No.54 September 1, 2002
Using Ubiquitous Networks to Create
New Services Based on the
Commercial and Public Infrastructure
Michio KITAMURA
NRI Papers No. 54
September 1, 2002
Using Ubiquitous Networks to Create
New Services Based on the
Commercial and Public Infrastructure
Michio KITAMURA
I
Reconstruction of Commercial and Public Infrastructure Through Ubiquitous
Networks
II Case Study for New Services Offered via a Ubiquitous Commercial and Public
Infrastructure
III Economic Impact of Ubiquitous Commercial and Public Infrastructure
IV Building Platforms for the Promotion of a Ubiquitous Commercial and Public
Infrastructure
V
Measures for Spreading Ubiquitous Commercial and Public Infrastructure
1. Reconstructing the commercial and public infrastructure through ubiquitous networks will be a
major challenge that offers the potential for promoting the economic rebirth of Japan by initiating structural changes. As we propose in this report, the commercial and public infrastructure
that could be realized by ubiquitous networks essentially consists of three strata: first, ubiquitous networks themselves; second, ubiquitous commercial and public infrastructure platforms;
and third, applications for ubiquitous commercial and public infrastructure.
2. Looking forward, we believe that ubiquitous networks should be sufficiently broad-based to
ensure applications offering “ubiquitous health and security concierge systems,” “ubiquitous
automobile network systems,” and “ubiquitous education and learning systems.” The development of such systems constitutes an important element of the process, as they would
contribute to structural reforms in terms of medical care, social welfare, social capital such as
roads, employment and employee training and the enhancement of skills.
3. The introduction and spread of ubiquitous commercial and public infrastructure applications
will have a major economic impact. If only focused on major applications such as health and
security functions, automobiles and ubiquitous education and learning, we estimate that they
could generate approximately ¥10 trillion in economic demand, as well as having various
profound economic effects on society as a whole.
4. In order to promote the development and formation of ubiquitous system applications, platforms to support them are needed. In the future, “ubiquitous personal terminals (UTs),”
“ubiquitous chips (UCs)” and “ubiquitous service exchanges (UXs)” must be developed and
widely spread to achieve this in Japan.
5. Measures to achieve a wider use and acceptance of ubiquitous commercial and public
infrastructure applications and platforms might include (1) a private-sector approach for
building and managing the proposed system, (2) structural innovation within each of the
specific considerations, and (3) developing systems and applications based on time-transition
scenarios.
Copyright 2002 by Nomura Research Institute, Ltd.
1
NRI Papers No. 54
I
September 1, 2002
2 Reconstruction and Structural Reform
Through Ubiquitous Networks
Reconstruction of Commercial
and Public Infrastructure
Through Ubiquitous Networks
These three types of innovative business models based
on ubiquitous networks (concierge systems, knowledge
asset management systems, and wide-area measurement systems) not only allow for increased business
opportunities in the private sector, but also greatly contribute to a structural reform of commercial and public
infrastructure in the public sector and the boundary
area that crosses both the private and public sectors.
Ubiquitous networks are seen as one of the last
resorts in re-vitalizing the inherent strengths of Japan
and enabling them to reach their full potential. The proliferation of such innovative networking applications
can be accelerated by introducing them into various
ubiquitous commercial and public infrastructure essential to public life.
With the effectiveness of commercial and public
infrastructure in Japan now coming for increased questioning, the onus is on us to bring about structural
changes in these systems.
In this sense, it will be a major challenge for us to
drastically change the commercial and public infrastructure by utilizing ubiquitous networks, which will lead us
to shift directly into gear for the rejuvenation of Japan.
1 Essential Elements of Ubiquitous
Networks
It is already possible in today’s world to enjoy networking by using any of a wide range of terminals,
including desktop or mobile PCs, mobile phones and
TV sets that are already available practically anywhere.
These widespread and widely accessible networks are
referred to as “ubiquitous networks.”
A ubiquitous network can be defined as follows:
1) It consists of a wide variety of networks that offer
such attributes as “broadband (high-speed largecapacity circuits) capabilities,” “mobile
characteristics” and “continuous dedicated
access” via any mode or medium, such as
stationary or mobile terminals, wired or wireless
systems, and telecom or broadcasting, etc.
2) It is capable of supporting any IT (information
technology) equipment, such as mobile phones,
PDAs (hand-held personal digital assistants), car
navigation terminals, and consumer information
appliances, as well as desktop computers and
mobile PCs that are connected or networked with
each other via a barrier-free (access friendly)
interface.
3) It thereby creates an environment in which digital
data can be exchanged in an interactive and
seamless manner, with more freedom and comfort
than ever.
3 New Commercial and Public
Infrastructure Through Ubiquitous
Networking: An Overall View
The hierarchy of ubiquitous commercial and public
infrastructure consists of the following three major
layers (see Figure 1).
The first is ubiquitous networks that constitute the
basis of telecommunications networks to support commercial and public infrastructure.
The second layer is formed by the “platforms for the
ubiquitous commercial and public infrastructure.” Each
platform provides the common basis for both the software and hardware necessary to enable a wide range of
ubiquitous commercial and public infrastructure applications (third layer) to proliferate and be marketed for
business purposes. Looking forward, we believe that
such platforms for the development and spread of ubiquitous networks will comprise such functional elements
as ubiquitous personal terminals (UTs), ubiquitous
chips (UCs) and ubiquitous services exchanges (UXs).
This will be explained in detail in Chapter IV.
The third layer includes applications for the ubiquitous commercial and public infrastructure. These are
individual commercial and public infrastructure (i.e.,
services) in various fields where ubiquitous commercial
and public infrastructure platforms are utilized.
Applications for the ubiquitous commercial and
public infrastructure are classified into two categories
according to the targets that are subject to services and
In particular, if IPv6 (Internet Protocol Version 6)—
which allows any equipment connected to the network
to have its own address—becomes the standard protocol, we will be able to construct innovative commercial
and public infrastructure.
Ubiquitous networks are able to foster three key factors that would promote a social revolution. These
include: (1) exchanging and sharing visible knowledge,
such as knowledge managed not only as text or symbols but also visual images and video; (2) an increased
strength of community; and (3) expanded capabilities
for sensing and tracking. Utilizing these key elements
properly, we will identify three major types of innovative business models: “Concierge business models
aimed at consumer markets,” “knowledge asset management business models focused on corporate users,”
and “wide-area measurement systems targeting public
service fields.” (For details, see “Innovative Business
Models in the Era of Ubiquitous Networks,” NRI
Papers, No. 49, June 1, 2002.)
Using Ubiquitous Networks to Create New Services Based on the Commercial and Public Infrastructure
Copyright 2002 by Nomura Research Institute, Ltd.
2
NRI Papers No. 54
September 1, 2002
Figure 1. Overview of the Ubiquitous Commercial and Public Infrastructure
Commercial and public
infrastructure for human activities
Applications for the ubiquitous
commercial and public
infrastructure
Commercial and public
infrastructure for the environment
Ubiquitous health and security concierge systems
Ubiquitous food history/safety checking systems
Ubiquitous automobile network systems
Ubiquitous national land monitoring systems
Ubiquitous education and learning systems
Ubiquitous forest conservation and
management systems
Ubiquitous vvv systems
Ubiquitous xxx systems
...
...
Ubiquitous yyy systems
Ubiquitous zzz systems
Ubiquitous personal terminals (UTs)
Platforms for the ubiquitous
commercial and public
infrastructure
Ubiquitous services exchanges (UXs)
Ubiquitous chips (UCs)
Ubiquitous network
Ubiquitous network
(1) Broadband, (2) Mobile terminals, (3) Dedicated access, (4) IPv6, (5) Barrier-free interface
Note: IPv6 = Internet Protocol Version 6.
management: namely, the commercial and public
infrastructure for human activities and those for the
environment. The former envisions individuals and their
relevant activities as the target at whom such services are
directed, while the latter involves the ecology that
surrounds human beings and the manmade world.
Between those that now exist and those that can only
be envisioned, there are an unlimited number of ubiquitous commercial and public infrastructure applications.
Those for human activities, for instance, include ubiquitous health and security concierge systems, ubiquitous
automobile network systems and ubiquitous education
and learning systems, all of which utilize ubiquitous
networking. The environmental applications might
include ubiquitous food history/safety checking systems
and ubiquitous national land monitoring systems.
The proposed development processes and their significance will now be explained by reviewing some
typical cases below.
services for our everyday lives—very much similar to
what is offered by a concierge in a hotel who provides
appropriate advice and suggestions in a comprehensive
manner according to the situation (see Table 1).
More specifically, the system may provide such services as mental and physical care services (such as
health maintenance, management and support to care
for physically or mentally challenged persons), as well
as residential and environmental care services such as
crime and fire prevention. These specific services are
variously combined and incorporated into a concierge
service that is offered by the system. It is possible to
assume such concierge services as healthcare or life
care, nursing care for elderly parents living alone some
distance from their children, or for physically challenged individuals.
The basic flow of the offered services is as follows.
The first step includes installing a sensor to detect
individual actions in a house, or alarm equipment that
is activated when an accident occurs. It also includes
such arrangements as temporarily fitting individuals
with body sensors to monitor health conditions, such as
a bracelet-type blood pressure sensor. The installation
of these sensing devices enables information to be
monitored about the indoor environment—anywhere,
anytime and whenever necessary. The collected
information is then automatically transmitted to service
providers via widely used simple telecommunications
devices such as ubiquitous personal terminals through
the ubiquitous network. The service provider in turn
offers concierge-like services such as appropriate
diagnoses, warnings and/or advice according to the
information received.
At present, several enterprises are already providing
some of these remote management services in the field
II Case Study for New Services
Offered via a Ubiquitous
Commercialand Public
and Infrastructure
1 Ubiquitous Health and Security
Concierge Systems
(1) Summary of the expected commercial and
public infrastructure
Ubiquitous health and security concierge services refer
to a system that offers various health and safety related
Using Ubiquitous Networks to Create New Services Based on the Commercial and Public Infrastructure
Copyright 2002 by Nomura Research Institute, Ltd.
3
NRI Papers No. 54
September 1, 2002
of welfare and healthcare management that are targeted
at individuals in their homes. However, the ubiquitous
health and security concierge services differ considerably from existing programs in that the former are
offered as part of an integrated sensing system using
ubiquitous personal terminals as the core elements to
receive various information on an integrated basis from
a wide range of sensors and detection devices.
Moreover, it also differs in that the new service system
provides us with a human service interface that utilizes
ubiquitous service exchanges.
For road administrators, the ubiquitous systems will
measure traffic volume and physical conditions on the
road, thus assisting them in maintaining the roads in
proper condition. A particularly innovative example of
this is the ubiquitous road pricing system, which provides the location and other information on all vehicles
equipped with a ubiquitous personal terminal. Thus a
road pricing system that allows tolls to be adjusted in
accordance with traffic volume or congestion can be
comprehensively and accurately implemented for all
manner of applicable roads.
At the same time, a variety of information and entertainment services can be offered to drivers by private
service providers. This would include traffic or roadside information and vehicle surveillance.
It should be noted that some of the above service
systems are already partially available through ITS
(Intelligent Transportation Systems) applications. But
the ubiquitous automobile network system differs from
ITS in the following points.
ITS is based on the road infrastructure being
equipped with a large number of sensors that function
to track vehicles, and serve to deliver the collected
information to the traffic control center. The installation costs of such systems are substantial. In contrast,
ubiquitous automobile network-systems are based on
ubiquitous personal terminals (capable of telecommunications, sensing, personal identification) that are
mounted on the vehicles, thus requiring no major new
investments for this specific purpose.
Further, ITS provides information in a uniform manner regardless of any differences in vehicle types or
passenger attributes. Conversely, ubiquitous automobile network systems are able to recognize and identify
a car via the driver, thereby making it possible to offer
a wide variety of services on the basis of known individual attributes.
(2) Significant features of the expected commercial
and public infrastructure
The proliferation of ubiquitous health and security
concierge systems will contribute to the reform of medical care and welfare systems in the following areas.
First, it will allow us to monitor individual health
conditions on a regular basis as a large number of people use the home health-check services. In addition, the
utilization of this information will enable us to determine and assess the target population segments for
healthcare services set by the Ministry of Health, Labor
and Welfare in its National Health Movement for the
21st Century.
Second, it will enable a broader dissemination of
daily health maintenance management as well as disease prevention measures to gain greater currency
among the population. This will work to expand the
healthy-state lifespan (the human lifespan minus the
period spent disabled with sickness or injury) to be
substantially extended through the greater usage of
health maintenance management services. The results
will have a positive effect on reducing financial deficits
stemming from the increased burden of social security
expenditures, which include health and medical care
costs.
Third, it will also enable the establishment of an
economical and reliable system for supporting elderly
parents living alone and concierge care insurance
services, which will improve the quality of such
services. For example, the new service system will
enable us to monitor elderly parents who live alone at
considerable distances from their children.
Accordingly, it will make available highly attentive,
concierge-like services.
(2) Significant features of the expected commercial
and civic infrastructure
Ubiquitous automobile network systems will also contribute to overall structural reform in Japan in terms of
a collaborative relationship and coexistence between
automobiles and the environment, as well as in efficient
road construction.
First, it will enable us to accurately determine
traffic volume for individual roads by tracking all
vehicles using a given road. This means that it
becomes easy to carry out ex post facto assessments
of road construction data, such the extent to which a
constructed road is actually being utilized.
Previously, such assessments could only be made
only with great difficulty. In addition, systems like
this would enable us to alleviate the problems of
traffic congestion and environmental pollution by
introducing flexible ubiquitous road pricing systems
on certain roads.
2 Ubiquitous Automobile Network Systems
(1) Summary of the expected commercial and
public infrastructure
Ubiquitous automobile network systems offer a comprehensive link connecting vehicles, drivers and road
administrators on a real-time basis via the network. As
such, they assess road conditions as well as deliver the
collected information to the road administrators and
drivers (see Table 1).
Using Ubiquitous Networks to Create New Services Based on the Commercial and Public Infrastructure
Copyright 2002 by Nomura Research Institute, Ltd.
4
NRI Papers No. 54
September 1, 2002
Table 1. Major Services Provided by Ubiquitous Commercial and Public Infrastructure Applications
Applications for the ubiquitous
commercial and public infrastructure
Ubiquitous health and security
concierge systems
Major services and contents
Mental and physical
care services
Residential
environment care
services
Ubiquitous automobile network
systems
Service for drivers
Service for
road-related
management
Ubiquitous education and
learning systems
Services for learners
Health maintenance and
management
• Physical checkups at home (medical checkups),
healthcare for exercising, automatic analysis of meals
and providing advice
Support and care for
physically and mentally
challenged persons
• Monitoring physical condition, remote room monitoring
Emergency care
• Emergency notifications (auto-sensing type),
emergency notifications (manual type)
Support for transporting
physically and mentally
challenged persons
• Ambulant navigation, assistance in transporting
disabled persons
Residential environment
care services
• Indoor environment control, room temperature and
humidity control, indoor nighttime-guidance systems
Crime and fire prevention
• Indoor and outdoor surveillance
Utilizing spatial and
temporal information
• Advanced navigation systems, auto-alarms to prevent
traffic violations, guidance for roads and facilities
Utilizing vehicle
information
• Monitoring and warning of vehicle conditions
Automatic toll/fee
collection systems
• Collecting tolls on roads, collecting various fees
Providing network content
• Advertising geared to driver attributes, delivering
contents such as music and video
Emergency support
• Car-theft warning and prevention systems, traffic
accident notifications
Utilizing spatial and
temporal information
• Real-time monitoring of traffic conditions, tolls on roads,
management of traffic demand and guidance,
prosecuting traffic violations
Utilizing vehicle
information
• Monitoring road conditions via vehicles, monitoring
weather conditions via vehicles
Offering learning programs
• Participating in qualifications-training programs offered
by companies, universities and other schools (in the
form of lectures, tutoring services, self-teaching, or
examinations)
Support for learning and
qualifications training
• Management of personal academic records, tutoring
services, Q&A services
participation in a wide range of educational programs
(training, course programs, mock exams, etc.) and
prepare for various qualification examinations (see
Table 1).
Individual users are able to flexibly participate in any
educational program they desire by using a ubiquitous
personal terminal from anywhere and at any time.
Under this system, the user’s academic and/or training
records are stored in a databank through the user
identification module that is part of each ubiquitous
personal terminal, thereby allowing the participants to
temporarily suspend or resume participation in any
program, receive suggestions for intensive learning in a
subject or field in which the participant has performed
poorly, and to take qualification exams as well as to be
notified of the results. Moreover, it will also be
possible to learn through the program in an interactive
manner via the ubiquitous personal terminal, and to be
Further, the system facilitates the measuring of road
deterioration and quantifies the necessity of repairs by
using vehicles equipped with sensors that monitor driving and road conditions (such as vibration, potholes,
etc.) in terms of both physical and chemical parameters. Accordingly, it becomes possible to achieve
increased efficiency in road maintenance and repairs,
thereby reducing the relevant costs.
3 Ubiquitous Education and Learning
Systems
(1) Summary of the expected commercial and
public infrastructure
Ubiquitous education and learning systems are intended to provide a network linking individuals,
enterprises, universities and schools in order to enable
Using Ubiquitous Networks to Create New Services Based on the Commercial and Public Infrastructure
Copyright 2002 by Nomura Research Institute, Ltd.
5
NRI Papers No. 54
September 1, 2002
the potential market for each of the major ubiquitous
commercial and public infrastructure applications that
are highlighted in this report.
These proposed ubiquitous commercial and public
infrastructure applications have not yet been
materialized. Therefore, an estimation of demand needs
to be made on the basis of assumptions about the services
to be offered. For this purpose, CVM (contingent
valuation method) analysis is most suitably used to
extrapolate such demand. This method first measures the
willingness-to-pay, which attempts to determine how
much people would be willing to pay for services (whose
nature is still not fully defined) related to maintaining the
environment and scenic surroundings, and to translate
this into a quantitative but simulated market value.
An actual questionnaire survey was conducted (sampling some 100 individuals with diverse demographic
attributes grouped into panels of ten members each) to
collect the basic data necessary for assessing the
demand for ubiquitous commercial and public infrastructure applications. Questions included “How much
is your household willing to pay monthly for the envisioned ubiquitous commercial and public infrastructure
services?” and the responses were then collated (see
Table 2).
Based on the survey responses, we extrapolated the
potential total demand that can be expected in Japan.
The results revealed a very large estimated demand of
approximately ¥4.2 trillion for ubiquitous health and
security concierge systems, ¥1.9 trillion for ubiquitous
automobile network systems, and ¥3.6 trillion for
ubiquitous education and learning systems.
It should be noted that no assumption has been made
that individuals need pay for the three types of services
mentioned above simultaneously. In this context, it
does not make sense to forecast total demand by simply aggregating all the estimated amounts for each.
Rather, the potential gross demand will likely not
exceed a maximum of ¥10 trillion.
offered Q&A practice and/or tutorial services—
including one-on-one home tutoring.
One of the major benefits inherent in ubiquitous education and learning systems is the availability of a wide
range of learning program options, as well as the ability to compare options and programs in selecting the
optimal course of study. This is because all kinds of
learning programs would be open to everyone through
ubiquitous education and learning systems. These
offerings would include training courses provided by
manpower outsourcing and recruitment companies, lectures offered at colleges and graduate schools,
qualifications-focused courses and mock exams
planned by professional schools, as well as curricula
and courses for continuing education.
(2) Significant features of the expected commercial
and public infrastructure
Ubiquitous education and learning systems will greatly
contribute to employment mobility and employee training in Japan in terms of the following.
First of all, the system facilitates increased employability and practical working skills because of the
expanded availability of methods, opportunities and
information gathering procedures that are necessary for
individuals to develop their capabilities. Beyond simply endowing us with knowledge, ubiquitous networks
make it possible to provide educational programs to
disseminate knowledge, expertise and practical skills,
such as remote simulation-type programs teaching
equipment operation that cannot be easily developed on
an explicit pattern. People are able to develop their
skills in a more practical format by participating in
these programs. In addition, it also becomes possible
for various qualification exams to verify the proficiency of the applicant’s knowledge, expertise and skills in
addition to testing one’s explicit knowledge.
Second, various data concerning people’s learning
behavior that are stored (such as how promptly a program has been completed) will be useful in more
efficiently implementing government employment policies. This would include existing education or training
subsidy schemes and various government-sponsored
programs.
2 Huge Economic Effects
Besides creating the potential demand mentioned
above, ubiquitous commercial and public infrastructure applications will yield substantial economic
effects including decreased public spending and social
costs. While it is difficult to specifically identify and
quantify such effects, some examples are presented
below.
The proliferation of ubiquitous health and security
concierge services will improve public life and convenience, thereby permitting a lengthening of the
healthy-state lifespan. This will result in saving some
¥1.9 trillion annually in medical care costs.
According to one assessment, moreover, traffic
congestion now costs ¥4.9 trillion in lost economic
opportunities in the Tokyo metropolitan area alone. If a
III Economic Impact of
Ubiquitous Commercial
and Public Infrastructure
1 Large-Scale Potential Demand
It is assumed that most of ubiquitous commercial and
public infrastructure applications will be operated in
the private sector. This requires a large demand to
make them feasible. Accordingly, we have estimated
Using Ubiquitous Networks to Create New Services Based on the Commercial and Public Infrastructure
Copyright 2002 by Nomura Research Institute, Ltd.
6
NRI Papers No. 54
September 1, 2002
Table 2. Results from CVM Questionnaire: Willingness-to-Pay for Ubiquitous Commercial and Public Infrastructure
Applications
Monthly spending
range per household
Ubiquitous health and security
lconcierge services
Number of
responses
Ubiquitous automobile network
services
Response
ratio (%)
Number of
responses
Zero
5
4.6
10
¥1,000 or less
1
0.9
¥1,001 - ¥2,000
8
7.3
Response
ratio (%)
Ubiquitous education and learning
services
Number of
responses
Response
ratio (%)
9.2
10
9.2
10
9.2
3
2.8
17
15.6
8
7.3
¥2,001 - ¥3,000
9
8.3
16
14.7
7
6.4
¥3,001 - ¥4,000
22
20.2
21
19.3
16
14.7
¥4,001 - ¥5,000
6
5.5
3
2.8
0
0
¥5,001- ¥10,000
32
29.4
21
19.3
35
32.1
¥10,001 - ¥20,000
17
15.6
10
9.2
22
20.2
9
8.3
1
0.9
8
7.3
100
109
100
109
¥20,001 or more
Total
109
Arithmetic average
¥7,252/month
¥3,438/month
100
¥6,610/month
Notes: (1) Response to the question: “How much is your household willing to pay monthly for the envisioned ubiquitous commercial and public infrastructure
service?”
(2) CVM = contingent valuation method.
This means that it is necessary to develop such a new
standardized terminal called ubiquitous personal terminals (UTs) that are suited to the characteristics of the
ubiquitous network in order to allow the proliferation
of ubiquitous commercial and public infrastructure
applications. The two basic concepts of the terminals
are as follows.
The first is that the terminal should be provided with
the basic functions of ubiquitous networks; specifically,
offering broadband capabilities, mobility, dedicated
access, a barrier-free interface, and IPv6.
The second concept is that such functions are provided modularly by means of open system architecture,
and that a standardized protocol is adopted throughout
the system without exception. In particular, the modular and open approach is most important in flexibly
responding to technological advances and changes in
user IT environments. According to this concept, various terminals and functions could be realized in a
competitive fashion, and then be set in place on a stage
where a wide variety of commercial and public infrastructure options can be developed.
ubiquitous road pricing system is materialized by
introducing ubiquitous automobile network systems, a
positive economic effect of approximately ¥2.5 trillion
is expected to be generated—assuming a 50-percent
reduction in traffic congestion.
IV Building Platforms for
the Promotion of a
Ubiquitous Commercial
and Public Infrastructure
1 Development and Spread of Ubiquitous
Personal Terminals
(1) Basic concept of the ubiquitous personal terminal
In order to allow ubiquitous commercial and public
infrastructure applications to proliferate, it is
essential that the bulk of the people actually use the
proposed applications. Accordingly, one of the
prerequisites is that ubiquitous commercial and
public infrastructure applications are superior in
terms of convenience of use. This would be achieved
by a sophisticated interface being installed in the
relevant terminals.
A precondition for spreading applications is that the
relevant market presents a high level of commercial
feasibility for those service providers expected to participate in such businesses. In this context, it is
necessary to reduce the R&D and operational costs by
achieving standardized configurations and capabilities
for the new system. An example of the ubiquitous commercial and public infrastructure that can be
standardized is a terminal serving as an interface
between the users and the system itself.
(2) Modular configuration of ubiquitous personal
terminals
The modular configuration of ubiquitous personal terminals constructed according to these concepts is
separated into two categories, known as the “generalpurpose module” and the “designated-purpose
module.” A general-purpose module that forms the
framework of ubiquitous personal terminals consists of
the following five elements (see Figure 2).
1) Multi-access network module
The multi-access network module includes a
versatile function that is responsive to a wide
Using Ubiquitous Networks to Create New Services Based on the Commercial and Public Infrastructure
Copyright 2002 by Nomura Research Institute, Ltd.
7
NRI Papers No. 54
September 1, 2002
Figure 2. Concept of Ubiquitous Personal Terminals (UTs) and Ubiquitous Chips (UCs)
Ubiquitous personal terminals (UTs)
Designated-purpose module
Energy supply
module
Data storage
module
General-purpose module
Multi-access network module
(e.g. software-defined radio technology)
Application module
User identity module
(ubiquitous UIM)
OS module
Sensing module
Input system
module
Display module
Ubiquitous chip (UC)
Consumer products
Location
ID
Vital signs
(body temperature,
blood pressure, etc.)
Automobile
Environmental
sensing
Human activities
Environment
• RFID (tag, label,
sticker, etc),
• Sensing device
• RFID (tag, label,
sticker, etc),
• Sensing device
Heath parameters
(body fat, glucose
level, etc)
Home appliances
Pyroelectric
sensing
Buildings
Animals and plants
Infrastructure
Notes: RFID = radio frequency identification; UIM = user identity module.
with sensing functions to collect information such
as temperatures or vibrations, and a GPS (global
positioning system) function.
variety of networks such as broadcasting, ordinary
telecommunications, and peer-to-peer (P2P)
communications. We assume at present that this
would mean the SDR (software-defined radio)
system that is attracting attention as a multi-access
network, as well as applications that are
responsive to IPv6.
4) Application module
The application module has an autonomous agent
function, which allows the terminal’s indication or
display mode to change in response to variations
in user needs (such as befitting senior citizens or
children). It also includes API (application
program interface) capabilities.
2) User identity module
The user identity module functions to identify the
user of the terminal. More specifically, we
envision the utilization of a ubiquitous UIM (user
identity module) in which, for example, a driver’s
license is integrated with the UIM device in a
highly sophisticated manner, which then serves as
an ignition/actuation key for the car. Furthermore,
it could be combined with fingerprint
identification technology as a basis for an
individual identification function provided by a
ubiquitous network.
5) OS module
The OS module is the terminal operating system
that controls the various multiple modules with
their independent functions. Accordingly, it is
expected that these modular functions when
combined in various configurations would allow
the terminal devices to adopt a wide variety of
forms (shapes). Looking a few years ahead, we
envision that the typical ubiquitous personal
terminal would be one that combines the current
models of mobile phones and PDAs into an
integrated unit.
3) Sensing module
The sensing module has an integrated function that
includes automatically receiving information from
external sensing devices, reading tag information
like that of RFID (radio frequency identification)
systems, a terminal that is additionally equipped
One of the greatest potential benefits from such a ubiquitous personal terminal would be the ability to access
Using Ubiquitous Networks to Create New Services Based on the Commercial and Public Infrastructure
Copyright 2002 by Nomura Research Institute, Ltd.
8
NRI Papers No. 54
September 1, 2002
food history and safety whereby ubiquitous personal
terminals would replace barcode readers in monitoring
detailed information concerning food history and
safety that is stored in an RFID sticker affixed to all
food items offered for sale. Furthermore, a micro
RFID tag may be affixed to a patient’s body to avoid
any mistakes in identification.
At the same time, various types of advanced sensor
technologies are also being developed. We are now
seeing this equipment with sophisticated functions for
monitoring a range of complicated information from
the vital signs of human beings or the deterioration of
concrete tunnels. Utilizing such defect information, we
will be able to realize a variety of system applications
such as, for instance, ubiquitous infrastructure
monitoring systems.
various services based on ubiquitous networks with
nothing more than one’s own personal terminal unit.
Thus we could use the terminal to access ubiquitous
health and security concierge systems when at home,
and also use the same hardware terminal for the ubiquitous automobile network systems when going out by
car by mounting the terminal on the vehicle. Such benefits and convenience embody some of the most
attractive features that the ubiquitous personal terminal
system could provide.
2 Development and Spread of Ubiquitous
Chips
Ubiquitous commercial and public infrastructure applications would allow sensing and measuring vital
information concerning our bodies for the human-related systems, while they serve to detect conditions of
synthetic and natural objects for the environment-related systems.
Therefore, in order to bring ubiquitous commercial
and public infrastructure applications into broad use,
the development and proliferation of various types of
sensors and information storage media that could be
attached to practically anything relevant to the system—whether human, synthetic and/or natural—must
be developed. We refer to all of these devices by the
generic name of a ubiquitous chip (UC).
More specifically, ubiquitous chips consistof a RFID
element and a sensing device. These tools will play a
very important role in developing ubiquitous commercial and public infrastructure applications.
In particular, RFID could become a powerful
platform. RFID is a system that enables an exchange of
information by radio wave between a micro medium
(such as tag, label, card) and a prompting device
known as a reader. Its features would be low prices,
superior durability, and the capability to store a
relatively large volume of information.
Systems based on RFID technology have rapidly
become popular especially as management systems for
production, distribution and sales. This is because they
provide informational capabilities that are far superior
to the conventional barcode label reader by simply
affixing a tag or label to merchandised goods.
Therefore it will become possible to construct an innovative commercial and public infrastructure by
attaching such RFID devices to synthetic and natural
objects everywhere.
For example, drain and gas pipes buried
underground may be provided with an RFID tag when
they are newly laid or repaired, thereby accurately
identifying the burying point as well as their service
years. This would enable the development of an
appropriate system for the maintenance and repair of
infrastructure installations. Also it will become
possible to provide a ubiquitous system for checking
3 Development and Proliferation of
Ubiquitous Service Exchanges
(1) Basic concept of ubiquitous service exchanges
The third of our proposals entails a system of ubiquitous service exchanges (UXs). Essentially, a UX is a
virtual place for linking service supply and demand
functions together via ubiquitous applications.
From the users’ point of view, a basic flow of services would be offered through such ubiquitous service
exchanges. For example, users would be able to access
a ubiquitous service exchange (i.e., contact center) via
their ubiquitous personal terminals whenever they feel
it necessary and tell an operator (or receptionist at a
counter) about whatever service they desire. The operator then responds immediately if possible, or otherwise
transfers the request to the appropriate consultation
window or dedicated service providers at various reliable institutions. Users are able to communicate with
such consultation counters or dedicated service
providers, and may book the service if necessary or
receive it immediately.
(2) Configuration of functions for ubiquitous service
exchanges
The ubiquitous service exchange system consists of the
following three functions.
The first is the contact center function. This means
that when accessing one of the desired services via
ubiquitous personal terminals, the users will see an
operator appearing on the display, who can respond
immediately by providing face-to-face guidance
onscreen, or otherwise transfer the request to the
appropriate organization.
This system offers four core features: (1) a type of
“Handy-Andy first-aid window” that can offer any type
of help; (2) a “person-friendly system” that serves the
user via a person appearing on the display; (3) “24
hours-a-day/365 days-a-year service” that would be
available for anybody at any time; and (4) “barrier-free
Using Ubiquitous Networks to Create New Services Based on the Commercial and Public Infrastructure
Copyright 2002 by Nomura Research Institute, Ltd.
9
NRI Papers No. 54
September 1, 2002
based on a mechanism that stresses private-sector
design and private-sector service. This focus needs to
be based on the following five principles.
service” that could be accessible by just pushing one
button.
The second element is its function as a marketplace.
This works in such a manner that users are helped
through the intermediary function in which the system
functions to find the most suitable service provider
from the registered list of dedicated service providers
such as NPOs (non-profit organizations), SOHOs
(small offices and home offices), administrative
institutions and volunteers.
An important feature of this function is the capability
to link small units in service demand with similarly
small units in service supply. For example, the service
exchange function could eliminate an undesirable mismatching between demand and supply in terms of such
things as welfare support services offered by local
SOHOs and NPOs.
The third is a service rating function. An operator at
a ubiquitous service exchange reviews the quality and
price of services offered by service providers registered
with the ubiquitous service exchanges for the purpose
of rating them, and then opens the review results to the
public. The data necessary for such rating reviews are
collected extensively from the actual users of the
services.
1) A low-cost approach that requires no large
investment for new construction or operational
expenditures (saving capital investment).
2) Commercial feasibility when operated by
companies in the private sector (commercially
feasible).
3) Open system platforms for promoting competitive
participation involving private business entities
(competitive arena).
4) Providing services focused on benefiting the
customer (customer-friendly).
5) Concept of customary rules that are applied for
operating the commercial and public
infrastructure (customary rules).
The ubiquitous commercial and public infrastructure
will come into use on a broad and stable basis by keeping the above rules intact when designing and
operating the system. For this purpose, the government
is required to take the initiative by carrying out deregulation, and extending the concept of electronic
government to include an electronic public infrastructure system. Further, the government needs to establish
a nationwide vision and provide support to R&D and
standardization activities for the development and proliferation of ubiquitous commercial and public
infrastructure applications.
V Measures for Spreading
Ubiquitous Commercial and
Public Infrastructure
1 Developing an Approach Based on the
Private Sector
2 Structural Innovation for Spreading the
Ubiquitous Commercial and Public
Infrastructure
To enable the effective proliferation of the ubiquitous
commercial and public infrastructure, it is essential to
bring the insight and dynamism often found in the
private sector into areas that have long been
dominated by state control. Conventionally, the
government-led systems—known in Japanese as
kansei-kan-ei (literally, government-designed and
government-serving) or kansei-min-ei (governmentdesigned and private-sector-serving)—have played
the primary roles in such public infrastructure as
welfare and medical care, transportation, and
personnel training. However, we have witnessed the
limits and drawbacks as well as shortcomings of these
systems in recent years. Examples include the
draining of financial resources, extensive
mismanagement, and decreased capabilities under the
yoke of antiquated regulations to cope with changes
in the social environment.
In order to construct the ubiquitous commercial and
public infrastructure applications and platforms that are
expected in the future, it becomes important to adopt a
private-sector approach to management and operations
In addition to the approach that focuses on a system
designed and served by the public sector, it is necessary
to achieve the following structural innovations with
adequate incentives to the users and providers in mind
in order to spread the ubiquitous commercial and
public infrastructure.
(1) Structural innovations for the proliferation of
ubiquitous health and security concierge systems
One feature of the proposed system is that of
monitoring and assessing a person’s health conditions
on a regular and constant basis. This can be utilized
effectively to develop and provide new medical
insurance products in the private sector, including
discounted insurance premiums according to one’s
health status, and risk-specific medical insurance as is
already seen in the case of automobile insurance. This
means that policyholders will benefit from premium
discounts for their medical insurance (rate reductions).
And more specifically, the longer the individual
Using Ubiquitous Networks to Create New Services Based on the Commercial and Public Infrastructure
Copyright 2002 by Nomura Research Institute, Ltd.
10
NRI Papers No. 54
September 1, 2002
adopted to examine an individual’s employability (e.g.,
knowledge, insight, know-how and skills useful for the
areas of expertise). In addition, it is necessary to
provide some benefits to those companies that proceed
to employ personnel who developed their capabilities
through the proposed ubiquitous education and
learning systems.
policyholder continues to maintain good health, the
greater the benefits that will accrue.
From the perspective of a medical institution, it may
be effective and useful to construct a mechanism
whereby the service providers or medical institutions
are rewarded in accordance with the length of time the
service user continues to enjoy good heath conditions
by using the ubiquitous health maintenance service.
Such systems will motivate the relevant medical institutions to offer better services to help people to
maintain healthy lifestyles and good health in general.
In order to realize these social systems, it is
necessary to devise strict rules to control an
individual’s personal health-related data, and
simultaneously review the medical treatment fee to
properly make any necessary adjustments.
3 Scenario for the Spread of the
Ubiquitous Commercial and Public
Infrastructure
Taking all the above into consideration, we can develop
the following scenarios for the spread of the ubiquitous
commercial and public infrastructure. The first stage is
to build the ubiquitous commercial and public infrastructure platform. In particular, the development and
proliferation of ubiquitous personal terminals is most
important.
As already explained above, it is desirable that the
platforms for the ubiquitous personal terminals be built
and managed by the operators and providers in the private sector. However, it is necessary to first take a
transitional step that promotes the proliferation of modular- and open-system architectures that offer various
capabilities, and that also standardizes the basic protocol for those areas that could be shared by a number of
companies. This should be done before attempting to
kick-start the proposed systems by allowing spontaneous marketplace competition to occur. Such
preparatory steps would allow the participating companies to cut R&D costs and shorten the lead-time for
new products, thus resulting in lower prices.
In order to promote modularized systems based on
open architecture and provide the impetus for
standardization, it is desirable that the relevant
companies undertake R&D on a collaborative basis.
This work may also be partially financed by the
government. The financial resources used for this
purpose may be made up by a decrease in future public
spending (such as in public works and services) that
can be expected because of the successful economic
effects derived from the ubiquitous commercial and
public infrastructure.
The second stage is to provide a variety of
applications for the ubiquitous commercial and public
infrastructure, together with enhancing the incentives
to lead individual users to commit to the new system.
For this purpose, it becomes important to devise
mechanisms that could reduce the costs the users have
to pay for conventional services, thereby reducing the
total burden (which includes the price the user will pay
for ubiquitous commercial and public infrastructure
services). As already shown above in discussing the
ubiquitous health and security concierge system, an
example of this is the mechanism whereby premiums
to be paid for medical insurance are lowered (charge
(2) Structural innovations for the proliferation of
ubiquitous automobile network systems
In the process of achieving a broad proliferation of the
proposed systems (especially for introducing the
ubiquitous road pricing system), all vehicles need to be
equipped with a ubiquitous personal terminal. We
believe that most effective approach to attain the
terminal installation is to integrate the driver’s license
with a ubiquitous personal terminal UIM (user identity
module). Information related to the driver’s license
would be incorporated into the identifier module of the
individual ubiquitous terminal that is then connected to
the equipment mounted in the automobile, thereby
permitting the driver to start the engine of the car.
Moreover, for those who use mechanisms to monitor
and warn of vehicle conditions based on the ubiquitous
automobile network systems, we can envision a system
in which such users will benefit from reduced costs for
the compulsory vehicle inspections required in Japan.
For example, the inspection of items known to be in
good working condition due to automatic monitoring
by vehicle monitoring systems could be postponed
and/or the fees reduced accordingly.
The adoption of these systems would require a
review and revision of existing driver’s license schemes
and appropriate changes in the regulatory automobile
inspection regimen.
(3) Structural innovation for the proliferation of
ubiquitous education and learning systems
To level the ground for the proliferation of ubiquitous
education and learning systems, we can envision an
environment that provides a seamless flow of
manpower from skills development to employment.
More specifically, in view of drawbacks in the current
system under which officially qualified individuals are
not necessarily assured of future employment, this
newly envisioned system would provide for clear
improvements. Specifically, more appropriate
certificate and qualification examinations would be
Using Ubiquitous Networks to Create New Services Based on the Commercial and Public Infrastructure
Copyright 2002 by Nomura Research Institute, Ltd.
11
NRI Papers No. 54
September 1, 2002
applications that are unique in character and have
extensive variations. The attractiveness of these
applications will lead to more active users, thereby
further expanding the markets. Our ultimate target
should be aimed at generating both the momentum and
processes that will foster self-sustaining growth and
expansion.
reductions) in line with the length of time the
policyholder maintains good health.
Further, the realization of a barrier-free networking
environment as the essence of ubiquitous networks that
offer communications access by anybody, anywhere
and at any time will enhance the attractiveness of services proved by the system and lead to further
incentives to sign up for the services.
The third stage is one of self-sustaining growth and
continued proliferation resulting from the synergistic
effects of the applications and the users. As the number
of on-the-run and frequent users increases, the larger
the market will become. This will lead to the
production of commercial and public infrastructure
Michio KITAMURA is a chief of Urban Systems
Consulting Unit, Social Systems Consulting Department. His
area of expertise includes urban policy and management
related to socio-economic systems, information
infrastructure, industries, and development.
Using Ubiquitous Networks to Create New Services Based on the Commercial and Public Infrastructure
Copyright 2002 by Nomura Research Institute, Ltd.
12
As a leading think-tank and system integrator in Japan, Nomura Research Institute is opening
new perspectives for the social paradigm by creating intellectual property for the benefit of all
industries. NRI’s services cover both public and private sectors around the world through
knowledge creation and integration in the three creative spheres; “Research and Consulting,”
“Knowledge Solutions” and “Systems Solutions.”
The world economy is facing thorough structural changes led by the dramatic growth of IT
industries and the rapid expansion of worldwide Internet usage—the challenges of which
require new concepts and improvement of current systems. NRI devotes all the efforts to
equipping the clients with business strategies for success by providing the best in knowledge
resources and solutions.
NRI Papers present selected works of NRI’s 3,000 professionals through its worldwide research
network. The mission of NRI Papers is to contribute new ideas and insights into business
management and future policy planning that are indispensable for overcoming the obstacles
to the structural changes in our society.
All copyrights to NRI Papers are reserved by NRI. No part of this publication may be
reproduced in any form without the prior written consent of NRI.
Inquiries to: Corporate Communications Department
Nomura Research Institute, Ltd.
E-mail: nri-papers@nri.co.jp
FAX: +81-3-5255-9312