It&#x27;s probably easiest to think of current Japan as being the highest culmination of mid-80s technology and thinking. The rest of the world moved to the next three major technological revolutions: personal computers, the internet and smart phones.<p>Japan&#x27;s entry into the PC market was timed in sync with the 80s boom economy, which meant every conglomerate on the islands turned it into a fractured, incompatible mess. Even imported standards, like the IBM PC standard, were turned into incompatible islands of technology like the FM-Towns. MSX was the big hope for a standard, but for various reasons failed to get to market in the U.S. (the biggest market) and died like everybody else did when IBM PCs came to market (notable exception Apple).<p>This meant there was no real PC market in place for the internet to attach to. While everybody else everywhere in the world was getting PCs specifically to send email and surf the early web. Japan funneled the internet into impossibly limited flip phones, turning it into not much more than an AOL-like information portal that the carriers could have just provided themselves -- but also meant it took longer to become the kind of full-on cultural phenomenon it became elsewhere.<p>Smart phones are, in many ways, a miniaturization and untethering of both previous technological waves and Japan, stuck using very limited internet on flip phones and the occasional PC didn&#x27;t catch on to this trend.<p>Thus the first wave of PCs caused a boom in the U.S., the second wave of the Internet caused a wave everywhere <i>but</i> Japan, and the third wave caused a boom in the U.S. (Apple again) and now caught up South Korea (which coincidentally imported the Internet and PCs as a single phenomenon during their later economic boom so they had the environment where smartphones made sense) and to some extent Taiwan.<p>Japan missed all of this stuff and the catchup efforts never made it off the islands. Even in Japan, the top smartphones are iPhones and Japanese Internet sites look like late 90s design.<p>Developing export channels for physical goods is almost hilariously expensive. If you haven&#x27;t just been doing it, getting a new channel going is very hard -- and having few channels for export of PCs and smartphones and an already well developed and competitive global market meant that the incentive to export Japanese made PCs and Smartphones no longer existed (this combined with a general downswing in the Japanese economy making access to capital investment for export pushes more difficult). Japan also spent the 80s dictating how the rest of the world was supposed to do business with them, while other export driven economies were more pragmatic in their dealings with everybody else and so the kinds of relationship building everybody else does was foreign to aging Japanese businessmen.<p>This all combines for the both the very inward looking domestic market only focus Japan&#x27;s tech industry has taken over the last 10-20 years and the lack of general technological and cultural development clearly visible in Japan. It&#x27;s not that the Japanese are stupid or not creative, just that fortune didn&#x27;t favor them and their stuck waiting for better conditions to coincide with the next technological wave.