Google Injects USD690 Million in Japan

Asia is a huge growth market for Google, and the company is committed to investing in the region, CEO Sundar Pichai said in an exclusive interview with Nikkei and TV Tokyo on Friday.

In an interview, Pichai said that Google intends to invest USD690 million in Japan over the next three years. The investment will be used for submarine cables, improvement of human resources, and building Google's first data center in Japan, which is expected to open in Chiba Prefecture this year.

Japan is of particular interest because of the country's potential for digitalization, Pichai highlighted. He said that, besides providing customers with more convenient internet services, Google aims to use its cloud computing business to help Japanese companies digitize.

The country has been one of Google's major markets since the search engine debuted in 1998. In 2001, Google opened its first overseas office in Tokyo, where its building is now one of the tallest in the capital city.

Google has invested more than USD2 billion in infrastructure throughout the greater Asia-Pacific region since 2010. Indirectly, these investments have added $430 billion to the region's GDP.

"When we look ahead over the next decade, we do think a lot of growth is going to come from our Asia markets," he said. Pichai referenced the increase of super apps, which provide users with multiple digital services and short video platforms.

"Given our focus on Google Cloud, Asia will have to undergo a massive digital transformation across every sector. And we think Google has a role to play," Pichai said, "so we view this as a big growth opportunity for Google Cloud as well."

The company has been streamlining its business and slowing the pace of hiring in recent months as it prepares for an economic slowdown. Critical roles, however, will continue to be filled, Pichai said.

"We are responding to the macroeconomic uncertainty. As a business, we've always known ad spending is correlated to macroeconomic performance, and so we take that into account," he added.

People have increasingly turned to digital work, study, and communication tools during the pandemic. This has driven up demand for Google's services and the expansion of its parent company, Alphabet.

However, due to inflation and other factors, Google's profit has declined for two consecutive quarters from April to June. Pichai, however, said that Google is looking at the long-term and is optimistic about the company's prospects in Asia.