can receive the items and services they need when and in the amount required. This society should be capable of providing fine-tuned responses to various social needs and making high-quality services available to all. In this manner, an ultra-smart society will enable people to overcome differences of age, gender, region, and language to live empowered and comfortable lives.

Society5.0 (5th Science and Technology Basic Plan)

The IoT is anticipated to make it possible for data from throughout society to be accumulated as big data and analyzed via AI to resolve various social issues.
In order for the IoT and big data to be used to resolve social issues in this way, it will be necessary to appropriately share and utilize the population, road, and other infrastructure (public sector) data possessed by local governments along with purchasing, transportation, and other industry (private sector) data.
In this undertaking, local governments should play a central role by effectively managing public sector and private sector data that has been collected to return the value produced by this information to citizens and local companies. This process will expand the possibilities for utilizing data and thereby contribute to the development of local businesses and the improvement of services for residents.
NTT Group aims to support the efforts of local governments to use ICT for community development purposes. To this end, we have concluded comprehensive partnership agreements with Fukuoka City and Sapporo City through which we have been contributing to the development of tourism and other local industries and to the improvement of healthcare, child support, and other resident services. These initiatives have brought to light a number of tasks needing to be addressed.
The first task is to establish data management entities and increase the number of companies taking part in the aforementioned scheme. If local governments are able to commit to playing a central role in this scheme, participating companies will be more trusting of the scheme, which in turn will make it possible to accumulate highly viable data that would be difficult to compile at the individual company level. Furthermore, returning the value created through this data to the companies that supplied it will support an ongoing cycle of data collection, processing, and utilization. NTT Group hopes to assist in generating such a cycle.
The second task is to formulate standardized rules and guidelines. One goal of this scheme is for various business operators to share purchase data and use it in marketing and promotional activities. However, the types of data collected currently vary by company as do the methods for categorizing products, and policies for disclosure are not uniform. It is therefore necessary for rules to be decided upon by business operators each time information is shared, and the development of such rules thus represents an obstacle needing to be overcome in order to promote such initiatives. By gaining experience through involvement in various information sharing initiatives, we aim to provide support to enable industry organizations and business operators to flexibly take part in such initiatives.
The third task will be to develop safe data management technologies and procedures. It can be expected that the data to be utilized through this scheme will include sensitive information in the possession of participating companies. For this reason, it is crucial to develop technologies for safely and reliably managing this data, including encryption and anonymization technologies, as well as management systems for preventing misuse of data. NTT Laboratories is developing secret sharing and secret computation technologies as well as anonymization technologies and is preparing for the practical application of these technologies.
Looking forward, NTT Group will utilize its assets to contribute to the resolution of government issues, the invigoration of local communities, and consequently the realization of Society5.0.

NTT Group exhibited leading-edge examples of B2B2X model use cases and technologies at CEBIT 2017, the world's largest ICT business trade fair, which was held in Hanover, Germany in March 2017.
Our exhibits presented an overall view of the value we supply to service providers, the second B in the B2B2X model. We were able to attract much attention and praise by displaying a lineup of the value offered on a Groupwide basis to address specific industries and regional issues. The exhibited NTT Group initiatives have the potential to contribute to the realization of Society5.0.

Future Market Scale and Initiatives for B2B2X Businesses

Following its privatization in 1985, NTT Group primarily focused its business on generating telephony and other voice revenues. After the turn of the century, however, broadband operations and global businesses became the engine driving our growth.
In the future, NTT Group will merge the broadband and information systems it has developed to date to pursue sustainable growth by supporting efforts for making industries and lifestyles smarter.
Broadband and information systems will remain central pillars of NTT Group's operations going forward. At the same time, we will leverage the unique strengths born out of the Group's operations in various business domains, including real estate and energy management, as we adopt the perspective of second B service providers in delivering comprehensive value and taking part in collaborative efforts with entities outside of the Group. We thereby aim to help increase the value supplied to end users, the X of the B2B2X model, by second B providers in order to expand our B2B2X businesses.

Potential for the B2B2X Market

The government's Japan Revitalization Strategy 2016 defines 10 areas for public-private partnership projects. By advancing growth strategies focused on these 10 areas, this strategy targets a gross domestic product of ¥600 trillion. Of this amount, ¥30 trillion is to be generated by the industrial field, ¥10 trillion is to come from sports, and ¥11 trillion is to stem from tourism.
Furthermore, the Japanese government's Growth Strategy 2017 has defined "building and developing pleasant infrastructure and towns," "realization of mobility revolution," and "extension of healthy lifespan" as strategic areas for realizing Society5.0. In addition, tourism, sports, and culture; aggressive development of the agricultural, forestry, and fishery industries; and energization and productivity improvement in service industries have been defined as core areas for government policy aimed at the construction of a regional economic virtuous circulation system.
NTT Group will coordinate its efforts with government policy as it utilizes ICT for realizing smart industries in various fields and supporting improvements in the resident services of local governments in order to expand B2B2X businesses.