INFRONEER Holdings Inc. INFRONEER Holdings Inc.

Connecting Citizens and Infrastructure with Digital Technology
for the Future

Takashi Kato
Founder and CEO of Whole Earth Foundation
Chairman, Fracta
Kibe Kazunari
Director, Representative Executive Officer, President,
and CEO of INFRONEER Holdings, Inc.
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Why TEKKON? Why now?(※3)

Kato Fracta has many talented engineers who can develop AI algorithms. As a result, we have begun to receive various consultations from infrastructure companies outside of the water supply industry. For example, we thought we could analyze the deterioration of infrastructure exposed to outdoor environments, whether it is located in Tokyo or Osaka. But at some point, we thought, "No, there's no point in using AI to predict this at all. Physical measurements would be less expensive and easier in the first place for infrastructure on the ground, as it can be seen and touched.” This led to a kind of realization, and the reason Fracta is successful in this way is because its targets are under the ground, invisible to the eye, inaccessible to the touch, and the cost of digging up the ground is enormous. And so I've come to believe that AI is very helpful.
But why do other infrastructure companies also ask Fracta to provide analysis? The reason, in a soundbite, is "labor shortages.” And if this is the case, then new markets will emerge if measures can be taken to address it. But wouldn't it be better if there were a more efficient way to do this, rather than exhaustively searching using flying robots and drones around the world to take pictures from above? In the UK and in Japan, citizens will report water leaks. They'll call the water department and say "Excuse me. My front porch is flooded with water. Could someone please come sort it out.” I thought it would be better to make use of this civic mindedness.
Smartphones are everywhere these days, meaning everyone has a high-resolution camera in their hands (built into their smartphone). There was a sense that since we have a device that can take actual measurements, if we create incentives and a system where people can report more frequently, it will make actual measurements easier. And so the initial idea of "TEKKON" gradually came to be. Later, we came up with the idea to develop a game to get people to take one photo with their smartphones on their way home.

Kibe Citizens collect data, validate that data on the blockchain, and receive virtual currency tokens in return. I took an interest in this mechanism. One of the reasons why I paid attention to TEKKON was the possibility of its applicability to a range of purposes, such as roads operated by the INFRONEER Group under its concession projects, tracking the deterioration of buildings, as well as manholes and utility poles. The other is that this mechanism can be used in virtual settings. I think that building, destroying, and maintaining things in the metaverse and the digital-twin world will create synergy with the real world. I believe that the TEKKON system can be used as an incentive to gather data to be used there.

The significance of the private sector working on infrastructure

Kato I believe that the state's way of doing things often doesn't work, especially when change is needed. To survive in the startup world, which, more even than competition between private companies, is a race to the finish line, there is a rational sense of urgency to find a gap in the market, hone the technology to fill that gap, and grow the company before funding runs out. I believe this is the source of creativity for innovation . It's a neat mechanism that humanity has figured out — allow talented people to take sufficient risks within a short timeframe. Yet there are also great returns. If you create a market or combine technologies nicely, money will come in and the company will grow. I believe that a gamified ecosystem is gradually being established in Japan, but compared to the U.S., we still have a way to go. The history of Silicon Valley shows that great things tend to be born in such environments, and that is why I still live in Silicon Valley.
I believe that the environment in Silicon Valley is the best in the world for rationally and systematically creating innovations. So, while Japan is currently not in a high-speed economic growth period anymore, its population has been declining, and its public sector is no longer able to stand on its own, I believe that only the private sector can turn the situation around by implementing measures that will fundamentally improve the country’s situation.

Kibe The question of why we should turn to the private sector is probably a uniquely Japanese concept. For instance, in France, where the private sector has always managed the water supply system, there is little debate as to whether something should be the purview of the private or public sector. This debate between public vs. private sectors is itself very Japanese in the first place. This is because in Japan, unlike in the West, civil servants have a certain social standing.
The public sector has become the main authority when it comes to infrastructure in Japan. The people behind innovations in Silicon Valley and the world at large are those who want the freedom to resist authority, and who have tried to remove established frameworks. The private sector has the freedom to do such things. In France and other countries, the possibility of bringing innovation may still exist because of the degree of freedom when it comes to management, even if something is operated by the public sector. I think it’s difficult to generate innovation in the public sector in Japan because there’s no incentive to change. So we have no option but to call on the private sector.

What do you wish to convey to citizens, local communities, and future generations?

Kato Science and technology are wonderful, f or all are equal before the truth. If objective facts can be conveyed to the public, we can move away from subjective discussions like which water departments have or haven’t been negligent. It would be quite complicated to try and clear up these matters with political “debates,” but I get the sense that we don’t need to have debates at all if the objective facts were all in place. Regular citizens could feel anything from a hazy sense of hope to a vague feeling of despair, not knowing whether their local water department is operating as it should be, or if it’s in complete shambles. In contrast, what Fracta and TEKKON technologies bring to the table is the ability to objectively display the conditions of the water department and water supply in one’s area, or demonstrate how the utility poles in one’s area might be leaning this much compared to other areas.
By combining science and technology with the power of citizens, you’ll be faced with objective facts about your own area compared to others, using your own photographs. I’m not saying that this is good or bad. But I believe that people will understand what my message to the public as an engineer is, and what I want to do.

Kibe Even as Japan becomes an aging society with a declining birthrate and the possibility of negative growth, there’s still a strong sense among Japanese people that infrastructure is a gift from heaven. From now on, we must participate in and manage our own infrastructure, and protect our living environment. As with environmental issues, we need to make infrastructure clearly visible to all, and clarify what it costs today, as well as in the future, so that citizens can see it all straight-up and participate in its management. If we want to drink safe and delicious water, we have no option but to participate in this management. If we don’t take steps to become this kind of country, there won’t be a future for Japan. But if we can do this, I believe that Japan’s infrastructure can rise to the top of the world again. I would like to create a new ecosystem in Japan for this very purpose.

(Person responsible for the text: INFRONEER Holdings/infOinf Inc)

Autumn 2023, Silicon Valley
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