FU­JIO MI­TARAI AIM­ING TO POSITION CANON FOR FUR­THER GROWTH INTO THE MID-21ST CEN­TURY

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Fu­jio Mi­tarai is look­ing to position Canon Inc. for fu­ture growth into the mid­dle of the 21st cen­tury by build­ing on the trans­for­ma­tion of his com­pany’s busi­ness port­fo­lio to make the switch from a B2C to a B2B com­pany and stay abreast of global mar­ket de­vel­op­ments.

The year 2020 marks the end of Phase V of this busi­ness port­fo­lio trans­for­ma­tion, and the multi­na­tional com­pany that is listed on both the Tokyo and New York stock ex­changes con­tin­ues to ad­vance steadily to­ward the tar­gets set by Mi­tarai.

The trans­for­ma­tion of Canon’s busi­ness port­fo­lio in­cludes seek­ing syn­er­gies in new busi­ness ar­eas that lever­age its ex­ist­ing as­sets, in­clud­ing both tech­nol­ogy and human re­sources, while also con­tin­u­ing to pur­sue a strat­egy of merger and ac­qui­si­tions. “We are trans­form­ing our busi­ness port­fo­lio to stay in sync with the changing times,” Mi­tarai says.

Canon at the Cutting Edge in the Med­i­cal Field

Mi­tarai has ear­marked the med­i­cal field as an area for po­ten­tial growth and in De­cem­ber 2016, Canon ac­quired Toshiba Med­i­cal Sys­tems Cor­po­ra­tion.

Over the short term, Canon is look­ing to ex­pand its lineup of di­ag­nos­tic imag­ing equip­ment, such as CT, MRI and ul­tra­sound, while also boost­ing their com­pet­i­tive ca­pa­bil­i­ties.

Mid- to long-term growth in­cludes a focus on re­gen­er­a­tive medicine, which could have far-reach­ing ap­pli­ca­tions, espe­cially in an ag­ing so­ci­ety. Since Au­gust 2019, the com­pany has en­gaged in joint re­search with No­bel Prize win­ner Pro­fes­sor Shinya Ya­manaka of Ky­oto Uni­ver­sity into in­duced pluripo­tent stem (iPS) cells, and how they could be used to repli­cate in­jured tis­sue, test drug ef­fi­cacy and de­velop new medicines. Canon is con­tribut­ing ad­vanced op­ti­cal, mea­sur­ing and di­ag­nos­tic imag­ing technologi­es to the project. To­gether with Ya­manaka and his re­search group, Canon is con­fi­dent they can make a con­tri­bu­tion to the fur­ther de­vel­op­ment and adop­tion of re­gen­er­a­tive medicine. It’s still in the early stages, ac­cord­ing to Mi­tarai, but there is huge growth po­ten­tial.

M&A: Mi­tarai Adopts Two-Pronged Strat­egy

Canon's net­work cam­era busi­ness boasts an­nual growth of more than 15% out­pac­ing the mar­ket, and Mi­tarai aims for fur­ther dom­i­nance in this area with a two-pronged strat­egy of ac­quir­ing var­i­ous hard­ware and soft­ware busi­nesses.

In 2015, Canon ac­quired Axis Com­mu­ni­ca­tions, a global leader in net­work video equip­ment, less than a year af­ter the ac­qui­si­tion of Mile­stone Sys­tems, a leader in video man­age­ment soft­ware for such equip­ment. In ad­di­tion, in 2018, Canon ac­quired lead­ing video analysis so­lu­tion provider BriefCam.

The global net­work cam­era mar­ket is ex­pected to see an­nual growth in ex­cess of 10% over the mid- to long-term, with such fields as se­cu­rity and law en­force­ment making up a ma­jor share.

Mi­tarai ex­plains, “Us­ing a cam­era equipped with the ul­tra-high-res­o­lu­tion 250-megapixel CMOS sen­sor and 800mm tele­photo lens, it is pos­si­ble to iden­tify the let­ter­ing on the side of an air­craft from a dis­tance of about 18km. This can help se­cu­rity pa­trols view ob­jects that

“We are trans­form­ing our busi­ness port­fo­lio to stay in sync with the changing times,” Mi­tarai says.

can­not be seen with the naked eye.”

That’s not to say Mi­tarai is ig­nor­ing the con­ven­tional ap­pli­ca­tions of net­work cam­eras and their po­ten­tial to help re­al­ize a safer, more se­cure so­ci­ety.

Mi­tarai also sees uses in mar­ket­ing: “Net­work cam­eras can be used in places like su­per­mar­kets to gather data on pur­chases made by cer­tain de­mo­graph­ics from spe­cific shelves. I be­lieve that this tech­nol­ogy can be used to cre­ate a more con­ve­nient so­ci­ety,” he says.

He cites po­ten­tial smart cities as a cat­a­lyst for the fu­ture de­vel­op­ment of the net­work cam­era mar­ket, en­vis­ag­ing the tech­nol­ogy con­nect­ing such in­sti­tu­tions as schools, broad­cast­ers and hos­pi­tals.

Mi­tarai’s M&A strat­egy is also prov­ing a suc­cess in the field of com­mer­cial print­ing, iden­ti­fied as one of Canon’s new core busi­nesses. Canon ac­quired Océ, based in Venlo, the Nether­lands, in 2010, but the com­pany that is ex­pected to rev­o­lu­tion­ize high-vol­ume, high­speed print­ing con­tin­ued to op­er­ate un­der its orig­i­nal name. Last year, Océ’s busi­ness divi­sion rec­og­nized the ad­van­tage of adopt­ing the Canon brand name, and ef­fec­tive from Jan­uary 2020, the com­pany has been re­branded as Canon Pro­duc­tion Print­ing— making Océ, al­ready a fully fledged mem­ber of the Canon Group, a mem­ber in name as well.

Serving Pro­fes­sion­als and In­no­vat­ing Im­agery

The Canon name has long been syn­ony­mous with con­sumer cam­eras, but this mar­ket has ma­tured as many of the orig­i­nal user needs can now be met by smart­phones. Mi­tarai wants his com­pany to focus its ef­forts else­where, in­clud­ing the pro­fes­sional user mar­ket.

“When we talk about the shrink­ing cam­era mar­ket we are re­ally only talk­ing about con­sumer cam­eras. The mar­ket for pro­fes­sion­al­level cam­eras used by the me­dia and those who shoot sport­ing events will not dis­ap­pear. These are ar­eas where smart­phones can’t meet user needs,” he says.

Be­gin­ning with the Rugby World Cup in 2019, Ja­pan is set to host a num­ber of global sport­ing events over the next several years. Mi­tarai him­self played a lead­ing role dur­ing the Rugby World Cup as Chair­man of the Or­ga­niz­ing Com­mit­tee.

Canon main­tains a strong con­nec­tion to sports, in­clud­ing event spon­sor­ship and me­dia sup­port, and has ac­tively honed its tech­no­log­i­cal ca­pa­bil­i­ties, in­clud­ing the Free View­point Video Sys­tem, cap­ture and dis­play of high-res­o­lu­tion 8K im­ages, and im­mer­sive widescreen view­ing ex­pe­ri­ences. Canon pro­duced video con­tent that al­lowed view­ers to feel like they were right in the mid­dle of the ac­tion.

Canon’s Free View­point Video Sys­tem is com­prised of cam­eras in­stalled around the perime­ter of the field, pro­duc­ing com­put­er­gen­er­ated video that pro­vides a new per­spec­tive of the game.

“The im­ages from the cam­eras are im­me­di­ately pro­cessed by com­put­ers and tele­vi­sion view­ers can ob­serve events from vir­tu­ally the same level as the crowd in the sta­dium. It is also pos­si­ble to trace in­di­vid­ual on-field plays, and to use com­puter pro­cess­ing to view them from dif­fer­ent per­spec­tives,” Mi­tarai says.

He sees pos­si­bil­i­ties for strate­gic analysis in such sports as Amer­i­can foot­ball and to help ref­er­ees de­ter­mine rule vi­o­la­tions from po­si­tions they can­not see for them­selves. “This will trans­form the way peo­ple watch sports,” he adds.

Look­ing ahead, you can be cer­tain that Mi­tarai and his staff have plans for Canon to con­tinue to cre­ate new image ex­pres­sions that change the way peo­ple view sports as the third decade of the 21st cen­tury gets un­der­way.

8K im­mer­sive live view­ing at Canon's Tokyo head­quar­ters.

Canon to ex­pand its lineup of di­ag­nos­tic imag­ing equip­ment.

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