Japanâ€™s electronics maker Hitachi and Tencent Holdings have reached a cooperation agreement to partner in developing infrastructures that are connected to the internet to offer various efficient services.
This long-term partnership aims at applying Tencent’s internet of things technologies to manufacture, logistics and infrastructure, including building “smart cities” across China, and distributing Hitachiâ€™s elevators and air conditioners.
Hitachi sees the internet of things as a driver of future growth, aiming to bring related sales to more than YEN 1 trillion Â (RMB$9 billion) in the year ending March 2019. The company combines technologies like sensors with railway and other infrastructure systems to add value to products and services.
The Japanese company’s expansion of its internet of things business in China is hampered by regulations in the communications sector. It aims to overcome those barriers by using Tencent’s cloud-computing servers.
While Tencent, which operates the WeChat messaging app popular in the country, seeks to tap the Japanese industrial giant’s technologies to boost services targeting corporate customers.
Hitachi’s Chinese operations include elevators, electronics parts for smartphones and cars and aircraft-related products. Its Chinese sales in fiscal 2017 came to YEN1.04 trillion, accounting for about 10% of its global sales.