In the context of countries racing to develop generative artificial intelligence (AI) algorithms, technology powerhouse Japan seems to be being left behind.
Since OpenAI made a new wave with the ChatGPT chatbot, generative AI has become the hottest topic in the tech industry. According to a Goldman Sachs prediction, new AI breakthroughs could boost global GDP growth by 7%, or nearly $7 trillion, over the next decade.
Key to the development of generative AI is large language models (LLMs), which are capable of processing huge data sets to generate text and images. Co-founder of startup LLM Kotoba Technology Noriyuki Kojima said Japan is now behind the US, China, and Europe in developing these algorithms.
According to CNBC, companies in China, including Alibaba and Tencent, have launched at least 79 LLMs in the past three years. Major US technology corporations such as Microsoft, Google, and Meta also played an important role in promoting the development of LLM.
However, Japan is “lagging” compared to the US, China, and Europe in terms of scale and speed of LLM development. Kojima said the reason for Japan’s lag in generating AI technology is largely due to shortcomings in the fields of deep learning and software development.
Deep learning requires a highly qualified community of software engineers to develop the necessary infrastructure and applications. According to Japan’s Ministry of Economy, Trade and Industry, the country will face a shortage of 789,000 software engineers by 2030. Based on IMD’s Digital Competitiveness Ranking, Japan currently ranked 28th out of 63 countries in the digital literacy category.
According to Nikkei Asia, Japan also faces hardware challenges because LLM needs to be trained using AI supercomputers like IBM’s Vela or Microsoft’s Azure storage system. But no private company in Japan has a world-class supercomputer with similar capabilities.
Kojima says government-controlled supercomputers like Fugaku will “hold the key” for Japan to pursue LLM. Access to these supercomputers will become the backbone of LLM development, he said.
Tokyo Institute of Technology and Tohoku University are planning to work with supercomputer developers Fujitsu and Riken to use Fugaku to develop Japanese data-driven LLMs. They plan to publish the research results in 2024 to help other Japanese researchers and engineers develop LLM.
The Japanese government will also invest $48.2 million to build a new supercomputer in Hokkaido, which is expected to start operations in early 2024 and will specialize in training LLMs to accelerate development. AI was created in Japan. In April, Japanese Prime Minister Fumio Kishida expressed support for the use of generative AI technology in industry
Japanese companies run after artificial intelligence
Tech giants have also joined the fray to enhance Japan’s position in the field of AI. In June, SoftBank Group’s mobile division said it plans to develop its own generative AI platform. SoftBank CEO Masayoshi Son emphasized that the investment firm plans to move from “defensive mode” to “offensive mode” and increase its focus on AI. Masayoshi said SoftBank wants to be a leader in the AI revolution.
Group SoftBank has sold an 85% stake in SB Energy and agreed to sell a 90% stake in Fortress Investment Group, cutting other investments will help SoftBank free up cash and pour money into AI through its investment firm. Vision Fund venture capital
SoftBank-owned chip design company Arm is also set to list an IPO in the US later this year. This will be the largest IPO worldwide, said Amir Anvarzadeh, Japan stock market strategist at Asymmetric Advisors.
The company Arm was initially just looking to raise between $8 and $10 billion. However, with demand for semiconductors skyrocketing, Anvarzadeh believes Arm can raise between $50 billion and $60 billion, or 85% of SoftBank’s market cap.
While SoftBank’s share price is likely to rise, that doesn’t guarantee the success of its AI investment efforts. Mr. Anvarzadeh said that SoftBank is not a savior in Japan’s AI development race.
Japanese telecommunications company NTT also announced plans to develop its own LLM to create a “lightweight and efficient” service for corporations. In May, digital advertising agency CyberAgent released an LLM that allows companies to create AI chatbot tools, which is one of the few models that specializes in the Japanese language and culture.
Although Japan has yet to catch up in the AI race, it is taking the first steps thanks to the contributions of businesses. Developing LLMs requires a highly skilled workforce and large capital investments. Once a strong infrastructure is established, the remaining technical challenges can be greatly reduced by using open-source software and data from the pioneers, Kojima says.
However, companies entering this sector should anticipate long-term competition. SoftBank and NTT’s involvement in AI development will not change the current situation in the short term, Kojima warned
AI Regulations in Japan
A survey by Teikoku Databank shows that more than 60% of companies in Japan have a positive attitude towards the use of generative AI, while 9.1% now apply AI in their operations.
Hitachi Corporation has established a generative AI center to strive to promote the safe and effective use of technology by employees. With the participation of data scientists, researchers, and AI experts, the center will come up with rules to reduce the risks that generative AI can bring.
Japan’s Chief Cabinet Secretary Hirokazu Matsuno said the government would consider the application of AI technology such as ChatGPT if the issue of cybersecurity and privacy is resolved.
Research professor at Kyoto University Law School Hiroki Habuka said that the Japanese government should develop and facilitate soft rules in the use of generative AI while reviewing and making strict regulations. closely to protect against potential dangers from AI