I went ahead and made some remarks about the postal system.

 ■I went ahead and made some remarks about the postal system.

"Colloquium on the state of postal services in the digital age."

A meeting hosted by the Minister of Internal Affairs and Communications was held where the government, which is treating digitization as its most important issue, made certain proposals to the Japan Post Group.

Professor Emeritus Kazuteru Tagaya of Chiba University served as chair, and I served as deputy chair.

I was asked to share my opinions at the beginning, so I did.

Here's a self introduction.

I joined the Ministry of Posts and Telecommunications in 1984, and my first training site was the Setagaya Post Office.

Thirty years ago, I was the Noboribetsu post office manager.

I was dispatched to Paris for 2 years and was involved in foreign investment in savings insurance.

I was in charge of restructuring ministries at the Minister's Secretariat.

I was involved in the postal service at three locations: on-site, overseas, and at the Ministry of Foreign Affairs, but that is over 20 years ago, now.

Since that time, I have been out of the postal sector.

I was intrigued when Kazuhide Kinugawa, president of Japan Post, recently said, "We will improve the channels of communication between people on the ground and management."

The postal service I am acquainted with was already a flexible organization with open lines of communication, but it seems to have become more constrained after undergoing privatization.

While efficiency improvements and governance are being emphasized under the trend of privatization, I am concerned about how far the postal service's role as infrastructure will be able to be maintained.

How to utilize the functionality of the postal service to cope with aging, informatization, and internationalization is an issue of national importance.

The assets of the postal service are tripartite: people, things, and its network. How to maximize that value?

The sense of security and trust that people in post offices have cannot be imitated by other companies.

They are involved in local government operations, monitoring services, and more, but they could feasibly handle other regional public services in a more strategic fashion. To that end, institutional allowances will also be an issue.

Physical objects and real estate can still be utilized to some extent.

It could also be used for activities aimed at the elderly or the like, but personally I hope it will be used as an educational base.

People have also expressed interest in support projects for the Olympics, e-sports, etc.

Next is a network infrastructure.

Postal mail is a form of communication and is not inherently in conflict with IT.

Since it operates a large commercial communication network, it would not be unusual if it becomes a telecommunications carrier or enters the ICT business.

It would have been no surprise if the post office took Rakuten's position, therefore.

Finance is also inherently a data business. Post offices handle large amounts of data through three businesses, and they have 24,000 bureaus where they could embed sensors to whatever extent they want to track the flow of people and goods. They are in an advantageous position.

In order to promote these approaches, human resources well-versed in data and design will be indispensable, but actually securing human resources to adapt to these innovations will be a challenge.

It is natural, or rather a defensive strategy, to make use of those assets: people, things, and networks.

But I hope they will also go on the offensive.

International expansion is a major issue for every industry as the domestic economy stagnates. What will the postal service do? The postal service is, in particular, a universal system.

I also look forward to seeing what technology initiatives they come up with.

I do not have data on how much Japan Post allocates to R&D, but communication and finance companies have to be driven by research if they wish to grow in the future.

Twenty years ago, the U.S. Postal Service invested 500 million JPY in the MIT Media Lab. Domestic competitors are also moving fast.

Meanwhile, Japan Post can be seen making inroads around the cloud, AI, robots, and the like, and they are also showing signs of supporting open innovation with partner companies, so we should support them.

This is no longer in the pilot stages, and both are ripe for implementation and actual use, so I'd like to see them speed things up.

Here are two details on my own recent activities.

I am promoting smart city development in the national strategic special zone in Takeshiba, Minato, Tokyo.

We are proceeding with a 5G/8K/AI data utilization project in collaboration with SoftBank, NTT, KDDI, broadcasters, and the University of Tokyo, RIKEN, NICT, and other players.

Also, this April, we opened an ICT business university called iU in Sumida Ward in cooperation with 250 companies in the communication and ICT space, among others.

This is a university where all students start businesses, and we are putting efforts into regional revitalization in cooperation with entities like Yoshimoto Kogyo.

I think both have a high affinity with the postal service, but they haven't been linked up yet.

This is but one example. Since there are projects like this all over the country, it would be nice to see meetings like this one lead to further developments around matching with the postal service.

As mentioned above, while the post office may be downtrodden due to scandals involving Japan Post Insurance and postal savings, a general slump in postal services, and overseas investment failures, a digital opportunity is coming, so I tried to set a fire under them to stay positive.

There are projects I'm involved in that they would do well to get involved in, but I haven't seen them rise to the challenge yet.

So it's my role to rouse them into doing so.

 

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The future of soft power policies

 ■The future of soft power policies

I was invited for a talk at the LDP's Soft Power Special Committee.

Appearing there were people like Chairman Takeo Kawamura (former Chief Cabinet Secretary and Minister of Education, Culture, Sports, and Science), Toshiaki Endo (former Olympics Minister), Masahiko Shibayama (former Minister of Education, Culture, Sports, and Science), and Takeaki Matsumoto (former Minister of Foreign Affairs).

I shared my personal opinion on the current state and issues around soft power, Cool Japan, and content policies as follows.

About 30 years ago, Harvard University professor Joseph Nye, who proposed the theory of soft power, pointed out that Japan should make use of the power of pop culture in particular.

The term "Cool Japan" originates in 2002, when Douglas McGray published a paper called "Japan's Gross National Cool," stating that the country changed from an economic powerhouse in the 80s to a cultural powerhouse in the 90s.

Compared to hard power, the evaluation criteria for soft power are not clear, and it is difficult to handle in terms of policy. And Cool Japan refers to things discovered about Japan from overseas. So the point is less about how to launch what Japan wants, but how to develop the kind of content people overseas are looking for. It was because of that trend that pop culture was the central theme, rather than traditional arts.

One frame of reference is NHK's Cool Japan program. It is a long-lived program that has run for 14 years since 2006, where foreigners living in Japan talk about what is cool about the country. I appear once monthly, and there are seemingly endless topics. The foreigners propose idea after idea. The more you explore, the more cool content Japan has to offer.

At first, a lot of the content was around pop culture like anime and games, but now it covers a wider range. Food topics include rice bowls and ramen. Other topics are friends, shopping, books, club activities, aquariums, convenience stores, deliveries, manners, and more. A recent topic was take-out food. The program talks about how a new culture is being born out of the bento box culture in the wake of COVID-19.

The government began paying particular attention to the content industry from the early 2000s.

In 2003, the Intellectual Property Strategy Headquarters was established, and together with related ministries and agencies such as the Ministry of Economy, Trade and Industry and the Agency for Cultural Affairs, they began focusing on intellectual property policies such as those around use of content. There has been a shift from domestic emphasis and industrial promotion measures in the past to an emphasis on overseas expansion and growth on the Internet.

First is overseas expansion. On a funding basis, policy tools have been built up, such as the establishment of the Cool Japan Fund in 2013. Overseas sales increased by 26% in 5 years. Anime increased by 3.6 times, and movies by 4.3 times. Broadcasting increased by 4.3 times. It could be said to be the result of the policies that were made. However, Japan's sales account for just 2.5% of the overseas market, so further growth is expected.

Next is development online. Online streaming grew from 9.5% in 2008 to 26.0%, but there is a big difference by area, with manga taking up 40%, anime 15%, music 8%, and video 4%. Sales in publishing increased last year for the first time in 23 years. The electronic publishing copyright business saw growth. On the other hand, the Japanese music industry has not been able to ride the wave of the global market growing online.

Overseas players are a threat, such as from pirated manga, anime on Netflix, games being made for the cloud, such as by Google, and music on Spotify. However, they also provide production funding and overseas sales channel expansion. Streaming has grown in unique ways due to emergency demand under COVID-19, but the question is how Japan's content industries should get on board with that.

I propose two trajectories to take.

First is matching between content and other domains. Strategies that leverage synergistic effects through collaborations between content and fashion, food, tourism, and other industries are key.

Of the 10T JPY from Pokémon-related sales, more than 6T JPY is in the character merchandise business.

Sales from anime creators are 240B JPY, and the rights business is 2.1T JPY. It's nearly 10 times larger.

Another issue is compatibility with Society 5.0. The content industry, which is mainly made up of small and medium-sized enterprises, has been unable to adapt.

Distribution will shift to 5G and the cloud, and content will be viewed through diverse environments such as IoT and VR. In particular, it is important to develop systems for data usage. Netflix is a targeting business based entirely on data, but domestic TV is unable to use viewing data.

Also, coordination between intellectual property strategy (copyright) and IT strategy (telecommunication encryption) is an important issue in anti-piracy measures. Similarly, policy issues surrounding intellectual property, content and IT, and technology are likely to grow. The Digital Agency has become an important issue for the Suga Cabinet, but the state of administrative organizations around Cool Japan should also be evaluated.

Here are two private sector projects I was involved in. The first is e-sports.

Japan has been late to the game in e-sports, but the environment is in place, so it looks poised to set off as an industry. According to a report by the Ministry of Economy, Trade and Industry and JeSU, it is predicted that it will grow by 16 times in the next five years. It is growing rapidly due to demand under COVID-19, and growth is slated to be faster than expected. However, to that end, there are issues that should be addressed by both industry, government, and academia.

Another example is about building sites. In September, the CiP opened in Takeshiba, Minato-ku, Tokyo as a site to aggregate content. Content creators, IT, universities, and other entities congregate here to run pop and tech projects. Digital Minister Takuya Hirai stated that he would like to make this location a branch of the Digital Agency, and preparations are underway.

We'd like to make it a hub by promoting cooperation within Tokyo, such as with sites like Haneda and Shibuya, and cooperation with other cities such as Sapporo, Nagoya, Kyoto, Osaka, Fukuoka, and Naha. Agreements have also been concluded with governments and local municipalities that are keen on content, such as the Korea Creative Content Agency and the Spanish state of Catalonia, and we will also promote collaborations with international cities. Talks are also underway with Shanghai.

The live entertainment industry has been hit the hardest by COVID-19. CiP has compiled some statements and is moving to ask the government and bureaucracy to take action. The content includes a mechanism to shore up content dissemination from rural areas, and support for utilizing the latest technology such as 5G and AR/VR. We have also expressed our interest in cooperating on measures such as the establishment of funds by the music industry.

Based on the above, I have 5 requests to make.

DX

This is the first topic of importance for the current administration. Digital support for content is still insufficient. There is an urgent need for live streaming, global expansion, and AI and data support. We should provide support and guidance through tax systems and the like.

Education

The foundation of soft power and Cool Japan is a creative cultural state where everyone can participate and create in a free environment. That requires education that maintains and enhances the creativity of the citizenry.

This year, the one computer per person policy will be realized in elementary and junior high schools all at once. I hope they will proceed with measures like enhancing creative activities through programming learning.

Core organizations

I want to create a core organization for public-private partnerships that advance the Cool Japan policy.

This has been repeatedly proposed at government meetings, and it has also been described in recent intellectual property plans. The private sector will prepare a context for this to work, so we should at the very least implement it and let them run with it.

"Ministry of Culture"

The Digital Agency is important, but administrative IT is the core pillar undergirding this. What is more important is the fusion of IT and intellectual property policies.

Recently, the Keidanren proposed the idea of a Ministry of Digital Affairs and Ministry of Information Economy and Culture. Digital is but a means, while the purpose is culture. I also agree with the establishment of a powerful ministry organ that represents the shape of the country to come. The core is culture, so the name should be the Ministry of Culture.

Olympics and Expos

There is no country that has had as many opportunities given to it as Japan. This should be used intensively for hybrids approaches, such as as a promotion venue for soft power.

Japan is seen by the world as creative, but it doesn't see itself as such. We have a low sense of self-affirmation. It's this issue of the prevailing atmosphere. We need to freshen things up and breathe new life into it so Japan can see itself for what it truly is. I hope the political leadership will take charge here.

A lawmaker asked how we should strengthen soft power through digital education.

Digital is a tool for creation and expression. It's therefore more effective for music, arts, and crafts than language, arithmetic, science, and sociology curricula. The extent of that education is the source of soft power. So double the time for music, arts, and crafts classes!

That was my reply.

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Looking back on Mr.Isao Okawa.

 ■Looking back on Isao Okawa.

I read Nishi Kazuhiko's "Record of Regrets" and I found myself deeply reflecting on the fact that it's been 20 years since Mr.Isao Okawa passed away.

He is a major entrepreneur who helped bring CSK, Sega, and Bell System 24 public, but there are fewer people who know about him nowadays.

None of the students at iU likely know him.

Yet it's a grave loss to forget about that old timer.

When he died in March 2001, I spent a lot of time writing memorial messages for him.

I left the government office and went to MIT, and since that time it was Mr. Okawa who gave me a chance to idle about in academia, and it was truly a shame that he passed away just before various digital projects and projects for children, such as the MIT Okawa Center, came to fruition.

One such message is here.

You can read it below. ↓

March 22, 2001: What Mr. Okawa leaves us (by Ichiya Nakamura), Nikkei Digital Core

http://www.ichiya.org/jpn/NikkeiNet/nikkeinet_010322_vol5.pdf

In other words, Mr. Okawa is the source of programming education and one computer per person idea that was later disseminated around MIT and elsewhere, and is a major global contributor to digitization of education.

But what I want to convey here is how he came across as that 20th century persona of someone who is wild and sexy, a flashy spender, which was in total contrast to his amazing feats. I have never met the likes of him since. He was quite an amusing man.

I first met him when I was a newcomer at the government office. The year was 1984.

I was with the Ministry of Posts and Telecommunications in the telecommunications bureau, and we were in the midst of formulating a bill for the Telecommunications Business Act to liberalize telecommunications.

On a nearly daily basis, Mr. Okawa negotiated with the executives.

Even though he was the president of a software company, he was like a private officer pitting the Ministry of International Trade and Industry against him.

I used to regularly serve him tea each day.

After that, in 1995, when I was sent to spy in Paris, I attended to him as part of G7 proceedings, as described in the memorial I wrote.

After returning to Japan, I started frequently taking part in a salon that Makoto Naruke of Microsoft held every month in Akasaka.

I met up with Mr. Okawa again there, but I wasn't in a position to talk freely with a bigwig who was 35 years my senior.

I would just get tipsy and gaze at him from a distance.

I burst open the door to the restroom and found Mr. Okawa there, pants down, taking a leak. I felt like I had seen something I shouldn't have, and scurried back to the parlor. I was sipping my drink, and he came out and shouted, "OK, who just took a peek at my ass?"

It was this guy, this guy.

It was like one of those interrogation routines in a Yoshimoto standup comedy duo, and he recognized me.

It was slightly later that Kazuhiko Nishi proceeded with the MIT investment project to save ASCII, pitching the idea of establishing a research institute to Mr. Okawa. It was then that he suggested I quit my government job and go to MIT.

Mr. Okawa appraised me over a round of drinks.

"So you'll leave the government. You sure you're okay with that?"

I would be going alone to the US, but I had no money to my name, and nowhere for my family to live.

"We have this apartment available, so they can live there."

It was a rather impressive apartment in Nagata-cho.

So my family moved in.

In the adjacent apartment was Koichi Hamada.

Across the way was Shin Kanemaru's office, from which illicit gold bullion donations were later found.

Many of the letters that arrived at the apartment were addressed to the Onko Chishin no Kai.

It was an office rented to Michio Watanabe, apparently.

And here were we, this suspicious family in the midst of it all.

As for what become of us after that, well, we still live on the fourth floor.

Mr. Okawa would take the stage and enthusiastically sing "Tokyo Rhapsody," which was tantamount to the CSK company song, leisurely dancing a traditional Japanese dance as well as the masters. He was a versatile entertainer. One of his other performative acts was handing out money.

Night after night, at high-end restaurants in Akasaka, he would slip envelopes with money in them into the sleeves of geisha entertainers.

He would put 10,000 JPY in small envelopes and bring lots of those every time, tossing them over to the entertainers while sharing frivolous and erotic stories with them.

What a bigwig.

That's not something your run-of-the-mill company president could do.

Only people who succeed at entrepreneurial ventures have the chutzpah to safeguard the old culture like this.

I often helped him prepare the envelopes by putting bills in them.

What a bigwig.

When Daijiro Hashimoto was elected governor of Kochi Prefecture, he donated more than 200 paintings by Chagall to the Prefectural Museum of Art to celebrate.

Why, I asked? He just said, "Chagall is dead. Dead artists are considered the good ones."

Although, he was enthusiastic about supporting Mr. Konishiki and other living people.

(I wish he had given me at least one...)

What a bigwig.

He went to the main Paris location of Hermes and said, "Give me all the neckties from this side of the display to that side." As his interpreter, I hesitated.

He then asked me to buy six bottles of milk, which I bought at the sticker price, and he spent an hour chastising me for not getting it at a discount.

It really gave me a glimpse into these two sides of him: the star-studded bigwig, and the penny-pinching man who had worked his way up from the docks.

He was the first person I worked for after leaving the government for the private sector.

Once I joined the private sector, I expected to find tons of these larger-than-life characters.

But the reality is that I never met another like him.

He had a vineyard on the west coast, and I had access to Bellinger whenever I wanted when he was around.

I still have a single 1999 vintage.

I plan to open it on the 20th, the anniversary of his death.

Thank you once again, Mr. Okawa.

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I recently read Dr.Kazuhiko Nishi's "Record of Regrets."

 ■I recently read Dr.Kazuhiko Nishi's "Record of Regrets."

Record of Regrets is written by Dr.Kazuhiko Nishi.

What would Mr. Nishi have to regret?

An unprecedented and rambunctious person who was Bill Gates' right-hand man, competing with him and succeeding at growing ASCII, a company with a punk mentality, although it later sunk, but he still was undeterred.

At least, that was my original thought, but it seems to be a serious look on the latter half of his life with a good dose of reflection.

He had a lot of turbulent times.

I have many people to whom I am indebted.

The person who created an opportunity for me to leave the government and go to MIT was Dr.Kazuhiko Nishi, after all, and it was Dr.Jun Murai who invited me to a project to create a graduate school in Japan, and Mr.Masayoshi Son supported me in launching a movement to digitize education.

And one such person is in the midst of serious reflections in this book.

I tried reading it in the context of my own career.

He is a true digital entrepreneur and tech nerd through and through. Ideas seem to just bubble forth aplenty.

He enters a pub, and orders items willy-nilly all across the menu, then takes out a red felt-tip pen and starts scrawling on the paper sleeve for the chopsticks, jotting notes about next-generation communications devices or acoustics systems, and pushes it over asking, "Well, what do ya think?"

So that must have been the framework out of which the "10 dollar PC" idea came about.

The fact that he garnered the support of Mr.Nori Oga, former president of Sony; Mr.Sohei Nakayama, special advisor to the Industrial Bank of Japan, and Mr.Shinji Fukukawa, vice minister of the Ministry of International Trade and Industry is a testament to his appeal as a business manager.

Yet the vexing trials and tribulations around financing, internal rebellions, restructuring, and betrayal that appear in the book would be fit to make a melancholy film.

He is mischievous, short-tempered, and focused on minutiae despite working at a macro scale.

That intriguing appeal may not fully come across in this 450-page autobiography, but give it a read all the same. It's quite interesting, I can tell you.

I had some involvement with the latter stories involving Isao Okawa of CSK/Sega, so I'll jot down some comments on that.

I first met Dr. Nishi at Charles de Gaulle Airport.

I was dispatched by the government as a "spy," and received a phone call from the White House.

Dr. Nishi, who had been discussing digital policy with the Clinton administration, said he would find someone to bridge the government and private sector, and got on a Concord jet then and there and arrived.

I think it was around 1995. It was a fun time.

But according to the book, ASCII fell on hard times and faced a looming deficit of 14.6B JPY.

Weekly ASCII, which was first published in May, featured me and Jun Murai, but the magazine failed miserably.

Dr. Nishi approached me and said, "Why not quit the government and handle the games division at ASCII?"

We were right in the midst of an agency reorganization, so it was neither the time nor place.

At the end of 1997, when the Ministry of Posts and Communications merged with the Ministry of Home Affairs and the General Affairs Agency to become the Ministry of Internal Affairs and Communications, the internal reorganization was finalized, I began thinking about how to handle my responsibilities.

Around the same time, Dr. Nishi asked Mr. Okawa to invest, and he agreed in December.

Dr. Nishi was demoted as president of ASCII and became a non-executive director, acting as Okawa's secretary.

In 1998, Dr. Nishi mediated negotiations between Dr. Negroponte, director of the MIT Media Lab, and Mr. Okawa, to discuss a plan to establish a media and children's research institute dubbed the MIT Okawa Center.

Mr. Okawa immediately agreed to MIT's proposal and paid them 1B JPY on the spot.

On the condition of that investment, one visiting professor from Japan would be invited.

So Dr. Nishi approached me and said, "Instead of ASCII, why not become a guest professor at MIT?"

I think he was worried he might be sent instead.

Building a lab at MIT? I was definitely game.

We met at a wine shop in Nishiazabu to present ourselves, so to speak. And I passed the test.

There's no one who is usually able to go toe-to-toe with Okawa and drink that much, they told me afterwards.

I went to MIT, became a special advisor to Sega, and was involved in the development of the Dreamcast.

It was the first game console to be equipped with a telecommunications function.

That epoch-making decision was perhaps ahead of its time.

It may have been one of the factors behind the delay in e-sports in Japan.

In March of 2001, after a battle with cancer, Mr. Okawa donated 85 billion yen to Sega and gracefully passed away penniless.

The Okawa Center was not ready in time.

In July, Dr. Nishi proposed to MIT a concept that would become the basis for the "100-dollar PC," and laid the foundations for the Okawa Center.

Apparently, his "Japan Advanced University" initiative was sundered by the global economic crisis.

Yet he was indomitable. He wrote, "I want to make it a success and gain the approval of Mr. Okawa!"

I had some doubts about Japanese universities when I saw MIT's industry-academia collaboration, so I went ahead and created iU first.

I hope it will be useful in its way in achieving Dr. Nishi's university plan.

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