Why are there so few software companies in Japan?

8 comments

1. I worked for a big company that makes game consoles, TVs, music, life insurance, and some other shit.

   I was told, basically, that hardware engineering is viewed as the supreme. If you are a hardware engineer, you’re goat. Thus, hardware engineers make UIs for their devices which are ass and convoluted.

   Software engineers, until recently, were looked down at as people who couldn’t hack it to be hardware engineers.

   Again, just what I was told. I don’t have enough societal knowledge to know if that’s true or not but it felt it at the time.

2. Why would you assume there are few software companies?? Japan has a huge domestic market. Just you don’t know about it and they don’t need to make stuff in English.

3. It’s been said time and again on youtube channels that cover the tech downfall of japan like Mayuko and Another Project. Software isn’t taken seriously and less so now with an elder majority making up the population. When it comes to hardware be it anything, that’s where the japanese care and care alot, no one will deny they put their all into it. But software it’s different because it’s not tangible so that makes them reticent to it. Not that there aren’t japanese who don’t want to pursue it but it’s mostly the young people and they don’t get to have a voice, which is why alot of them moved to silicon Valley.

4. I’d guess it’s because the majority of Japanese people (*Cough* Old people *Cough*) can’t use most technology for shit; Therefore there is little demand for software, outside of the Hardware focused items with “add-on software” such as A/Cs which App controllers etc.

   Also, since Japanese generally are basically illiterate at English, they can’t simply build Global focused Software/Apps in English either.

   But that’s just my guess, Who know what’s actually going on…

5. I’m by no means an expert on this matter and I sincerely hope someone else would provide further insight, but prior to 2002, software was not patent-able on its own and instead needed to be combined with a hardware to be patent-able in Japan. I imagine that has a certain degree of impact to date.

6. There are hundreds of software companies. I wouldn’t be surprised if the per capita number is higher than other countries.

   The industry, however, is structured differently like a pyramid. Most big companies keep their proprietary staff relatively small and rely on outsourcing. Then, the software company outsources to smaller companies. It’s why software developers earn less. Most are not part of mega corporations.

7. My take on this is maybe a little different (given my background in both fields). You could to some extent view hardware design (electrical engineering) as a largely closed-systems design problem. I’d argue the Japanese education system is great for this, and accounts for the wild success of Japanese companies doing it since the post-war recovery period. Consumer electronics was their jam.

   Software is different. It’s open-ended problem solving much of the time, sometimes without clearly delineated boundaries. Sometimes there’s not a right answer. I think most of us acknowledge the Japanese education system/culture is *not* good with this. They really struggle with it. I’ve seen 400 page binders with attempts to map out every possible situation when using a (poorly specified, ambiguous) network protocol spec. Most Western software engineers would just roll with it and focus on handling the 95% of common cases and punt on the rest which is really the right answer.

   There’s a reason Microsoft and Google are American companies. It’s a totally different mindset. Before anyone gets in a huff, I’m not saying good or bad. Culture matters and it gets very different results in different situations is all.

   (But yeah they can’t program their way out of a paper bag haha omg)

8. The ideal of modern software development in the US and related markets is that it’s fast, iterative, responsive to changing requirements, and embraces new technologies.

   Japanese business culture is predicated on stability, planning, consensus-building, and guaranteed employment even if you don’t update your skills.

   When I was at a large international software company in Tokyo, I was told the reason almost all of the Japanese devs were new grads was that anyone older had been ruined with bad habits from their Japanese companies. Industry experience was a de facto negative. It was much easier to import a foreigner for an experienced role rather than try to hire domestically.

   There’s also just not enough of a domestic worker pipeline. The reality is that the more prestigious domestic Japanese software companies take on big expenses and inefficiencies to hire foreigners and translators and have teams working partially or fully English here because that’s just what you have to do to get the talent. I’m sure they’d much rather save those expenses by having a more fully Japanese team, but they just can’t get enough qualified butts in seats without going internationally.

   Finally, Japan has not been not a very startup friendly place. Yeah yeah, there’s a new government program every 20 minutes to foster innovation through loans or a co-working space, but what really matters is the cultural acceptance of small and failed ventures on your resume. It’s irrationally self-destructive to leave a job at Toyota, etc., in order to work on a startup, because if you’re not very successful, it’s going to be really hard to catch up to where you would have been as a more loyal salaryman/OL. That has kept the ecosystem of companies that could have grown into significant software firms now small.