6.22.22-Showcase-Takashi-Hara

TAKASHI HARA: Good morning. My name is Takashi Hara, CEO of DOCOMO Innovations and head of a Silicon Valley branch of NTT DOCOMO Ventures. And I thank you, Marcus, and especially, thank you, Marcus. And thank you, Todd, for having me this great opportunity.

And so my job is creating new business opportunity or collaboration between the US companies and the Japanese companies via technology development and investment. DOCOMO Innovations is actually R&D base of NTT DOCOMO in Palo Alto. And DOCOMO Ventures is obviously corporate venture capital of DOCOMO.

And at the same time, I'm the father of two teenagers, 18 and 14. I have two concerns for them. So first one is communication, communicating with teenagers. It is very difficult and sensitive. So although I'm working for a communication company, sometimes it might be difficult. So if you have a good solution or innovation, please let us know. It will be welcome.

Well, the second concern is that they will have many, many social problems, including sustainability. But this is because of previous generations, including us. So sustainability, today's topic, is very, very important for me, too. And I'm working for NTT DOCOMO for over 20 years. And DOCOMO is a Japanese cellular operator, like AT&T Wireless or Verizon in the United States. But the unique point is, DOCOMO has the R&D resource. And DOCOMO is very crazy about creating new platform itself.

So obviously, DOCOMO created the digital server at the first decade. And next decade we created a mobile internet platform. And then we created a mobile payment platform. So 1999 is over eight years before iPhone runs. And 2004 is over 10 years before Google Pay and Apple Pay. Actually, emoji is the invention of DOCOMO. It's for fun or joy of platform users.

And next decade, we created the Smart Life service platform. So we created a digital content platform, point economy platform, and bike share platform, and so on. So DOCOMO is techie and sometimes seems to be weird, but we love creating new platforms changing people's lives. This is DOCOMO.

What will be the next? What type of platform is DOCOMO thinking, going to create in next decade? 5G platform, this is one. But last year, we announced Caboneu platform. This is a platform for the effort to the carbon neutrality. This is one of the important topics for today.

This is the agenda for today. So after checking the situation, telecom industry, I will introduce three steps of approach we are now thinking of to the carbon neutrality. By the way, in order to say hi to my parents living in Osaka, it took, maybe 300 years ago, it takes 22 days. But now we can take a bullet train, and the airplane, and cars. So it's just only two hours or several hours.

But by using the telecommunication, it takes just a few seconds. This is the fundamental value of telecommunication. In terms of carbon reduction, in terms of carbon emission, that's virtually the same. Instead of going there actually, by using a telecommunication, we could reduce the carbon emission. This is a fundamental contribution of telecom industry.

However, now telecom industry is struggling in terms of carbon emission problem. Why? Because of demand . Explosion Everybody now using a video streaming service like Netflix or Amazon Prime or YouTube at the same time. How about meetings? All meetings now maybe has changed from in-person to teleconference. Although I love in-person communication, so this event is fantastic. Maybe I shouldn't say, as a guy of the telecom industry, but in-person has a power.

But some people are saying that everything might be in metaverse, right? So demand is now exploding. So this is a graph of growth of mobile data traffic from Cisco. In the last five years, data traffic has grown seven times in five years. The pace is 1.5 times per year. This pace is very fast. This space exceeds many technological evolutions.

So actually, in this industry, all power consumption in telecom industry has been growing, increasing gradually. This is very problem. The situation is the same in Japan. The one smartphone, including all rated electricity, like a network operation or manufacturing-- one smartphone emits 88 kilograms of carbon dioxide annually. So 200 pounds maybe? So heavier than me, annually. And totally, 16 million tons per year.

The number this amount is equivalent to is almost 10 million cars annually. So because of the amount, because of the trend, now telecom industry is struggling. So I believe that you can imagine now how challenging telecom company to commit to carbon neutrality. DOCOMO committed last year that we accelerate our goal from 50% reduction to the carbon neutrality by 2030.

But how to do it? How to achieve the carbon neutrality? We have three steps. First one is by ourselves, which means from our network operation. So in order to reduce the carbon emissions, we have three ways. First one is reduce from existing network operation. Second, we could develop the new technologies contributing to future network. And third, obviously, we could procure renewable energy more and more.

Where should we start? Of course, operation, existing network of radio network. Radio network consuming 70% of all power consumption in our business. So now we are doing many things in radio network. So I cannot explain all, but for example, advanced base station sleep mode. So base stations are designed based on the peak traffic. So we could turn off the facilities or some resources if the traffic is lower. But the prediction is very difficult without any quality sacrifice.

So we are using the big data analysis of network data. And at the same time, we could install newer, more efficient facilities. The 5G is more efficient than previous technologies. So 5G could transport the same amount of data with less power. So shifting into the 5G is directly contributing to the carbon reduction.

And I want to pick up today Green Base Station system. This is not the project, just only putting the solar panel or windmills near the base station. I will explain detail later. The Green Base Station has three components-- so generator, battery, and a management system AI. The management system has mainly two features. First one is to control battery capacity based on the demand and supply.

So in the case of rainy forecast, the AI doesn't discharge at night. But on the other hand, in the case of sunny forecast, the AI discharge in advance at night then to make room for the electricity expected in daytime. This is one. And the second feature is the feature to share the electricity between multi base stations.

So based on the situation, the system can transfer electricity one base station to another base station. This feature enabled the stable operation of base stations with unstable renewable energy. This management system has connected with 263 base stations countrywide, but this is not the end of the story.

As I said, the number of Green Base Stations is 263. But the base station, which has a battery, lithium-ion battery, the number is over 100,000. Why so different? Because this high-performance battery is for disaster preparation. Japan experienced a big earthquake in 2011. DOCOMO's base station lost the power, and we couldn't provide any cellular services, although this connectivity is a very important lifeline for everybody.

So based on this experience, DOCOMO decided to install lithium-ion battery to all base stations. Now we have done how? What would happen if 100,000 batteries-- we connected between 100,000 batteries of base stations and the Green Base Station system? It would become a gigawatt battery network distributed countrywide.

What would happen if we opened this system to the society? It would become the battery network that enables stable operation in the society with unstable renewable energy. So this is another potential. It's like a reservoir, right? So as the water of rain is installed in a reservoir to grow crops or to have drinking water for every day, a stable operation. So this is another potential of Green Base Station system.

Next topic is about the future network. MWC, Mobile World Congress, this March, DOCOMO and NEC announced a PoC network function virtualization on AWS Cloud environment. So this is not only for higher performance of a higher network robustness. It's for a higher energy efficiency.

At the same time, this article is saying that when we think about the carbon reduction of next generation network, we need to think about cloud environment. Typically, cloud environment is a shared responsibility model. So in order to reduce power consumption with the cloud, we need to consider server power consumption, a cooling system power consumption, and facility consumption, and so on. But this is the responsibility of cloud provider.

But power consumption of cloud is decided. So it depends on how you use the cloud itself. So for example, how efficiently you use the database on the cloud or how efficiently you design applications on the cloud and so on. So this is the responsibility of the cloud user. So from the viewpoint of next generation network, we, federal operator, needed to be on cloud user side.

So DOCOMO Innovations started to think about this environment. So based on the carbon reduction cycle, we're now creating new tools for next generation network virtualized on the cloud environment.

So Green Visualizer, which allows us to show all carbon emissions on multi-cloud environment on the one dashboard and to orchestrate multi-cloud resources, now we are developing and evaluating the cloud orchestrator which has such kind of features. So these efforts are for next generation network virtualized on the cloud side, cloud environment.

Our next section is about the cooperation with customers. So we are now taking an initiative, not only carbon neutrality of DOCOMO, but also carbon neutrality for society by cooperating with our customers, 80 million subscribers, almost half of the Japanese. We hope to add the entertainment element into the carbon neutrality effort. Of course, sustainability is very important. But we hope to do such kind of challenge.

Now we named this initiative and platform Caboneu. I have a video of explaining Caboneu concept. It's in Japanese, but it has captions.

[VIDEO PLAYBACK]

[MUSIC PLAYING]

- [SPEAKING JAPANESE]

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TAKASHI HARA: So the last sentence in Japanese is saying that changing world with you. This is the brand slogan of my company.

Anyway, as you can see, Caboneu is an initiative now DOCOMO is taking for society. And Caboneu is a platform connecting these services and visualized customer's effort to the carbon neutrality and adding some entertainment elements like joy or fun to the carbon neutrality effort. It's like emoji on the mobile internet platform, right? So this is what we are doing now.

This is an example of green 5G commitment. So as I said, 5G migration is a good thing. So 5G is more efficient than previous technologies. So more 5G migration, meaning more efficient network operation, DOCOMO's network operation. But this is the internal effect. So it's difficult for customers to know how much the customer's choice impacted to the carbon neutrality.

So we decided, as customers migrate to the 5G, we will procure more renewable energy. And the impact of customer's choice will be visualized on the Caboneu platform and Caboneu app with Caboneu Point. This is an example. This is the Caboneu platform.

But I believe that one of the important things, most important thing, is this is the way to really go to the carbon neutrality, not only for fun, not only for joy. So we believe we needed to enhance our accountability to this platform. So by communicating with customers, we will improve our system based on the feedback.

And the services should be expanded, not only by us, but also with our partners. This is the topic of the next section, With Partners. The collaboration with partner enterprises is very important in various industries. This is essential.

So we are calling it the ecosystem of Caboneu, a Caboneu Ring. So DOCOMO providing a platform, and on the platform, enterprise creates and provide the service and opportunities to the customers. And then the more services we increase, the more people participate in these activities. And then our platform will be more valuable for additional other partner candidates. This is the cycle of Caboneu Ring.

And how about the collaboration with startup communities? The NTT DOCOMO Ventures video. The NTT DOCOMO Ventures is a corporate venture capital. We have already raised $850 million and invested over 100 companies globally. Especially, we have been working in Silicon Valley since 2005, so over 15 years. So we invested a lot of companies like Coinbase, Evernote, and of course, MIT-rated startups like Skydio, which is a world-famous drone company, RapidSOS, TileDB, Metawave, wasabi, and so on.

So we have been working with these portfolio companies in over 100 collaboration projects because we are seeking strategic return rather than financial return. So we are supporting other business development in Japan and the Asian market. And actually, last month-- oh, no, no, no-- March-- we raised a new fund. The size is over $100 million. But the difference from our previous one is, the strategic focus includes social reform, including sustainability.

So this is kind of a commitment for us. And actually, we have already invested and collaborated with boost technologies. This is a Japanese startup developing and providing the CO2 Emissions Visualization Platform. But we have already started this fund. So I'm very happy and excited to meet great startups on MIT Startup Showcase.

So let me summarize today's presentation. Increased traffic data amount, including traffic data trend and resulting carbon emission, makes carbon neutrality in telecom industry very, very challenging. But DOCOMO committed to carbon neutrality by 2030. How to do it? We will create new platforms with customers and partners.

I introduced first carbon reduction in radio network. The examples are Green Base Station and the battery network. I called it the reservoir. And second, I introduced the tools developed by DOCOMO Innovations, which is for next generation network, virtualized on cloud environment.

As the second section, I introduced the Caboneu platform. It's an initiative DOCOMO is now taking for society. At the same time, it's a platform connecting many services and visualizing the customer's choice and providing them with fun and joy, a sense of game, like emoji of [INAUDIBLE] platform.

Last but not least, the collaboration, the partners we will include in the Caboneu Ring. And I introduced the collaboration with startup communities via NTT DOCOMO Ventures. This is all of my presentation. So I appreciate, again, for this opportunity to introduce DOCOMO's activity.

And I would be happy if you find some clues for future sustainability, or if you find something that inspires you, I would be happy. Maybe if, yes, it's the best news for my teenagers in my house. Thank you.

[APPLAUSE]

SPEAKER: There should be some questions. So I can read the questions first. So I can read the question to you, [INAUDIBLE]. How do you manage the carbon footprint of putting up new infrastructure versus modifying and recycling the previous generation?

TAKASHI HARA: It's based on the amount of electricity. So the previous generation-- of course, it's difficult to monitor each infrastructure one by one. But totally, we are now measuring on the amount of the electricity. But we are now checking more detail because we hope to modify our project more sophisticated.

SPEAKER: We've got a few more questions. Here we go. Are you considering an industry consortium with other companies for the total value chain achieving carbon neutrality?

TAKASHI HARA: Wow. It's a good idea.

[LAUGHTER]

I will show, yeah, this idea to Japan. But actually, yes, we should do that. Maybe we should start the industry directly related to the mobile server industries like digital content or point economy and so on. But we hope to expand more industries like manufacturing or transportation and so on. Yes, we should have a consortium.

SPEAKER: Next one. What is the biggest hurdle to the Green Base Station network project?

TAKASHI HARA: Wow. It's a tough question. But biggest hurdle may be capital because in the how to evaluate the ROI of this investment? Of course, sustainability is very, very important. So we need to enhance this activity. But we need to care about the fee of customers. We cannot increase the price. We don't want to price over the communication fee. So we need to balance the investment and the effect.

But obviously, I love Green Base Station project. So I hope to push this kind of project.

SPEAKER: What is the business model for the Caboneu platform?

TAKASHI HARA: Oh, tough question, too. It depends on what the corporate now thinking. So if the company thinks paying additional capital or paying additional investment is a good thing for their business, then maybe it's very reasonable. So of course, we need to communicate with partner companies. But it's a basic business model, I think, from the B2B business model, not B2C.

SPEAKER: So I'm going to add my own personal question to the Caboneu topic. It seemed like there was some gamification on that platform. Can you talk a little bit more about the incentives that exist for consumers to do the right thing?

TAKASHI HARA: And so for example, the customer chooses not driving the car but taking a train. Then they get the Caboneu point, for example. And if they walk instead of taking the train, more points that they can get. So we need some kind of resources to managing such kind of point.

But we have already point economy. It's one of the largest point economy in Japan. So we could leverage such kind of resources to enhance carbon neutrality activity.

SPEAKER: Got it. Thank you. I think we're going to wrap up here. One more question? All right. We'll do one more question. Let's see the next one. Oh. Let's see. I'm going to go for the last one there. In general, CVCs, so corporate venture capitalists, aim at strategic or financial gain. In a collaboration upon sustainability, which or what gain will you aim at? Is it beyond purely financial gain, I guess is the question.

TAKASHI HARA: No, no, no, no. Yes, so obviously strategic return. As I said, we are working for telecom industry. So we have almost no know-how related to carbon neutrality. So we needed to know, we need to be educated, of course, today, too. So I needed to be educated on cutting-edge startups on the MIT Startup Showcases.

So definitely, we hope, we seek the strategic return from our investment, of the new fund.

SPEAKER: Got it. Thank you very much. And we're going to go to the next speaker. Thank you.

TAKASHI HARA: Thank you.

[APPLAUSE]

Thank you.