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Business Trends

KDDI and Sony invest in self-driving startup

Tier IV receives $28m in its bid to set industry standard

Tier IV's autonomous driving technology gets taken for a test spin in Kota, Aichi Prefecture, in December.

TOKYO -- With autonomous-driving technology looking like the next big thing in the automotive industry, major companies in fields from technology to electronics and telecommunications have been teaming up with self-driving startups, investing aggressively and jockeying to take control of the latest developments. 

Japan's KDDISony and others have invested around 3 billion yen ($28.4 million) in Tier IV, a university-affiliated startup that develops and sells operating systems for self-driving vehicles.

In a statement Monday, KDDI said it will partner with Tier IV to conduct self-driving tests using fifth-generation, or 5G, telecommunications technology. 

Sony, which acquired its stake via its affiliated investment fund, said it may collaborate with its semiconductor and nonlife insurance units.

The Japanese venture capital firm Jafco and the University of Tokyo Edge Capital are also investing in the project.

Around the world, the amount of money raised by self-driving startups tripled to $3 billion in 2017 from the previous year, according to U.S. research company CB Insights.

Last year, Nauto, a U.S. startup that develops image analyzing technology that can be adapted for autonomous driving, raised $159 million from companies such as SoftBank Group, General Motors and BMW.

In late February, Aurora Innovation, an artificial intelligence startup set up by Chris Urmson, former head of Google's autonomous driving project, along with others, raised $90 million.

Tier IV aims to set the industry standard by using the funds raised to collaborate with other companies to start selling self-driving cars for testing both in Japan and overseas, and to develop regional transportation systems using low-speed autonomous vehicles.

Founded in 2015 based on research by Nagoya University, the National Institute of Advanced Industrial Science and Technology and others, Tier IV was among the first developers of autonomous driving technology to adopt an open source approach. Autoware, the operating system developed by Tier IV, has been adopted by more than 100 companies, including Yamaha Motor, Sony and U.S. chipmaker Nvidia.

Operating systems have a crucial role in the development of self-driving cars, analyzing the car's surroundings and selecting its routes. Google and a number of automakers are also developing their own operating systems.

On the other hand, some tech companies and component makers are betting on open-source designs for autonomous driving software, free of charge and available to anyone, with the aim of speeding development. Chinese internet giant Baidu announced last year it would promote open-source software.

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