No. 351, December 1998

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Japanese Companies in the United States

American Companies In Japan

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Japanese Companies in the U.S.


A $41.3 million expansion is underway at DAIKIN INDUSTRIES, LTD.'s four-year- old fluoroplastics plant in Decatur, Alabama to install capacity for tetrafluoroethylene and hexafluoropropylene. These monomers, currently imported from Japan, are used in the production of NEOFLON FEP (fluorinated ethylene-propylene) pellets. This product is well-suited for molding wire shielding. FEP demand is surging in the United States in large part because of the construction of local area networks in the business world. Through its DAIKIN AMERICA, INC. subsidiary and factories in Japan, Daikin Industries splits the global FEP market with E.I. DUPONT DE NEMOURS & CO., INC.

Ownership of IB CHEMICAL CO., a 13-year-old Bucks, Alabama manufacturer of isobutylidene diurea (IB nitrogen) controlled-release nitrogen fertilizers, has changed hands. MITSUBISHI CHEMICAL CORP. (35 percent), MITSUBISHI CORP. (15 percent) and HOECHST CELANESE CORP. (50 percent) sold the business to Canada's NU-GRO CORP. for $2 million. Mitsubishi Chemical, which developed the technology used by IBCC, has pulled out of a number of American production ventures in the last six months or so because they were unprofitable. That was not the case with IBCC. It makes money on annual revenues of $6.6 million. Instead, the hands of Japan's biggest chemical company and its top trader basically were forced by Hoechst Celanese. That multinational not only is their third partner, but its uncertainty about remaining in the fertilizer business made long-term planning difficult for Mitsubishi Chemical.

Commercial production of Aricept (donepezil hydrochloride) tablets -- a treatment for mild to moderate Alzheimer's disease -- has begun at EISAI CO., LTD.'s $40 million research and development/manufacturing complex in Research Triangle Park, North Carolina (see Japan-U.S. Business Report No. 339, December 1997, p. 2). Pending receipt of manufacturing approval from the Food and Drug Administration, PFIZER INC. had been making Aricept for U.S. sale. The plant has a single-shift capacity to produce 300 million Aricept tablets a year. Eisai plans to use the facility for other products, including Pariet (rabeprazole sodium), a proton pump inhibitor for peptic ulcers that is undergoing FDA review (see Japan-U.S. Business Report No. 340, January 1998, p. 2). More than 80 people currently are employed at the plant.

SANWA KAGAKU KENKYUSHO CO., LTD. and a Swiss firm provided a total of $10.5 million in financing for TELIK, INC. The money will enable the South San Francisco, California biopharmaceutical discovery firm to fund its R&D programs into 2000. The Nagoya firm is a longtime Telik investor and collaborator. In addition to using Telik's TRAP chemoinformatics drug discovery technology to identify promising active compounds against Sanwa's targets in several therapeutic areas, they are working on an insulin sensitizer for the treatment of noninsulin-dependent diabetes mellitus (Type II diabetes). The next step is to identify a clinical candidate. TAIHO PHARMACEUTICAL CO., LTD. and TEIJIN LTD. also have partnerships with Telik.

An exchange rate of ¥121=$1.00 was used in this report.

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Matching new enterprise-class servers from PACKARD BELL NEC, INC.'s NEC Computer Systems Division and HITACHI PC CORP. (see Japan-U.S. Business Report No. 350, November 1998, p. 3), the Computer Systems Division of TOSHIBA AMERICA INFORMATION SYSTEMS, INC. announced shipments of the Magnia 7000 series. The line, which rounds out TAIS's current workgroup and departmental server families, supports up to four 400-MHz Pentium II Xeon processors. Magnia 7000 servers come standard with 256-megabyte ECC (error checking and correcting) EDO (extended data-out) DRAM (dynamic random access memory), expandable to 4 gigabytes, plus six hot-swappable drive bays and two hot- pluggable power supplies for high availability and reliability. The machines now are compatible with Windows NT and NetWare, but TAIS reportedly will extend operating system support to Unix. Pricing of a Magnia 7000 with a single 400-MHz processor starts at just under $8,000.

Both the NEC Computer Systems Division of PACKARD BELL NEC, INC. and HITACHI PC CORP. have announced Windows 2000 Ready desktop and notebook computers -- machines that run the Windows NT Workstation 4.0 operating system and meet the system requirements for easy migration to the forthcoming Windows 2000 Professional operating system. For Sacramento, California-based NEC CSD, the relevant products are the Versa SX and the Versa LX notebook computers and the PowerMate 8100 series of desktop computers. The comparable Windows 2000 Ready machines from Milpitas, California-headquartered Hitachi PC are the VisionBook 7700 and the just-announced VisionBook 800 and VisionBook Traveler 600 notebook lines, plus the new VisionDesk 1330, 2200 and 3400 desktop computers.

HITACHI PC CORP. introduced a new line of VisionDesk desktop computers designed to address the application-specific requirements of a range of corporate environments. The refreshed series starts with the all-in-one, 7.5- inch-deep VisionDesk 1330. Equipped with a 333-MHz Pentium II processor, this $2,600 system features HITACHI, LTD.'s 14.1-inch SuperTFT (thin-film- transistor) LCD (liquid crystal display) screen, which delivers high resolution, reduces eye strain and provides a 160-degree viewing angle. The small-footprint VisionDesk 2200 microtower, which also uses a 333-MHz Pentium II processor, offers an alternative to the VisionDesk 1330 for space- constrained environments. It starts at $1,300. At the high end of the line is the VisionDesk 3400 minitower. Running off a 450-MHz Pentium II processor, it comes with 64 MB of main memory (expandable to 256 MB), a 6.4-GB hard drive, integrated 10/100 Base-TX local area network capability, plus two open drive bays and an equal number of open PCI (peripheral component interconnect) and ISA (integrated standard architecture) slots. Available in January, it costs $2,000.

In a companion release, HITACHI PC CORP. introduced the VisionBook 800 desktop replacement and the VisionBook Traveler 600, touting for both their built-in connectivity features to distinguish them from the competition. Corporate buyers of the VisionBook 800 have a choice of a 266-MHz or a 300-MHz Pentium II processor and a 13.3-inch or a 14.1-inch TFT display, plus 128 MB of base synchronous DRAM (expandable to 256 MB), up to 8 GB of hard drive capacity and a combination 20X CD-ROM/floppy drive. The mininotebook Traveler 600 weighs just 2.9 pounds, including the battery, and measures only 1.2 inches thick, yet it has a 10.4-inch TFT display and a keyboard sized at 90 percent of a normal notebook keyboard. Performance features include a 266-MHz Pentium processor with MMX technology, 32 MB of RAM and a 3.2-GB hard drive. A docking bar for connecting to external devices is among the system's convenience pluses. Pricing begins at $2,000. The VisionBook 800, which will be available in January, as well as the VisionDesk 2200 and the VisionDesk 3400 will be built to order. In time, Hitachi PC will extend its custom-configuration program to other desktop and portable machines. FUJITSU PC CORP. and TOSHIBA AMERICA INFORMATION SYSTEMS, INC. already have similar programs in place.

Going after cost-conscious small and midsized businesses, the Computer Systems Division of TOSHIBA AMERICA INFORMATION SYSTEMS, INC. introduced three notebook products priced below $2,000. In fact, its new Satellite 2515CDS lists for just $1,400. That price buys a 266-MHz Pentium processor with MMX technology, 32 MB of EDO DRAM, a 4.3-GB hard drive, a 12.1-inch color dual- scan display and a built-in 56-kilobit-per-second modem packaged in a 1.7- inch-thick, sleek, curvy case. The leader in portables also introduced the Portégé 3010CT/3015CT. This duo, with their distinctive magnesium-alloy dark gray chassis and silver metallic lid, measures a mere 0.75-inch thick and weighs 2.9 pounds. The $2,000 machines have the same processor, memory, hard drive and modem specifications as the Satellite 2525CDS but come with a 10.4- inch TFT display and a fast graphics accelerator. At the same time, TAIS beefed up its mininotebook line with the release of the Libretto 110CT, a 2- pound product with a 233-MHz Pentium processor with MMX technology, a 4.3-GB hard drive and a 7.1-inch TFT display that lists for $1,800. Value-conscious notebook buyers, particularly in the government, education, corporate and SOHO (small office/home office) markets as well as first-time customers, also are the targets for the Versa Note from PACKARD BELL NEC, INC.'s NEC CSD. Pricing starts at $1,700 for a system with a 266-MHz Pentium processor with MMX technology, 32 MB of internal memory, a 3.2-GB hard drive and a 12.1-inch TFT display. A similarly configured computer with a 233-MHz Pentium II is $1,900. The Versa Note's all-in-one design means that the CD-ROM drive, floppy drive, modem and battery are integrated and available simultaneously.

The price-sensitive home market also has a new notebook option from PACKARD BELL NEC, INC.'s NEC CSD: the sub-$1,000 NEC Ready 120LT. The company is billing the system as the first full-featured, small, Windows 98 notebook computer at that price point. Weighing only 3.6 pounds despite its 8-inch color TFT display and full-sized keyboard, the NEC Ready 120LT sports a 200- MHz MMX-Enhanced MediaGX processor, 32 MB of SyncDRAM, a 2.1-GB hard drive, an external 3.5-inch floppy drive, an external 24X CD-ROM drive, a 56-kbps- capable modem and multimedia-enhancing features.

FUJITSU PC CORP. is shipping its slimmest (1.1 inch) and lightest (under 4.5 pounds) LifeBook notebook to date for mobile professionals and corporate executives. The LifeBook L440 is powered by a 266-MHz Pentium II processor and features 32 MB of RAM standard (expandable to 160 MB), a 4-GB hard drive, a 13.3-inch TFT display and a 56-kbps internal modem. Two configurations are available. One, with an estimated street price of $2,700, has an external floppy drive; the other, which lists for $2,900, comes with a detachable multifunction bay, allowing users to travel with only the components they need.

In a major boost to CANDESCENT TECHNOLOGIES CORP.'s efforts to make field emission display technology the format for the next generation of thin, flat panel computer displays, SONY CORP. agreed to work with the San Jose, California company to develop high-voltage FED technology. Color displays incorporating this technology deliver a level of brightness and provide a viewing angle and a response speed similar to the cathode ray tubes found in most of today's desktop monitors. FED displays also can achieve the same thin, lightweight design characteristic of LCD displays. Moreover, compared with low-voltage FEDs, the high-voltage counterpart offers longer life, reduced power consumption and better color quality. Sony and Candescent expect to jointly commercialize 14-inch and larger full-color, high-voltage FEDs within the next two years. That time frame coincides with the start of volume output at a $400 million factory that Candescent has under construction in San Jose for the production of its ThinCRT flat panel displays. Sources value Sony's development deal with Candescent at $100 million.

A new display option is available to buyers of XYBERNAUT CORP.'s "wearable" Mobile Assistant IV PC (see Japan-U.S. Business Report No. 349, October 1998, p. 13). JAPAN AVIATION ELECTRONICS INDUSTRY, LTD. is supplying a 6.5-inch color VGA (video graphics array) FPD with integrated digitizer to the Fairfax, Virginia company on an original equipment manufacturer basis. Unlike Xybernaut's existing head-mounted display, the one-pound JAE product is designed to be worn on the forearm or in a sleeve on the same belt or vest holding the MA IV. The new display, which has 16 built-in function keys and provides a resolution of 640 x 480, can be operated by touch or by using a built-in stylus.

SHARP CORP.'s Mahwah, New Jersey subsidiary is marketing a second-generation 15-inch TFT LCD multimedia monitor optimized for high-end workstations. The LL-T152A, which delivers XGA (extended graphic array) resolution (1024 x 768), has a display area equivalent to a 17-inch CRT monitor, yet takes up just one- fourth the desk space and uses only 40 percent of the power of that monitor. It lists for about $1,500. Sharp's U.S. unit also has added to its LCD monitor lineup a product with a viewing area of 12.1 inches measured diagonally. The 15-inch Sharp product is up against a similarly sized TFT LCD display from FUJITSU, LTD. Its FUJITSU MICROELECTRONICS, INC. unit claims that the XGA- resolution display, which is designed for high-end multimedia applications and desktop monitors, offers the widest viewing angle (more than 160 degrees both vertically and horizontally) and the fastest response time of any product in its class.

The PanaSync monitor line from PANASONIC COMPUTER PERIPHERAL CO. will gain a new member in February. The 19-inch PanaSync SL90 has an 18-inch viewing area measured diagonally and delivers a resolution of 1600 x 1280. The Secaucus, New Jersey affiliate of MATSUSHITA ELECTRIC INDUSTRIAL CO., LTD. has priced the monitor at $680.

Formalizing a two-year working relationship, MI-TSUBISHI CHEMICAL CORP. and QUINTA CORP. have teamed up to develop and commercialize technology that overcomes the potential capacity limitations of the magnetic recording media used in the disk drives of today. This constraint involves ariel density, or the amount of data per square inch on a hard drive platter. The focus of the collaboration is recording media for Quinta's optically assisted Winchester architecture, which incorporates thermally assisted magnetic recording and vertical recording techniques to get around the so-called superparmagnetic effect. Mitsubishi Chemical brings to the job its expertise in hard disk and magneto-optical media. OAW products draw on techniques used in both technologies. The partners' immediate goal is to put 30 GB of capacity on a platter. San Jose, California-based Quinta is the optical storage development subsidiary of SEAGATE TECHNOLOGY, INC.

The next generation of disk drives -- devices with capacities up to 20 GB -- has arrived. Along with at least two American companies, FUJITSU COMPUTER PRODUCTS OF AMERICA, INC. introduced a number of hard drives for servers, desktop PCs and notebook computers that fall into the higher storage range. And, like its competitors, the FUJITSU, LTD. unit expanded disk capacity by increasing ariel density. It did this by adopting a more sensitive disk drive head technology pioneered by INTERNATIONAL BUSINESS MACHINES CORP. called GMR, short for giant magnetoresistive. For desktop machines, San Jose, California-based Fujitsu Computer Products will offer capacities of 17.3 GB, 12.9 GB, 10.8 GB, 8.4 GB, 6.4 GB and 4.3 GB. It also will start shipping in February three slim but higher-capacity notebook drives.

Continuing its push into the printer field from its stronghold in the copier market (see Japan-U.S. Business Report No. 348, September 1998, p. 5), CANON INC.'s Lake Success, New York subsidiary introduced two additions to its color laser printing line. The CLBP 460PS for workgroups outputs four pages per minute in color and 16 ppm in monochrome with a resolution of 600 dots per inch. The $3,000 system incorporates a new print engine derived from San Mateo, California-based ELECTRONICS FOR IMAGING, INC.'s Fiery X2e embedded color controller. Canon also announced for March shipment the imageClass 2100, a 6-ppm network color laser printer that has walk-up copying capabilities. It will be priced at $10,000. Moreover, sometime in 1999's second quarter, the company will begin selling the CLCZ, an 11-ppm color laser copier with printing capabilities.

KONICA CORP.'s Windsor, Connecticut business products subsidiary is making the same move. Its color laser printer line has two new additions: the KL-3015N Force Color and the KL-3015N+ Force Color. Both machines print 3 ppm in color and 15 ppm in monochrome and can be managed remotely over the Web. They, too, include ELECTRONICS FOR IMAGING, INC.'s Fiery X2e controller. The main difference between the two color lasers, which cost $4,500 and $5,000, respectively, is how much memory they have.

Multifunction systems are going mainstream. Recent product introductions from Japanese competitors include the Bizworks 406DF, a color laser printer/digital copier for the SOHO market from RICOH CO., LTD.'s West Caldwell, New Jersey marketing subsidiary. The $800 unit prints 6 ppm with a 600-dpi resolution. On the copier side, it has a document feeder and scan-once, copy-many capabilities. Then there is the Panafax DX-1000 from PANASONIC COMMUNICATIONS & SYSTEMS CO., a networked fax machine that doubles as a scanner and a networked printer. One novel feature is that users can fax documents over a corporate intranet or the Internet to either a fax machine or an e-mail address. The DX-1000 will be available early in 1999 at a price of $3,000. For its part, KONICA CORP.'s U.S. unit is marketing for $3,000 the high-volume Fax 9825. Designed for midsized workgroups, the system functions not only as a fax machine but as a printer, a scanner and a copier as well. Companies not sure that they want these added capabilities now can buy the midvolume Fax 9820 and later invest in a low-cost upgrade kit. TOSHIBA AMERICA INFORMATION SYSTEMS, INC. also plans to break into the multifunction systems market in 1999. Its starting point will be the DP2460 networked copier. This machine will allow users to copy, print, fax and scan directly from an office PC or from a networked computer.

Multifunction printers for another type of business -- banks' teller stations -- are being pushed by SEIKO EPSON CORP.'s Torrance, California marketing unit. Its small-footprint, faster TM-U675 printer is an integrated receipt, validation and document transaction printer designed to consolidate numerous branch jobs into one device. The system costs $865.

An exchange rate of ¥121=$1.00 was used in this report.

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Digital television-capable PCs will arrive in stores sometime during the first half of 1999, thanks to the joint efforts of MATSUSHITA ELECTRIC INDUSTRIAL CO., LTD. and COMPAQ COMPUTER CORP. The consumer electronics giant developed a tuner-decoder that receives and decodes terrestrially broadcast digital TV signals and displays them on a PC monitor. The world's top PC vendor will build the device into some of its models, although the high cost of the board -- expected to be more than $800 initially -- could limit sales of the new PCs. MEI's Secaucus, New Jersey-based PANASONIC INDUSTRIAL CO. subsidiary plans to market the MATSUSHITA ELECTRONICS COMPONENTS CO., LTD.-made tuner-decoder board to other PC manufacturers and to broadcasters and content developers on an OEM basis.

Home theater-type TV sets keep getting bigger. SANYO ELECTRIC CO., LTD. is marketing a 70-inch rear-projection unit. The Big Show Date can handle high- definition broadcasts as well as standard-definition programming. Because of the set's steep price -- roughly $24,600 -- Sanyo expects to sell only about 100 units a month.

U.S. sales of digital video disc players are still limited, totaling an estimated 1 million units in 1998, but more makers are moving into the market. Among the latest is VICTOR CO. OF JAPAN, LTD., which released two DVD models at the end of November that had been introduced earlier in Japan. JVC is projecting sales of 150,000 DVD players in the United States in 1999. Achieving that forecast is key to its goal of winning 10 percent of the world market in the near term.

Industrial control systems manufacturer GE FANUC AUTOMATION NORTH AMERICA, INC. acquired TOTAL CONTROL PRODUCTS, INC. for just under $100 million, plus the assumption of $20 million in debt. Melrose Park, Illinois-headquartered TCP, which is in the same business as GE Fanuc Automation, supplies such products as input/output devices, graphic operator interfaces and open connect hardware and software for factorywide control systems. It earned $4.1 million on sales of $60.6 million in its last fiscal year. One of the company's shareholders was DIGITAL ELECTRONICS CORP., an Osaka maker of electronic control systems. With the buyout of its 4 percent TCP share, Digital Electronics plans to set up a wholly owned U.S. subsidiary in the spring of

Charlottesville, Virginia-headquartered GE Fanuc Automation is the result of a 1986 partnership between FANUC LTD. (45 percent), the world's dominant maker of numerical controls for machine tools, and GENERAL ELECTRIC CO. (55 percent). The latest phase of YOKOGAWA ELECTRIC CORP.'s year-old-plus turnaround strategy for its North American industrial automation business (see Japan-U.S. Business Report No. 342, March 1998, p. 4) involves the integration of its Newnan, Georgia manufacturing operation, YOKOGAWA INDUSTRIAL AUTO-MATION AMERICA, INC., with its sales arm, YOKOGAWA CORP. OF AMERICA, also based in Newnan. The resulting organization retains the name of the sales subsidiary. To better exploit opportunities in the world's largest industrial automation market, YCA will expand direct marketing and sales by distributors by hiring more people. Its parent also will transfer systems engineers and marketing specialists from Japan to the Georgia company. Yokogawa Electric is looking for North American sales of roughly $250 million in FY 2000, or 50 percent more than current annual revenues.

An exchange rate of ¥121=$1.00 was used in this report.

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Another Japanese bank has found in its profitable U.S. commercial finance unit a way to raise money to cover the write-off of bad loans. SANWA BANK, LTD. has agreed to sell its wholly owned SANWA BUSINESS CREDIT CORP. to FLEET FINANCIAL GROUP, INC. The deal's terms were not disclosed, but insiders said that the bank did not get as much money for the Chicago company as it had hoped. Estimates put the sale price between $700 million and $750 million. Sanwa Bank acquired what became SBCC in 1984. The company provides equipment leasing and secured lending to businesses, with about a third of its receivables coming from vendor financing. SBCC controls assets worth $6.4 billion. Boston-based Fleet's commercial finance unit, FLEET CAPITAL CORP., has assets of $9 billion. Both FUJI BANK, LTD. and DAI-ICHI KANGYO BANK, LTD. have used their American commercial finance units to generate funds to take care of problems at home (see Japan-U.S. Business Report No. 341, February 1998, p. 4, and No. 350, November 1998, p. 5).

An exchange rate of ¥121=$1.00 was used in this report.

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UNITED GRAIN CORP., a MITSUI & CO., LTD. company, and CENEX HARVEST STATES COOPERATIVES, the largest farmers' cooperative in the United States, have integrated their wheat and barley operations in the Pacific Northwest. Equally owned UNITED HARVEST, LLC runs two export elevators: one in Vancouver, Washington previously owned by UGC and another in Kalama, Washington that Cenex Harvest States operated. As part of the deal, grain will be shipped to them from country elevators that Cenex Harvest States has in central and Western Montana. Portland, Oregon-based United Harvest is projecting annual revenues of $730 million. It expects to handle about 6.2 million tons of wheat a year, or roughly 40 percent of the crop moving to Asia through West Coast ports, plus a smaller volume of barley. Mitsui and Cenex Harvest States, which is headquartered in St. Paul, Minnesota, are no strangers. In the summer of 1996, they merged their respective vegetable oil-based processing, packaging and marketing operations into VENTURA FOODS, LLC. That City of Industry, California company, which is majority-owned by Mitsui, has plants across the country.

From January, BON VILLAGE FOODS CORP. will ship three types of seasonings to SAFEWAY INC. for sale in its West Coast supermarkets. Made from sun-dried vegetables, including mushrooms, the products are added to rice either before or after cooking. The Saitama prefecture firm, which just opened a plant that can turn out 400,000 packages of seasonings a month, has a 1999 sales goal of $4.1 million.


Rescuing magnet wire manufacturer OPTEC DAI-ICHI DENKO CO., LTD. has become a complex, multinational effort. In October, France's ALCATEL S.A. acquired OPTEC D.D. U.S.A., INC., which has made copper magnet wire in Mexico, Missouri since 1987. It also agreed to buy an Optec plant in Portugal and the company's Canadian assets. Now, MITSUBISHI MATERIALS CORP., which took Optec under its wing last spring and is the company's top shareholder with a 30 percent stake, has an agreement with Alcatel to buy approximately 12 percent of the former Optec subsidiary in the United States and 10 percent or so of the Portuguese firm. News sources put the cost of this transaction around $8.3 million. MMC hopes to use the purchases to further its fabricated copper business in the United States and Europe. In turn, Alcatel, a big telecommunications equipment maker, will purchase roughly 12 percent of Optec's stock. Magnet wire in used in such equipment as motors, transformers, television tubes, clocks and vehicles.

An exchange rate of ¥121=$1.00 was used in this report.

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MEGATOOL, INC., a Buena Park, California maker of carbide drills for printed circuit boards, has another expansion underway. The wholly owned UNION TOOL CO. subsidiary expects to complete a $5.8 million second plant in Buena Park in the spring. At full operation in late 1999, it will give Megatool, which has been in business since 1982, the capacity to make 1.9 million drills a month compared with a yearend 1998 output of 1.5 million units. The firm's estimated sales in the year through November 1998 were $119 million, up a projected 22 percent from the previous fiscal year, while pretax profits were forecast 30 percent higher.

Through its Hanover Park, Illinois marketing subsidiary, NITTO KOHKI CO., LTD., Japan's top manufacturer of fluid coupling equipment, has opened a sales office in Columbus, Ohio in an attempt to win more business from Japanese- affiliated automotive and other producers in Ohio, Kentucky, Tennessee and West Virginia. The company's unique one-touch fluid couplers, sold under the CUPLA name, not only do away with conventional thread-type couplings or flanges and the fluid leakages and hose kinking they can cause but also allow water, oil, gas and air hoses to be quickly and easily connected and disconnected.

In a partial offset to its shrinking business at home, FUJI HEAVY INDUSTRIES, LTD. struck a deal with DEERE & CO. to supply it with lawn and garden equipment on an OEM basis starting in January. FHI expects to ship 35,000 lawn mowers and other products to the world's top agricultural equipment maker in 1999 and 50,000 in 2000. The lawn mowers will be sold under Deere's Green Mower brand. Joint product development is a possibility if the OEM arrangement works out.

TANAKA KOGYO CO., LTD. is shipping its innovative PureFire engine for handheld power equipment to the United States. Available in displacements of 26 cubic centimeters and 40cc, the engine is the first two-stroke certified to meet the tough emissions standards that will take effect in California in 2000. The company also has incorporated the 40cc PureFire version in a pair of Tanaka- brand grass trimmers/brush cutters that are sold along with other Tanaka outdoor power equipment products by INTERNATIONAL SALES & MARKETING, INC. of Kent, Washington. Tanaka also has a subsidiary in the same place.

At a cost of about $2 million, NIIGATA ENGINEERING CO., LTD. is building a new campus in Rolling Meadows, Illinois for its vertical machining center operations that will allow its subsidiary to focus more on turnkey systems. Like the existing facility in the same town, the complex will house offices, training rooms, a showroom, a parts warehouse and space for customizing machines with various peripherals. However, it also will have room to build transfer lines or manufacturing cells that integrate Niigata's machining centers with robots and conveyors. The new facility will open in the summer of 1999. With its expanded capabilities, NIIGATA MACHINERY (USA) CO., INC. expects sales of $53.7 million in the 1999 business year versus $31.4 million in the comparable 1997 period.

TAKAMATSU MACHINERY CO., LTD. of Ishikawa prefecture, a manufacturer of CNC (computer numerically controlled) precision lathes, is in the process of tripling to 12 the number of distributors it uses in the United States. It is interested in expanding in areas where automotive parts makers are located in the Midwest and the Southeast. Takamatsu Machinery also will dispatch marketing specialists to this country in the spring to backstop current and future distributors. The firm's CNC lathes include servo turret and linear turret models as well as a pair of two-spindle machines.

To help achieve its goal of winning 10 percent of the U.S. market for midrange truck-mounted cranes (see Japan-U.S. Business Report No. 347, August 1998, p. 5), FURUKAWA UNIC CORP. has introduced the UNIC UR-1504. It has a top lifting capacity of 30,000 pounds and, with an optional jib installed, can reach a height of 115.1 feet above ground level. The key marketing point, however, is that these capabilities are possible with the UNIC UR-1504 mounted on a 26,000-pound GVW (gross vehicle weight) truck rather than the previously required 33,000-pound-and-up truck.

With exports of hydraulic equipment to Southeast Asia in a slump, KAWASAKI HEAVY INDUSTRIES, LTD. and TOKIMEC INC. are doing the groundwork to start or expand sales of these products in the United States and Europe. KHI is putting together a hydraulic valve marketing team at KAWASAKI MOTORS CORP., U.S.A. in Irvine, California in preparation for the launch of sales in 1999. For its part, Tokimec plans to end a technical tie-up with VICKERS, INC. and set up within 1999 a hydraulic equipment division at its California subsidiary. Between American and European sales, KHI hopes to turn hydraulic valves into an $8.4 million annual business in three years, while Tokimec is forecasting revenues of $41.3 million in FY 2000.

An exchange rate of ¥121=$1.00 was used in this report.

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Having a strong lineup of copiers, fax machines, networked multifunctional machines, optical filing systems, printers and scanners is not enough to win more accounts from big and midsized American companies, CANON INC. has decided. It needs greater expertise in the area of systems and network integration to meet customers' growing demand for networked imaging solutions. The manufacturer also has come to the conclusion that the fastest way to expand the systems integration capabilities of its CANON U.S.A., INC. unit is to buy 10 or so companies that already provide integrated services. In the second such purchase, Canon U.S.A. and AFFILIATED BUSINESS SOLUTIONS, INC., a regional direct sales subsidiary headquartered in Burlington, New Jersey, acquired SINTAKS. That Bridgeport, Pennsylvania company provides information technology sales, support and integration services to more than 3,000 customers nationwide.

An exchange rate of ¥121=$1.00 was used in this report.

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In a reversal of their original relationship, FERROTEC CORP. licensed manufacturing and marketing of its ferrofluid sealed spindles to FERROFLUIDICS CORP., which was instrumental in the Tokyo company's formation in 1980. Used in semiconductor production, this sealing system allows the transmission of rotary motion through the wall of a vacuum chamber, pressure vessel or other sealed and protected environment while isolating the protected environment from the ambient space. Nashua, New Hampshire-based Ferrofluidics will pay a 5 percent royalty on sales of the Ferrotec sealing system. The payment is expected to total $500,000 in the April 1999-March 2000 period. The former parent also will market a vacuum seal made by its offspring.

The Environmental Protection Agency has approved the sale of AMANO CORP.'s Alpha 800 electrolytic ionized water system for sanitizing all precleaned, nonporous food contact surfaces, including countertops, eating utensils and glassware in restaurants, dairies, food processing plants and other food preparation areas. The system, which is effective against S.aureus and E. coli bacteria, also can be used as a general sanitizing agent in all areas of federally inspected meat and poultry plants. To produce the electrolytic ionized water, an aqueous salt solution is added to the Alpha 800 and a current then is passed through the solution to produce chlorine, sodium hydroxide and hydrogen. Amano's PIONEER/ECLIPSE CORP. subsidiary in Sparta, North Carolina will handle marketing. It has priced the Alpha 800 between $7,400 and $14,900. Because this method of sanitizing is new to the United States, the company expects to sell just 100 Amano 800 systems in the first year.

With marketing clearance in hand from the Food and Drug Administration, CANON U.S.A., INC. is marketing nationwide the Canon Digital Radiography System. This digital X-ray imaging system, approved for all general-purpose diagnostic procedures, consists of a sensor plate imaging unit, a control station and an operation unit/preview panel. Unlike traditional X-ray systems, which involve exposing film for subsequent wet-chemical processing to create a hard-copy image, the CANON INC. product uses a device to capture the image in electronic form. The digital image data then is used to produce diagnostic hard-copy and reference soft-copy images. A key benefit of the Canon system is its networking capability, which can facilitate teleradiology among distant radiology departments.

An exchange rate of ¥121=$1.00 was used in this report.

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Through a $23 million capacity expansion, KOBE PRECISION, INC. is running what it says is the largest silicon wafer reclamation facility in North America. Semiconductor manufacturers use recycled wafers as test wafers to optimize and monitor their manufacturing processes. The KOBE STEEL, LTD. subsidiary's Hayward, California plant now can process 90,000 wafers per month based on 8- inch wafer equivalents. It has the capability to handle 150-millimeter (6- inch), 200mm (8-inch) and 300mm (12-inch) wafers. In each case, it removes films and layers from used wafers and then repolishes and cleans them. Surprisingly, given the troubled state of the semiconductor industry over the last three years, KPI has more than doubled reclaimed wafer sales every year since it went into this business in 1996. The 450-employee company, which Kobe Steel bought 10 years ago, also is one of the world's biggest manufacturers of aluminum substrates for hard disk drives. It now has the capacity to make 6 million units a month compared with 600,000 in 1988.

For $15 million, NEC CORP. acquired roughly 13 percent of VADEM, LTD. The San Jose, California company is a developer and marketer of Windows CE handheld PCs and software. However, under a November 1996 strategic partnership, Vadem has been working with NEC on the development of RISC (reduced instruction-set computing) processors for Windows CE devices. NEC's recently announced VR4100 Series of chips for a new generation of Windows CE machines is a product of that collaboration. The big semiconductor maker sees its equity tie to Vadem as a way to expand chip sales. Its affiliate has a contract to supply VR4100- equipped Windows CE terminals to SHARP CORP. on an OEM basis.

ZUKEN INC., a provider of electronic design automation services for printed circuit boards, is moving into the semiconductor business. Its vehicle is an alliance with LIGHTSPEED SEMICONDUCTOR CORP. Zuken acquired for $1.5 million about 5 percent of the Sunnyvale, California company, the developer of the so- called module-based array ASIC (application-specific integrated circuit) architecture. This technology is said to significantly reduce design and production cycle times for complex, high-performance ASICs. As part of their tie-up, Zuken gains exclusive rights to distribute Lightspeed's MBA ASICs in Japan. These products are manufactured by TAIWAN SEMICONDUCTOR MANUFACTURING CO. Zuken believes its new business will produce annual sales of $24.8 million in three years.

Add-on memory maker ADTEC CO., LTD. of Hiroshima prefecture will open an office in Silicon Valley in January. The main purpose of the move is to develop new marketing channels for the company's products, both among PC manufacturers and retailers. The office also will track technology developments.

The Santa Clara, California Semiconductor Equipment Division of CANON U.S.A., INC. is taking orders for CANON INC.'s latest excimer laser scanning wafer stepper. The FPA-5000AS1 can achieve 0.13-micron line widths for 1-gigabit and higher DRAMs as well as for the development of process technologies for microprocessors in the 1-gigahertz class. Just as important, a field conversion kit allows the system to be used with both 200mm and 300mm wafers. Canon will start worldwide deliveries of the scanning stepper by the second quarter of 1999.

An exchange rate of ¥121=$1.00 was used in this report.

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The list of Internet ventures that have received financing from SOFTBANK CORP. continues to grow. In its latest move, Japan's top software distributor paid $40 million for a 9.9 percent stake in BUYCOMP.COM CORP., which sells software, computer hardware and peripherals over the Internet. Last summer, a Softbank affiliate acquired a 10.25 percent position in The Aliso Viejo, California company said that it would use the Softbank money to expand into new on-line markets. Softbank's Internet-related portfolio also includes on-line stock trader E*TRADE GROUP, INC. (27.2 percent), search engine company YAHOO! CORP. (31 percent), on-line "communities" hoster GEOCITIES CORP. (35 percent) and ZIFF-DAVIS INC. (71 percent), the magazine publisher behind the ZDNet Web site.

SONY MARKETING (JAPAN) INC. and an ITOCHU CORP. company were among the existing institutional and strategic investors in PREVIEW SYSTEMS, INC. to participate in the latest round of financing for the provider of electronic software distribution and digital content distribution infrastructure technologies. Sony Marketing is the Cupertino, California start-up's Japan development partner and the exclusive local distributor of its ZipLock ESD system (see Japan-U.S. Business Report No. 350, November 1998, p. 22). Preview Systems will use the $8 million in additional financing to back product development and its international expansion. ZipLock already supports nine languages. It soon will allow on-line purchases in Japanese.

In advance of an expected initial public offering by NETOBJECTS, INC., a U.S. unit of MITSUBISHI CORP. bought a small stake in the developer of software tools for Web site construction. The Redwood City, California company is majority-owned by INTERNATIONAL BUSINESS MACHINES CORP. Its second-largest corporate investor is NOVELL, INC., now followed by Mitsubishi. For the last year, the trader has distributed the Japanese-language version of NetObjects Fusion (see Japan-U.S. Business Report No. 350, November 1998, p. 22).

In a deal that will make its tools for debugging large and complex embedded software applications available outside Japan for the first time, KYOTO MICROCOMPUTER CO., LTD. gave METROWERKS INC. exclusive rights to resell its Partner-ET II ROM (read-only memory) emulators and new miniPartner on-chip debugging hardware. KMC's products support most major 8-bit, 16-bit and 32-bit processors and are used by many Japanese semiconductor manufacturers for RISC processor embedded development work. San Jose, California-based Metrowerks is the supplier of the popular CodeWarrior integrated development environment solution.

In what would seem like a gamble, Tokyo's GAIO TECHNOLOGY CO., LTD., another embedded tools provider, has opened an office in Silicon Valley to backstop sales of its microcontroller development environment by three distributors. Current plans call for upgrading the branch to a subsidiary in the spring.

A trio of Japanese companies is trying to break into the American market for computer-aided design and manufacturing software, but at least they are sharing the risk among themselves and with an Indian software developer, CAE SOLUTIONS, that has an operation in Stratford, Connecticut. The four have formed AIA SOFTWARE, LLC, also located in Stratford, to develop and market CAD-CAM software in the United States and to come up with Internet-related software for the Japanese market. AIA Software's Japanese partners are ANDOR CO., LTD., a Kobe-headquartered CAD developer (19 percent), CAM developer DATA DESIGN, INC. of Nagoya (9.5 percent) and ROMAN RESEARCH CORP. (35.75 percent), a Chiba prefecture software distributor that will handle marketing for the joint venture. CAE Solutions put up the remaining 35.75 percent of the new company's equity. AIA Software is projecting first-year revenues of $826,400.

An exchange rate of ¥121=$1.00 was used in this report.

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All of the contracts that Japanese companies have let to date for communications or broadcast satellites have gone to either HUGHES SPACE AND COMMUNICATIONS CO. or to SPACE SYSTEMS/LORAL INC. That record has been broken. SPACE COMMUNICATIONS CORP. and JAPAN SATELLITE SYSTEMS, INC. chose the Lockheed Martin Missiles & Space group of LOCKHEED MARTIN CORP. to build a communications satellite to be launched in the third quarter of 2000. N-SAT- 110 will use an A2100 platform equipped with 24 Ku-band transponders to deliver direct broadcast, telephone, data and other telecommunications services across Japan. MITSUBISHI ELECTRIC CORP., which was a subcontractor on SCC's Superbird satellites, will build unspecified components for the payload. The contract, which also includes a ground station, reportedly is worth $124 million. SCC and JCSAT spokesmen said that they went with Lockheed Martin because the company offered them an accelerated production schedule and the best-value contract proposal. Its fast turnaround time, the satellite supplier said, reflects the fact that the assembly and testing facilities at its Sunnyvale, California Commercial Satellite Center are adjacent to each other. At the same time, the A2100's modular design reduces the parts count and simplifies construction while also cutting the weight of the bus and its cost. SCC and JSAT will jointly operate N-SAT-100, an arrangement forced on the otherwise competitors by the Ministry of Posts and Telecommunications since both wanted to operate communications satellites in the geostationary orbit used by the NHK public broadcasting system.

In another announcement that raised some eyebrows on both sides of the Pacific, BROADCASTING SATELLITE SYSTEM CORP. revealed that it was negotiating a contract with ORBITAL SCIENCES CORP. for the construction and launch of two direct-to-home TV broadcast satellites. BSAT-2a and BSAT-2b, an in-orbit backup, will provide satellite-based digital TV service to subscribers in Japan after launch in the fall of 2000 and the spring of 2001, respectively, onboard ARIANESPACE S.A. rockets. BSAT, which is owned by NHK and a number of companies, currently provides direct-broadcast analog TV services to more than 12 million customers in Japan using a pair of satellites built by HUGHES SPACE AND COMMUNICATIONS CO. Dulles, Virginia-headquartered Orbital said that BSAT selected its three-axis-stabilized NovaStar lightweight (1,210 pounds without propellants) platform because of its high reliability, advanced performance and capacity and relatively low cost. If BSAT contracts with Orbital, SPACE SYSTEMS/LORAL INC. will build the Ku-band communications payload for the two BSAT-2s.

SANYO ELECTRIC CO., LTD. is supplying digital cellular telephones to the Sprint PCS (personal communications services) subsidiary of SPRINT CORP. The $150 phones are said to provide between 20 percent and 30 percent more talk and standby time than competing products. Based on CDMA (code-division multiple access) technology, which is marketed in Japan as cdmaOne, the handsets also are capable of operating in analog mode when digital service is not available. Sanyo Electric also sells CDMA cell phones through distributor BRIGHTPOINT, INC. of Indianapolis (see Japan-U.S. Business Report No. 342, March 1998, p. 8).

In its latest attempt to ease congestion on its transpacific Internet backbone, INTERNET INITIATIVE JAPAN INC. disclosed plans to expand bandwidth between Japan and the United States to 290 megabits per second by mid-December from 245 Mbps. The increase will involve doubling IIJ's Osaka-New York connection to 90 Mbps from 45 Mbps. The company's 200-Mbps Tokyo-West Coast backbone will not be increased at this time, but the major Internet services provider left open this possibility when it simultaneously said that it would further upgrade its facilities next spring. IIJ's Japan-U.S. backbone is connected directly to other countries in Asia through A-Bone, an Asian Internet backbone operated by an affiliate of the Tokyo-based ISP.

An exchange rate of ¥121=$1.00 was used in this report.

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In a good-news/bad-news development, MITSUBISHI MOTORS CORP.'s Normal, Illinois assembly unit, which has been building vehicles since 1988, posted its first profit ever in the year through March 31, 1998. However, as part of its drive to return to profitability in FY 2000, MMC plans to cut 700 of the 3,900-plus jobs at the assembly plant in addition to trimming 300 from the payrolls of its Cypress, California sales and credit operations, which now employ a total of 1,150 people. Mitsubishi Motors previously had announced that it would merge MITSUBISHI MOTORS MANUFACTURING OF AMERICA, INC. and MITSUBISHI MOTOR SALES OF AMERICA, INC. in the spring of 2000 in an effort to turn around its money-losing North American business (see Japan-U.S. Business Report No. 348, September 1998, p. 8). The automaker's goal is to make MMMA profitable on an annual production run of 160,000 units and to reduce costs enough that the sales arm can make money on a yearly volume of 200,000 units. Both objectives were just missed in 1998. The Normal factory built 157,000 cars, while MMC car and truck sales in the United States totaled 190,500.

In what is said to be a first for a Japanese automotive parts supplier, TOYOTOMI KIKO CO., LTD. will produce service or aftermarket parts in the United States. The Aichi prefecture manufacturer will supply fenders, hoods and other body stampings for TOYOTA MOTOR CORP. vehicles. Work on TOYOTOMI AMERICA CORP.'s $33 million plant in Springfield, Kentucky will begin in February 1999. Full-scale operations are scheduled to start in April 2000 with a work force of 75 people. In 2002, the company expects to be turning out anywhere from $16.5 million to $24.8 million worth of body parts for supply to Toyota service centers. Toyotomi America, which was formed last April, is its parent's first offshore subsidiary.

An exchange rate of ¥121=$1.00 was used in this report.

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Ten months after it put its money-losing Secaucus, New Jersey distribution subsidiary up for sale, TSUMURA & CO. has found a buyer (see Japan-U.S. Business Report No. 342, March 1998, p. 9). For a reported $20 million, BALAE BRANDS, INC. will acquire the assets of TSUMURA INTERNATIONAL INC., which markets in North America bath, home fragrance and licensed children's toiletry products. TII's brands include Vitabath, Vitabath Naturals and VitaSpa bath products, which are sold through department stores, and Claire Burke home fragrances. Its children's toiletries are sold under such names as Barbie, Barney and Rugrats through mass merchandisers. Phoenix, Arizona-based Belae Brands, a subsidiary of RIANCO LLC, also is in the personal-care products business.

"The ride simulation system for the 21st century." That is how HITACHI, LTD. and ENTERTAINMENT DESIGN WORKSHOP, LLC are describing their jointly developed interactive, six-passenger, all-electronic simulation system. The yet-to-be- named simulator is the initial result of an exclusive arrangement that Hitachi and Sheffield, Massachusetts-based EDW forged in November 1997 to collaborate on interactive contents to create special venue ride simulation systems for the themed entertainment industry worldwide. The system is set to debut in mid-1999. It will be marketed internationally by an IMAX CORP. subsidiary and Hitachi. They are projecting sales of 300 units over three years.

By yearend, TOTO LTD. expects to set up a subsidiary, HYDROTECT INC., in the San Francisco Bay area to market an antidimming film that it developed for vehicles' windows and side mirrors using a light catalytic technology. A variant of this technology prevents ceramic tiles from mildewing. In late summer, Toto, Japan's top manufacturer of toilets, basins and bathtubs, announced that it would start licensing its know-how to tile manufacturers as well as selling treated tile in the United States (see Japan-U.S. Business Report No. 348, September 1998, p. 9).

JAPAN CONSULTING INTERNATIONAL, INC., which recently opened an "incubation facility" in Dallas for Japanese venture businesses (see Japan-U.S. Business Report No. 349, October 1998, p. 11), is working with HOOK PARTNERS, also located in Dallas, to raise between $20 million and $30 million in venture capital from Japanese and American sources for investment in early-stage communications companies. The Hook Communications Partners venture capital fund, which will close at the end of March 1999, will invest in communications hardware and software companies as well as in Internet start-ups and businesses developing chips for communications applications primarily in Silicon Valley and in the area around Richardson, Texas dubbed Telecom Corridor.

In an efficiency-enhancing move, NIPPON EXPRESS CO., LTD. and FEDERAL EXPRESS CORP. have agreed to collaborate on international services. For starters, Japan's largest package delivery company will piggyback on FedEx's much larger worldwide network and the faster service it can deliver. The American giant serves 120,000 locations in 200 countries around the world, while the Nippon Express network links 211 cities in 79 countries. At the same time, FedEx will use Nippon Express for pickups and deliveries in Japan outside the metropolitan areas where it has offices. The tie-up also will include joint use of collection points and other facilities in various countries as well as access to each other's information systems to track deliveries.

An exchange rate of ¥121=$1.00 was used in this report.

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American Companies in Japan


A third major Japanese pharmaceutical company has acquired a license to use GENETICS INSTITUTE, INC.'s DiscoverEase protein development platform. SANKYO CO., LTD. joins CHUGAI PHARMACEUTICAL CO., LTD. and KIRIN BREWERY CO., LTD. in using the Cambridge, Massachusetts company's library to accelerate the drug- discovery process. The library contains novel human, secreted proteins, their corresponding DNAs (deoxyribonucleic acids) and a companion data base of information. Genetics Institute is a wholly owned subsidiary of AMERICAN HOME PRODUCTS CORP.

The merger and acquisition activity constantly going on in the United States generally entails the renegotiation of distribution arrangements in Japan for companies active in that market. As a case in point, BECTON DICKINSON AND CO., the world leader in flow cytometry systems for both the research and the clinical market, gave FUJISAWA PHARMACEUTICAL CO., LTD. rights to sell antibodies and reagents for immunological research. The Franklin Lakes, New Jersey diagnostic equipment supplier gained a significant number of the 300 reagents covered by the agreement when it bought PHARMINGEN in mid-1997. Fujisawa Pharmaceutical was a minority owner of that Del Mar, California manufacturer as well as its exclusive Japanese distributor. By working out a new contract with the drug maker, Becton Dickinson's subsidiary hopes to lift sales of the Leu Series of flow cytometry-related reagents to $8.3 million in 2000 from an estimated $6.6 million in 1998.

Sometimes, of course, new distribution arrangements are required because the original ones did not pan out. That was true for SONUS PHARMACEUTICALS, INC., which terminated a March 1995 agreement with DAIICHI PHARMACEUTICAL CO., LTD. The pact gave the midsize drug company marketing and distribution rights to the Bothell, Washington firm's EchoGen ultrasound contrast agent in Japan and nine other Pacific Rim nations. Daiichi Pharmaceutical completed Phase I clinical trials in Japan in December 1997, but it did not follow up the safety and efficacy tests with additional clinical work, even though the results of the initial study were encouraging. SONUS reported that several other companies are interested in obtaining the Pacific Rim license for EchoGen and another ultrasound contrast agent in development.

Technology developed by TEXACO INC. that shows promise for converting waste plastics into usable products without environmental degradation has been licensed to DAICEL CHEMICAL INDUSTRIES, LTD. In very simplified terms, the process produces among other gases carbon monoxide, a raw material for the acetic acid that is one of Daicel's major products. The chemical manufacturer plans to employ the Texaco technology in a pilot plant to be built in Himeji, Hyogo prefecture as part of a waste plastics gasification project. Companies in Japan are under increasing pressure to find environmentally safe ways to recycle plastics because of new, more encompassing legal mandates. In 2001, for instance, TV sets, air conditioners, refrigerators and other home appliances made from plastics have to be recycled. Texaco will test its technology in Rotterdam, the Netherlands starting sometime in 1999 at a plant capable of processing 50,000 tons of waste plastics a year.

An exchange rate of ¥121=$1.00 was used in this report.

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The subsidiary of professional services giant ELECTRONIC DATA SYSTEMS CORP. hopes to win contracts from five new companies a year to handle all or part of their information technology operations. It is off to a good start. EDS has a seven-and-a-half-year outsourcing contract from HOME WIDE CORP., the largest operator of home centers on Kyushu, to plan, develop, operate and maintain its computer system. The contract also covers the installation of a point-of-sale system in all Home Wide stores that is connected to the company's main computer system as well as the construction of an electronic data interchange between Home Wide and its suppliers. EDS will be paid a fraction of the company's revenues.

Market intelligence indicates that PC sales finally have turned up, but American manufacturers continue to look for ways to maximize their business. DELL COMPUTER CORP.'s subsidiary has set up an Internet site to sell directly to corporate customers. They can get cost estimates and terms as well as place orders. The company hopes the site will attract 200 new customers in its first three months of operation. For the local unit of another direct marketer, GATEWAY 2000, INC., one answer is to open more stores. The firm already has directly managed outlets in Tokyo, Osaka and Nagoya. Current plans call for setting up stores outside major metropolitan areas.

In an effort to prevent further encroachment on its turf by Windows NT machines, SUN MICROSYSTEMS, INC. introduced a pair of affordable servers for workgroups and two workstations for the same price-sensitive market. Both the Sun Enterprise Ultra 5S Server and the Sun Enterprise Ultra 10S Server use a 333-MHz version of the 64-bit UltraSPARC-IIi processor. Promoted as a Web server and for file/print applications, the 5S provides 2 MB of external cache and a 9.1-GB EIDE (enhanced integrated drive electronics) hard drive. It lists for $7,400. The 10S, priced at $8,200, features 1 GB of internal memory, four PCI expansion slots and up to 18.2 GB of storage to support Web, e-mail or file/print services. For technical computer users, Sun is offering the $7,000 Sun Ultra 5 and the $10,700 Sun Ultra 10 workstations. The Ultra 5, powered by a 333-MHz UltraSPARC-IIi with 2 MB of cache, is being marketed for software development and two-dimensional design, while the Ultra 10, which sports a 360-MHz UltraSPARC-IIi chip and 2 MB of cache also, gives users a choice of graphics packages for three-dimensional design and analysis.

One of the companies trying to take sales away from the high end of the Unix market is INTERGRAPH CORP. Its weapon is the new Intense 3D Wildcat 4000 graphics accelerator. With it installed, the Huntsville, Alabama company's TDZ 2000 GTI and TDZ 2000 GXI ViZual Workstations powered by 450-MHz Pentium II processors are said to deliver the fastest 3D graphics performance for Windows NT applications. Not only that, Intergraph claims that the TDZ 2000 GXI with Intense 3D Wildcat 4000 graphics outperforms top-of-the-line Unix workstations but costs just a fraction of what those machines go for. Its subsidiary has priced the two TDZ systems from $16,400. Given their price/performance edge for 3D graphics, the local unit expects to sell 10,000 units.

For animation, video and film professionals using rendering software, which requires multiple fast processors, INTERGRAPH CORP.'s subsidiary also has on the market a new family of RenderRAX II modular, racked-mounted rendering systems powered by the latest Pentium II processor. The TDZ 2000-based line, which can be scaled to any size of production facility, starts at $90,900. With production professionals starting to migrate to the Window NT platform, Intergraph hopes to sell 100 of the new-generation RenderRAX II systems a year.

COMPAQ COMPUTER CORP. has switched its entire enterprise server line to Pentium II Xeon processors with the worldwide announcement of ProLiant 6500 rack-ready models. Able to support up to four 400-MHz Pentium II Xeon chips with 512 KB or 1024 KB Level-2 cache, as much as 4 GB of ECC-buffered EDO memory and dual-peer 64-bit buses, the ProLiant 6500 allows six units to be stacked in a standard rack. For companies running data base, on-line transaction processing, messaging and Web-hosting applications, this means that the computing power of up to 24 Pentium II Xeon processors can be harnessed in less than 2.5 square feet of floor space. Compaq's subsidiary priced the base configuration of the ProLiant 6500 at $19,800, while a dual- processor model lists for $33,100.

The PC server market leader does not have the advantage of any lead time on its American competitors in the enterprise computing field. Almost simultaneously, many of them announced the availability in Japan of systems capable of four-way processing using 400-MHz Pentium II Xeon processors. Each, though, touted the ways its server line stood apart from the others. The rival products included the NetServer LH 4 and the rack-mounted NetServer LH 4r from HEWLETT-PACKARD JAPAN LTD. It is targeting sales of 1,000 units a year for the new line, which starts at $15,300. DELL COMPUTER CORP.'s competing entry is the rack-optimized PowerEdge 6350. For its part, UNISYS CORP.'s subsidiary is taking on its rivals with the Aquanta QR/2 rack-mounted server.

COMPAQ COMPUTER CORP. also has released internationally products designed to protect its turf in the departmental and workgroup server markets. The revamped ProLiant 3000 departmental server comes with one or two 400-MHz or 450-MHz Pentium II processors with integrated 512-KB L2 cache, plus up to 4 GB of system memory. The pricing of the three models of the ProLiant 3000 begins at $8,700. The company's new ProLiant 800 workgroup server is tailored, in Compaq's words, to deliver next-generation performance while still meeting budget requirements. At prices starting from $5,000, buyers have a choice of one or two 400-MHz or 450-MHz Pentium II processors and as much as 1 GB of internal memory. .....Workgroups that are willing to pay for clustering capabilities as well as the features available from competitors have at least one new alternative: UNISYS CORP.'s Aquanta DS/2 rack-mounted server. It lists for $21,500 and up.

The Dell Precision WorkStation 610 now defines the high end of DELL COMPUTER CORP.'s dedicated workstation line. Powered by single or dual 400-MHz Pentium II Xeon processors, it can be custom-configured to meet the requirements of people who need maximum performance in a Windows NT environment for mechanical CAD, geographic information systems, digital content creation, electronic design automation, computer animation and financial analysis applications. Among the options is INTERGRAPH CORP.'s Intense 3DPro 3410GT OpenGL AGP (accelerated graphics port)-enabled graphics accelerator. Pricing starts at $3,600. .....Dual-processor capabilities also are available in an entry-level DELL COMPUTER CORP. system with the release of the Dell Precision WorkStation 210. Customizable like its high-end counterpart, it employs the 400-MHz version of the Pentium II processor. Value-priced, the Windows NT machine goes for $2,500 and up.

A number of big American PC makers are taking a breather on product introductions for the corporate desktop market, cutting prices instead on existing systems to win more business from companies. An exception is IBM JAPAN LTD., which released four models in the Pentium II-based PC 300GL series. It is highlighting their power to handle the newest business applications at affordable prices while offering expansion opportunities. Although pricing is open, the base model is available through mail order for around $1,200.

About the same amount of money will buy IBM JAPAN LTD.'s new, Japan-only home PC. The Aptiva DIJ, which runs off a multimedia-optimized INTERNATIONAL BUSINESS MACHINES CORP. 300-MHz processor, includes 64 MB of system memory, a 3.2-GB hard drive, a 15-inch monitor, MICROSOFT CORP.'s Word and Excel, plus voice-recognition software.

Even in Japan's reviving PC market, demand for notebooks continues to be stronger than sales of desktop machines. In fact, the strength of the notebook business has enticed HEWLETT-PACKARD JAPAN LTD. to test the waters of this market after a roughly 30-month absence. In December, it was scheduled to start sales of the OmniBook 4100 series to multinationals. These notebooks offer a choice of a 233-MHz or a 266-MHz Pentium II processor, a 13.3-inch or a 14.1-inch TFT display as well as a CD-ROM drive. If the test marketing proves successful, HP Japan will launch a full-scale sales campaign for OmniBook notebooks in 1999.

COMPAQ COMPUTER CORP.'s subsidiary is going after power users with the Compaq Armada 7800 Pro. This Windows NT model runs off a 300-MHz mobile Pentium II processor with 512 KB of L2 cache. It comes standard with 64 MB of synchronous DRAM memory, an 8-GB hard drive, a DVD-ROM drive and a 14.1-inch color TFT display. These and other performance features come at the fairly stiff price of $6,200, however.

Home and small business users are the target customers for DELL COMPUTER CORP.'s new Inspiron 3500 notebooks, the lightest (6.1 pounds) and thinnest (1.5 inches) Inspiron to date. Between $2,600 and $3,300 buys a system with a 233-MHz, 266-MHz or 300-MHz Pentium II processor, a 13.3-inch or a 14.1-inch display, 3.2 GB to 6.4 GB hard drives, DVD and Zip drives, a full-sized keyboard and some of the latest multimedia features.

In a coup for CYCOMM INTERNATIONAL, INC., its rugged, portable computer will be marketed by NIPPON TELEGRAPH AND TELEPHONE CORP. in Japan and elsewhere in Asia. The McLean, Virginia company claims that its PCMOBILE, which is powered by a 266-MHz Pentium chip, is the world's fastest heavy-duty laptop. NTT has positioned the PCMOBILE as the hub of a fully integrated disaster-relief system that it recently developed. To this end, the communications giant committed significant resources to specialized coding, translation and customized software engineering for the PCMOBILE. NTT also is marketing the system to service, construction and manufacturing companies, including related businesses, that require mobile applications, reliability and a rugged design.

Virtually every month recently, EMC CORP., the self-described world leader in enterprise storage systems, software and services, has earmarked additional resources, both financial and personnel, for its Japanese operations. In its latest move, the Hopkinton, Massachusetts firm's subsidiary opened a product development center. The Japan Technology Center's initial staff of 20 -- a number that will double in 1999 -- is working on the software development side of EMC's business. In a complementary initiative, the local unit now is offering consulting services, which include advice on system design and software support.

In a deal that also should help EMC CORP. build sales and share, the company gave NEC CORP. the right to resell Symmetrix Enterprise Storage systems and software with its Express5800 Windows NT-based servers and NX7000 Unix-based servers. The multiyear agreement extends worldwide, but NEC is expected to generate most of its Symmetrix sales in Japan, where the Express5800 is the leading Windows NT server with an estimated 30 percent of the market. EMC officials believe the new relationship could generate sales on the order of $100 million over two years.

Network file server supplier NETWORK APPLIANCE, INC. also has gained a powerful ally: FUJITSU, LTD. The Santa Clara, California company's first Japanese OEM customer will market, sell and support its network-attached storage systems through the computer maker's domestic direct and indirect sales organizations. Filers, as they are called, manage both Unix and Windows- based heterogenous enterprise storage environments. They offload file access from general-purpose servers, thereby speeding access to the information across a network. Network Appliance's current product line is the NetApp F700 series (see Japan-U.S. Business Report No. 349, October 1998, p. 12). As part of the deal, Fujitsu named Network Appliance its long-term technology partner for network-attached storage.

A faster version of STORAGE COMPUTER CORP.'s RAID7 desktop storage server for workgroups and server clusters has been developed for the Japanese market. The RAID7 F1 System, which scales from 54 GB all the way up to 218.4 GB with a maximum of 12 3.5-inch drives, offers read/write speeds that are more than double the original system's at 46 MB per second (read) and 34 MB per second (write). Exclusive distributor TECHNOGRAPHY INC. has priced the system between $53,600 and $106,600. It expects to sell 100 units through March and a total of 500 in FY 1999.

In Japan as elsewhere, demand for scalable, manageable, protected storage capacity is increasing exponentially. That growth has attracted a new competitor, DELL COMPUTER CORP. Its subsidiary has introduced a range of PowerVault storage subsystem products that offer a choice of Fibre Channel or SCSI (small computer system interface) connections to host servers.

The data explosion also requires new backup and restore systems, a demand that COMPAQ COMPUTER CORP. is ready to meet with the Compaq StorageWorks Enterprise Backup Solution for Windows NT and NetWare environments. This $57,400 system, which integrates application software and industry-standard hardware, allows multiple servers to share, via a Fibre Channel Arbitrated Loop, a single tape library, the Compaq DLT 3570 Tape Library. It consists of two 35/70 DLT (digital linear tape) tape drives with a total storage capacity of 1 terabyte through a 15-cartridge magazine.

With storage-intensive applications like multimedia, 3D graphics and video streaming proliferating, INTERNATIONAL BUSINESS MACHINES CORP. has announced new families of desktop and notebook hard disk drives that meet the capacity challenge. For desktop storage, its subsidiary will start shipping by March the IBM Deskstar 25GP and the IBM Deskstar 22GXP drives. The former provides up to 25 GB of capacity running at 5,400 rotations per minute, while the latter offers as much as 22 GB of storage with a 7,200 RPM access rate. The key to these industry-leading capacities is increased ariel density, the result of IBM's second-generation giant magnetoresistive head technology. The Deskstar 25GP will be priced at $990, while the Deskstar will list around $1,300.

INTERNATIONAL BUSINESS MACHINES CORP.'s GMR technology also has allowed it to develop a record-breaking hard drive for notebook computers. The Travelstar 14GS holds 14.1 GB of information -- about four times more than today's typical notebook hard drive. IBM JAPAN LTD. simultaneously began sampling the Travelstar 6GN, the highest-capacity (6.4 GB) 9.5mm drive for ultraportable computers, and the Travelstar 10GT, a 10-GB drive for the mainstream notebook PC market. All of the new Travelstar and Deskstar hard drives feature not only GMR head technology but also include IBM's Drive Fitness Test technology, which lets users easily and quickly test the health of their drives.

An external disk drive for APPLE COMPUTER INC.'s iMac computers was to be available before yearend from MICROTECH INTERNATIONAL INC. The North Branford, Connecticut firm's Mil Zip 100 USB (universal serial bus) drive is the smallest and lightest drive based on IOMEGA CORP.'s Zip technology with its 100-MB disks. It will be priced around $230. Microtech is a majority-owned subsidiary of PC retailer ADO ELECTRONIC INDUSTRIAL CO., LTD.

Building on the success of the REX PRO PC Card organizer in the United States, STARFISH SOFTWARE, INC. and CITIZEN WATCH CO., LTD. developed a comparable product for the Japanese market. By plugging the 1.4-ounce DataSlim into their laptop's PC Card slot or a docking station connected to a PC's serial port, users can synchronize their contacts, calendars and to-do information. The $205 package includes Scotts Valley, California-based Starfish's TrueSync Desktop, which allows users to transfer information from leading personal information management software programs to DataSlim. CBM LTD. is handling distribution.

Business people on the move who do not want to take a laptop with them can use the Crosspad to record information for later transfer to a PC. Designed by IBM JAPAN LTD. and writing instrument maker A.T. CROSS CO. of Lincoln, Rhode Island, the product consists of a special ballpoint pen and a letter-sized pad that contains a 1-MB flash memory and stores some 50 pages of data. The local Cross unit and KOKUYO CO., LTD. are distributing the $520 Crosspad.

Lower-cost PCs require less expensive input devices, MICROSOFT CORP. believes. Accordingly, its subsidiary introduced the $27 Basic Mouse, an ambidextrous two-button mouse that fits a range of hand sizes and works with either serial or PS-2 ports. .....PC race car drivers can get the feel of the real thing with MICROSOFT CORP.'s SideWinder Force Feedback Wheel. Designed for Windows 95 or Windows 98 machines, the $215 force feedback-enabled PC steering wheel comes with a release clamp, nonslip pedals and a power supply brick.

For $1,200, GATEWAY 2000, INC.'s subsidiary is selling as an option for certain of its desktop PCs a space-saving, energy-efficient color TFT display with a 15.1-inch viewable area. The FPD1500 is equipped with a digital interface for clearer, crisper images.

An exchange rate of ¥121=$1.00 was used in this report.

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Japanese contractors continue to turn to American companies for expertise on how to build the food safety standards captured by the HACCP (hazard analysis critical control points) program into food-service facilities. The latest is MAEDA CORP. In charge of the construction of Japan's first HACCP-based large meat processing plant, located in Fukuoka's central wholesale market, the general contractor has retained the Tokyo subsidiary of CINI-LITTLE INTERNATIONAL, INC. to advise it on HACCP-related matters. By working with the Rockville, Maryland firm and other businesses that specialize in the design of food-service facilities, Maeda hopes to gain a competitive edge on its rivals. Industry experts predict that HACCP requirements soon will become the norm in Japan.

The Xcite-World Marketplace shopping center has opened on three floors of what was a department store in Sagamihara, Kanagawa prefecture. Commercial real estate developer AMERICAN MALLS INTERNATIONAL INC. was in charge of the conversion and will manage the 36-store complex, which has roughly 108,000 square feet of retail space (see Japan-U.S. Business Report No. 344, May 1998, p. 13). The building is connected to ODAKYU ELECTRIC RAILWAY CO., LTD.'s Sagamiohno Station.

BEST WESTERN INTERNATIONAL, INC. has opened four new Best Western hotels in Japan. The Best Western Hotel Nagasaki, located on the hillside overlooking the Kyushu city, has 48 guest rooms. The Best Western Hotel Takayama in Gifu prefecture features 78 guest rooms. Tsuyama, Okayama prefecture is home to the Best Western Tsuyama Plaza Hotel with 41 guest rooms. Located lakeside in Toyokawa, Aichi prefecture is the Best Western Toyokawa Grand Hotel; it offers 40 guest rooms. A Nagoya real estate company is managing the hotels for the world's largest lodging chain.

An exchange rate of ¥121=$1.00 was used in this report.

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In a move that should drive down the now high cost of digital television receivers, SARNOFF CORP. is licensing a manufacturing reference design for customizable DTV sets through ITOCHU TECHNO-SCIENCE CORP. The design can be implemented in integrated receivers or set-top box converters. The Princeton, New Jersey developer believes that its design will help consumer electronics firms cut the cost of DTV sets to between $400 and $550 per receiver (excluding the display) by the 1999 Christmas selling season. The technology is aimed at the volume end of the market, including converters that allow consumers to receive DTV on their current analog sets, as well as at entry- level and midrange standard-definition DTV receivers. Sarnoff expects to have a version of its manufacturing reference design for high-definition TV displays available early in 1999.

The Rio PMP300 portable music player, which stores and plays back up to 60 minutes of digital-quality music, has arrived in Japan through the subsidiary of developer DIAMOND MULTIMEDIA SYSTEMS, INC. The product is a lighter, smaller counterpart to a Walkman or a MiniDisk player, but what really sets it apart is the inclusion of Jukebox MP3 compression software licensed from MUSICMATCH CORP. and XING TECHNOLOGY CORP. With this technology, people can create a customized mix of music playable on their Rio PMP300 or their PC from either their personal collection of music CDs or from digital music and audio content downloaded from the Web. San Jose, California-based Diamond Multimedia has priced the Rio PMP300, which uses flash memory for storage and playback, at $225.

A more affordable version of BOSE CORP.'s home theater system is on the market through the subsidiary of the Framingham, Massachusetts company. The $1,200- plus Bose Theater LS-8, sold in the United States as the Lifestyle 8 system, includes five Acoustimass cube speakers; a music center with a CD player, AM- FM tuner and outputs for additional speakers; a radio-frequency remote controller; and an Acoustimass module with built-in amplification and proprietary electronics.

An unnamed Japanese company, identified only as a leading consumer electronics manufacturer, is evaluating the zinc-air battery technology developed by AER ENERGY RESOURCES, INC. The Atlanta firm says that its battery technology provides the long, continuous run time sought for portable electronic products like camcorders, handheld computers, cellular telephones and lighting products.

According to METANETICS CORP., its IR-2000 handheld image reader ushers in a new generation of automatic identification products for barcode reading, verification and image acquisition. Unlike conventional laser-based scanners, the IR-2000 uses camera technology and has no moving parts. It automatically differentiates among all the major barcode symbologies. Other advantages of the imager, says the Fort Myers, Florida company, is that it can read a barcode from any direction and capture signatures and digital photographs. Moreover, the IR-2000 supports optical character recognition. Metanetics, a TELXON CORP. subsidiary, has named a Tokyo company to market the device.

AMERICAN POWER CONVERSION, the market leader in uninterruptible power supplies, has released a remote power switching device for network management. The MasterSwitch E515 gives a LAN administrator complete control over the power to network-connected equipment. From anywhere on the network, he or she can use a network management station or a Web browser to power, depower or reboot computers and internetworking equipment. Potential applications for the device, which costs around $1,000, include remotely located racks of servers or internetworking equipment or banks of modems that occasionally need to be rebooted. Each MasterSwitch E515 can manage eight independent power channels.

American companies repeatedly have criticized what they call the discriminatory procurement practices of Japan's electric power industry. With the help of distributor NIPPON KOUATSU ELECTRIC CO., LTD., however, G&W ELECTRIC CO., a manufacturer of gas load-break switchgear and fault interrupters, is doing business with CHUBU ELECTRIC POWER CO., INC. The Blue Island, Illinois company has supplied its Rotary Puffer-style, two-position (open/close) switch to Nippon Kouatsu, which modified the load-breaker and built it into a system that gives Chubu Electric extremely efficient, high-speed arc extinction capabilities. Japan's third-largest electric utility, which reportedly decided to buy the G&W-adapted product because it offered a 20 percent cost saving over anything available in Japan, will purchase 10 open/close switch systems from Nippon Kouatsu.

An exchange rate of ¥121=$1.00 was used in this report.

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The sixth-biggest consumer finance company in Japan -- the AIC CORP. subsidiary of Dallas-head-quartered ASSOCIATES FIRST CAPITAL CORP. -- just got bigger. At an estimated cost of $124 million, it acquired a midsized Shizuoka prefecture competitor from NIPPON INVESTMENT & FINANCE CO., LTD., a venture capital company affiliated with DAIWA SECURITIES CO., LTD., and other shareholders. NISSEN CO., LTD. had 35 offices and an outstanding loan balance of $198.3 million at the end of March 1998, which ranked it 27th in the domestic consumer finance industry. AIC, in business since 1979, expanded its presence considerably earlier this year when it bought what was then the number nine in the industry, DIC FINANCE CO., LTD., for more than $600 million (see Japan- U.S. Business Report No. 343, April 1998, pp. 12-13).

Probably not by coincidence, this deal closed just days before GE CAPITAL CORP. completed the acquisition of the consumer loan business of LAKE CO., LTD. (see Japan-U.S. Business Report No. 347, August 1998, p. 14). Japan's fifth-largest direct consumer lender brings to the American giant's local consumer financial services business in excess of 1.4 million customers, 597 branch offices, close to $4.5 billion in loan receivables and 2,800 employees. Corporate loans, real estate and other Lake operations not acquired by GE Capital were retained by a new company named L CO., LTD.

This was not the first time that GE CAPITAL CORP. used an acquisition to gain a major presence in a Japanese financial services market. Earlier this year, it employed the same strategy to move into the insurance business (see Japan- U.S. Business Report No. 342, March 1998, p. 15). Now, the world's largest nonbank financial services provider, which has been exploring opportunities to enter Japan's huge equipment leasing market, is in talks to take over JAPAN LEASING CORP. The nation's third-largest equipment leasing company, a LONG- TERM CREDIT BANK OF JAPAN, LTD. unit, filed for bankruptcy at the end of September with debts of $19.7 billion. Any deal also would include JAPAN LEASE AUTO CORP., Japan Leasing's automotive leasing subsidiary. The news that GE Capital was negotiating to buy Japan Lease effectively ended the company's discussions about purchasing a majority stake in RYOSHIN LEASING CORP., a much smaller equipment lessor than Japan Leasing (see Japan-U.S. Business Report No. 347, August 1998, p. 14).

Add DONALDSON, LUFKIN & JENRETTE INC. to the list of American financial services providers that have found the lure of Japan's huge pool of personal savings irresistible. However, it will use a different means than its New York City competitors to attract some of this money. Through its DLJDIRECT INC. on- line brokerage subsidiary, the investment bank will form a joint venture with SUMITOMO BANK, LTD. and INTERNET INITIATIVE JAPAN INC. to provide on-line financial services to Japanese investors. Initially, the DLJdirect unit will offer Japanese equities, investment trusts (Japan-style mutual funds) and money market funds. In time, the on-line service will give Japanese investors access to U.S. securities, including investment products offered by Donaldson, Lufkin & Jenrette and its affiliates. The DLJdirect subsidiary expects to begin operations in the second quarter of 1999, by which time brokerage commissions will be completely liberalized. The partners did not disclose how the capital for the new company would be divided.

AMERICAN EXPRESS CO. has revised the Japan business strategy of its AMERICAN EXPRESS ASSET MANAGEMENT INTERNATIONAL (JAPAN) LTD. unit. Rather than just offering investment advice, the original plan (see Japan-U.S. Business Report No. 348, September 1998, p. 12), the company will build a retail brokerage network to sell the investment products of American Express Financial Advisors. AmEx Asset Management has applied to the Ministry of Finance for a brokerage license and hopes to start sales sometime in 1999. It initially will try to attract the brokerage business of the more than 1.1 million AmEx cardholders in Japan.

LIBERTY FINANCIAL COS., which manages more than $57.5 billion of assets on behalf of 1.7 million investors worldwide, has formed a subsidiary to market mutual funds and other investment products from its various affiliates. The first offering will be a new class of shares in the Colonial Strategic Income Fund, a U.S. multisector bond fund. Other products from THE COLONIAL GROUP, INC., STEIN ROE & FARNHAM INC. and NEWPORT PACIFIC MANAGEMENT INC. are expected to be introduced in the future.

For months, American mutual fund managers had been preparing for December 1, the day that banks could start selling their products directly to individuals. FIDELITY INVESTMENTS JAPAN LTD. was especially well-positioned to tap into this potentially big customer base. By then, it had lined up 23 midsized and large banks around the country to handle its yen-denominated investment trusts. Fidelity mutual funds also are sold by brokerage houses as well as by the company via phone and mail.

CITIBANK N.A.'s subsidiary also was ready when the ban was lifted on direct sales of investment trusts by banks. The bank started off with nine of its own products, all relatively low-risk bond and money market funds denominated in yen, dollars or the new euro. In addition to sales at its branches, Citibank is marketing the funds through its telephone banking system.

Like a number of other major Japanese banks, SUMITOMO TRUST & BANKING CO., LTD. wants to sell one or more of its own investment trusts. It has turned to CHASE MANHATTAN CORP. for help in developing the initial product. The dollar- denominated fund will be managed by the New York City bank's Chase Asset Management division (see Japan-U.S. Business Report No. 350, November 1998, p. 17) and will invest mainly in U.S. Treasury bills and other low-risk debt instruments. The minimum purchase will be $3,000.

An exchange rate of ¥121=$1.00 was used in this report.

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Outdoor retailer RECREATIONAL EQUIPMENT, INC. has selected TOKYU CORP.'s Minami Machida Shopping Center as the location of its first international store (see Japan-U.S. Business Report No. 347, August 1998, p. 15). The Seattle company will lease more than 30,000 square feet of the 215,000 square feet in the American-style mall, which is scheduled to open in the spring of 2000. Located between Tokyo and Yokohama, it will contain about 50 tenants. The REI store will have sections devoted to camping and hiking, bicycling, climbing and outdoor travel. It also will feature such novelties for Japan as an indoor rock-climbing pinnacle, a hiking shoe test trail and an outdoor mountain biking trail. Work on the store will begin in April 1999 and will be handled by Tokyu's Minami Machida project team. MITHUN PARTNERS, INC., the Seattle architectural firm that designed REI's flagship store in the city, is the design architect for the Japanese outlet's interior and exterior spaces.

By early 1999, the Tokyo subsidiary of discount office products catalog seller VIKING OFFICE PRODUCTS INC. (see Japan-U.S. Business Report No. 347, August 1998, p. 29) will be absorbed by OFFICE DEPOT INC.'s local operation. The move, which follows Office Depot's acquisition of Viking, will give the store- based office supplies discounter complementary marketing channels in Japan as well as in the United States. Office Depot's subsidiary plans to begin catalog sales from the middle of March.

An exchange rate of ¥121=$1.00 was used in this report.

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The financial problems of some companies affiliated with FV CORP. will help COCA-COLA CO.'s Japan operation move closer to its goal of having 1.3 million vending machines across the country. For an undisclosed price, the Tokyo food and beverage retailer will sell its roughly 40,000 vending machines to Coke, which now has a nationwide network of 930,000 vending machines.

At an estimated cost of $24.8 million, the joint venture between the Mercury Marine unit of Lake Forest, Illinois-headquartered BRUNSWICK CORP. and TOHATSU CORP. will expand four-stroke outboard engine capacity at its Okaya, Nagano prefecture plant as well as fund further development work on environmentally friendly, energy-efficient two-stroke, direct-injection engines. The capacity expansion will give the company the ability to turn out more than 160,000 outboard engines annually in four or five years. It currently can make 80,000 MFS5A four-stroke engines a year in a range up to 140 horsepower, having recently boosted annual capacity from 60,000 units. The factory's output goes to Mercury Marine and Tohatsu as well as to NISSAN MOTOR CO., LTD. on an OEM basis.

KENNAMETAL INC., a world leader in superhard tool tips and other tooling for the metalworking industry, has opened a technical center in Nagoya. Through this facility, which is equipped with CNC engine lathes, grinders and other machine tools, the Latrobe, Pennsylvania manufacturer's KENNAMETAL HERTEL JAPAN LTD. unit is able to demonstrate the cutting abilities of its tooling as well as provide tooling adjustments for its customers. The tech center also houses the Kennametal marketing operation responsible for central Japan, which is home to many of the country's machine tool builders as well as numerous companies that use machine tool in their work.

Filling a March 1998 contract valued at $2.1 million, GLEASON WORKS shipped to OKUBA GEAR CO., LTD. one of its Phoenix 800G Computer Controlled Hypoid Grinders. This large-capacity grinder is optimized for hard-finishing pinions and gears in order to reduce or eliminate the process variations that can occur during normal gear manufacturing operations. Atsugi, Kanagawa prefecture-based Okuba is a longtime customer of the Rochester, New York machine tool company, but this is its first purchase of a Phoenix CNC machine tool for manufacturing bevel and cylindrical gears. It will use the 800G to make low-noise, compact bevel gears and speed reducers.

The long-standing lift truck manufacturing venture between NACCO MATERIALS HANDLING GROUP, INC. -- the Portland, Oregon parent of U.S. industry leader HYSTER CO. and YALE MATERIALS HANDLING CORP. -- and SUMITOMO HEAVY INDUSTRIES, LTD. has released a 35-model line of redesigned battery-operated reach-type forklifts. Despite the overhaul, Aichi prefecture-based SUMITOMO-YALE CO., LTD. kept the prices of the R-X Reliance Reach Series at the same level as the replaced models, or between $21,700 and $29,100. The partnership hopes to sell 600 of the new models a year.

COMCO INTERNATIONAL, INC., a manufacturer of flexographic and converting systems for cartons, flexible packaging and labels, has tied up with a Tokyo- based affiliate of DAINIPPON INK AND CHEMICALS, INC. to market its equipment to label and packaging suppliers. The first of the Milford, Ohio company's line that INCTEC INC. is distributing is the ProGlide quick-change press. Comco claims that its in-line component changeover system, which costs less than $826,400, requires less manpower, equipment and floor space than off-line cassette changeover systems and is less expensive to operate than the alternative technology. A complete component changeover, it says, can be accomplished in 90 seconds. Inctec expects these advantages to help it build ProGlide into a $12.4 million annual business.

An exchange rate of ¥121=$1.00 was used in this report.

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At the relatively low price of $81,800, EASTMAN KODAK CO.'s subsidiary is marketing the LVT RHINO Image Recorder, a high-resolution, desktop film recorder that writes digital images on 4 x 5-inch and 8 x 10-inch transparency and negative films. Digital image recorders are designed for use in a variety of production environments, including color labs, service bureaus, creative studios and high-end digital retouching studios. The LVT RHINO actually is manufactured by Rochester, New York-based DICE AMERICA CO., which purchased Kodak's LVT division in February 1998.

The Japan-available line of EASTMAN KODAK CO. EKTAPRO projectors now includes the Kodak EKTAPRO 5020 slide projector for the professional business presenter. Operable via an infrared remote controller or a PC, the system lists for $1,700.

Trying to get kids interested in photography from an early age, EASTMAN KODAK CO.'s subsidiary is marketing the SnapKids Advantix Quick Flash. The 25- exposure disposable camera retails for about $13.20.

An exchange rate of ¥121=$1.00 was used in this report.

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In the future, the luggage of passengers arriving at Narita International Airport will be automatically screened for drugs. To further Japan's drug interdiction efforts, the Ministry of Finance's Customs Bureau has ordered a pair of detection systems from VIVID TECHNOLOGIES INC. that incorporate its advanced X-ray technology. The contract is the first one the Woburn, Massachusetts company has won in Japan. It also is the first time that Vivid, the world's top manufacturer of automated explosives detection systems for checking hand luggage, parcels and airline baggage, has adapted its technology for automated inspection of inbound baggage.

A codevelopment effort between the subsidiary of Bedford, Massachusetts-based MILLIPORE CORP., one of the international leaders in the field of precision filtering systems, and YAMATO SCIENTIFIC CO., LTD. has yielded a new system for producing distilled water for use in research labs. Conventional deionized water production systems use ion exchange resins that must be replaced periodically. The Auto Still WX710 eliminates this problem by incorporating a Millipore-supplied electron deionization module that is a continuous ion exchanger. Yamato Scientific, which is in charge of final assembly, will handle sales of the $14,900 product. It is projecting sales of 150 units in the first year and 500 annually after three years. This initial member of the Auto Still WX family can produce almost two quarts of distilled water an hour.

In another transpacific cooperative effort, SCIENTIFIC UTILIZATION, INC. of Huntsville, Alabama and ISHIKAWAJIMA HANYOKI SERVICE CO., LTD. have devised a system to recover about 90 percent of the abrasive grains from the slurry waste produced when silicon ingots are sliced into wafers. Their machine uses a pulse electric field to boost the recovery rate from the 40 percent achieved with conventional centrifugal separators. The system costs about $8.3 million. Tokyo-based IHS already has received one order for the system, which the development partners are comarketing.

Four vector network measurement systems developed by the microwave measurements division of ANRITSU CORP.'s Morgan Hill, California subsidiary are available through the parent company. The MS4622A and the MS4623A transmission reflection analyzers are one-path, two-port network analyzers designed to provide a combination of accuracy, stability, speed and system dynamic range for high-volume radio-frequency production requirements, while the MS4622B and the MS4623B measurement systems provide the capability to accurately characterize both active and passive devices. Anritsu has priced the four systems between $23,700 and $46,300. It expects a combined sales total of 60 units a year.

Machine vision systems leader COGNEX CORP. has released what it calls the world's first modular, automated surface inspection system for detecting, measuring and classifying defects in paper, plastics, metals, nonwovens and other products made in a continuous process. The SmartView Modular Camera Network, which builds on the Natick, Massachusetts company's Fine-Line system (see Japan-U.S. Business Report No. 342, March 1998, p. 18), consists of one or more CCD (charge-coupled device) cameras with camera-based inspection algorithms, a drag-and-drop Windows NT-based interface, a PC, a mounting frame and lighting components. The basic configuration of SmartView MCN costs $24,800.

Joining such heavyweights as KYOCERA CORP., SONY CORP. and TOSHIBA CORP., the subsidiary of JOHNSON & JOHNSON has become an investor in CARENET, INC. For about $1.2 million, J&J acquired a 6.8 percent share in the first company in Japan to provide information on medical care and hospital management over the Internet and through digital satellite TV broadcasts. It already has more than 14,000 subscribers to its CareNet TV Medical Channel, which just started in July. CareNet also is developing a hospital network called Search PLUS.

The sale of its global coronary angioplasty and angiography lines to ARTERIAL VASCULAR ENGINEERING, INC. will lead to changes in C.R. BARD, INC.'s local operations next spring. At that time, the Murray Hill, New Jersey company will liquidate its subsidiary since these products made up the unit's main business. Bard will continue to be represented in Japan through MEDICON, INC., an equally owned venture with KOBAYASHI PHARMACEUTICAL CO., LTD. that was formed more than 25 years ago. Osaka-headquartered Medicon markets various Bard vascular, urological, oncological and surgical products. The joint venture is projecting a 20 percent gain in sales to $82.6 million in the year through November 1999.

The Ministry of Health and Welfare has approved for marketing SURGICAL LASER TECHNOLOGIES INC.'s laser fiber-optic delivery systems, probes, scalpels and related accessories. OLYMPUS OPTICAL CO., LTD. is the Montgomeryville, Pennsylvania company's distributor. It will market the products under the Diomed name for use with a diode laser manufactured by a British company of that name. SLT's equipment is applicable to virtually all general and specialty surgical procedures.

A new computed tomography scanner from GENERAL ELECTRIC CO.'s GE Medical Systems is on the market from GE-YOKOGAWA MEDICAL SYSTEMS, LTD. The CT HiSpeed Advantage QX/i, which lists for $6.2 million, is a multislice scanner. Unlike conventional single-slice systems, which provide one image for each rotation, this one can produce one, two or four images with each rotation. Not only does this capability provide better image quality, but the system is four times faster than single-slice scanners operating in axial mode. All of GE Medical Systems' HiSpeed CT scanners are built around SILICON GRAPHICS, INC.'s high- end graphic workstations.

TOHO KAGAKU KENYUSHO CO., LTD., a wholly owned subsidiary of Westbury, New York-based E-Z-EM, INC., has given RIKUTOH CO., LTD. exclusive distribution rights for three years to its parent's MRI (magnetic resonance imaging) contrast agents. Demand for these products is expanding with the growth in open-type MRI scanners. E-Z-EM is the world's biggest maker of contrast agents for diagnostic imaging of the gastrointestinal tract.

An exchange rate of ¥121=$1.00 was used in this report.

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The expansion of the high-speed communications market has persuaded VITESSE SEMICONDUCTOR CORP. to open a wholly owned direct sales subsidiary in Tokyo. The facility also will include a design center where field application engineers will work with customers in designing Vitesse's technology into their products. The Camarillo, California company makes high-bandwidth communications and automatic test equipment chips for applications that require a combination of high speed, considerable complexity and low power dissipation. Its products have been handled by INTERNIX, INC.

Samples of the 400-MHz version of SUN MICROSYSTEMS, INC.'s 64-bit UltraSPARC II are available now, with a 450-MHz version coming in the spring of 1999. The new processors, designed for high-performance servers and workstations, are binary-compatible with existing SPARC applications and middleware and are fully compatible with Solaris 7, the latest version of Sun's Unix operating system. To raise the UltraSPARC II to the higher clock speeds, manufacturing partner TEXAS INSTRUMENTS INC. will use 0.25-micron process technology.

TRISCEND CORP. has named INTERNIX, INC. to distribute its recently introduced E5 Configurable Processor Family and the companion FastChip software development tool beginning in January. A configurable processor combines on a single chip a dedicated, industry-standard processor, programmable logic, memory and a dedicated system bus. This technology allows an embedded system designer to quickly configure a customized processor derivative. The San Jose, California company's E5 family of configurable processors will cost around $80 each, while the FastChip software will be priced at $825.

Hoping to speed the deployment of ADSL (asymmetric digital subscriber line) technology, TEXAS INSTRUMENTS INC. has a January shipment date in Japan and elsewhere for its next-generation ADSL chipset for central office and customer premises equipment applications. The TNETD3000 offers a 60 percent power reduction as well as a 33 percent smaller footprint. Chipsets for central office equipment will cost $105 each, while the client-side part will go for less than $60, both in quantities of 10,000 units. ADSL technology permits high-speed communications over regular telephone lines.

DSP COMMUNICATIONS, INC. and TEXAS INSTRUMENTS INC. have codeveloped the first single-chip baseband solution for Japan's PDC (personal digital cellular) standard. The PDChip D5311E integrates a DSP (digital signal processor) core based on TI's TMS320C54x technology with logic circuits as well as the analog circuits needed for baseband processing. Previous PDC chip generations required separate chips for the digital and the analog functions. Cupertino, California-based DSP Communications has started shipments of the new PDChip to its handset customers in Japan.

Buyers of NEC CORP.'s Mate NX corporate PCs and VALUESTAR NX home PCs have the option of upgrading to NVIDIA CORP.'s RIVA TNT 3D graphics processor, the fastest such part available. The computer maker incorporated the Santa Clara, California company's first 128-bit 3D processor, the RIVA 128, in its VALUESTAR NX and Mate NX lines in 1997.

A general-purpose, dual-operational amplifier that is only slightly larger than the die itself is on the market from NATIONAL SEMICONDUCTOR CORP.'s subsidiary. The key to this breakthrough is the use of National's leadless Micro-SMD package, which is applied to the die at the wafer level using an encapsulation process on the front and the back of the wafer. The LMC6035JBP is optimized for low-power applications. Also new from National is the LMC2001, the first of a new class of operational amplifiers guaranteeing very high precision over both time and temperature variables for 10 years.

BURR-BROWN CORP.'s local unit is sampling two new products. The PLL1700 is a multiclock generator PLL (phase lock loop) device used to synchronize audio and video clocks in DVD systems. It is sample-priced from $2.65 in quantities of 100. The PCM1704U is a 24-bit digital-to-analog converter with an exceptionally high dynamic performance that is targeted at high-end consumer and professional audio applications. In batches of 100, this part costs between $35 and $62.

Eighteen months after bringing its digital, mixed-signal and memory engineering Test Stations to Japan through a distributor, INTEGRATED MEASUREMENT SYSTEMS, INC. opened a direct sales and support office in Tokyo. At the same time, the Beaverton, Oregon company introduced three next- generation Test Stations. Vanguard, the flagship IMS system for complex, high- speed digital ICs, can be configured with up to 512 input/output pins, each supporting data rates of 500 megabits per second as well as 16 500-MHz clocks. The Orion test station is designed for debugging advanced, high-speed memories, including DRAMs, static RAMs and SDRAMs. It is priced at one-half to one-third the standard cost of automated test equipment typically used for at- speed engineering tests. For design validation of mixed-signal chips, IMS released the Electra Mx high-pin-count engineering test station.

With copper expected to replace aluminum and its alloys for interconnections as device geometries shrink to 0.18 micron from 0.25 micron, SEMITOOL, INC. has allied with ULVAC JAPAN, LTD. to develop copper deposition tools. The focus of this tie-up is the Kalispell, Montana company's electrochemical deposition equipment and Ulvac's physical vapor deposition technologies. The two manufacturers will exchange technical information, pursue joint development of optimized processes and team up on marketing and sales activities. In Japan, Semitool's recently opened direct sales unit (see Japan- U.S. Business Report No. 349, October 1998, p. 21) and Ulvac will offer technical services, including joint demonstrations.

For companies making the transition to copper interconnects, APPLIED MATERIALS, INC. has introduced a low K CVD (chemical vapor deposition) dielectric film that can be integrated with existing process technologies. Black Diamond is deposited by the new DLK chamber, which has a throughput of 60 to 100 wafers an hour depending on the thickness of the film. The first Black Diamond product, BD27, has a dielectric constant of 2.7. It was designed for 0.18-micron process technology. BD27 initially is available on Applied Materials' Centura platform with up to four DLK chambers. The Santa Clara, California manufacturer's subsidiary has priced the new system from $2.1 million.

Manufacturers of epitaxial wafers no longer need to destroy 4 percent to 5 percent of their output testing the resistivity of the silicon forming the epi layer. The Epimet system developed by SEMITEST, INC. makes the resistivity measurement in a nondestructive manner by using an optical technique to sense this parameter as a function of depth. The Billerica, Massachusetts company has appointed HAKUTO CO., LTD. to distribute Epimet, which costs roughly $702,500. Given the system's short payback period, Hakuto expects Epimet sales to total $4.1 million in the first year of marketing and double that in the second.

Having signed MARUBENI SOLUTIONS CORP. as its exclusive distributor last summer, APLEX, INC. now has a product for the Yokohama company to market. It is the AVera polisher module, a new chemical mechanical planarization tool that Sunnyvale, California-based Aplex has been developing for two years. AVera features a unique vertical belt technology called EV2, short for equal vertical velocity, that is said to overcome the pattern sensitivity drawback to using CMP for sub-0.25-micron polishing. The vertical belt design also allows two wafers to be polished simultaneously while maintaining single-wafer control. Marubeni Solutions is installing a beta AVera system at its Yokohama technology center for customer demonstrations in the first quarter of 1999.

ROBOTIC VISION SYSTEMS, INC. has incorporated its machine vision expertise in an inspection system for "bumped" wafers for flip-chip interconnect. The WS- 1000, which can handle 100mm to 200mm wafers, provides real-time monitoring of bump height, missing bump/extra bump, diameter, coplanarity and shape. It can inspect an entire wafer or a single die and has a random sampling capability. Under a year-old agreement, KAIJO CORP. is marketing the Hauppauge, New York maker's system (see Japan-U.S. Business Report No. 339, December 1997, p. 15). It has priced the WS-1000 at $495,900. Sales are forecast at 10 machines a year.

Memory manufacturers in Japan and elsewhere have committed to shipping RAMBUS INC.'s Direct RDRAM in volume in 1999 for use as the main memory in a number of new PCs from leading suppliers. To facilitate this ramp-up, HEWLETT-PACKARD CO. introduced the HP 95000 High Speed Memory Series of ATE systems for production testing of the new generation of high-bandwidth DRAMs. The first member of the HSM Series, the HP 95000 has the flexibility to test both memory core and embedded logic in a single pass. It can test as many as 16 devices in parallel at a data rate of 1.0 gigahertz. HEWLETT-PACKARD JAPAN LTD. has priced the base configuration of the HP 95000 HSM Series at $4.1 million. Given the number of local Rambus licensees, the company expects to sell 50 systems. It will have competition for this business, however. SCHLUMBERGER LTD.'s ATE unit has released the DX2200 system for production testing of Direct RDRAM chips and other high-performance memories. The system, the second member of the Schlumberger ATE memory test family, will be readily available in Japan during the first quarter.

An exchange rate of ¥121=$1.00 was used in this report.

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To counter recent moves by its competitors (see Japan-U.S. Business Report No. 348, September 1998, pp. 15-16, and No. 350, November 1998, p. 21), INFOSEEK CORP. has revamped its Internet site, adding more content channels and improving the search engine. In cooperation with site operator DIGITAL GARAGE INC., the Santa Clara, California firm has opened six content-specific areas, such as computers, sports and job search. This expansion, Infoseek hopes, will boost monthly hits to 5 million within a few months from 3.5 million currently. News, travel, music and entertainment areas will be added in the near future.

Burlington, Massachusetts-based NEWSEDGE CORP. has plunged into the Internet news-delivery business by establishing a subsidiary in Tokyo. The new unit's launch product is an electronic global industry newspaper with special sections on multimedia, telecommunications, software, digital broadcasting and medical products. Each area features about 20 articles in Japanese. The service costs $165 a year. NewsEdge, which claims more than 1 million businesspeople around the world as readers, hopes to boost the number of industry-specific "editions" to 100 within two years.

Video game fanatics in Japan now can battle on-line, thanks to an agreement between VR-1, INC. and a SONY CORP. affiliate. The two will offer the Boulder, Colorado firm's massive, multiplayer on-line gaming system, The S.A.R.A.C. Project. Hundreds of gamers can play a game together in real time, cooperating or combating each other as they pilot their futuristic submarines on a distant oceanic planet. Last May, the Sony unit picked VR-1's on-line gaming technology to power its Party Crew gaming channel.

The company formed by electronic retailer ONSALE, INC. and SOFTBANK CORP. (see Japan-U.S. Business Report No. 345, June 1998, p. 17) has achieved a first in Japan by beginning an Internet auction service aimed at the wholesale market. Softbank Internet Auction listed more than 5,000 items in its first cycle, initially focusing on PCs and PC-related products. The Mountain View, California partner provides the software and expertise to run the Web auctions, while Softbank handles goods procurement and marketing. The joint venture plans to launch an auction site accessible to consumers this spring. It will feature PC-related products, consumer electronics and sporting goods among other products.

One reason some observers predict that Japanese consumers soon will do nearly half their shopping on the Web is the long-standing tie-up between direct- response TV giant NATIONAL MEDIA CORP. and big trader MITSUI & CO., LTD. The Los Angeles firm has been aggressively leveraging its multimedia resources on the Web, recently launching three full-time video channels via the Internet. In cooperation with Mitsui, it will bring a version of its Everything4Less discount shopping Web site to Japan. The two also are contemplating joint e- commerce operations targeting Australia and other Asian countries.

APPLE COMPUTER INC.'s subsidiary has rolled out a new version of the popular Web site development tool, WebObjects 4. The new version features more tools aimed at creating, operating and managing an e-commerce system. Designed for Windows NT and Unix platforms, the software ranges in price from $420 all the way up to $57,800.

Joining the move to tie everything in the home to the Internet, browser pioneer SPYGLASS INC. has begun licensing its browser and network-control know-how to makers of home electronics products and appliances. The Naperville, Illinois business already has concluded its first contract, signing up NEC CORP. It hopes to build its local customer portfolio to 10 companies by March 2000.

Taking aim at the rapidly growing number of Internet service providers and large corporate intranets, HEWLETT-PACKARD JAPAN LTD. is shipping an Internet service management package, HP FireHunter/PRO. Besides enabling "end-to-end" carrier-grade network performance, the software -- which begins at $28,900 -- allows providers to guarantee specific levels of performance to customers. A Japanese-language version of HP FireHunter/PRO will be available in the spring.

SYMANTEC CORP.'s subsidiary has debuted a new version of the popular Visual Café Java-based application development tools. Version 3.0 includes support for the latest Java standards, including the new JDK 1.2, as well as many ready-to-use objects. The program comes in three flavors: data base ($810), professional ($370) and standard ($120).

The popularity of SUN MICROSYSTEMS, INC.'s Java language is beginning to attract competitors. For instance, HEWLETT-PACKARD JAPAN LTD. licensed its "Java look-alike" language, Chi (X), to Tokyo's APLIX CORP. for use in embedded, real-time applications.

Diving through the window of opportunity created by delays in the release of MICROSOFT CORP.'s Windows 2000 enterprise operating system, SUN MICROSYSTEMS, INC. released a completely new version of its Solaris operating system. Besides being fully localized, the Unix-based OS now supports 64-bit computing while taking up a fraction of the disk space required by the competing Microsoft EOS. Solaris 7 pricing begins at $820 for a version that runs on desktop computers using INTEL CORP. processors. For a multiprocessor server, the cost is $1,100.

Even though operating systems from MICROSOFT CORP. and APPLE COMPUTER INC. dominate, BE, INC. of Menlo Park, California continues to carve out a niche with its advanced operating system. BeOS has attracted attention from computer cognoscenti around the world. The debut of the Japanese-language version of the OS at exclusive seller PLATFORM K.K. in Tokyo was greeted with a long line of interested buyers. Optimized for multimedia applications, the $130 BeOS can run alongside both Microsoft's and Apple's OS on the same machine. .....This dual-personality trait has won BE, INC. its first contract with a major Japanese PC maker. HITACHI, LTD. is offering BeOS 4.0J preinstalled on one of its consumer models, the Flora Prius 330J, along with software for creating multimedia content.

The Windows CE operating system for handheld devices has won strong local endorsement. MICROSOFT CORP. announced that NTT DATA CORP. will use the OS in a line of credit-card authorization terminals it is planning for Japan. By replacing its current line of terminals based on proprietary software with the more open Windows CE, the NIPPON TELEGRAPH AND TELEPHONE CORP. affiliate expects that future upgrades and modifications of the devices will be easier. NTT Data controls about three-quarters of the market for point-of-sale, charge-authorization terminals. Testing of the Windows CE-based units is underway, with the full rollout scheduled to begin in April.

Companies worried about the Year 2000 problem can turn to localized software from Sunnyvale, California-based CYGNUS SOLUTIONS and its recently established Tokyo subsidiary. The $2,000 Cygnus Source-Navigator Enterprise edition for Unix and Windows platforms is an out-of-the-box code comprehension and analysis tool that simplifies the task of migrating, reengineering and reusing code. Also available are GNUPro Toolkit, a software development tool, and eCOS, an embedded operating system that is compatible with the µITRON standard used in Japan. TOYOTA MOTOR CORP. is examining eCOS for use in its vehicle control and other systems.

For businesses looking for complete Y2K services, MATRIDIGM CORP. has the answer. The San Jose, California firm recently took over a joint venture it founded last year with another American firm (see Japan-U.S. Business Report No. 345, June 1998, p. 19). It has begun marketing Y2K conversion services based on its MARC2000 technology.

According to WRQ, INC. officials, Japanese demand for its middleware has been growing despite the recession, prompting the Seattle firm to announce the opening of a Tokyo office in early 1999 and to boost localization of its products. Available now are Reflection for the Mainframe v6.11J, which ties together IBM-style mainframes with thin clients running under Windows NT Terminal or CITRIX SYSTEMS, INC.'s MetaFrame, and Reflection X v7.0, which features "hands-free" administration and support for OpenGL, X11R6.3, VTPlus and ANSI terminal emulation. The Japanese version of Reflection for the Mainframe costs $550. CYBERNET SYSTEMS CO., LTD. is WRQ's distributor.

APPLE COMPUTER INC. is offering localized versions of its latest Internet/intranet server package, AppleShare IP 6.1, and its network client administration tool, Apple Network Assistant 3.5. AppleShare IP 6.1, which lists for $490, boasts many feature and performance improvements, including remote Web administration, TCP/IP filtering, multihoming and shared IMAP folders. The $400 Apple Network Assistant 3.5 provides five levels of administrator access, administration over TCP/IP and support for voice communications over the Internet.

San Diego, California-based STAC, INC. selected NIPPON SYSTEM DEVELOPMENT CO., LTD. as the exclusive distributor of the Replica 3 server backup and recovery utility for Windows NT and NetWare systems. The Tokyo firm will localize Replica 3 as well as market and support it.

Positioning itself to meet the inevitable demand for greater network computing muscle, VERITAS SOFTWARE CORP. is preparing to market and support in mid-1999 a localized version of its cluster server software. VERITAS Cluster Server will feature built-in support for storage area networks. In the meantime, the subsidiary of the Mountain View, California firm is integrating parts of the local operation of SEAGATE SOFTWARE, INC. This follows the recent purchase by VERITAS of Seagate Software's network and storage management group in the United States.

Enterprise storage powerhouse EMC CORP. is firing back with a Japan-only product designed for SAN applications. InstaShare is priced from $31,600 to $57,000. It eventually will work in a wide range of mainframe environments, including IBM, Unix and Windows, and with an even broader range of network mass storage devices.

Sensing a new opportunity in corporate Japan's growing interest in SANs, HEWLETT-PACKARD JAPAN LTD. has announced that it will offer its parent's Stress-Free Storage service. At a cost of $26,000 and up a year, HP Japan not only will build a fiber-optic SAN from existing and/or new client computing resources and install all the necessary software, but it also will manage and guarantee SAN performance and customer satisfaction. The company thinks that it can sign up 1,000 clients for the new service.

LOTUS DEVELOPMENT CORP.'s subsidiary and NTT MOBILE COMMUNICATIONS NETWORK, INC. have developed a remote client server package optimized for the popular Notes groupware. Domino Mobile Server allows field representatives to link their laptops to corporate Notes/Domino networks through their NTT-serviced cellular phones. The two now are working on a version for palm-size devices that run under the Windows CE and the Palm operating systems.

In the same vein, ORACLE CORP.'s local unit is offering a set of extensions to its parent's Oracle Mobile Agent networking middleware. Developed by SOLITON SYSTEMS K.K. and supplied to Oracle on an OEM basis, Extensions for OMA 1.0 enhances the functionality and the capability of field agents using Oracle applications linked to corporate computing resources via OMA. Oracle expects to sell annually 30,000 copies of the $85 package.

Redwood Shores, California-based NETWORK COMPUTER, INC. has landed a deal with FUJITSU, LTD. to provide the computer maker with complete thin-client solutions for enterprise environments. NCI will deploy its NC Navigator software environment and thin-client application development suite to meet the individual needs of Fujitsu customers using its Business Terminal 300 thin client, which will be released in January.

A new version of IBM JAPAN LTD.'s thin-client administration package, WorkSpace On-Demand, is on the market. Version 2.0 can deploy and manage desktop clients now running under OS/2, DOS and Java. Support for Windows 95 and Windows NT clients is scheduled for the first quarter of 1999. The administration software is priced at $1,100 per server.

Targeting administrators faced with rapidly growing numbers of client computers, NETWORK ASSOCIATES, INC. has released a new version of its Zero Administration Client Suite. ZAC Suite 6.21 inventories client hardware and software, distributes new software, configures and locks down desktops, and meters and generates reports on software usage. The package starts at $6,700 for a 100-user license and rises to $41,300 for a 1,000-user agreement.

Choices for protecting networks with firewalls continue to expand. AXENT TECHNOLOGIES, INC. is pushing a new version of its Raptor Firewall. Although version 6 is available only in English at the moment, the Rockville, Maryland developer still has high hopes for it. Starting at $2,500, the firewall works with both Windows NT and Unix systems and provides enhanced proxy security for most types of network connections. .....WATCHGUARD TECHNOLOGIES, INC. and distribution partner DATA CONTROL LTD. are offering a competing product, Firebox II. The plug-and-play network security appliance has improved throughput to handle the needs of large enterprises. It also allows remote configuration and policy updating. Firebox II packages start at $8,200 for a basic model and go up to $9,800 for all the options. Data Control hopes to sell 200 units the first year.

Another network security option is to outsource the entire task. ICSA, INC. stands ready to help. The Reston, Virginia company established a wholly owned subsidiary in January 1998 and began offering a full range of network security services last May. Working at first with 12 firms in this field, ICSA's Japan unit evaluates networks, builds network security systems and trains personnel in security operations. NK-EXA CORP. recently agreed to distribute ICSA's services, including its TrueSecure network protection package.

IBM JAPAN LTD. is offering a solution to the mountain of paper documents most companies generate every day. e-DMS (electronic Document Management System) lets users create electronic versions of commonly used forms and other documents, allowing data either to be entered initially in electronic form or to be scanned in from a hard copy. e-DMS does not stop there, however. The IBM Japan product can interface with popular data base and groupware packages and can be turned into a knowledge-management system with additional software modules. An e-DMS package costs from $8,300 to $826,000.

Betting that the Internet soon will be the primary computing environment, ORACLE CORP.'s subsidiary will release in May a localized version of the Oracle8i relational data base management system for the Web. The new incarnation of Oracle's flagship product relies completely on Internet standards, such as the Java language, the Internet File System and multimedia formats. Oracle8i data bases not only can handle any data type, but they also can be accessed via the Internet by almost any kind of Web-enabled client.

Hoping to ride on ORACLE CORP.'s coattail, PLATINUM TECHNOLOGY, INC. has released a new version of its Fast Unload for Oracle data-export utility. Fast Unload 2.0J, which starts at $2,000, provides partial support to version 8 and full support to version 7 of Oracle's RDBMS. It is fully localized. By accessing Oracle files directly without using the SQL engine or Oracle kernel, Fast Unload moves data in and out of the system much more quickly. Also available from the Oakbrook Terrace, Illinois firm is TSreorg 2.3J, a utility for defragmenting Oracle data bases. It goes for $3,600 and up. If a company wants to make money from its information resources, ORACLE CORP. can help with its Data Mart Suite 2.0. The $57,900 Window NT package includes Oracle Data Mart Designer, Oracle Data Mart Builder, Oracle7 Enterprise Edition and Oracle Discoverer. To support the launch, Oracle's local arm started a Partner Program that provides consulting and trouble-shooting assistance.

With the size of data resources shooting up through the terabyte ceiling, highly scalable software tools to mine the information become vital. In response to this demand, SILICON GRAPHICS, INC. has rolled out a Japanese version of its MineSet 2.6 data mining and visualization software that supports both 32-bit and 64-bit computing. The latest version of SGI's flagship data management program not only is an open platform but also supports multiway associations with record weighting. In addition, it provides multibyte characters for easy compatibility with non-English languages and tighter integration of its mining and visualization tools. MineSet 2.6 is available through Tokyo-based ADAMNET CO., LTD., which hopes to sell 1,000 copies of the $33,000 package over the next two years.

RED BRICK SYSTEMS, INC. also is updating its key data base product to keep up with the changing market. The Los Gatos, California company's Red Brick Warehouse 5.1.5 relational data base server now provides Windows NT users with levels of query, performance and scalability that previously were available only to users of the Unix versions of its program. SHARP SYSTEMS PRODUCTS, INC., which offers systems integration services for data warehousing based on Red Brick's software and its parent's hardware, sees a ready market for the new package, citing the proliferation of Windows NT-based corporate networks and the high cost of creating a Unix-based data warehouse.

Global organizations with multiple proprietary on-line analytical processing systems can roll them into one OLAP application with Holos 7 from SEAGATE SOFTWARE, INC. The sophisticated Holos development environment allows users to create flexible, scalable applications that can rapidly analyze large data stores, such as those created by SAP AG's systems. The Japanese version of the Scotts Valley, California firm's Holos 7 starts at $33,100.

The ability of UNIFY CORP.'s VISION application development and server software to integrate legacy client-server software with Internet-based computing was the reason that DAIDOH CO., LTD. used it to develop its mission- critical decision support system. VISION AppBuilder and AppServer are at the heart of the textile maker's Sales and Purchase Information Analysis System, which allows sales offices to analyze transaction data to make better and faster decisions about manufacturing, purchasing and marketing.

Taking aim at companies with 100 to 700 employees, IBM JAPAN LTD. has modified an existing enterprise resource planning package developed by J.D. EDWARDS & CO. By stripping out all nonaccounting modules from the WorldSoftware package, IBM Japan was able to reduce installation time to just six months and halve the program's cost -- which starts at $206,600 -- while still offering full integration support. The company is looking for sales of at least 100 K-Kit Solutions in the first year.

To bolster support for major clients as well as for local systems integrators, ORACLE CORP. opened a marketing and customer support center in Tokyo. In cooperation with 20 computer makers, the center is offering comprehensive assistance for users of Oracle's enterprise resource planning and relational data base management systems. Service participants include FUJITSU, LTD., HEWLETT-PACKARD JAPAN LTD., HITACHI, LTD., IBM JAPAN LTD., OTSUKA SHOKAI CO., LTD. and TOSHIBA CORP.

STERLING COMMERCE, INC. has rolled out a localized version of its GENTRAN:Server for Windows NT. The electronic data interchange package -- which starts at $67,200 -- automates business transactions while integrating them with business processes. Equally important, the Dublin, Ohio firm's GENTRAN:Server is the first EDI program to support the CII and the EIAJ data exchange standards as well as the ANSI X12 and the EDIFACT standards common outside Japan in one package. GENTRAN: Server for Windows NT is distributed by Sterling's subsidiary along with KANEMATSU ELECTRONICS LTD. and KAWASAKI STEEL SYSTEMS R&D CORP.

To improve its chances of winning a bigger share of the Japanese market for supply-chain execution software, EXE TECHNOLOGIES, INC. has opened a subsidiary in Tokyo. The Dallas business is promoting its SCE and warehouse- management programs to retailers, grocers, distributors and third-party logistics companies. One of its subsidiary's first tasks is to develop Japanese-language versions of the software's documentation and end-user training materials.

Product data management software from UNIGRAPHICS SOLUTIONS INC. is the kernel of a new PDM system developed for KANSAI ELECTRIC POWER CO., INC. by UGS partner NIPPON STEEL CORP. Four years ago, NSC chose to implement the Maryland Heights, Missouri firm's IMAN package at its mills. It then became UGS's distributor. The IMAN implementation for KEPCO initially will manage equipment and parts data at four fossil-fuel generating plants, allowing KEPCO's engineering team to hone its maintenance schedules. If this initial phase yields good results, KEPCO will extend the PDM system throughout its power- generating network.

LUCENT TECHNOLOGIES INC. has developed a new set of algorithms for matching incoming customer calls with sales agents. This breakthrough promises both better service and greater sales opportunities than the traditional "first in, first out" approach. CentreVu Advocate and CentreVu Virtual Routing direct incoming calls to specific sales reps by evaluating a customer's potential business value and desire to wait and matching that against agents' skills pool and likely availability. Calls thus are directed to the sales agent who is most able to satisfy the customer's needs, regardless of what order the calls come in. Lucent's subsidiary will handle sales and support. Prices start at $206,600 for a 50-agent call center.

With computer programs becoming both more complicated and integrated into daily business activities, Japanese help-desk managers face a growing tidal wave of demands. To centralize and automate this vital task, NETWORK ASSOCIATES, INC. has released versions of its McAfee Total Service Desk Suite 1.5J for several popular enterprise operating systems, including Windows NT. McAfee TSD Suite provides event management and correlation for automated diagnosis and response to common desktop and network issues. With two additional modules -- Event Orchestrator and Asset Orchestrator -- the localized suite also can support integrated network and desktop security from a central location. A 100-user license costs $9,300.

A competing help-desk package is available from TIVOLI SYSTEMS INC.'s subsidiary. Tivoli Service Desk integrates three modules that were marketed previously as separate packages: Problem Management, Change Management and Asset Management. With the addition of Java-based client support, users have access to all three modules via a Web browser. The package currently is available only in English, however.

ELECTRONIC DATA SYSTEMS CORP. has developed a customer-relationship management system for SURUGA BANK, LTD., a midsized financial institution with offices in Tokyo, Shizuoka and Kanagawa prefectures. Scheduled for full deployment in April, the system will integrate all aspects of customer services and information, including telephone banking, credit cards, account inquiry, product inquiry, call center and loan services Officials hope the integrated system will help the bank prosper in a highly competitive market.

Although labeled as a CRM product, BROADVISION INC.'s family of software modules has a distinct sales flavor to it. The Redwood City, California firm has chosen TOSHIBA ENGINEERING CORP. to distribute BroadVision One-to-One locally. The two have picked the financial sector as their first target because of ongoing Big Bang deregulation. BroadVision One-to-One Financial not only makes most account data available to customers 24 hours a day via an automated response system, but it also matches that data with products that might be of interest. Modules begin at $157,000.

Building on the large installed base of Lotus Notes users in Japan, IBM JAPAN LTD. and DAINIPPON PRINTING CO., LTD. have combined forces to develop a flexible system for automating many business expense systems. By linking Dainippon Printing's DCubeFORM electronic expense voucher system with IBM Japan's FormWave Notes-based expense accounting system, the two have created a simple system to automate business processes like supplies purchasing, travel expenses and petty cash. JAPAN INFORMATION ENGINEERING CO., LTD. will distribute DCubeFORM for FormWave in cooperation with IBM Japan's many local marketing partners.

MITSUBISHI TRUST & BANKING CORP. and the wholly owned securities subsidiary of SANWA BANK, LTD. have launched sophisticated financial derivatives trading systems based on software from a division of Wayne, Pennsylvania-based SUNGARD DATA SYSTEMS INC. Infinity Derivatives and Infinity Limit Manager streamline trading activities while managing risk in these highly volatile instruments. Mitsubishi Trust has deployed the Infinity trading system in New York and London as well as at its head office in Tokyo. SANWA SECURITIES CO., LTD. is the first Japanese brokerage house to go live with Infinity Derivatives.

Taking advantage of the Internet's global reach, software from SCAN-OPTICS, INC. allows information from documents scanned into a PC with a connection to the Web to be entered into a central data base. FormWare can handle remote data entry from checks, other bank forms, fund transfer orders, change of address notices, insurance claims and many other types of transactions. The Manchester, Connecticut firm chose NISSHO ELECTRONICS CORP. as the exclusive reseller of FormWare.

For $50, people can buy an upgrade of the Visio Standard 5.0 business graphics application. VISIO CORP.'s 5.0 Plus handles organization charts, presentation graphics, timelines, calendars, marketing charts, flow charts and Rummler- Brache methodology charts. A full version of the Seattle company's new program goes for $250.

Designed to meet the needs of SOHO users, Toonz for Video and SOFTIMAGE|3D from AVID TECHNOLOGY, INC. are powerful tools for creating multimedia content. The $9,900 Toonz for Video easily creates professional-looking video sequences for television or video tape. SOFTIMAGE|3D v3.8 SP1, which lists for $6,400, adds advanced deformation tools, abstract mesh editing and smoothing tools and powerful surface texturing tools. Both packages have been discounted at least 40 percent from previous versions to make them more obtainable by SOHO customers.

RADIUS INC. has released a Japanese version of its award-winning Radius EditDV 1.5 digital video editing tool. With support for the FireWire (IEEE 1394) interface and based on QuickTime 3.0 standards, the Mountain View, California firm's software offers professional nonlinear video editing capabilities to users of APPLE COMPUTER INC.'s Macintosh G3 family of desktop computers for the modest sum of $1,200. In addition to delivering faster rendering speeds at every resolution, Radius EditDV 1.5 offers batch image capture, edit decision lists and support for embedded time codes.

AUTODESK, INC. announced recently that it had shipped the 100,000th copy of its 3D solid modeling program when it delivered a 159-seat installation to TOKYO ELECTRON LTD., a builder of semiconductor production equipment. The San Rafael, California developer's Mechanical Desktop package achieved this milestone just 32 months after its introduction, far faster than any of the competition. TEL officials said that they selected the Autodesk CAD solution because it was able to perform 2D and 3D modeling using the same engineering data base.

Although CAD packages are widely used by engineering departments, the cost of such complex software remains a barrier to their use in other departments. 3D View 3.0 from San Francisco's ACTIFY, INC. partially solves this problem by providing an inexpensive way to view CAD images on desktop computers running Windows NT. The CAD utility can assemble very large drawings from renderings of individual parts or subsystems, display measurements, allow multimedia markup of drawings, perform real-time cross-sectioning of parts and track multiuser changes to single drawings. The core viewer is priced at $410, with modules for importing drawings from specific CAD packages, such as CATIA, SolidWorks IGES, STL, VDA, VRML and ISO G-code, priced from $50 to $350. DATA DESIGN, INC., Actify's distributor, expects the low cost of these capabilities to help it sell 1,000 copies of 3D View 3.0 in the first year.

The local unit of CADENCE DESIGN SYSTEMS, INC. has released a Japanese- language version of the Affirma equivalence checker. The San Jose, California company's $74,400 product is a high-performance tool for checking the accuracy of deep-submicron IC designs. It integrates formal verification tools with mixed-language and mixed cycle/event logic simulation. A free Windows NT-based model-checking training tool is available along with Affirma. .....Separately, CADENCE DESIGN SYSTEMS, INC. has ported its SPECTRAQuest interconnect designer package to HEWLETT-PACKARD CO.'s 64-bit Merced processor, even though Merced itself is not yet available. Distributed by INNOTECH CORP., the Merced port of the utility for designing high-speed systems and motherboards will be provided gratis to current users of SPECTRAQuest.

SYNTEST TECHNOLOGIES, INC. has tapped SPINNAKER SYSTEMS, INC. of Tokyo as the local source for its design-for-test tools. Sunnyvale, California-based SynTest's DFT suite examines IC designs for ways to reduce defects and speed testing of actual chips. Modules available from Spinnaker include TurboFCE, a register transfer-level fault coverage enhancer; TurboBSD, a boundary-scan test suite; and TurboCheck, a partial scan/full synthesis automatic test pattern generation program. Spinnaker, which priced the modules from $24,800 to $165,300, has forecast first-year sales anywhere between $2.5 million and $4.1 million. It is working with SynTest's Tokyo subsidiary to support Japanese customers.

An exchange rate of ¥121=$1.00 was used in this report.

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Washington, D.C.-based XM SATELLITE RADIO INC., which plans to launch coast- to-coast, multichannel, satellite-delivered digital radio service in the United States in 2000, has signed agreements with three Japanese companies to make and market XM-capable radios and audio systems for the American market. ALPINE ELECTRONICS, INC. and PIONEER ELECTRONIC CORP. will produce XM radios for the automotive market, while SHARP CORP. will turn out XM audio systems for the home market. All this equipment will be able to receive AM and FM broadcasts in addition to the XM digital programming and will have such add- ons as CD players. A dish-shaped receiver just a few inches wide will be needed to pick up the signal from XM's pair of direct-broadcast satellites. The company is owned by AMERICAN MOBILE SATELLITE CORP. and WORLDSPACE, INC.

A restructuring MOTOROLA INC. exited the personal handyphone system business. The only foreign competitor in this field, its sales, like those of domestic equipment suppliers, were hurt by the shift in the wireless market from this cellular wanna-be to the real thing as cell phone prices and service charges came down. At the time it pulled out of the market, Motorola was supplying PHS terminals to NTT PERSONAL COMMUNICATIONS NETWORK, INC. on an OEM basis as well as selling PHS handsets under its own name.

The Ministry of Posts and Telecommunications has awarded a Type I license to a third foreign communications carrier. PACIFIC GATEWAY EXCHANGE, INC. joins MCI WORLDCOM, INC. and BRITISH TELECOMMUNICATIONS PLC in being able to build, own and operate communications facilities (see Japan-U.S. Business Report No. 348, September 1998, p. 21). The Burlingame, California company, which installed a switch in Japan during the third quarter, already is marketing its global high-bandwidth data and Internet services to carrier customers. It expects to add retail customers in 1999.

In a Japan-only tie-up, UNISYS CORP. and MCI WORLDCOM, INC. are partnering on the computer telephony integration business. Their primary target is American companies operating in the Japanese market, although they also will try to win contracts from local financial institutions, manufacturers and distributors in order to build CTI into a $165.3 million annual business in three years. NIHON UNISYS, LTD. will build and market the systems, while MCI WorldCom's subsidiary will be in charge of consulting.

The Enterprise Interaction Center, an all-in-one Windows NT communications server built by Indianapolis-based INTERACTIVE INTELLIGENCE, will be sold in Japan by ERNST & YOUNG TECHNOLOGIES, INC. to clients of its Tokyo-based affiliate, ERNST & YOUNG CONSULTING JAPAN CO., LTD. EIC eliminates the need for integration among proprietary communications devices like private branch exchanges, voice-mail systems, fax servers, Web servers and CTI gateways. Since it is designed for call centers as well as for any company interested in automating its communications systems, Ernst & Young expects the system to enhance its expertise in the area of customer service strategies.

Roughly one-fourth of global sales of notebook PCs are made in Japan, where portable machines comprise a much higher proportion of PC shipments than in the United States. That reality persuaded XIRCOM, INC., the self-described world leader in connectivity solutions for mobile computing professionals, to open a subsidiary in Tokyo. The new organization, which replaces a branch office (see Japan-U.S. Business Report No. 347, August 1998, p. 26), will double as the Thousand Oaks, California firm's Asian regional headquarters.

The Cisco 12000 gigabit switch router, which CISCO SYSTEMS, INC. calls the primary building block of its optical internetworking strategy, has arrived in Japan a year after its American debut. A number of major U.S. service providers already have deployed the network backbone router. Cisco's subsidiary also hopes to persuade big Japanese service providers to use the GSR 12000 series to build optical internetworking infrastructure that will provide the foundation for the evolving Internet economy. The GSR line of switch routers starts at $16,000.

The latest addition to CANOGA PERKINS CORP.'s line of wavelength division multiplexers gives managers of bandwidth-constrained networks the power to optically multiplex up to eight channels over a single fiber-optic pair. The modular, protocol-independent Access Model WA-8 WDM system supports data transmissions at speeds anywhere from 10 Mbps all the way up to 1.25 Gbps. It can handle a long list of protocols, including 10/100/1000-Mbps Ethernet, token ring, FDDI (fiber-distributed data interface), Fibre Channel and ATM (asynchronous transfer mode) or SONET/SDH (synchronous optical network) at OC- 1, OC-3 or OC-12, over the same fiber backbone. NET ONE SYSTEMS CO., LTD., which already distributes the Chatsworth, California company's Access Model WA-4 (see Japan-U.S. Business Report No. 345, June 1998, p. 22), expects to sell 50 WA-8 modules.

The alliance that MATSUSHITA ELECTRIC INDUSTRIAL CO., LTD. and MICROSOFT CORP. formed last summer to propel the convergence of PCs and consumer electronics products (see Japan-U.S. Business Report No. 347, August 1998, p. 7) has produced its first concrete results. The software giant's WEBTV NETWORKS INC. is shipping tuners to MEI on an OEM basis that allow buyers to access the Internet through their TV sets. Matsushita Electric has priced the analog tuner at $455. It is looking for sales of 2,000 units a month. If achieved, that volume would give a boost to WebTV Networks' lagging Japanese operations (see Japan-U.S. Business Report No. 350, November 1998, p. 28).

Extending its line of videoconferencing systems upward, PICTURETEL CORP.'s subsidiary put on the market the Montage 570. Designed for large, reservation- based video networks and multipoint service operations, the scalable and customizable server connects as many as 48 sites in any number of conferences. The Montage 570, which starts at $52,900, can be used with any PictureTel product as well as with any other videoconferencing system that supports the H320 industry standard.

An exchange rate of ¥121=$1.00 was used in this report.

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In a milestone for the aircraft industry and for U.S.-Japan commercial relations, BOEING CO. delivered the 100th 747 jumbo jet to JAPAN AIRLINES CO., LTD. The long-range 747-400 is configured to carry 348 passengers -- 12 in first class, 99 in business and the rest in economy. The plane will be used on JAL's international routes. The partnership between Boeing and JAL goes back 30 years.

An exchange rate of ¥121=$1.00 was used in this report.

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The aft fuselage for Japan's first production F-2 support fighter aircraft has been delivered to prime contractor MITSUBISHI HEAVY INDUSTRIES, LTD. by LOCKHEED MARTIN CORP. The top U.S. defense contractor, the builder of the F-16 on which the F-2 is based, will provide the aft fuselages for all 130 planned production F-2 aircraft. The company's Tactical Aircraft Systems unit in Fort Worth, Texas also will supply all the wing leading-edge flaps, eight of 10 left-hand wing boxes, all the stores management systems and other avionics and avionics support equipment for the plane. MHI is scheduled to deliver the first production F-2 to the Japan Defense Agency in early 2000.

Cushion Pack, a heavy-duty, air-bubble packaging material developed by SEALED AIR CORP. exclusively for the Japanese market, is being sold by CREATIVE PACKAGING CORP., the Saddle Brook, New Jersey manufacturer's year-old joint venture with JAPAN SYNTHETIC RUBBER CO., LTD. (see Japan-U.S. Business Report No. 339, December 1997, p. 25). A sheet measuring roughly 10 feet wide and 164 feet long costs $33.

Face masks that can filter out as much as 99.8 percent of all particulate matter have been released by 3M HEALTHCARE LTD., a Tokyo-based unit of the pharmaceuticals division of MINNESOTA MINING & MANUFACTURING CO. The three types of masks, which have a minimum efficiency rating of 99.5 percent and are equipped with air tubes to vent humidity and heat, are priced between $4.40 and $18.20 each. 3M Healthcare believes that the new products can develop into a $2.5 million business in the first year.

The subsidiary of Irvine, California-based PROLONG SUPER LUBRICANTS, INC. has named CHUGAI SHOKO CO., LTD. to market its automotive lubricating products. These include the Prolong Fuel System Treatment and the Prolong Engine Treatment Concentrate. The Nagano prefecture distributor is looking for sales of $413,200 in the initial year of the marketing agreement.

The fight for share in Japan's razor market will heat up in the spring when GILLETTE CO.'s subsidiary introduces the MACH3. The world's largest maker of razors hopes that the MACH3's revolutionary triple-blade shaving system will help it double market share to 40 percent. WARNER-LAMBERT CO.'s Schick brand now generates 37 percent of Japanese razor sales. KAI-JIRUSHI CO., LTD., which has been selling a triple-blade razor since March, is second with a 33 percent cut of the business, followed by Gillette with 20 percent. The MACH3 will be priced at $10.75. Blades will cost $8.25 (package of four) or $14.90 (eight).

Two giants in toys and games are tying up. HASBRO, INC. has signed a long-term distribution agreement with TOMY CO., LTD. under which Japan's second-largest toy manufacturer will be the exclusive Japanese distributor of essentially all of the Pawtucket, Rhode Island company's toy and game products. Hasbro's brands include Playskool, Kenner, Tonka, Super Soaker, Milton Bradley and Parker Brothers. Its subsidiary has tried to boost sales in recent years by expanding the line of merchandise for Japan.

An unnamed furniture retailer has ordered a container load of outdoor wood furniture from the LEISURE LIFE, INC. subsidiary of Delavan, Wisconsin-based AJAY SPORTS, INC. The order was placed through Leisure Life's Web site, which has customized tools that allow buyers to determine the optimal number of units to purchase to fill a container so that transportation costs are minimized.

The McCann Relationship Marketing unit of major advertising agency MCCANN- ERICKSON WORLD GROUP acquired a Tokyo data base management firm. ISD has annual billings of $25 million. Its clients include ORACLE CORP., BOSTON SCIENTIFIC CORP. and AMERICAN INTERNATIONAL GROUP, INC.

Boston's DELPHI GROUP, which provides market research and advisory services for knowledge management, document management, work flow and business process automation, has recruited MUTSUMI ENTERPRISES as a consulting partner for Japan. A major focus of the Tokyo firm will be to show corporate Japan how to acquire, share and leverage knowledge by using computer networking technology.

A Manhattan specialist in marketing strategies for food retailers has been retained by SUNNY CO., LTD., a regional supermarket chain based in Fukuoka, to help it stand out in an increasingly competitive marketplace. CDI GROUP, INC. is in the process of designing a new store layout for the chain as well as developing distinctive architectural and interior designs for Sunny's 60 existing supermarkets.

Last July, the Diet passed legislation allowing companies to store their tax records electronically. Despite the cost advantages of this option, many businesses reportedly are reluctant to abandon hard copies for fear of running afoul of the law's tough standards. Enter NIHON UNISYS, LTD. and the accounting and auditing partnership of DELOITTE TOUCHE TOHMATSU. Starting this month, they are offering consulting services to companies that want to move to electronic storage of their tax records. The pair will advise clients not only how to configure their systems but also how to conform with the law's requirements for data accuracy, transparency and verifiability.

COPC, INC. of Williamsville, New York will review call centers and fulfillment centers for compliance with the COPC-2000 standard, which uses criteria based on customer service, customer satisfaction and operational efficiency to evaluate performance. It then will advise clients that come up short. COPC, which also will evaluate companies that outsource their call center and/or distribution services, is working with a Japanese consulting firm to develop a customer base.

An exchange rate of ¥121=$1.00 was used in this report.

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