Company Overview

1. Business Overview. P-B Systems <4447> is an independent SIer based in Fukuoka, with expertise in system virtualization technology and strong cloud-based infrastructure building capabilities that builds various information systems for mid-sized enterprises, SaaS providers, and public agencies. The secure cloud system business is the core of the business, supporting total security, resilience building related to cybersecurity, and the realization of DX with cloud technology, ranging from digital work promotion to experience-sharing VR theaters with MetaWalkers, a series of emotional system businesses. The company is also fostering metaverse businesses. The company has claimed to have been a "small group of professionals in system virtualization" to date. However, steering toward further growth in the future, the company plans to expand its scale from the FY2024, aiming to transform itself into a "professional group of hybrid clouds."

For example, there are more Japanese companies than expected that use systems that have been in use for decades and have become completely rigid, where productivity is not improving and data utilization for DX cannot be conducted, systems that have become complicated and black-boxed due to years of ad hoc reinforcement, and so on. As a result, companies have become unable to easily migrate to the cloud, and if this is not resolved, there is a risk of the "cliff problem*" facing the Japanese economy from 2025, where economic losses could expand to 12 trillion yen annually. The basic steps to fundamentally transform old systems are to first migrate to a private cloud and then further migrate to a "hybrid cloud." A hybrid cloud is a platform where private and public clouds are combined to take advantage of the strengths of each, allowing customers to manage data aggregation and utilization themselves.

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"The cliff problem in 2025*" is a problem that the Japanese economy is facing, which was first used in the "DX Report" announced by the Ministry of Economy, Trade and Industry in 2018. It predicts that if DX is not promoted, competitiveness will decline, and economic losses of about 12 trillion yen will occur annually from 2025.

The key to realizing a hybrid cloud is, first and foremost, the basic private cloud part, but there are actually not many domestic SIers that can build high-quality private clouds that meet the increasing quality demands of customers. The reason for this is that SIers must set up hardware for private clouds, and setting up the hardware properly requires a vast amount of know-how, both new and old. In addition, in companies where migration to private clouds has been completed, or so-called DX is progressing, new challenges have emerged, such as "cloud lock-in," where core competencies (in-house data) are tied to a specific public cloud. This exposes companies to risk situations such as being unable to use in-house data for new businesses, incurring high download costs during disaster recovery, and being unable to switch to other clouds even if the fee system is changed disadvantageously. In order to build high-quality private clouds and to prevent situations such as "cloud lock-in" in advance, the rich experience and achievements that the company has cultivated so far have become a powerful advantage in developing and maintaining customers.

The "cliff problem in 2025" seems like the biggest hurdle from its name alone, but in reality, the dangerous situation of economic losses and business continuity risks will continue to be high if radical reforms of old systems are not advanced in each company. The symbolic solution of hybrid clouds, and the professional group as P-B Systems, positions themselves even higher.

(Writer: FISCO analyst Tomoichi Murase)