Japanese telecoms giant NTT offers researchers million-dollar salaries to rival Google, Apple
- NTT has set annual salaries of as much as US$1 million for researchers at its labs in Palo Alto, California
- That is more than what the company pays its chief executive and 41-year veteran Jun Sawada
Telecommunications giant NTT Group is offering record pay to hire top scientists, as it looks to match some of the basic research prowess of global technology powerhouses like Alphabet’s Google and Apple.
The former Japanese telephone monopoly set annual salaries of as much as US$1 million for researchers at its Palo Alto, California, labs, said Kazuhiro Gomi, president of the company’s research arm. That is more than the company pays its chief executive and 41-year veteran Jun Sawada, and a rare step for a traditional Japanese company.
The increased investment in basic science comes as NTT is regrouping its businesses to focus more on cloud computing services and data centres amid a dimming outlook for profit from its mainstay mobile phone carrier operations. Having star scientists on the lab’s payroll, backed by a 25 billion yen (US$230 million) five-year budget, helps the group draw better technology workers and partners as it wages a global war for top talent it needs to expand globally, Gomi said.
“We are competing with companies like Google and Apple,” said Gomi, explaining that the company had traditionally followed the Japanese norm of modest pay. “It wouldn’t be possible several years back.”
Tatsuaki Okamoto, director of cryptography and information security for NTT Research, is an example of a star that has helped draw in other top researchers in encryption, where interest in cryptocurrencies has led to surging demand for expertise. Okamoto, an NTT R&D fellow since 1999, is known globally as a key researcher on blockchain technologies for cryptocurrencies.
The talent NTT is gathering is focused on cryptography, quantum computing and medical informatics in a bet that these fields can yield breakthroughs on a horizon of five years or more, said Kei Karasawa, vice-president of corporate strategy for NTT Research.
The lab also needs big-name scientists because for most top researchers, high pay alone is not enough, said Karasawa. Scientists strongly prefer to work with the leaders in their field, he said.
Moreover, NTT’s pay is not at the top of the range in all fields. Oracle Corp, the software maker that is racing to catch Microsoft Corp and Amazon Web Services in cloud computing, offered a pay package worth US$6 million to hire a single expert in artificial intelligence, Business Insider reported. While US$1 million a year dwarfs the pay of many information technology professionals, it is far less than what most chief executives make at global companies of NTT’s scale.
That is also in contrast with Japan, where average chief executive pay at top companies is less than US$1 million, compared with more than 10 times that for the average US boss of a big firm.
NTT is pushing for overseas growth while forecasting a 13 per cent drop in net income at NTT Docomo, its mobile carrier in Japan, this financial year, following a 16 per cent decline in the previous year.
NTT said it was forming a global technology and services provider by combining capabilities of 28 of its companies including NTT Communications Corp, Dimension Data Holdings and NTT Security Corp. The goal is to create a top five global technology and business solutions provider with US$20 billion in revenue outside Japan, Sawada said at the time.
Shares of Nippon Telegraph & Telephone Corp, the parent, have climbed 23 per cent this year in Tokyo after slumping about 15 per cent last year.
Cryptography, the science of encoding and decoding data to maintain privacy, is fundamental to the internet’s security and plays a role in blockchain and cryptocurrencies, two red-hot areas of research and development. Quantum computing, which uses properties of quantum mechanics to speed up processing, has the potential to help discover new drugs and improve the algorithms that shape industrial logistics and supply chains.
The third area, medical informatics, presents an opportunity to apply powerful computing technologies to mapping molecules in a way that can help scientists better understand viruses and how to combat them.
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