Soirée with Toshiba CEO Taro Shimada: Enabling a Sustainable Quantum Economy — Sustainability Briefs™ by Maëva Ghonda — Exclusive Interview

Disclaimer: This article is adapted from my Soirée with Toshiba CEO Taro Shimada. All slides were supplied by Mr. Taro Shimada.

WELCOME

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INTRODUCTION

Founded in July 1875, the Toshiba Corporation has become the corporate giant that generated 3.3 trillion Japanese Yen in revenue, in the fiscal year that ended this year, on March 31st. Toshiba is headquartered in Tokyo, Japan and the corporation now boasts more than 116,000 employees worldwide. Toshiba has a strong heritage and a rich history. In 1873, Japan’s Ministry of Engineering, responsible for promoting the nation’s modernization, commissioned one of the nation’s most prolific inventors and Toshiba company founder — Mr. Hisashige Tanaka — to develop telegraphic equipment. Hence, in 1875, Mr. Tanaka opened a telegraph equipment factory in Tokyo.

This global giant strives to create the world’s first and the world’s number one products and services. I’ll review a few brief examples:

  • In 1921, Toshiba invented the world’s first double coil electric bulb, which was later recognized as one of the six great inventions in the history of bulb technology.
  • In 1985, Toshiba introduced the world’s first laptop personal computers.
  • And, this year, on April 26th, Toshiba made history once again by launching the trial of the world’s first commercial quantum secured metro network along with its partner British Telecom, BT, for their customer EY.

This last example was a result of the creation of the new Quantum Key Distribution (QKD) business which Toshiba launched two years ago, in 2020, under the leadership of today’s special guest: Mr. Taro Shimada.

Mr. Taro Shimada was appointed President and Chief Executive Officer of the Toshiba Corporation this year, on March 1st. Prior to his current role, in April 2020, Mr. Shimada was appointed Director and President of Toshiba Digital Solutions Corporation. And, in February 2020, he was appointed CEO of Toshiba Data Corporation. Mr. Shimada has also held the important position of Chief Digital Officer for Toshiba. He joined the company in October 2018 as Corporate Digital Business Officer.

Before joining Toshiba, Mr. Shimada was Senior Executive Operating Officer and Head of Digital Factory and Process & Drive at Siemens K.K. He has been a Visiting Professor at Otemon Gakuin University in Osaka, Japan, since April 2020. Away from the office — I’m not sure how he does this — Mr. Shimada relaxes by playing the drums. And, he enjoys all types of music.

So, today, we meet the great titan of industry: Mr. Taro Shimada, President and CEO of the Toshiba Corporation.

Thank you so very much for joining me today and for accepting my invitation! Your generosity is always greatly appreciated.

EXCLUSIVE INTERVIEW

Maëva Ghonda: Mr. Shimada, When you sent me that email informing me that you had just been appointed the new CEO and President of Toshiba, I was overjoyed for you. It was fantastic news! How did you react when you received this great news?

Taro Shimada: Thank you very much for the kind introduction! And, also for the very kind words about Toshiba. You know, it’s a good reminder for us of what we have done in history. And, I think we’d like to make another history chapter for the world.

When I was asked to do the CEO role, I thought: OK. Why not? I’ve been pushing, as Chief Digital Officer, the digitization of Toshiba Corporation as an entire company. And, one of my dreams is really pushing to build the quantum society, which I am continuously pushing and moving forward as CEO of Toshiba.

Maëva Ghonda: You have an enviable quantum technology intellectual property (IP) portfolio. Why did you choose to launch a QKD business vs. a quantum computing hardware business for instance?

Taro Shimada: QKD and quantum communications, I think, are very close to real usage today. Quantum computers are going to take some time. I’m not saying that we are not doing quantum computers. We wanted to take the approach which would impact the market and the company the most, which is QKD today.

Maëva Ghonda: Will you be manufacturing quantum computers? I must ask because you have a multitude of patents for quantum computers and different quantum computing methods in many jurisdictions. When I studied quantum tech IP awarded in the last couple of decades, I noticed that you have been granted IP protection in many nations, including: the United States, Europe, Japan, etc. For example, you were awarded the Toshiba Quantum Computer Patent No. JP6530326B2 by the Japan Patent Office, which was filed seven (7) years ago, in 2015, and titled: Quantum Computer and Method. When will we see Toshiba’s quantum computers?

Taro Shimada: This, I cannot say. But, in this short time, we are trying to do much more of the algorithmic solutions, meaning quantum simulations. This is already available today. And, this is already showing very promising results which normal computers cannot achieve. And, the other thing is that Toshiba is famous for all kinds of different technologies. One of the things that we have been doing are nuclear power plants: the cooling systems and also the superconducting systems are really useful for building a quantum computer.

Maëva Ghonda: Will we see Toshiba’s quantum computers by 2025?

Taro Shimada: Well, I have no comment on that. Let’s see.

Image Credit: Quantum Transformation — Taro Shimada / Toshiba Corporation

Maëva Ghonda: Let’s discuss this quantum society that you’re envisioning — that you would like to help build. How do you define this quantum economy? How do you see it?

Taro Shimada: It’s going to take some time because the quantum computer is not available yet. Yes, we do have a smaller scale proof of concept of the types of machines. And, then also, IBM and others already announced their roadmap. But still, we need time. I think it’s important that we build a hybrid type of a solution before we actually embrace the entire quantum technology.

It is important. It is very expensive. Nobody knows how to use it. And, there are not many people who are really familiar with those technologies. That doesn’t create the quantum society itself. It is important that we build a bridge technology, so that people are using quantum technology without noticing that they are using it. That, I think, is a very important step to do.

Image Credit: The Quantum Economy — Taro Shimada / Toshiba Corporation

Maëva Ghonda: When you say “bridge” technology, will you please clarify this a bit? This is a global audience, so everyone is not super familiar with the different technology solutions.

Taro Shimada: Right! For example, one of the quantum technologies that I think is the closest to the real application is really quantum communications, particularly, QKDQuantum Key Distribution. For this, we only send the encrypted keys over quantum technology with a fiber over the fiber. But, the actual data is sent through the normal internet. So, this is a perfect example of hybrid technology. You don’t have to introduce a completely new way of transmitting data. You can actually just send it the normal way and then send a key with the special methodologies.

We wanted to make it really easy for people to use. That’s why we are trying to provide the QKD service instead of selling the QKD box, which is amazing technology. But, in order to make people available to those technologies, it is important that we can provide QKD as a service so that people can just plug-in and call the API (Application Programming Interface) then you have ultimate security.

Maëva Ghonda: Almost two years ago, in October 2020, Toshiba announced the global launch of the company’s quantum key distribution (QKD) business and its aim to engage in roughly three (3) billion dollars in the QKD business market by 2030. Why was 2020 the defining moment? Why was it that in the midst of a pandemic — a global crisis year — you chose that moment as the right time to launch such a significant quantum technology business?

Taro Shimada: There’s no time as the right time, I guess. One of the things that I had seen was one of the trends: Because of the pandemic, people were keen to jump in on all those digital technologies. Even here in Japan, we used to come to the office on an everyday basis. But, now they work from home and utilize the different types of digital communications. And now, all of a sudden, we are scared about security. And then also, at the same time, this is not really that the related pandemic itself, but with all those quantum computing technologies becoming available. And, people are realizing that, even today, some people are stealing those encryption keys and that, maybe in five years or ten years, these keys will be broken by decrypting by those powerful computers called quantum computers. So, time is ticking if we don’t act right now to secure encrypted keys for people with long-term value information.

Image Credit: Quantum Safe — Taro Shimada / Toshiba Corporation

Maëva Ghonda: Will you please help us understand how your solutions will help enable the quantum internet?

Taro Shimada: QKD uses photons to send the signal. This is actually using the photons to carry the information over one length to the other. And, the first application is: we are only sending encrypted keys. But, this can be used to send actual data. One of the most prominent use cases for the quantum internet might be: connecting quantum computers. As you know, with more qubits built into the quantum computer, it’s going to be very difficult to control. One of the solutions that people are talking about is: Why don’t we connect quantum computers with the quantum internet. So, if you can have the entanglement photons, and that means that you can actually have the same state of the photons and distributed quantum computers, that means that you have exactly the same memory state of the information between that computer in Washington, DC and New York, for example. This will create a larger problem to solve: utilizing that newly developed quantum computer.

Maëva Ghonda: A few months ago, you published a press release which was titled: JP Morgan Chase, Toshiba and Ciena Build the First Quantum Key Distribution Network Used to Secure Mission-Critical Blockchain Application — Proof of Concept Showed Ability to Detect and Defend Against Potential Threats and Eavesdroppers. Why was that meaningful? What are the future implications? [Link to research paper: Paving the Way towards 800 Gbps Quantum-Secured Optical Channel Deployment in Mission-Critical Environments].

Taro Shimada: Security in the Finance sector is quite important. You have to protect information, privacy and so forth. The fact that we were actually able to send real customer data over QKD is a testimony that this technology is available today and it’s applicable. It’s actually real technology that we can use in real day business.

Once people start embracing all those technologies and people start comparing that, let’s say, JP Morgan Chase has the ultimate security. Would they want to choose JP Morgan Chase or another company? They may have second thoughts on who is the most serious company that wants to protect their data.

Image Credit: Commercial QKD Network Trial — Taro Shimada / Toshiba Corporation

Maëva Ghonda: You previously mentioned QKD-as-a-Service. Have you officially launched that service? Do you already have customers using that service? How is the commercialization of that segment of your business progressing?

Taro Shimada: For QKD-as-a-Service, it has to be critical infrastructure. That means that we have to have a very stable system that people can rely on. That’s why we started the commercial trial. For example, British Telecom and ourselves used our own money to build the proof of concept of the services and then people started using it. Within a couple years, we will do all kinds of testing and also all kinds of exceptional handling and things like that to be able to flush out all the problems before we actually fully support people’s daily activities. And this has been done all over the world, not just the UK. We are doing it here in Japan too. There are all kinds of new testbeds created in the U.S. And then also in Korea, we are doing all kinds of tests over there too.

Image Credit: QKD-as-a-Service Trial — Taro Shimada / Toshiba Corporation

Maëva Ghonda: What big bets are you taking with quantum for the next couple of years? When can we expect big news similar to the one in 2020 when you launched the new QKD business?

Taro Shimada: This is a little bit of a secret. So, I’m not telling the secret right now.

Maëva Ghonda: Why not?

Taro Shimada: We are thinking about many items. You will be surprised! The thing is that there are all kinds of things going on right now. And, even I don’t know which one we want to announce.

Maëva Ghonda: Can you surprise me now with one that you know will happen in the next three to six months? Since you’re not yet certain on anything beyond six months.

Taro Shimada: Let’s please hold that because we have to make the maximum impact on the market.

Maëva Ghonda: Let’s transition to Sustainability and Climate Change. These are enterprise level priorities for Toshiba.

Taro Shimada: Yes!

Maëva Ghonda: You’ve established the Toshiba Vision 2050. Clearly, the climate crisis cannot be solved by one innovation. Having said this, how do you believe that quantum can help lead the charge and drive positive change as it relates to climate action.

Taro Shimada: If we want to be serious about solving climate change, real invention is required. For example: battery technology. Current battery technology is insufficient to store large amounts of electricity. Wind turbines, based upon natural phenomena, when the wind is blowing you generate energy. But, when the wind is not blowing, you cannot get energy out of that. And, sometimes you want to store energy, but we don’t have a very good way to do that.

Quantum Computing integrated with AI (Artificial Intelligence) might be helpful to develop an entirely new way to develop materials. In order to solve the climate change problem, we must understand how much CO2 we actually consume. Today, we don’t know that. For example, this tea in front of me: How much CO2 was consumed to manufacture this tea in front of me? Nobody knows. This information has to be captured. This is the other reason that I established Toshiba Data Solutions; it’s because we want to capture that information. If you know how much CO2 you are consuming, people might change their attitude or their buying behavior. But, the information is not there.

The beauty of quantum computers is that you can actually optimize information. But, if the data is not available, the quantum computer is just a box – a huge box!

Image Credit: Toshiba Corporation

Maëva Ghonda: Let’s have a bit more fun! What is the most fun part of your job as the CEO of Toshiba?

Taro Shimada: The fact that I can take responsibility for making a decision. When I was Chief Digital Officer of Toshiba, I had to convince the CEO that this was a good thing to do. Of course, it is my responsibility if I fail but, at least, I can make decisions by myself. Also, I talk to all kinds of different people, and I try to motivate people.

All those quantum researchers and the people who wanted to do quantum inside of Toshiba came to me saying: Mr. Shimada: Thank you! Now, we will be able to go out and we can actually talk about it and we can actually spend some time on it and spend some money on it, which is fun.

Maëva Ghonda: Do you still find time to play the drums?

Taro Shimada: Yes, I do. I actually also play the piano. Usually, first thing in the morning, I wake up at 5:30 AM and I go to the gym. I run around six kilometers and I listen to German news because I can understand German too. Then, I go back to my house, and I play the piano for about 15 minutes. And then, I go to work. That’s my ritual.

Maëva Ghonda: Fabulous! You’ve been a visiting professor since 2020. Are you still teaching?

Taro Shimada: Yes!

Maëva Ghonda: What do you teach?

Taro Shimada: I teach a leadership class. How you can actually build a new organization, build a new business and so forth. Those are the things that I’m focusing on. Maybe, I can teach different things, but I think that this is the most important thing which is missing in Japan: Leadership. And, how to build a new business and try to challenge new things. I try to encourage them. That’s the reason why I’ve taken the position right now.

Maëva Ghonda: What are your thoughts on the metaverse? Given your vision to help build the quantum economy, how do you see quantum enabling or interacting with that space?

Taro Shimada: I think people are really excited about the metaverse, as I understand. But, the first thing that I want to say is that, to me, it is important that you have the physical because you cannot really just live inside of the metaverse. You have to eat. You have to move the body and so forth. If you think that the metaverse can solve all problems, it’s probably not. It is more important that your soul and body are united. That’s the first thing I wanted to say. That’s why as a company at Toshiba, we’d rather focus on the cyber-physical system, not just a cyber-only system.

On the other hand, the metaverse is quite exciting because you can actually go beyond the time difference and the distance difference. If you live far away, you can actually communicate with each other as if you don’t have any difference in locations. Also, on the virtual, all kinds of different values are created: NFTs and all kinds of stuff. This is based upon blockchain technology and so forth. And, some of the things that you actually invent inside of the metaverse are more valuable than the actual live items. This is quite interesting!

As to the relationship with quantum computing, quantum computing might be an interesting aspect for the metaverse too because we might be able to break blockchain encryption because of the strength of quantum computers. But, today, if you jump into the metaverse, it’s too slow. It’s far from the real situation that you can actually enjoy: a nice scenery or a nice feeling or you’re actually exchanging a conversation with others. It is not there yet. There might be a chance that quantum computers might be able to help that too.

Maëva Ghonda: Mr. Shimada, Thank you so very much for your generosity! You’ve always been great and super supportive of me. And, I just want to thank you tremendously. It’s been a huge honor to speak to you for an hour today.

Taro Shimada: My pleasure! Thank you very much. Please ask me again! I’m happy to support you.

Maëva Ghonda: Thank you! Thank you so much!

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Maëva Ghonda

Maëva Ghonda

Maëva Ghonda advises institutional investors and board members on Quantum Computing & IP. She also specializes in Strategy, Risk Management and Sustainability.