Hitachi to deploy $2.8b in internet-of-things platform over next three years

REUTERS/Yuya Shino

Hitachi Ltd. plans to invest about $2.8 billion over the next three years in its Internet of Things platform as the Japanese maker of power plants, bullet trains and elevators bets the technology will drive sales.

The money will be used for acquisitions, research and development and capital spending, Keiji Kojima, head of the services and platforms unit, said in an interview in Tokyo on Monday. The division will receive 100 billion yen ($918 million) of the investment, he said.

Hitachi is also starting a global leadership team to be headed by Kojima that will oversee the company’s investments in the Internet of Things, the executive said. The team, based in Silicon Valley, will look for ways to maximize returns from combining the company’s operating and information technologies using its Lumada platform.

“We’ll need partner companies as we’re not just going to offer this service on our own,” said Kojima. “I expect there will be multiple companies. We hope to make an announcement within this year.”

The Internet of Things involves linking devices and infrastructure, such as trains, to each other and the Web to manage their operation.

Hitachi has slumped 31 percent this year in Tokyo trading, more than double the 14 percent drop in the benchmark Topix index. The shares dropped 0.7 percent on Tuesday to 480.2 yen.

Train System

The Tokyo-based company has teamed up with Vodafone Group Plc to develop a preventative maintenance system for trains in the U.K., using sensors to gather information, Kojima said.

The Internet of Things accounted for about $5.4 billion of Hitachi’s sales in the year ended March 31, Kojima said, equivalent to 6 percent of projected revenue for the company. Analysts expect Hitachi to post revenue of 9.95 trillion yen when it reports full-year results on May 13, according to the average of 16 estimates compiled by Bloomberg.

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In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

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