No. 361, October 1999

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Japanese Companies in the United States

American Companies In Japan

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Japanese Companies in the U.S.


Only one U.S. marketer of nitrile-butadiene rubber will be left once ZEON CHEMICALS L.P. completes the purchase of this part of GOODYEAR TIRE & RUBBER CO.'s synthetic rubber business. The transaction, the terms of which were not disclosed, will give the NIPPON ZEON CO., LTD. subsidiary global sales rights to roughly 14,300 tons of product. With that addition, the Japanese company will have 40 percent of the world NBR market versus 33 percent now, further distancing itself from number-two BAYER AG, which controls about 24 percent of international sales. NBR is used to make such automotive parts as engine hoses and oil seals. Earlier this year, Louisville, Kentucky-based Zeon Chemicals acquired worldwide sales rights to the American-produced NBR output of another company (see Japan-U.S. Business Report No. 352, January 1999, p. 2). The leading U.S. producer of elastomers, it has manufacturing facilities in Louisville as well as in Hattiesburg, Mississippi and Bayport, Texas.

The world's fourth-largest supplier of fluoropoly-mers soon will become the second biggest. At a cost of $136 million, ASAHI GLASS CO., LTD. has agreed to acquire the international Fluon polytetrafluoroethylene business of IMPERIAL CHEMICAL INDUSTRIES PLC. This part of the British multinational's operations had revenues of $110 million in 1998. It employs close to 400 people. Production facilities are located in Bayonne, New Jersey and the United Kingdom, with a downstream specialty PTFE plant in Thorndale, Pennsylvania. Fluoropolymers are used in a variety of industrial applications, ranging from nonstick coatings for cookware to architectural coatings. Asahi Glass sees the deal as a way to bolster its position in a growth market in which it already has a strong presence. E.I. DUPONT DE NEMOURS & CO., INC. is the world's top producer of fluoropolymers.

Corporate restructuring cuts both ways. Case in point: KOBE STEEL, LTD.'s decision to sell before April 2000 GLASTIC CORP. to CRAWFORD GROUP LLC, a Detroit-based investment firm. Together with trader ITOCHU CORP. (15 percent), the steelmaker had purchased the manufacturer of reinforced thermoset materials and components and electrical and structural- grade fiberglass-reinforced plastics in 1988. Glastic, which has plants in Cleveland and Jefferson, Ohio and some 375 people on the payroll, had sales of $51.4 million in 1998. It was profitable through 1996 but lost money the following two years.

NIPPON SODA CO., LTD. has identified agrichemicals as one of its core businesses. To date, herbicides have accounted for most of its sales in this field, but the company hopes to add insecticides as an equal contributor. To that end, Nippon Soda established a laboratory to work on insecticide intermediates at a high technology research center in Alachua, Florida run by the state government and the University of Florida. By developing its own intermediates through the collaborative efforts of the American facility and its Japanese research center and manufacturing them at a new, $27.8 million plant in Toyama prefecture, the Tokyo firm believes that it can strengthen its international competitiveness in the insecticide market.

Although it recently started to market in the United States its own prescription drug for the treatment of adult-onset or Type II diabetes (see Japan-U.S. Business Report No. 359, August 1999, p. 2), TAKEDA CHEMICAL INDUSTRIES, LTD. acquired the rights to commercialize and sell outside Japan and three other major Asian markets a diabetes therapy discovered by DAINIPPON PHARMACEUTICAL CO., LTD. New York City-headquartered TAKEDA PHARMACEUTICALS AMERICA, INC. hopes to start U.S. clinical trials of AJ9677 through a contract research organization before yearend. Its target date for Food and Drug Administration marketing approval is late 2005. Takeda Chemical's own ACTOS (pioglitazone hydrochloride) is off to a fast sales start in this country.

OTSUKA PHARMACEUTICAL CO., LTD. has gained some powerful help in bringing to the market in the United States, the European Union and other key markets outside Japan and certain additional Asian countries its potential agent for schizophrenia. Here and in the EU, BRISTOL-MYERS SQUIBB CO. will comarket and copromote aripiprazole with Otsuka Pharmaceutical under the Japanese company's trademark, according to a recently signed development, commercial-ization and collaboration agreement. Aripiprazole, which Otsuka Pharmaceutical discovered in 1988, currently is in Phase III clinical testing in the United States. To date, the new compound with its unique mechanism of action has shown greater efficacy and fewer side effects than current antipsychotics. Otsuka Pharmaceutical and BMS plan a regulatory filing in this country for aripiprazole in late 2001.

In their second such arrangement in a year, SANKYO CO., LTD. signed a research agreement with QUARK BIOTECH, INC. This one covers autoimmune diseases. Under it, the Pleasanton, California company will use its gene-discovery technology to identify key genes and pathways responsible for the apoptosis of particular cells and tissues caused by such problems as chronic rheumatism, hepatitis and nephritis. QBI also will target candidates for drug discovery and, in time, conduct clinical testing of selected therapeutic candidates. For this work, it will receive research and development funding, milestone payments and royalties on the sale of any resulting products. In exchange, Sankyo will have exclusive rights to market worldwide drugs emerging from the research program. The initial collaboration between Japan's second-biggest pharmaceutical house and QBI involves the study of gene responses to Type II diabetes and the identification of possible treatments (see Japan-U.S. Business Report No. 354, March 1999, p. 2).

Yet another Japanese pharmaceutical company is teaming up with an American drug discovery firm in the hope of accelerating its search for a commercializable treatment for Type II diabetes. This pairing, intended to discover and develop small molecule drugs, brings together TANABE SEIYAKU CO., LTD. and OSI PHARMACEUTICALS, INC. It will build on the drug discovery alliance between the Uniondale, New York company and the Vanderbilt University Diabetes Center that has been underway since April 1998. Tanabe Seiyaku and OSI Pharmaceuticals will focus their research on normalization of the elevated plasma glucose levels seen in the large and rising number of people with noninsulin-dependent diabetes. The terms of the agreement call for the Japanese partner to make an up-front payment to OSI Pharmaceuticals, plus fund a four-year research program in exchange for exclusive worldwide marketing rights. Successful clinical development, which will be Tanabe Seiyaku's responsibility, could trigger milestone and other payments to the U.S. firm in excess of $30 million in addition to royalties.

To help advance its research on kidney disease, TAISHO PHARMACEUTICAL CO., LTD. chose a pioneer in the field of therapies to treat kidney fibrosis — a problem that can be caused by diabetes, hypertension and immune diseases as well as by chronic rejection of transplanted kidneys and that can result in end-stage renal disease and repeated chronic transplant rejection. Its collaborator is FIBROGEN, INC. Together, they expect to develop human monoclonal antibodies that neutralize the effects of connective tissue growth factor, a key cytokine in fibrosis. Taisho Pharmaceutical will provide funding for its South San Francisco, California partner's work in the form of equity purchases, milestone payments and money for half of the global costs of preclinical and clinical development outside of Asia. The Japanese firm will have exclusive commercialization rights in that area. FibroGen will retain those rights elsewhere.

KIRIN BREWERY CO., LTD.'s aggressive Pharmaceutical Division has contracted with CHEMRX, the wholly owned chemistry services subsidiary of San Diego, California's DISCOVERY PARTNERS INTERNATIONAL, to develop multiple classes of compounds for its lead optimization libraries. The targets of interest to the Japanese firm were not described. Under the pact, ChemRX will develop the chemistries on a fee-for-service basis. It will provide them exclusively to Kirin Brewery for screening in a wide range of that firm's internal assays. No additional money will change hands.

The Food and Drug Administration approved for marketing anti-allergy eye drops discovered and commercialized by SANTEN PHARMACEUTICAL CO., LTD. The Napa, California subsidiary of Japan's top supplier of prescription ophthalmic pharmaceuticals plans to launch ALAMAST (pemirolast potassium) 0.1% in the United States in the spring of 2000. This treatment for what technically is called allergic conjunctivitis will be the first Santen Pharmaceutical product sold here. ALAMAST will be manufactured by the company's Finnish unit and marketed to physicians by a 30-person sales force. The Japanese drug company hopes to introduce antibiotic eye drops in this country in 2001.

Relief could be on the way for people who suffer from atopic dermatitis, more commonly known as eczema. FUJISAWA PHARMACEUTICAL CO., LTD.'s Deerfield, Illinois subsidiary submitted a new drug application to the FDA for tacrolimus ointment, reportedly the first new drug designed specifically to treat the chronic skin conditions caused by eczema in more than 40 years. If cleared for sale, tacrolimus ointment will be manufactured at FUJISAWA HEALTHCARE, INC.'s Grand Island, New York plant. Production of the drug already has started in Japan, where it will be sold as an atopic dermatitis remedy under the Protopic brand name. .....FUJISAWA HEALTHCARE, INC. expects tacrolimus ointment to be as big a seller in the United States as its Prograf immunosuppressant, which is made from the same chemical substance. To help insure that outcome, the company will hire in the coming months an additional 40 to 50 sales people. It now has some 100 medical representatives on staff.


Like top-tier Japanese pharmaceutical houses frustrated by the Ministry of Health and Welfare's frequently slow drug-approval process, midsize ZERIA PHARMACEUTICAL CO., LTD. has come to see offshore clinical testing as a primary way to expedite the introduction of money-making new products. It plans to sign up an American contract research organization to conduct clinical trials on a drug that has shown effectiveness in treating patients with a dwindling white blood-cell count. Such a product would have obvious application for people fighting the human immunodeficiency virus.

An exchange rate of ¥108=$1.00 was used in this report.

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Next spring, HITACHI DATA SYSTEMS CORP. will open a 450,000-square-foot distribution and warehouse facility in Plainfield, Indiana, outside Indianapolis. Located within 24 hours by truck of three-fourths of the company's existing and potential customers, the center will enable the Santa Clara, California supplier of high-end servers and multiplatform storage subsystems to provide next-day delivery to most businesses. In time, the Plainfield facility, which will employ 100 people, will replace Hitachi Data Systems' distribution centers in San Jose, California and Laurel, Maryland.

Hoping to win the business of small companies looking for an affordable way to expand their Internet presence, HITACHI DATA SYSTEMS CORP. redefined the low end of its VisionBase server family (see Japan-U.S. Business Report No. 360, September 1999, p. 3). The VisionBase 8245 can be configured with one or two 600-MHz or 550-MHz Pentium III processors with 512 kilobytes of Level-2 cache per processor, as much as 1 gigabyte of synchronous dynamic random access memory, up to 90 GB of internal storage and six PCI (peripheral component interconnect) slots. VisionBase 8245 pricing begins at an affordable $2,700.

TOSHIBA AMERICA INFORMATION SYSTEMS, INC. is leveraging the power of the 550-MHz Pentium III Xeon processor in its quad-processing Magnia 7010 series of enterprise-class servers. Suited for enterprise management, electronic commerce, data bases, data warehousing and general high-volume business processing, the build-to-order line starts at $7,300 for a single processor with 512 KB of L-2 cache, 256 MB of DRAM memory, a 32X CD-ROM (compact disc-read-only memory), a PCI graphics adapter and six 3.5-inch hot-swap drive bays that support 18-GB drives.

The fast-expanding market for low-cost (sub-$800) desktop machines has attracted another competitor: TOSHIBA AMERICA INFORMATION SYSTEMS, INC. The Irvine, California company's V3100 line starts at $550 for a system with a 366-MHz Celeron processor; a 15-inch TAIS monitor adds about $160 to the price. Many BTO options are available for buyers interested in machines for Internet browsing, electronic mail and basic productivity applications. These include Celeron processor speed (up to 500 MHz), 64 MB or 128 MB of system memory, 4-GB to 13-GB hard drives, a 40X CD-ROM drive, modem or network interface cards and a choice of Microsoft operating systems.

People interested in near-professional digital video editing have four new choices in SONY ELECTRONICS, INC.'s VAIO Digital Studio PC line. Ranging in price from $900 to $2,000, they include the entry-level PCV-R532DS with a 466-MHz Celeron processor, 64 MB of SDRAM memory, a 10-GB hard drive, an 8X digital video disc-ROM drive, and two iLINK (IEEE-1394) digital interface ports, plus two USB (universal serial bus) ports. Three higher-end models — the PCV-R536DS, the PCV-R538DS and the PCV-R539DS — are available as well, each with increased processor power (450-MHz to 550-MHz Pentium IIIs) and bigger hard drives (10 GB or 17 GB). They also feature 128 MB of system memory, three-dimensional, 2X AGP (accelerated graphics port) graphics, 8 MB or 16 MB of video memory, an 8X DVD-ROM drive, a CD-Rewritable drive in the two high-end models, two iLINK ports and two USB ports.

SONY ELECTRONICS, INC. also broadened its popular line of VAIO 505 SuperSlim notebooks with their sleek, rugged magnesium-alloy cases. For high-end business travelers and road warriors, the company added two SuperSlim Pro models that weigh less than 3.5 pounds and have a 1-inch profile. Both Z505 models have a 12.1-inch XGA (extended graphics array) active-matrix TFT (thin-film-transistor) display. The $2,500 VAIO Z505R has a 366-MHz mobile Pentium II processor, 64 MB of SDRAM and a 6.4-GB hard drive, while the VAIO Z505RX, which has an estimated selling price of $3,000, features a 400-MHz mobile Pentium II chip, 128 MB of system memory and an 8.1-GB hard drive. Both also come with a dedicated Memory Stick media slot, a pair of USB ports and an iLINK port. In addition, Sony Electronics extended its original SuperSlim notebook series, adding two models with a 10.4-inch XGA active-matrix TFT display, 64 MB of SDRAM and a 6.4-GB hard drive. The VAIO N505VE, which goes for about $1,700, is powered by a 333-MHz mobile Celeron processor. The $2,200 or so VAIO N505VX uses a mobile Pentium II processor running at the same speed.

The first product in a planned SEIKO EPSON CORP. family of PCI bus-based card PCs will be available in production quantities in December. One of the initial card PCs based on NATIONAL SEMICONDUCTOR CORP.'s power-saving Geode processor running at 200 MHz, the CARD- PCI/GX is said to be 30 percent smaller and thinner than its closest competitor. It also is claimed to be more than 20 percent less expensive than alternatives at $300 each in 10,000- unit lots. The CARD-PCI/GX is fully compatible with the Windows CE, 95/98 and NT operating systems. It also supports leading real-time operating systems. The PCI motherboard is targeted at applications where high performance, low cost and low power consumption are all at a premium. Those include factory automation, mobile test equipment, ruggedized notebooks, dedicated Web servers and compact PCI-compliant boards.

Complementing its channel strategy, FUJITSU COMPUTER PRODUCTS OF AMERICA, INC. formed an Internet Sales and Distribution Division to spearhead Internet-based sales and service of its hard drives, tape drives, magneto-optical drives, scanners and printers. The San Jose, California supplier also opened a new on-line store at its Web site.

The Hitachi Freedom Storage 5800 family of multiplatform, high-availability storage subsystems has a new, lower-capacity member. The Model 5840 also is the first product that HITACHI DATA SYSTEMS CORP. is releasing through a two-tiered sales model of systems integrators and value-added resellers as well as its existing large-account sales team. The Model 5840 houses up to 10 36-GB disk drives in a standard 19-inch rack-mount chassis, and six subsystems can be mounted in a single rack. That capability on top of the interoperability and the connectivity of the Hitachi Freedom Storage 5800 family enables channel partners to build storage solutions supporting SANs (storage area networks), electronic business, data warehousing and back-office applications for their clients. Pricing of the Model 5840 with Fibre Channel or SCSI (small computer system interface) connectivity starts at under $20,000.

People who take laptop or handheld PCs on the road can take along a 1.1-pound printer. PENTAX TECHNOLOGIES CORP., a wholly owned Broomfield, Colorado subsidiary of ASAHI OPTICAL CO., LTD., has introduced the PocketJet 200 portable printer. Compatible with any Windows-based device, the thermal system prints 200-dots-per-inch text and graphics at speeds of up to three letter-size pages per minute. It will generate approximately 40 pages per battery charge. The PocketJet 200 has a suggested list price of $320.

KYOCERA ELECTRONICS, INC. has added a high-volume network laser printer and a midrange counterpart to its Ecosys printer line, which is designed to minimize the total cost of ownership. The Duluth, Georgia firm's FS-3750 outputs 18 ppm with a print resolution of 1200 x 1200 dpi. Designed for large workgroups in networked environments, this $1,100 printer has a 166-MHz PowerPC 603e processor and comes standard with 16 MB of memory. Its $900 midvolume mate, the FS-1750 for small, networked groups, prints 14 ppm, also with a 1200 x 1200-dpi resolution. It is equipped with a 100-MHz PowerPC 603e chip and 8 MB of memory.

Going after the growing market for printers among small businesses and home users, OKI DATA AMERICAS, INC. of Mt. Laurel, New Jersey released the OKI-PAGE 6w. A six-ppm digital LED (light-emitting diode) printer with a 600-dpi resolution, the compact desktop machine has a suggested street price of $200.

The first color copier/printer designed by SHARP CORP. is available in the United States through its Mahwah, New Jersey marketing unit. The midvolume AR-C150 Digital Color IMAGER operates at speeds of 15 ppm in color and 25 ppm in black and white with a 600-dpi resolution. Aimed at graphic arts and print-for-pay businesses as well as at markets where color output is becoming increasingly important, Sharp says that the AR-C150 is both the fastest machine in its class and the most compact four-drum copier/printer sold. The basic unit, which incorporates a Fiery print controller from ELECTRONICS FOR IMAGING, INC., has a suggested retail price of $21,800.

USB compatibility is now available for SHARP CORP.'s IMAGER series of desktop multifunction peripherals. With this technology, a user simply plugs the new AR-150 line of 15-ppm digital copiers/laser printers/facsimile machines into a PC. All the necessary drivers then are loaded automatically, with little or no configuration required. IN-SYSTEM DESIGN of Boise, Idaho and LUCENT TECHNOLOGIES INC. designed and implemented the USB device for Sharp.

An exchange rate of ¥108=$1.00 was used in this report.

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The sell-off of what 10 years ago was corporate Japan's extensive portfolio of U.S. properties continues building by building as companies attempt to lighten their debt burden. In one of the latest deals, midsize contractor FUJITA CORP. agreed to sell the Miramar Sheraton Hotel in Santa Monica, California to MARITZ, WOLFF & CO. The price is thought to be more than $92.6 million. The Los Angeles-based investment group is a major shareholder in the company that manages the Four Seasons and Fairmont hotel chains.

An exchange rate of ¥108=$1.00 was used in this report.

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Each of the Silicon Valley start-ups promoting a format for the digital video recording devices that soon could make personal television a reality has enlisted the help of a Japanese consumer electronics powerhouse. First, REPLAY NETWORKS, INC. of Mountain View, California licensed its technology to MATSUSHITA ELECTRIC INDUSTRIAL CO., LTD. for what the winner of the videocassette recorder design standard bills as hard disk recorders (see Japan-U.S. Business Report No. 358, July 1999, p. 6). Now, rival TIVO INC. has forged a capital and technology alliance with SONY CORP., the loser in the VCR format battle. Under it, SONY CORP. OF AMERICA will spend $27.5 million to acquire a 7.5 percent stake in the Sunnyvale, California company, which has announced plans for an initial public offering. At the same time, TiVo licensed its platform for devices that Sony is calling personal video recorders. However they are known, the devices are hard drive-equipped set-top boxes. Together with either the ReplayTV service or the TiVo Personal Television Service, they record television programming in progress, allowing consumers to pause and rewind. The devices also can be set to record programs automatically. For Sony in particular, the tie-up with TiVo is appealing because it provides a pipeline for getting Sony movies and Sony television programming into homes. The first Sony-branded PVRs that support TiVo Personal Television Service could be in stores as early as the spring of 2000 at prices around $500. That is the cost of similar devices for TiVo service subscribers that were just released by PHILIPS ELECTRONICS NV.

Deciding that it no longer could justify two California consumer electronics plants, PIONEER CORP. closed its facility in Chino, which had made large-screen television sets, including projection units, since 1988. Production of these products was shifted to PIONEER ELECTRONICS TECHNOLOGY, INC.'s Pomona factory. The stereo speakers that had been produced there since 1978 were outsourced to American and Japanese-affiliated companies to make room for the TV sets. The closure of PET's Chino plant cost 100 jobs.

The mass market in the United States for high-definition TVs has not developed as quickly as set manufacturers had hoped, in part due to the combination of high costs and limited programming but also because of technical drawbacks that reflect the lack of agreement on a single digital HDTV format. Nonetheless, Japanese suppliers continue to refine their technology. For instance, HITACHI AMERICA, LTD. introduced a 61-inch HDTV set at the high end of its three-tiered UltraVision Digital lineup. The wide-screen, 16 x 9 ratio 61HDX98B is a fully integrated unit. It receives signals from the four available broadcasting sources: all 18 ATSC local digital broadcasting formats, standard and high-definition satellite and today's NTSC analog format. High-definition broadcasts are displayed at the highest level possible, while other formats automatically are converted and displayed in enhanced form. However, Hitachi's 61-inch HDTV set still is on the expensive side with a suggested retail price of $8,000.

SHARP CORP., which ranks among the world's leading manufacturers of LCDs (liquid crystal displays), has released through one of its U.S. marketing units what is said to be the first 20- inch LCD monitor to offer video component inputs and PC compatibility. The SharpVision LC- 20VM2U LCD AVC Monitor was designed so that people could buy one product for all of their entertainment viewing requirements, including DVDs and PC graphics. It is just 1.9 inches deep and weighs only 15.4 pounds. The LC-20VM2U will be available in December at an estimated retail price of $6,000. Sharp's LCD video monitor line already includes a 15-inch model that lists at $1,900 and a 12.1-inch display that goes for about $1,500.

The same LCD technology found in SHARP CORP.'s video monitors is used in the company's home theater projection products. Those now include the full-featured but compact SharpVision XV- Z1U LCD front projector. Like the rest of the SharpVision LCD front projector line, the new model not only is engineered for multisystem video compatibility with analog formats but also is equipped with component video inputs to provide compatibility with current high-end DVD players. In addition, it has S-video and composite inputs for access to other digital sources. Weighing only 16 pounds, the XV-Z1U offers a picture ranging from 30 inches all the way up to 300 inches. These features are not inexpensive: the XV-Z1U is an estimated $4,000.

With the much-hyped Sega Dreamcast video game console going on sale in the United States in early September (see Japan-U.S. Business Report No. 356, May 1999, p. 5), SONY COMPUTER, INC. announced the details and the launch schedule for the follow-on to the PlayStation, the best-selling video game console in this country. The PlayStation2 will debut in North America in the fall of 2000 following its March 2000 release in Japan. Sony Computer boasts that the PlayStation2 will create a new world of computer entertainment since, in addition to its game-playing capabilities, it will support the audio CD and the DVD-Video formats. Like the Dreamcast, the unit will incorporate a 128-bit architecture. It will have 32 MB of Direct Rambus DRAM main memory, plus 4 MB of video RAM. U.S. pricing has not been decided. In Japan on launch, the PlayStation2 will have a suggested price of about $370.

Two formerly wholly owned MATSUSHITA ELECTRIC INDUSTRIAL CO., LTD. factories in Kentucky have been merged into the company's principal North American subsidiary in an effort to boost efficiency and better serve customers' needs. The rechristened MATSUSHITA HOME APPLIANCE CO. (formerly Matsushita Home Appliance Corp. of America) of Danville got its start as a MEI company through a 1990 acquisition. It employs 1,700 people who produce vacuum cleaners and microwave ovens for sale under the Panasonic name as well as other brands. The renamed MA-TSUSHITA ELECTRIC MOTOR CO. (previously Matsushita Electric Motor Corp. of America) in Berea opened in the fall of 1996. Its 200 employees produce electric motors for vacuum cleaners, automotive antilock braking systems and power windows.

Over the next four years or so, TOPPAN PRINTING CO., LTD. could invest as much as $92.6 million in a state-of-the-art printed circuit board factory in Poway, California. Operations are scheduled to start in the summer of 2000 following a July groundbreaking. TOPPAN ELECTRONICS, INC. makes PCBs at a plant in nearby San Diego that it acquired in 1988. However, strong orders from major American electronic equipment original equipment manufacturers and their suppliers are straining capacity at the 500-employee plant. The Poway facility, which could make such products as multilayer and high-density circuit boards, will lift Toppan Electronics' capacity by 50 percent in 2003.

YASKAWA ELECTRIC CORP. is looking for a site in Silicon Valley that will enable it to combine the employees and the work of its current semiconductor office in Santa Clara, California with its new Yaskawa USA Development Center. This technology and business development unit is scheduled to begin operations in November. It will be staffed initially by some 20 Yas-kawa Electric workers transferred from Japan, although the company hopes to hire an equal number of Americans. Their immediate mandate is to develop next-generation servo motors, controllers and inverters for factory automation open systems and networks. Yaskawa Electric makes computer numerical controls at a Northbrook, Illinois plant opened in 1990. It also owns robotics manufacturer MOTOMAN, INC. of Dayton, Ohio (see Japan-U.S. Business Report No. 352, January 1999, p. 6).

Japan's top maker of visual and audible signaling devices — a category that includes signal towers, cube towers, rotating warning lights, voice synthesizers and audible alarms — has set its sights on doing more business in the United States. PATLITE CORP.'s Torrance, California marketing subsidiary is spearheading the drive. For starters, it is opening a branch office in Rolling Meadows, Illinois in November to extend sales coverage to the Midwest and the South from the West Coast. More money also will be earmarked for marketing, including advertising. At the same time, Osaka-based Patlite is taking steps to streamline its U.S. product delivery system. The company's visual indicators and audible alarms are designed for any automated assembly line setting. Most of its business today comes from semiconductor makers.

TOKIN CORP., a midsize manufacturer of electronic materials, devices and systems, has big plans for its San Jose, California marketing subsidiary. The Sendai prefecture company has identified five product areas where it believes that North American sales can be built into annual businesses of $18.5 million each within 2000. They are: cellular phone antennas; optical isolators for high-speed, long-distance, large-capacity optical communications transmissions; solid-chip noise suppressors for computer equipment; contactless integrated circuit cards for building security and management control; and sensors for automotive applications. Tokin says that it will consider onshore production if all its sales targets are achieved.

An exchange rate of ¥108=$1.00 was used in this report.

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Shares of TOYOTA MOTOR CORP., the world's third-largest automotive manufacturer, now are trading on the New York Stock Exchange and on the London Stock Exchange in addition to their Tokyo Stock Exchange listing. Executives of the cash-flush company said that the two listings were designed to give investors around the world easier access to its stock rather than to raise capital. Coming at a time of consolidation in the world automotive industry, though, analysts saw in the move an attempt by Toyota to highlight its position as a global, first-tier company. In conjunction with the listings on the NYSE and the LSE, Toyota adopted accounting practices that make its finances more transparent to investors. The shares offered on the New York exchange were part of the 45 million shares released by three major Toyota stockholders: MITSUI TRUST & BANKING CO., LTD., MITSUI MUTUAL LIFE INSURANCE CO. and CHIYODA FIRE & MARINE INSURANCE CO., LTD.

With drug discovery becoming an ever higher-stakes process for pharmaceutical companies that want to be counted among world leaders, FUJISAWA PHARMACEUTICAL CO., LTD. established a $5 million fund to make equity investments in start-up American drug research ventures. The goal of FUJISAWA INVESTMENTS FOR ENTREPRENEURSHIP, L.P. is to supplement its parent's drug-discovery work with the innovative research ideas or technologies of entrepreneurial businesses. FUJISAWA RESEARCH INSTITUTE OF AMERICA, INC., the firm's U.S. research arm, is in charge of Evanston, Illinois-based FITE.

HIKARI TSUSHIN, INC., which has started to make a name for itself over the last year or so as an investor in American Internet and other high-technology start-ups, joined two California venture capital firms in providing $22.25 million in financing for STOCKPOWER INC. The San Francisco business has created a transaction and security system that enables Fortune 500 companies to sell stock directly to individual investors via their Web sites. StockPower will use the trio's money for continued e-commerce technology and product development as well as for national marketing.

An exchange rate of ¥108=$1.00 was used in this report.

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Its Folsom, California soy sauce plant is not even a year old (see Japan-U.S. Business Report No. 350, November 1998, p. 5), but KIKKOMAN CORP. already has announced aggressive expansion plans for the facility. It will spend $18.5 million to boost capacity by 50 percent to nearly 4 million gallons a year in 2000. In Kikkoman's current thinking, this increase will be the first stage of a $138.9 million, seven- or eight-year process that will raise the Folsom brewery's annual output to 10.6 million gallons. If plans proceed on schedule, Kikkoman will be able to make by the late 2000s 31.7 million gallons of soy sauce a year in the United States, with about two-thirds of the production coming from its original Walworth, Wisconsin plant. The company, which controls roughly half of the American soy sauce market, expects demand to continue to rise by approximately 5 percent a year.

Responding to the backlash in Japan against food products made from bioengineered soybeans, ITOCHU CORP. has decided that almost all of the 165,000 tons to 220,000 tons of soybeans that it buys annually from the United States for tofu and similar products will not be genetically modified. The trader's wholly owned QUALITY TRADERS INC. subsidiary of Cincinnati, Ohio, which was formed in the fall of 1997, is in charge of this project. QTI will use a storage facility it owns in Sharon, Wisconsin to segregate GM-free soybeans that it grows on neighboring land or that it buys from contract farmers from the modified variety. The business already does this for corn. Trading companies handle the bulk of the American-grown soybeans exported to Japan, whether for food products or the far bigger volume that is crushed for oil and feed.

With some recent studies indicating that drinking green tea can be good for a person's health, Japan's top maker of canned and bottled green tea sees a marketing opportunity in the United States. ITO-EN CO., LTD. will open a representative office in New York City in May 2000. According to current plans, it will launch sales of its green tea drinks sometime in 2001 after setting up a marketing subsidiary. Initially at least, Ito-En will contract production out to an American beverage manufacturer, although it will import tea leaves and other materials from Japan as well as from its tea-growing operations in the People's Republic of China and Australia.

An exchange rate of ¥108=$1.00 was used in this report.

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Copper foil manufacturer OAK-MITSUI, INC. opened a $2 million plant at its Hoosick Falls, New York production complex, enabling the joint venture between MITSUI MINING & SMELTING CO., LTD. (49 percent) and ALLIEDSIGNAL INC. (51 percent) to expand output of conductive panels for high-end printed circuit board applications. The new facility is equipped with proprietary ultrasonic welding equipment. It also has high-specification clean rooms to minimize contamination of the copper foil. Oak-Mitsui, in business since 1976, has a plant in Camden, South Carolina as well.

Next spring, NITTO KOHKI CO., LTD. will start U.S. assembly of air conduit couplings for the automotive industry. Recently formed NITTO KOHKI COU-PLING LLC has a roughly $925,900 plant and equipment budget. Its operations will be located in Hanover Park, Illinois, where the Tokyo parent has had a marketing unit for 30 years. Despite this longtime presence, Nitto Kohki's U.S. coupling sales total less than $1 million a year, giving it a negligible share of the market. With an onshore assembly capability, the manufacturer predicts that revenues will climb to $5 million in 2004.

Ten years after acquiring SWISSTRONICS, INC. of Watertown, Massachusetts, SUNCALL CORP. has decided to liquidate the maker of turned metal parts and custom screw machine products. Swisstronics had estimated revenues of $11.1 million in the year through March 1999, but competition from Southeast Asian-made products reportedly has caused net losses in recent years ranging from $185,200 to $277,800.

In back-to-back announcements, MITSUBISHI MATERIALS CORP. said that it was closing two U.S. money-losing operations: CYBEQ NANO TECHNOLOGIES, a San Jose, California maker of chemical mechanical polishing equipment (see Japan-U.S. Business Report No. 360, September 1999, p. 8), and NEOMET CORP. A West Pittsburgh, Pennsylvania producer of rare earth metals, the latter firm was established in 1987.

An exchange rate of ¥108=$1.00 was used in this report.

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Just two months shy of the tenth anniversary of operations in Gainesville, Georgia, KUBOTA MANUFACTURING OF AMERICA CORP. doubled its capacity to manufacture lawn tractors. The expansion, which cost some $19.4 million, covers both the T Series of 12.5-horsepower, 14- hp and 17-hp lawn tractors, which the company has made since 1995, and the TG Series, an 18-hp lawn and garden tractor that was added to the production line in 1997. With the extra capacity, the wholly owned KUBOTA CORP. subsidiary hopes to boost lawn tractor output to $60.2 million in 2000, about twice the level projected for this year. KMA, which is close to employing 600-plus people, was set up to make front-end loaders. It now turns out 2,000 such units a month. It also produces backhoes, a 1990 addition, and roll bars for tractors.

Fifteen months after the Glendale Heights, Illinois marketing subsidiary of machine tool builder IKEGAI CORP. tied up with MITSUI MACHINE TECHNOLOGY, INC. in an attempt to move its business beyond the sale of one or two CNC (computer numerically controlled) lathes and machining centers to a job shop here and there, the company has won its first big contract. ZOLLNER PISTONS LLC of Fort Wayne, Indiana ordered 29 of Ikegai's TC26 two-axis, chucker- type CNC lathes in a deal worth roughly $1.9 million. Most of the machines will be delivered in 2000. Ikegai is estimating its U.S. sales at $18.5 million in 1999.

Although best known for its midsize and large CNC lathes and machining centers, big machine tool manufacturer OKUMA CORP. is trying to develop the low end of the American market with made-in-Japan models. A recently formed division at OKUMA AMERICA CORP., the company's Charlotte, North Carolina production unit, is spearheading the drive. Twelve of Okuma's 40 U.S. distributors now handle low-end products. The firm believes that it can sell between 10 and 20 less expensive CNC lathes and MCs a month despite the fact that this part of the American market has been soft so far in 1999 and the yen's strength makes exports less competitive.

Market newcomer TOYO MACHINERY & METAL CO., LTD. of Hyogo prefecture is introducing through an unnamed distributor its three-model Si Series of computerized plastic injection molding machines. Available with a clamping force of 50 tons, 150 tons or 280 tons, these ultraprecision machines are capable of molding products as thin as 0.08 millimeter with no irregularities in the surface, thanks to automatic adjustment of pressure and resin amount. Moreover, with two motors, the injection speed is double that of conventional plastic injection molders.

The first direct imaging press for the book printing market is the initial objective of a development alliance between press maker AKIYAMA PRINTING MACHINERY MANUFACTURING CORP. and PRESSTEK, INC., a supplier of digital imaging and printing plate technologies for the printing and graphic arts industries. They will bring digital imaging to the Tokyo company's J Print, a compact, multicolor press with a unique linear transfer arrangement that permits printing on both sides of the sheet in one pass. The new J Print DI press will use the Hudson, New Hampshire partner's digital plate media. It is expected to debut in 2000.

KAWASAKI HEAVY INDUSTRIES, LTD. licensed its patented tungsten carbide nozzle for water-jet cutting machines to Latrobe, Pennsylvania-head-quartered KENNAMETAL INC., the North American leader in consumable tools for the metalworking industry. Designed for machines that combine ultra-high-pressure water and fine abrasive powder to cut such hard materials as metal, glass and ceramics, the KHI technology yields nozzles that are 10 to 20 times more wear-resistant than ones made from traditional cemented carbide.

In its first such deal, the U.S. production unit of bearing manufacturer KOYO SEIKO CO., LTD. contracted with AMERICAN AXLE & MANUFACTURING, INC. for three forged products. The two rotating wheel hubs and a wheel spindle will be made at AAM's Tonawanda, New York forging facility and shipped to Koyo Seiko's wheel bearing plants in Orangeburg and Blythewood, South Carolina. Annual production volumes for each part range from roughly 200,000 units to double that amount. One of the rotating wheel hubs is for the BMW Z3 Roadster; the other goes into the Nissan Quest/Mercury Villager van. The wheel spindle is made for the Ford Lincoln LS sedan. It is used as well in Jaguars.

An exchange rate of ¥108=$1.00 was used in this report.

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For large-capacity data capture, GRAPHTEC CORP. released through its Irvine, California marketing subsidiary the WR1000 Series Thermal Arraycorder. The configurable system offers a choice of eight, 16, 24 or 32 data input channels and data capture and storage via an 8- GB hard drive, a 3.5-inch magneto-optical disk drive or a 3.5-inch floppy disk drive. Buyers also can select the interface for computer control, data transmission and data output. WESTERN GRAPHIC, INC. believes that the WR1000, which its parent views as a strategic product, can be as big a seller in the United States as in Japan. At home, the system mainly is used by the automotive industry for collision testing, bench tests and running tests. Here, though, the main WR1000 applications could be turbine inspection and maintenance by utilities and rolling stock testing by railroads.

In an effort to expand U.S. sales of its patient monitoring systems, NIHON KOHDEN CORP. transformed its Irvine, California development operation into a wholly owned subsidiary. NKUS LAB has been given responsibility for developing products, including related software, for the American market. It will contract out production to a U.S. manufacturer. Nihon Kohden's Irvine marketing unit will handle sales and maintenance of these patient monitoring systems and any imported from Japan.

CORE MEDICAL MANUFACTURING INC. has established a marketing subsidiary in Denver to launch sales of its MediAqua handwashing sterilization system for surgical and other hospital personnel. The Shizuoka prefecture manufacturer claims that the U.S.-patented ozone-based system, which contains ozone in the proportion of four parts per million units of water, is effective against a wide range of germs and bacteria. Core also says that MediAqua works more quickly and is less expensive than alternative means of disinfecting hands. In addition, it is environmentally friendly because the ozone in the water decomposes naturally.

An exchange rate of ¥108=$1.00 was used in this report.

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To accelerate attainment of a leadership position in the system-on-a-chip market while continuing its success in memories and other commodity electronics products, NEC ELECTRONICS, INC. set up separate organizational structures for these businesses at its Santa Clara, California headquarters. The new System LSI Division offers SOC solutions ranging from standard products to fully customized ASICs (application-specific ICs). The unit's focus also has been expanded to include the automotive and Windows CE markets as well the existing areas of communications equipment, consumer products, PCs and PC peripherals. In another initiative to support SOC development, NEC Electronics established a U.S. Technology Center to centralize R&D on advanced processors, including parent NEC CORP.'s VR Series of RISC (reduced instruction-set computing) processors as well as on mixed-signal products and processor cores. The new operation is the counterpart to NEC's Japan Technology Center and its European Technology Center. NEC Electronics has made DRAMs and other ICs in Roseville, California since 1984.

At a cost of $25 million, TDK SEMICONDUCTOR CORP. acquired a 25 percent interest in VERTEX NETWORKS INC., a fabless Irvine, California provider of chips for Layer 3 Internet Protocol routing switches. In addition, TDK Semiconductor — a Tustin, California company that specializes in parts for high-speed networking and other data transmission market segments — and Vertex Networks entered into a development partnership. The goal of the alliance is a new generation of highly integrated, low-power Fast Ethernet (10/100 megabits per second) switch and PHY (physical layer) single-chip devices for the local area network and wide area network markets. The first products from the tie-up, which will draw on TDK Semiconductor's experience in low-power PHY technologies, are expected in the next few months. TDK CORP. formed TDK Semiconductor in mid-1996 from what had been the communications products division of SILICON SYSTEMS INC. after selling the rest of that company's chip business to TEXAS INSTRUMENTS INC.

The San Jose, California semiconductor subsidiary of HITACHI, LTD. is collaborating with SILICON WAVE, INC. on a Bluetooth hardware/software solution. Bluetooth is a low-cost, short- range radio interface that connects mobile electronic devices without cables or the line-of-sight and distance limitations of infrared communications. Realizing this capability involves embedding inexpensive short-range transceivers in mobile devices or adapter devices like PC Cards. The Hitachi-Silicon Wave Bluetooth interface will represent the marriage of the Japanese company's 16-bit CISC (complex instruction-set computing) H8S/2238 baseband controller — its first Bluetooth-targeted product — with the San Diego, California venture's RMC (radio modem controller) family. Start-up Silicon Wave will provide the Bluetooth firmware for the H8S baseband controller.

In their latest semiconductor packaging tie-up, SHARP CORP. and AMKOR TECHNOLOGY, INC. have agreed to share their stacked-die chip-scale packaging assembly technologies. The Osaka manufacturer licensed its tape-based stacked-chip packaging know-how to Chandler, Arizona- based Amkor, the world's largest independent IC packaging and test contractor, to make stacked ICs for Sharp and other manufacturers. In turn, Sharp has the right to use Amkor's laminate- based ChipArray technology to package any of its products. The two companies also will work together to enhance stacked CSP technologies and cut the cost of this packaging method. Stacked- chip CSP technology combines flash and static RAM memory devices on top of each other in a package that is not much bigger than the chips themselves. Stacking is key to small cellular phone handsets and other portable wireless devices.

ADVANTEST CORP., the world leader in automatic test equipment for the semiconductor industry, is extremely optimistic about its U.S. market prospects. It is projecting revenues of $463 million in FY 2000 versus sales of some $278 million in FY 1998. To backstop this expansion, Advantest increased its ranks of engineers to 60 from 25. It also formed ADVANTEST TEST ENGINEERING CORP. in Santa Clara, California, which already was home to marketer ADVANTEST AMERICA, INC. and to ADVANTEST AMERICA R&D CENTER, INC. The company sees high-end logic testers as a primary means to bigger sales over the near term, particularly the just-introduced 500-MHz T6672 Logic Test System for high-volume production testing and the companion T6682 VLSI Test System for 1,024-pin testing of system-level ASICs and high- speed processors at data rates of 500 MHz to 1 GHz. Since 1987, Advantest America has had an ATE plant in Buffalo Grove, Illinois.

An exchange rate of ¥108=$1.00 was used in this report.

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Few dot-coms have been more successful than BUY.COM CORP. in attracting financing from SOFTBANK CORP. (see Japan-U.S. Business Report No. 351, December 1998, p. 8). In the third and biggest investment to date by the firm and its affiliates, a syndicate led by SOFTBANK CAPITAL PARTNERS LP purchased $165 million of the Aliso Viejo, California firm's stock. The deal gives the Softbank Group a stake of roughly 31 percent in Buy.Com, which runs seven on- line specialty stores through an e-commerce portal that offer brand-name computer hardware and peripherals, software, books, videos, DVDs, computer games, music and surplus equipment at low prices. Along with the latest cash infusion, Buy.Com and Softbank agreed to bring the Buy.Com business model to Japan as well as to the United Kingdom and elsewhere in Europe.

Two more companies have been added to TRANS COSMOS INC.'s already considerable portfolio of Internet concerns. Its Bellevue, Washington strategic investment and business development unit led an $8.5 million round of follow-up financing for XENOTE, INC. In early 2000, this San Mateo, California Internet company hopes to roll out new services for connecting consumers to the Web. .....TRANS COSMOS INC.'s American investment unit also participated with three new investors and four existing ones in raising $18.8 million of third-round financing for PLACEWARE, INC. The Mountain View, California firm provides Web conferencing software and services that enable corporations to deliver presentations to as many as 1,000 people with just a Web browser and a phone. PlaceWare, which already has signed up more than 240 big-name companies for its services, will use the new money for sales and marketing, branding, product development, partnerships and international expansion.

BEENZ.COM received an additional $20 million in third-round private funding from HIKARI TSUSHIN, INC. and four other investors. The New York City company is the creator of beenz, a Web currency that can be earned by consumers by simply visiting, interacting with or shopping at select Web sites. People then can use their beenz to buy goods and services from participating traders. Hikari Tsushin, the largest distributor of cellular phones in Japan, and are talking about a joint venture to launch a Japanese version of beenz.

The leader in the on-line video gaming business, VR-1, INC., also obtained investment funds from HIKARI TSUSHIN, INC. as well as from two other strategic partners in addition to raising $25 million or so in a second round of private placement funding. The Boulder, Colorado company will use part of this money to underwrite R&D on applications for its VR-1 Conductor networking technology that go beyond on-line gaming and to move into the console video game industry. Some of the new funding also will be used to finance VR-1's operations in Japan, where it purchased a video game developer last spring (see Japan-U.S. Business Report No. 355, April 1999, p. 32).

In the fall of 1996, big materials-handling equipment manufacturer DAIFUKU CO., LTD. bought two automation software companies — AUTO-SOFT CORP. of Salt Lake City, Utah and Bountiful, Utah-based AUTOSIMULATIONS, INC. — so that it could offer customers a complete solution. For reasons that were not disclosed, however, Daifuku has agreed to sell both companies to BROOKS AUTOMATION, INC. The Chelmsford, Massaschusetts firm already is a major supplier of integrated automation solutions for semiconductor, data storage and flat-panel display manufacturers. When the deal is finalized, Brooks will become the top provider of automation software to the semiconductor industry. Daifuku and Brooks plan some type of collaboration in the field of semiconductor factory automation, although the details still must be worked out.

Beta testing is underway of NEC SYSTEMS, INC.'s eBusiness Process Framework. Developed by NEC CORP.'s Boston Technology Center, the system allows companies to integrate via the Internet their external business processes with internal fulfillment processes. eBusiness Process Framework serves as a platform for building and deploying next-generation XML-based business-to-business applications in such areas as supply chain management and customer relationship management. The XML "nerve center" in the framework is supplied by OBJECT DESIGN, INC.'s eXcelon XML e-business information server.

At the same time, San Jose, California-headquar-tered NEC SYSTEMS, INC. released the English-language version of NEC CORP.'s Obbligato II product data management software. Designed for small and midsize manufacturers and product development organizations, Obbligato II comes in three preconfigured packages that provide document management, supply chain optimization and collaborative computer-aided design capability. Each can be implemented separately or together. NEC has been Japan's leading supplier of PDM solutions since 1995.

CANON INC. has moved in the American desktop publishing market with the $90 Canon Publishing Suite. Targeted at computer users of all levels of experience, the package includes Canon Publisher, Canon Draw, Canon Photo Editor, Canon 3D Text, Canon Web Publisher and Canon Screen Grab. Canon Publishing Suite is marketed by Canon Software Publishing, a Costa Mesa, California division of CANON COMPUTER SYSTEMS INC. The unit was formed in 1998 to develop, publish and distribute software primarily in North and South America.

An exchange rate of ¥108=$1.00 was used in this report.

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In a twist on the expected, SONY CORP. is moving into the U.S. market for cable television digital set-top boxes on its own rather than through its alliance with GENERAL INSTRUMENT CORP. — to date the dominant supplier of these products (see Japan-U.S. Business Report No. 352, January 1999, p. 8). The consumer electronics giant won an order valued around $1 billion from CABLEVISION SYSTEMS CORP. to provide a minimum of 3 million next-generation set-top boxes to the cable operator, which serves some 3.4 million homes in the greater New York City area. The new partners plan to develop a platform that will enable Cablevision to deliver enhanced digital services to its subscribers, including video on demand and interactive video gaming as well as high-speed Internet access. The set-top boxes will incorporate Sony's IEEE 1394-compliant, high-speed iLINK interface for connecting PCs and various other digital devices.

NIPPON INVESTMENT & FINANCE CO., LTD., the venture capital arm of DAIWA SECURITIES CO., LTD., and SUMITOMO ELECTRIC INDUSTRIES, LTD. were part of an international group of venture investors that raised $21 million in equity financing for WAVESPLITTER TECHNOLOGIES, INC. The Fremont, California manufacturer has developed a DWDM (dense wavelength-division multiplexing) architecture that addresses bandwidth bottlenecks in the metropolitan access market rather than in the long-haul market, the original target of DWDM technology. WaveSplitter's modular, all-fiber-optic, cost-effective line of DWDM products consists of the Wave-Xpander, the WaveSplitter and the WavePump.

The company that pioneered the development of Internet-based messaging servers for reliable, secure and cost-effective electronic mail services has won the financial endorsement of NISSHO ELECTRONICS CORP. The distributor joined a group of existing and new investors in providing $21 million in third-round funding for MIRAPOINT, INC. of Cupertino, California. The company, which launched its first Internet e-mail server appliance last December and now has three product lines on the market, will use the money in part to support its product development initiatives. Mirapoint also has earmarked money for worldwide sales programs. One is directed at Japan, where Nissho Electronics will market the full complement of Mirapoint's dedicated messaging appliances. A system for 300 users will list for $20,400, while one for an unlimited number of business customers will go for $58,300.

A high-flying NTT MOBILE COMMUNICATIONS NETWORK, INC. is strengthening its research capabilities to ensure that it remains at the forefront of the cellular mobile communications business. In early November, it will establish a U.S. holding company in Palo Alto, California. Under NTT DOCOMO USA, INC. will be DOCOMO COMMUNICATIONS LABORATORIES USA, INC. Its mission is to identify existing know-how that can be adapted for Internet-capable mobile phones, such as the iMode phones currently available from NTT DoCoMo, as it is known in Japan, and the forthcoming third generation of wireless devices (IMT-2000) and to explore new mobile Internet and other advanced software technologies. In time, DoCoMo Labs USA could employ as many as 50 people. The holding company also will have under it wing DCM INVESTMENT, INC. NTT DoCoMo set up this Boston-based firm in March 1996 to invest in communications-related companies in the United States and venture funds.

In a deal valued at $140 million, SANYO FISHER (U.S.A.) CORP. of Chatsworth, California is supplying Internet-capable CDMA (code-division multiple access) cellular phones make by parent SANYO ELECTRIC CO., LTD. to the Sprint PCS unit of SPRINT CORP. The Sanyo SCP-4000 is equipped with a microbrowser that gives users Internet access via the handset's display. The phone went on sale October 1 at Sprint PCS and Radio Shack stores across the United States.

By next spring, subscribers to NIPPON IDOU TSUSHIN CORP.'s cdmaOne digital mobile phone service should be able to use their phones in North America. IDO's handsets feature Japan's first international roaming capability, which makes them work overseas using the same numbers as in Japan. The company will have to tie up with U.S. cellular phone operators to implement the new benefit.

Two Internet services providers have announced plans to expand their transpacific Internet backbones in just the latest attempt to accommodate surging traffic. KDD CORP. will upgrade its Japan-U.S. backbone to 555 megabits per second from 400 Mbps. INTERNATIONAL DIGITAL COMMUNICATIONS, INC. has the more ambitious goal of quintupling the capacity of its Japan- U.S. backbone to 1 gigabit per second within 2000.

Three more American TV broadcasting facilities have installed SONY CORP.'s NewsBase nonlinear, server-based news production system, including DNE-1000 digital news-editing workstations with Sony's ClipEdit software. San Antonio-based Texas News Channel, Texas Cable News of Dallas and KHON-TV in Honolulu join 12 other broadcasters that have been sold on the significant time savings for newsroom operations that the Sony equipment provides.

The restructuring plan that SONY CORP. announced last spring has claimed a second casualty among the multinational's American operations. This past summer, the company announced that it was exiting the North American wireless phone handset market (see Japan-U.S. Business Report No. 359, August 1999, p. 11). Now, a SONY ELECTRONICS, INC. broadcasting equipment plant in Boca Raton, Florida is being closed in a cost-saving move. Sony had produced professional audio-visual equipment in Florida since 1982. Most recently, the Boca Raton factory made digital studio cameras for TV networks and commercial stations as well as editing equipment. Production of these products will be shifted to other Sony factories, primarily in the United Kingdom and Japan. The closure cost the jobs of 200 people.

An exchange rate of ¥108=$1.00 was used in this report.

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The global leader in bicomponent fibers, CHISSO CORP., and the world's top maker of polypropylene staple fiber, HERCULES INC.'s wholly owned FIBERVISIONS, L.L.C. subsidiary, have agreed to establish a company to develop and market bicomponent fibers for use in hygienic and other applications on an international basis excluding Japan. Chisso and FiberVisions will combine all of their bicomponent fiber operations and activities into equally owned ES FIBERVISIONS, which will have its headquarters in Wilmington, Delaware. The Japanese partner will license its technology to the joint venture for the production and sale of bicomponent fibers. ES FiberVisions will have access to Chisso's manufacturing facilities in Moriyama, Shiga prefecture and China and to FiberVisions' factories in Athens, Georgia and in Denmark. Hercules apparently was the initiator of the joint venture, seeing it as a way to expand FiberVisions' bicomponent fiber business without committing additional capital to it. ES FiberVisions is expected to be operational January 1, 2000.

An exchange rate of ¥108=$1.00 was used in this report.

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The future of SUMITOMO RUBBER INDUSTRIES, LTD., at least as a tire manufacturer, now is largely in the hands of GOODYEAR TIRE & RUBBER CO. On schedule, the two formed a wide- ranging global alliance under which the Akron, Ohio company took control of SRI's Dunlop tire operations in North America and Europe (see Japan-U.S. Business Report No. 354, March 1999, p. 11). Goodyear also will become the second-largest shareholder in Sumitomo Rubber with a 10 percent interest and a minority owner of two tire manufacturing companies in Japan. To equalize the value of the various transactions, Goodyear, once more the world's number-one tire producer, made a cash payment of $936 million to SRI.

With automotive makers using more aluminum in their cars and trucks, OGIHARA CORP. is spending some $35 million to enable its plant near Birmingham, Alabama to produce body panels and other stamped aluminum parts. The $100 million factory opened roughly two years ago to make all of the steel body panels for the Mercedes-Benz M-class sport-utility vehicle produced in nearby Vance, Alabama and, more recently, in Austria. It now employs about 320 people. Ogihara will install a $20 million tandem stamping press line that can stamp parts in both steel and aluminum. At least for now, the company's Howell, Michigan plant, which has been in business since 1987, will continue to turn out just steel stampings for its many customers. Ogihara had U.S. sales of $294 million in 1998.

A $46 million expansion is underway at AISIN AUTOMOTIVE CASTING, INC. in London, Kentucky. Operational since April 1998, the AISIN SEIKI CO., LTD. company now makes oil pumps and other cast aluminum engine parts as well as timing chain covers primarily for the North American operations of TOYOTA MOTOR CORP. The new capacity, scheduled to go onstream in July 2001, will be used to make transmission cases for TOYOTA MOTOR MANUFACTURING WEST VIRGINIA, INC. (see Japan-U.S. Business Report No. 360, September 1999, p. 10). The expansion will create between 120 and 130 jobs at Aisin Automotive Casting. It now employs more than 200 people.

DENSO MANUFACTURING TENNESSEE, INC. will add coils for electronically controlled ignition systems (which have no distributor) to the product line at its Athens factory in March 2001. The expansion will require an investment of $24 million. Capacity production of 350,000 units a month should be reached by mid-2001. All of the output initially will go to TOYOTA MOTOR CORP.'s North American operations. The start of direct ignition system coil production will generate another 50 jobs at the factory, which now has close to 450 people on its payroll. The expansion also is expected to double projected 1999 sales of $130 million. These are derived from the production of injectors and oxygen sensors. Denso Manufacturing Tennessee's main plant, opened in 1990, is located in Maryville. It employs more than 2,300 people to turn out starters, alternators and other electric and electronic parts as well as instruments gauges for Toyota, HONDA MOTOR CO., LTD.'s North American assembly plants and DAIMLERCHRYSLER AG. DMT, a DENSO CORP. company, predicts that the Maryville complex will have revenues of $1 billion in 1999.

Automotive speaker maker ONKYO AMERICA, INC. of Columbus, Indiana is buying TOP SOURCE AUTOMOTIVE, INC. from TOP SOURCE TECHNOLOGIES, INC. The Palm Beach Gardens, Florida company's product line includes the MotorCheck On-Site Analyzer, which it calls an oil analysis minilab in a box, and proprietary overhead sound systems. The ONKYO CORP. subsidiary is paying $8.5 million in cash in addition to the $500 million it spent in July to acquire a 4.9 percent stake in TSA, plus $1 million in convertible preferred Onkyo America stock.

The Plymouth, Michigan partnership between NOK CORP. and Germany's FREUDENBERG & CO. has won a $1 billion contract from FORD MOTOR CO. for a complete engine sealing system for 2 million vehicles a year starting in 2001. The first such contract awarded by the number-two U.S. automotive maker will run for eight to 10 years, giving a 10 percent or even larger boost to FREUDENBERG-NOK's annual sales. The turnkey engine sealing system, which includes roughly 80 parts, will be used in the new, four-cylinder-engine Ford Focus.

In another contract award, FORD MOTOR CO. named TOKICO, LTD. and its own Visteon Automotive Systems unit to supply a new type of suspension system for luxury vehicles set to debut in the 2002 model year. The system uses electronic control technology to dampen vibrations from the road surface. TOKICO (USA), INC. will assemble the main suspension system; Visteon, the world's second-largest automotive parts manufacturer, will provide the electronic controllers. Berea, Kentucky-based Tokico figures that the order will add approximately $925,900 to its monthly revenues once deliveries start in 2001. The contract is just the latest one that Tokico has received from the big U.S. vehicle builder (see Japan-U.S. Business Report No. 355, April 1999, p. 11).

Automatic dimming rearview mirrors made by GENTEX CORP. are standard equipment on the Toyota Avalon sedan assembled by TOYOTA MOTOR CORP.'s Georgetown, Kentucky plant. The Zeeland, Michigan company's Night Vision Safety mirror, which also is found on the Toyota Camry Solara coupe built in Canada, uses a combination of sensors and electronic circuity to detect glare from trailing vehicles and automatically darken the mirror to eliminate glare.

FUJITSU TEN LTD.'s Torrance, California marketing unit has released a mapless vehicle navigation system. The voice-interactive Eclipse Commander uses speech-recognition and interactive technologies from PRONOUNCED TECHNOLOGIES, LLC of Reseda, California that allow drivers to enter commands by voice. The system determines a route by asking the driver a series of brief questions. It then retrieves route information from NavTech-brand digital map CDs supplied by NAVIGATION TECHNOLOGIES CORP. of Rosemont, Illinois. Travel directions are both heard through the stereo system and displayed. The voice capabilities of the Eclipse Commander, which costs $300 without the CD player, can be used to dial cell phones, control vehicle electronics and operate a vehicle's audio system. Fujitsu Ten is projecting sales of 800 Eclipse Commanders a month.

Every seat aboard 17 of JAPAN AIRLINES CO., LTD.'s 747-400 and 747-300 aircraft will be equipped with an in-flight entertainment system from the Rockwell Collins unit of ROCKWELL INTERNATIONAL CORP. The Cedar Rapids, Iowa division's Total Entertainment System gives each passenger a screen and access to several channels of video programming that they can control. The contract could be expanded to 28 747s. JAL is the ninth major airline to select the Rockwell Collins system for in-flight entertainment on their wide-body planes.

An exchange rate of ¥108=$1.00 was used in this report.

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For better or for worse, JAPAN TOBACCO INC. now owns what were the non-U.S. tobacco operations of RJR NABISCO HOLDINGS CORP. (see Japan-U.S. Business Report No. 355, April 1999, p. 11). It ended up paying RJR Nabisco slightly less than $7.8 billion for these businesses. JT also repaid a $5 billion bridge loan used to finance part of the purchase. Already, though, the company has downgraded the expected near-term business results of JT INTERNATIONAL BV, in part because of weak sales in Eastern Europe. Sales over the May- December period now are projected at $3.3 billion compared with the $4 billion estimated earlier, with earnings before interest, taxes, depreciation and amortization predicted at $250 million, down from an initial $430 million.

Beginning in November, SEKISUI JUSHI AMERICA, INC. will make plastic-covered steel garden poles at a new plant in Cartersville, Georgia. The $3.2 million facility is adjacent to the SEKISUI JUSHI CORP. subsidiary's plastic strapping band factory. The poles, in diameters of 8mm and 11mm, will be shipped to a Tustin, California distributor for sale to home centers. Sekisui Jushi America believes that the new product will add $3 million to its annual revenues in the first year and about $5 million after three years.

Osaka's NIPPON PILLAR PACKING CO., LTD. formed a subsidiary in California to boost U.S. sales of its fluorocarbon resin connectors and other mechanical seals. Marketing will be targeted at semiconductor manufacturers and other producers that require products with high chemical and leak resistance for use in their operations. Nippon Pillar is projecting American sales of $2.3 million in FY 1999 and $3.1 million in FY 2000.

Although all the details have not been finalized, MITSUBISHI HEAVY INDUSTRIES, LTD. will be a key Japanese industry participant in the work on a sea-based theater missile defense system that Washington and Tokyo agreed to research in mid-August. The five-year or six-year transpacific project will focus on an improved version of the SM-3 missile used in the U.S. Navy's Theater Wide missile defense program. MHI already has received an $8.3 million government contract keyed to Japan's part of the program. That involves the development of a lightweight nose cone, an infrared search and tracking sensor, a kinetic warhead equipped with course correction and a propulsion system for a second-stage rocket. MHI will work closely with RAYTHEON CO.'s Defense Systems unit in Tucson, Arizona, the prime contractor for the Navy's Theater Wide system.

An exchange rate of ¥108=$1.00 was used in this report.

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American Companies in Japan


One of the first companies to take advantage of Japan's decision to allow the sale of oral contraceptives (see Japan-U.S. Business Report No. 358, July 1999, p. 14) was the Wyeth- Ayerst Laboratories division of AMERICAN HOME PRODUCTS CORP. Its WYETH (JAPAN) LTD. subsidiary is marketing Tridiol 21 (levonorgestrel and ethinyl estradiol tablets), which contains the world's most prescribed low-dose oral contraceptive regimen. It is sold in the United States as Triphasil.

The number of people in Japan who have HIV is relatively limited. By one count, however, 14 treatments have been approved for sale by the Health and Welfare Ministry. Two of the latest were cleared under MHW's recently introduced fast-track evaluation process for innovative HIV therapies. One is Prozei (amprenavir), a twice-daily HIV protease inhibitor that is indicated in combination with other antiretroviral agents. Known outside Japan by the trade name Agenerase, Prozei was discovered by VERTEX PHARMACEUTICAL INC. It is available through the Cambridge, Massachusetts firm's local development and commercialization partner KISSEI PHARMACEUTICAL CO., LTD. (see Japan-U.S. Business Report No. 359, August 1999, p. 14). The other new HIV treatment is a once-daily nonnucleoside reverse transcriptase inhibitor that was discovered by MERCK & CO., INC. but is sold in the United States by the pharmaceuticals subsidiary of E.I. DUPONT DE NEMOURS & CO., INC. as Sustiva (efavirenz). In Japan, it is on the market as Stocin through Merck affiliate BANYU PHARMACEUTICAL CO., LTD. It, too, is recommended in combination with other antiretroviral agents. Banyu expects sales of Stocin to be around $2.8 million a year, or about the amount of business it does with Crixivan (indinavir sulfate), another Merck drug that was the first HIV protease inhibitor approved for sale in Japan.

For reasons that were not detailed, the subsidiary of BRISTOL-MYERS SQUIBB CO. and YOSHITOMI PHARMACEUTICAL INDUSTRIES, LTD. ended their comarketing arrangement on two drugs. One is BMS's ZERIT (stavudine, d4T), a thymidine nucleoside analog for the treatment of HIV. Yoshitomi Pharmaceutical had ZERIT sales of $5.6 million in FY 1998. That equaled BMS's revenues from the sale of Serotone, a drug for controlling nausea and vomiting that was discovered and commercialized by Yoshitomi Pharmaceutical and JAPAN TOBACCO INC.

One of the world's biggest clinical contract research organizations, COVANCE INC. of Princeton, New Jersey, has teamed up with INA RESEARCH INC., a Nagano prefecture preclinical CRO, to offer pharmaceutical companies a comprehensive array of third-party testing services. The collaborative effort could significantly shorten time to market for viable therapies. Ina Research will be responsible for animal testing, while Covance will handle Phase I clinical trials as well as the first part of Phase II testing. The partners, which plan to open consulting and marketing offices in Tokyo and Osaka, predict that first-year revenues could reach as much as $23.1 million.

An exchange rate of ¥108=$1.00 was used in this report.

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Business prospects in the supercomputer field seem to be improving for SILICON GRAPHICS, INC.'s subsidiary, both on its own and through a new alliance with NEC CORP. (see Japan-U.S. Business Report No. 360, September 1999, pp. 12-13). In its latest victory, SGI retained TOSHIBA CORP. as a high-performance computing customer, moving the electronics giant from the Cray T916 vector supercomputer it had used since 1996 to a SGI Origin 2000 scalar machine. Equipped with 32 processors, the system, including auxiliary equipment, cost $13.9 million. Toshiba reportedly was persuaded to stay with SGI in part because of the inducements the company was offering to make the switch to a scalar supercomputer but also due to the easy expandability of the SGI Origin 2000 and a change in the types of applications it was running on its high-performance computer. Toshiba apparently is so satisfied with SGI and its equipment that it plans to order a 100-processor SGI Origin 2000 next year.

A massively parallel Compaq NonStop Himalaya S700-A server or a Compaq ProLiant 1600 PC server is at the heart of the round-the-clock settlement system for debit-card transactions that COMPAQ COMPUTER CORP. and TOYO INFORMATION SYSTEMS CO., LTD. are marketing to retailers. TIS provided the software for the system, which is said to be priced at about half of what competitors charge for a similar capability. The standard CardWorks S package for big store chains lists for $553,700, while the base configuration of the CardWorks NT version for small and midsize retailers goes for $180,600. Compaq and TIS expect their initial collaboration to produce revenues of $27.8 million in the first year.

In its second such move, DELL COMPUTER CORP.'s subsidiary released a PC tailored for customers of NIKKO BEANS INC., the start-up on-line brokerage affiliate of NIKKO SECURITIES CO., LTD. The space-saving model is powered by a 400-MHz Celeron processor. It lists for $1,600 without a monitor. Dell will handle installation and provide support. It has a similar arrangement with MATSUI SECURITIES CO., LTD. (see Japan-U.S. Business Report No. 356, May 1999, p. 13).

The effort by GATEWAY 2000, INC. to extend its customer base beyond individuals and small and midsize businesses has paid at least one dividend (see Japan-U.S. Business Report No. 357, June 1999, pp. 14-15). The direct marketer has a deal to supply its ALR series of Windows NT servers to recently established regional communications services providers NIPPON TELEGRAPH AND TELEPHONE EAST CORP. and NIPPON TELEGRAPH AND TELEPHONE WEST CORP. for use in the computer telephony integration systems that they market. These CTI solutions can serve up to 24 PCs and 20 phone lines. NTT East and NTT West have priced a system with an ALR server, 10 multifunction phones and four ISDN (integrated services digital network) lines are $24,100.

In the hope of signing up 1 million new customers for its OCN Internet service over the next two years, long-distance/international carrier NTT COMMUNICATIONS CORP. tied up with IBM JAPAN LTD. to offer potential subscribers a low-cost package deal. People willing to sign a three-year service agreement can get an Internet-ready version of the Aptiva 20J desktop and 100 hours of on-line time for approximately $37 a month, although this charge does not include telephone fees. At the end of the contract, subscribers will have the option to renew at the same price and get a new PC, remain an OCN customer for $26 a month or cancel their contract at a cost of $280.

IBM JAPAN LTD. has made several other moves recently to ensure that it capitalizes on the market's growth now and down the road. In an initiative that goes beyond a new HEWLETT- PACKARD JAPAN LTD. program (see Japan-U.S. Business Report No. 360, September 1999, p. 13), the firm will provide hardware, software and technical support free of charge to at least 10 promising Internet start-ups. Successful candidates will receive as much as $925,900 in IBM Japan help over three years, including servers and desktop PCs. The selection process should be finished by the end of the year. At the same time, IBM Japan is investing more effort in reaching the huge number of small businesses in Japan. That includes opening the Small Business Center on its Web site. Here, the company offers complete solutions, such as a Netfinity 1000 server running the Linux operating system packaged with all the software that a smaller firm might require for $6,400.

In a potentially more significant move, IBM JAPAN LTD., which generated some 60 percent of its 1998 revenues of $13.6 billion from software and services, will expand staffing at its 16 service-oriented subsidiaries over the next year. The company hopes to add 1,000 technicians and systems engineers to the 3,200 or so already employed by these affiliates to handle what it predicts will be a continued upswing in corporate outsourcing of information technology operations. This already is a big business for IBM Japan, with revenues projected to hit $926 million in 2000. .....IBM JAPAN LTD. also will open a customer support center in Naha, Okinawa prefecture next April. It will have 50 employees initially, but as many as 300 people could be on the payroll in 2001.

Visitors to GATEWAY 2000, INC.'s Japanese Spot Shop Internet site, which was opened last April, soon will find a broader selection of products — four times as many, according to plans. The company is boosting its lineup of peripherals, software, DVD movie titles and Gateway logo products. It also will add computer-related furniture and other office products. Gateway executives say that the site not only has had a high number of hits but, more importantly, has produced strong sales.

INTERNATIONAL BUSINESS MACHINES CORP. has packaged the performance-enhancing technology of its fifth and sixth generations of high-end S/390 enterprise servers into a compact, lower-cost server designed to meet the current and future e-business requirements of small and midsize companies and corporate departments. The three models of the S/390 Multiprise 3000 enterprise server, which run all of IBM's enterprise operating systems, incorporate the input/output and storage subsystems of the S/390 for greater throughput, plus 12 slots for parallel or ESCON adapters for high-speed access to peripherals. They also integrate 100/10-Mbps Ethernet for LAN connectivity and come with seven industry-standard slots for additional options. In two other adaptations for e-business applications, the Multiprise 3000 can be equipped with as much as 4 GB of main memory and up to 792 GB of internal storage. Packaged solutions are available as well to help companies tap the potential of e- business. IBM JAPAN LTD. has priced the Multiprise 3000 from $624,000.

In another worldwide release, INTERNATIONAL BUSINESS MACHINES CORP. introduced the 64- bit RS/6000 Enterprise Server Model S80, which it claims is the world's fastest e-business server. System improvements on existing S family servers include 24-way SMP (symmetric multiprocessing) capability, 64-GB memory capacity and a new backplane that nearly quadruples internal bandwidths. Performance is boosted further by the use of 450-MHz RS64 III RISC processors, each with 8 MB of L-2 cache and featuring IBM's copper interconnect technology, and the optimization of the AIX 4.3.3 operating system for e-businesses applications. S80 pricing in Japan is around $490,700. .....The RS/6000 line of Unix servers also has a new member developed specifically for Internet and application services providers. The low-cost ($5,500 in Japan), high-density, rack-mount Model B50, which runs AIX 4.3.3 as well, features the 375-MHz PowerPC 604e processor with 1 MB of L-2 cache, up to 1 GB of main memory and a maximum 36.4 GB of internal storage capacity. As many as 20 B50 servers fit into an industry-standard 19-inch rack.

Going after the workgroup server market, particularly Unix customers with compute-intensive requirements, SILICON GRAPHICS, INC.'s subsidiary put on the market the SGI 2100 server. It is a true 64-bit system, featuring not only two to eight R10000 MIPS RISC processors but also this architecture in its I/O system, the file system and the IRIX operating system. Moreover, like the SGI Origin 2000 series of servers, the SGI 2100 leverages the company's ccNUMA (cache-coherent nonuniform memory access) technology to eliminate memory bottlenecks. These and other enterprise-caliber capabilities are priced aggressively, with an entry-level SGI 2100 starting at $98,200.


The first product based on SUN MICROSYSTEMS, INC.'s Hot Desk software technology has arrived in Japan as well as in other markets. The book-sized Sun Ray 1 is the industry's first true enterprise appliance, Sun says, because all computing resources are accessed from the Sun Ray enterprise server software residing on Sun Enterprise or Sun workgroup servers. This setup has numerous benefits for a company, starting with zero administration requirements since all software upgrades, resource management and configuration takes place on the server. For workgroup users, the Sun Ray appliance offers such advantages as instant access to any application or information on the server and mobility via smart-card technology. Sun's subsidiary priced the device, which comes with 10/100BaseT connectivity, a smart-card reader, two USB ports, a keyboard and a mouse, at $535, including a monitor. The Sun Ray enterprise server software costs $825.

Engineers who are nearing system limits in running electronic design automation and mechanical design automation applications have a way out. HEWLETT-PACKARD CO. released worldwide the HP VISUALIZE J7000, a four-way SMP system that delivers what is said to be a workstation-record 8 GB of RAM memory. The technical workstation is built around HP's 64- bit PA-8500 RISC processor operating at 440 MHz and deploys the power of the 64-bit HP-UX operating system. A variety of graphics packages is available. HEWLETT-PACKARD JAPAN LTD. priced a typical low-end configuration at $120,400, which includes four processors, 4 GB of internal memory, 18 GB of disk storage, a monitor and VISUALIZE EG graphics.

Redefining the low end of its Unix lineup, HEWLETT-PACKARD CO. announced for world markets a family of mission-critical, Internet-optimized HP 9000 Enterprise Servers. The two HP 9000 L-Class products — the dual processor-capable L1000 and the L2000, which can support as many as four 360-MHz or 440-MHz PA-8500 processors — are designed to enable ISPs and midmarket firms to deploy emerging e-services across the Internet. Among other innovations, the entry-level systems run an Internet-enabled version of HP-UX 11. HEWLETT-PACKARD JAPAN LTD. priced the L1000 model from $29,900; the L2000 model starts at $40,000. As is typical with HP 9000 servers, HITACHI, LTD., MITSUBISHI ELECTRIC CORP., NEC CORP. and OKI ELECTRIC INDUSTRY CO., LTD. also will sell the L-Class machines on an OEM basis.

The Linux bandwagon rolls on in Japan as well as in the United States. For instance, COMPAQ COMPUTER CORP. introduced through its direct sales channel six Prosignia servers with the freeware version of Unix preinstalled. The high-end Prosignia Server 740 Model 660 uses a 600-MHz Pentium III processor. It lists for $3,200 or so. The least expensive Linux machine, the Prosignia Server 720 Model 6450, goes for $1,800. It is powered by a 450-MHz Pentium II. Buyers of these build-to-order systems can get a year of access to a help desk for $1,700. .....Likewise, DELL COMPUTER CORP.'s affiliate is marketing Precision workstations with Linux, although customers have to install the open-source operating system themselves since these systems come with Windows NT installed. It opted to use the version from San Francisco's TURBOLINUX, INC. The Japanese-language edition of TurboLinux 4.0 costs $65, while the localized version of TurboLinux Pro 4.2 goes for $220.

The SGI 1000 server family that SILICON GRAPHICS, INC. recently announced has the distinction of being the first Intel Architecture-based enterprise server introduced by the big Unix vendor, which earlier had released Windows NT workstations (see Japan-U.S. Business Report No. 353, February 1999, p. 13). The initial product in the new line, the four-way SGI 1400L workgroup and application server, also is the company's first enterprise-class Linux server. The SGI 1400L, which employs 500-MHz or 550-MHz Pentium III Xeon processors, comes preloaded with the SGI Linux Environment with Red Hat Linux 6.0.

COMPAQ COMPUTER CORP.'s subsidiary has brought the latest in Pentium processor technology to its ProLiant enterprise-class and workgroup servers. The ProLiant 5500 server for large business and enterprise customers now can be equipped with one to four 550-MHz Pentium III Xeon chips for a minimum of $12,700. At the same time, the performance-boosting power of the 600-MHz Pentium III is available in a number of dual processor-capable ProLiant servers. These include the ProLiant 3000 tower, which starts at $8,500, as well as the rack-mountable ProLiant 1850R for ISPs, corporate data centers and remote sites and its workgroup mate, the $7,800-and-up ProLiant 1600R. Compaq also introduced the next-generation Pentium III technology in its ProLiant 800 tower, which, at a starting price of $4,300, is the firm's most affordable workgroup server, and in the ProLiant 1600 tower for more demanding workgroups and remote/branch sites. Compaq used the switchover to the 600-MHz Pentium III to tweak certain features of some ProLiant servers.

The 600-MHz Pentium III processor also is an option on the mainstream Windows NT-based HP Kayak XU workstation line for as little as $5,000. This family, which offers a choice of 2D and OpenGL 3D graphics, is aimed at such markets as digital content creation and mechanical design. HEWLETT-PACKARD JAPAN LTD. used the launch to slash prices on the HP Kayak workstation series that it offers by as much as 27 percent. Now, all models cost less than $9,300. It paired this change with cuts in the prices of the HP VISUALIZE Personal Workstations that were introduced in April (see Japan-U.S. Business Report No. 356, May 1999, p. 15). Sales of these Windows NT machines for technical computing, which share the HP VISUALIZE fx graphics architecture of the Unix version of the line, have fallen far short of expectations. In order to raise shipments closer to the forecast rate of 7,000 units a year from the current level of 4,800 or so annually, HP Japan trimmed the price of the X-Class model with a 550-MHz Pentium III Xeon processor and 256 MB of internal memory by 10.2 percent to $13,800 and lowered the cost of a P-Class model with a 600-MHz Pentium III chip and 128 MB of system memory to $8,500, a 15.2 percent reduction.

COMPAQ COMPUTER CORP.'s marketing unit adopted a similar strategy for its Deskpro EN Series, which is designed for enterprise customers that are interested in a combination of value, manageability, serviceability and performance for their client systems. It made the 600-MHz Pentium III processor available in this line at prices, including a monitor, that begin at $3,000. At the same time, it cut the cost of the 27 existing Deskpro EN desktop, minitower and small form-factor configurations by as much as 18 percent.

Increasingly, the competition in the desktop segment of the PC market is between firms trying to outdo each other in terms of offering the most performance at the lowest price. COMPAQ COMPUTER CORP. has two entries in this sweepstakes. For corporate buyers, it is offering a Deskpro EC Series model for as little as $925. That gets a machine with a 433-MHz Celeron processor, a 4.3-GB Ultra ATA hard drive and a 15-inch monitor. The same money also buys the Prosignia Desktop 320 through Compaq's direct sales, build-to-order channel. In fact, people who do not need to buy a monitor can obtain this system, which also features the 433-MHz Celeron processor, for as little as $740.


IBM JAPAN LTD.'s latest candidate is a new member of the low-cost, Japan-only Aptiva E line of desktop PCs introduced in June. Included in the $925 price of the Aptiva 20J, which runs off a 400-MHz AMD-K6-2 processor and features 64 MB of internal memory, are a monitor, a modem, LAN capabilities, and word-processing, spreadsheet and voice-recognition software. The Aptiva 20J has proved to be a heavyweight contender in the ¥100,000 and under desktop category. In fact, initial demand for the machine was so strong that IBM Japan had to boost weekly production to 10,000 units from the planned 6,000 units.

IBM JAPAN LTD. also is trying to ride the wave of interest in the corporate world in space- saving designs. It added the four-model PC 300PL Slim line to the Japan-only PC 300 family. The new systems, which are powered by a 433-MHz Celeron processor, start at $1,600. Simultaneously, the company put on the market four more models in the volume PC 300GL series of desktops and minitowers. Pricing of these Pentium III/Windows 98 machines begins at $3,000.

A number of American PC vendors recently have buttressed their lineup of low-cost notebooks or at least their entry-level models in an effort to broaden their market reach. COMPAQ COMPUTER CORP., for instance, is marketing through its direct sales channel the value- oriented Prosignia Notebook 150 for small businesses. The base configuration is priced at less than $1,600. That covers a 380-MHz AMD-K6-2 processor, 32 MB of internal memory, a 4- GB hard drive, a 24X CD-ROM drive, ATI Rage Pro 3D graphics, a one-touch Internet access button, a 12.1-inch active-matrix TFT display and Office 2000. .....For budget-conscious corporate notebook users who want an all-in-one design, COMPAQ COMPUTER CORP. is offering the Armada 1500C Basic for under $1,900. Running off a 400-MHz Celeron processor and equipped with a minimum of 32 MB of system memory, this unit features simultaneous access to the diskette drive, the 4-GB SMART hard drive, the 24X CD-ROM drive, the 56K V.90 modem and the AC adapter. It also has a dual-function bay for either a diskette drive or a second battery.

Other American PC makers are trying to exploit the strong demand in Japan for slim, lightweight notebooks. DELL COMPUTER CORP.'s latest product targeted at the business end of this market is the Latitude CS R400XT. This 4.3-pound machine comes standard with the fast 400-MHz mobile Pentium II chip, a 13.3-inch active-matrix TFT screen with XGA resolution, 64 MB of RAM and a 4.8-GB hard drive for $2,500. HEWLETT-PACKARD JAPAN LTD. countered by releasing the OmniBook 4150, which weighs less than six pounds and measures just 1.4 inches thick. This performance-oriented notebook, which uses a 366-MHz mobile Pentium II processor, offers the choice of a 13.3-inch XGA active-matrix TFT display for $4,200 or a 14.1-inch screen for $4,800.

"Mobile Desktop" is how DELL COMPUTER CORP. describes its new Inspiron 7500 Series. Much of the desktop technology for the two models available in Japan is fairly standard: a 433-MHz Celeron or a 400-MHz Pentium II processor, 32 MB of SDRAM memory or twice that amount and a 4.8-GB or a 10-GB Ultra ATA hard drive. However, the Inspiron 7500 comes with a 15- inch active-matrix TFT screen with either XGA resolution or super XGA+ resolution (1400 x 1050 pixels). These notebooks also have Dell's new MegaBay, which gives users as much as 75 GB of total hard-drive capacity when using optional second and third hard-drive modules. The two units are priced at $2,200 and $3,000, respectively. .....Of course, GATEWAY 2000, INC. might argue that its rival has no monopoly on this description since it also fits the latest Solo 9300 models. These thin, lightweight products offer a choice of processors (360-MHz and 400-MHz Celeron chips or a 400-MHz Pentium II engine), 64 MB of system memory, a 4-GB or a 6.4-GB hard drive, a modular 24X CD-ROM drive or a modular 4X DVD-ROM drive, and a 14.1-inch or a 15-inch XGA active-matrix TFT display. Moreover, the Solo 9300 line is IEEE 1394-compatible. Pricing runs from $2,800 to $3,700.

APPLE COMPUTER, INC. has staged a major comeback in Japan as well as in the United States. It now is banking on an updated desktop line and a new, distinctive-looking notebook computer to keep momentum on the upswing. The sleek Power Mac G4 desktop series delivers processing improvements on its G3 predecessor since the line's new 400-MHz, 450-MHz and 500-MHz PowerPC G4 chips contain a so-called Velocity Engine execution unit that gives speeds a boost. As usual, desktop publishers are expected to be major buyers of the new machines, but the aggressive pricing of the Power Mac G4 series could win Apple some first-time customers. Pricing is open, but purchased directly from the company, the G4s range from $1,800 for the 400-MHz model to $4,000 for the 500-MHz machine.

The iBook also is coming to Japan. If the success of the home-oriented iMac desktop is any indication, the new portable should be another big hit for APPLE COMPUTER, INC. Housed in a semitransparent, clamshell-like case available in tangerine or blueberry, the iBook is powered by a 300-MHz PowerPC G3 processor. It has 32 MB of system memory, 3.2 GB of hard-disk storage, a 24X CD-ROM drive, a 12.1-inch active-matrix TFT display and a six-hour lithium- ion battery. The iBook, which has a suggested retail price of $1,800, also is the first computer designed specifically to handle wireless networking. Targeted at the consumer and educational markets, the iBook will be sold on launch by 31 companies, including PC volume retailers.

In what certainly is good news for e-business companies and ISPs, Internet caching servers have arrived in Japan. The first major vendor to deliver this help is COMPAQ COMPUTER CORP. Its Compaq TaskSmart C-Series servers are the initial products in a planned line of single- purpose servers or what the company calls appliance servers. Using the Internet Caching System architecture developed by NOVELL, INC., the easy-to-deploy, easy-to-manage TaskSmart machines accelerate the performance of e-business Web servers, speed information access across networks and lower network communications costs. In fact, Compaq says, its package, which starts at $15,300, can increase Web response times by as much as 10-fold. The company will have competition in the Internet caching appliance server field before yearend, however, since Novell has licensed its technology to NEC CORP. The first Japanese hardware vendor to become a Novell Internet Caching System partner, NEC will develop an Internet caching server product based on its Express5800 Series of Windows NT servers.

Months behind schedule, IBM JAPAN LTD., many of the country's nationwide commercial banks, including the biggest, BANK OF TOKYO-MITSUBISHI, LTD., and other businesses were set to launch in early October a company to install and run automatic teller machines at the outlets of FAMILYMART CO., LTD. and four additional convenience store chains. E.NET CO., LTD., in which IBM Japan is the top shareholder with an 8 percent stake, was to be operational last spring. However, government red tape held up the start of business, as reportedly did hesitancy on the part of IBM Japan's parent, which had to be convinced that e.Net met its guidelines for new businesses, particularly its growth and profit potential requirements.


The exponential growth in data volumes has created enormous sales opportunities for suppliers of storage products. HEWLETT-PACKARD JAPAN LTD. has been especially quick in trying to exploit these openings. Among its latest products is an expandable line of tape library backup solutions designed to ease the burden placed on this equipment by e-services applications. The new family consists of the HP SureStore and the HP SureStore E tape libraries, which support both the HP-UX and the Windows NT operating systems as well as SCSI and Fibre Channel interfaces. These remotely manageable libraries feature the just-released DLT (digital linear tape) 8000 drives for extremely fast data transfers. Based on a common architecture, they offer a choice of a one- or two-drive 20-slot configuration, a two- or four-drive 40-slot combination and a two-, four- or six-drive 60-slot setup. Backup capacity ranges from 800 GB to 2.4 terabytes, with pricing scaling from $29,600 to $140,700.

To meet the data-protection requirements of midsize corporations, HEWLETT-PACKARD JAPAN LTD. introduced the DLT 8000-compliant HP SureStore DLT 80 tape backup drive. With 2:1 data compression, it can hold as much as 80 GB of data on a single tape and transfer this information at a maximum rate of 43 GB per hour. The system is compatible with a broad range of server brands and supports the Windows NT, Novell NetWare, Linux, SCO Unix and Sun Solaris operating systems. HP Japan, which expects to sell 1,000 HP SureStore DLT 80 systems a year, priced the internal and the external models at $10,600 each and the rack- mountable version at $11,000.

PC users in Japan will have access to the latest 250-MB Zip drives from IOMEGA CORP. before American customers do as the company attempts to defend its turf against the encroachment of other storage formats. The subsidiary of the Roy, Utah supplier first will release English- language versions of a USB-compatible Zip drive and one that offers both USB and PCMCIA (personal computer memory card interface) connections. Japanese-language products will be available in late November. Both packages are almost half the size of earlier Zip drives. The USB Zip drive will cost $240, while the combination drive will list for $270.

The second of LEXMARK INTERNATIONAL, INC.'s aggressively priced, watch-out-competition ink-jet printers (see Japan-U.S. Business Report No. 359, August 1999, p. 17) will be on store shelves at the end of October. The Z31 Color Jetprinter outputs up to eight pages per minute in black and white and as many as 3.5 ppm in color, both with a resolution of 1200 x 1200 dpi. It will list for $275. .....In another move to lift sales in Japan, LEXMARK INTERNATIONAL, INC.'s subsidiary signed PILOT CORP. to market cartridges for its ink-jet printers. By tapping into the big writing instruments manufacturer's nationwide distribution channels, Lexmark expects to broaden its customer base beyond people who live in metropolitan areas.

HEWLETT-PACKARD JAPAN LTD. hopes to fortify sales in the high end of the ink-jet printer market with the HP DeskJet 970Cxi Professional Series printer. The company says that this $535 machine provides its best photo-like reproduction, thanks to its parent's enhanced color layering technology. However, with a print speed of up to 12 ppm in black and 10 ppm in color, the DeskJet 970Cxi is targeted at mainstream business applications. .....With demand for large- format printers expanding in the graphics market, HEWLETT-PACKARD JAPAN LTD. is optimistic about the sales prospects for the HP DesignJet 2800CP and the HP DesignJet 3800CP. They are the fastest HP DesignJet CP Series printers ever offered, enabling mechanical printing speeds that are up to 60 percent faster than those obtained with the line's existing products while still maintaining photo-quality output. The improved speed and performance are attributable in large part to technology from ELECTRONICS FOR IMAGING, INC. HP Japan priced the HP DesignJet 2800CP at $15,600 and the HP DesignJet 3800CP around $24,900.

Supplies of active-matrix TFT displays are increasingly tight not only because of increasing sales of notebook computers but also due to growing demand for high-resolution flat-panel displays used as desktop monitors. To ensure that this problem does not affect their shipments of computer products, IBM JAPAN LTD. and TOSHIBA CORP. have decided to expand capacity at equally owned DISPLAY TECHNOLOGIES INC. at a cost of more than $92.6 million. Capacity at DTI's plant in Nosu, Shiga prefecture will be boosted by 50 percent a month to the equivalent of 450,000 12.1-inch displays, while output at the joint venture's original factory in Himeji, Hyogo prefecture, now running at the counterpart of 200,000 10.4-inch screens a month, will be raised by roughly 20 percent. The additional output should be available next spring.

Part of the additional capacity coming onstream at DISPLAY TECHNOLOGIES INC.'s Shiga prefecture facility will be devoted to the output of an extremely high-resolution 15-inch panel developed by IBM JAPAN LTD. With its resolution of 1400 x 1050 pixels, this display is one of the first to meet the new specifications for SXGA+ graphics. Volume production actually will start even before the extra capacity is available at an expected rate of 20,000 to 30,000 units a month. IBM Japan says that the higher resolution of the new display will aid the growth of on- line shopping since customers will get a more accurate view of merchandise.

RARITAN COMPUTER, INC., a Somerset, New Jersey maker of switches that enable multiple computers to be controlled through a single keyboard, monitor and mouse, has formed a subsidiary in Tokyo. Its products have been available through a distributor (see Japan-U.S. Business Report No. 360, September 1999, p. 16). However, demand for its switches is climbing as corporations install more servers, leading to overcrowding in their data centers and a shortage of IT people to manage all the hardware. To support this growth, which is projected to lead to annual sales of $9.3 million in three years, Raritan decided that it needed its own sales and technical services base.

An up-and-coming maker of host adapters and other connectivity products, San Jose, California-based ADVANCED SYSTEM PRODUCTS, INC., also is in the process of establishing a subsidiary. ADVANSYS JAPAN K.K. will backstop current distributors MATSUSHITA ELECTRIC INDUSTRIAL CO., LTD. and SHINSHO CORP. as well as attempt to sign up other marketers to ensure that sales climb to a projected $15 million in 2000 from an estimated $5 million this year. AdvanSys currently has on the market Fast SCSI, Ultra SCSI, Ultra Wide SCSI and Ultra 2 Wide SCSI host adapters that feature SCSI data transfer rates between system memory and internal and external devices of up to 10, 20, 40 and 80 megabytes per second, respectively. Before yearend, the company plans to release an IEEE 1394-compliant host adapter for linking various digital consumer electronics products to a PC. At the heart of AdvanSys' connectivity products are the company's own RISC processors.

Behind the boost in performance of RICOH CO., LTD.'s latest CD-Recordable/CD-Rewritable drive is its host I/O card, which was supplied by ADAPTEC, INC. of Milpitas, California in the form of the AVA-2903B SCSI card. Ricoh's MediaMaster MP7060 combines a 6X CD-R recording speed capability and a 4X CD-RW rewriting speed with a 24X CD-reader.

LEXAR MEDIA, a supplier of digital film and connection cables that transfer large image files to desktop computers via the faster USB port rather than the serial cable usually included with digital cameras, has enlisted two powerful partners to work with its Tokyo sales office. The Fremont, California company signed OLYMPUS OPTICAL CO., LTD. to market its 64-MB, USB- enabled CompactFlash digital film card and JumpShot USB cable, which will be cobranded. At the same time, SANYO ELECTRIC CO., LTD. and Lexar will comarket the new 32-MB, 8X CompactFlash digital film card and JumpShot cable; it also will be cobranded.

An exchange rate of ¥108=$1.00 was used in this report.

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JACOBS ENGINEERING GROUP INC., the big global engineering and construction firm, and KAJIMA CORP., one of Japan's five largest engineering and construction companies, have extended their year-old alliance covering the introduction of Good Manufacturing Practices for pharmaceuticals production and HACCP (Hazard Analysis Critical Control Point) for food processing. During year one of their tie-up, Pasadena, California-headquartered Jacobs mainly supplied information on GMP and HACCP to Kajima. Now, it plans to send an engineer to the Japanese company to provide direct support on three drug facility projects. Kajima also reportedly has expressed interest in Jacobs' soil-remediation expertise and building vibration-control technology.

The fourth Sheraton Hotels & Resorts property in Japan is the renamed Sheraton Sapporo Hotel on Hokkaido. The 515-room hotel is owned by TOEI K.K. It is one of only two international hotels in Sapporo. The other Sheraton hotels are the Sheraton Grande Tokyo Bay, the Kobe Bay Sheraton Hotel & Towers and the Yokohama Bay Sheraton Hotel & Towers. Westin Hotels & Resorts, which also is part of STARWOOD HOTELS & RESORTS WORLDWIDE, INC., has four properties in Japan as well.

An exchange rate of ¥108=$1.00 was used in this report.

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The exclusive distribution agreement that Lightcaster microdisplay provider DISPLAYTECH, INC. signed in August 1998 with NISSHO ELECTRONICS CORP. has been broadened to include microdisplay components that result from an alliance between the Longmont, Colorado firm and HEWLETT-PACKARD CO. The first Displaytech-HP product is a full-color, fully illuminated quarter VGA (video graphics array) microdisplay. Targeted at such applications as viewfinders in digital cameras and the like, the low-power QVGA combines Displaytech's ferroelectric liquid crystal technology and HP's system design expertise. MIYOTA CO., LTD. will make the FLC microdisplays at its dedicated plant in Nagano (see Japan-U.S. Business Report No. 355, April 1999, p. 17).

The Rockwell Automation unit of ROCKWELL INTERNATIONAL CORP. licensed electrical control equipment manufacturer MEIDENSHA CORP. to assemble and market in Japan its high-voltage inverters. The American manufacturer will supply semiconductors, printed circuit boards and other components to the Tokyo-headquartered company for inverters that control 3-kilovolt and 6-kv motors. One likely market for these products is pump controls at water-processing facilities. Meidensha expects to sell 20 of Rockwell Automation's inverters a year under its own brand name. It makes low-voltage inverters but believes that energy-conservation efforts will boost demand for high-voltage inverters.

AERO-ELECTRIC CONNECTOR, INC. named MEIHO ELECTRIC CO., LTD. to distribute five of its connector lines. The Torrance, California manufacturer's products are available in a range of coupling configurations and shell sizes. The families sold in Japan, which are priced from $18.50 to $92.60 each, include circular connectors that provide aerospace performance and reliability for general-purpose power interconnection requirements; threaded connectors for situations with excessive moisture, fluids, shock and/or vibration; connectors for instrumentation applications where space is at a premium; connectors that provide greater vibration protection; and connectors that deliver improved interface protection in the presence of a variety of liquids.

Two new products from K-TRON INTERNATIONAL, INC., a Pitman, New Jersey maker of materials feeders for production equipment, are available through distributor SHINWA CORP. The Smart Control Module, which combines motor drive and control unit functions in a small box that mounts right on the feeder, operates a feeder for both batch and continuous processes. An infrared data link lets users perform configuration work or diagnostics with a notebook computer without attaching connector cables to the SCM. The Smart Commander, the second product, gives operators an easy-to-use Windows NT interface for controlling or monitoring up to 30 feeders on as many as seven process lines.

Three consumer electronics companies, described only as major players, now are evaluating AER ENERGY RESOURCES, INC.'s patented zinc-air battery technology by means of a prototype 6-volt primary battery (see Japan-U.S. Business Report No. 351, December 1998, p. 15). The Smyrna, Georgia R&D firm's system, which provides a long run time for portable electronic devices, consists of zinc-air cells and a patented air manager that allows air flow to the cells during discharge and blocks it during charge and when the battery is not in use.

An exchange rate of ¥108=$1.00 was used in this report.

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To the pleasant surprise of many analysts and observers, financial regulatory authorities gave a foreign consortium the right to negotiate the purchase of nationalized LONG-TERM CREDIT BANK OF JAPAN, LTD. The group is led by RIPPLEWOOD HOLDINGS LLC, a New York City specialist in corporate turnarounds. It has lined up a number of name American and European companies as possible participants in the buyout of the investment bank, which the syndicate hopes to finalize before yearend. Ripplewood officials believe that a now slimmed-down and partially cleaned-up LTCB, which sought government protection in October 1998 and subsequently received billions of dollars in public funds, can generate earnings of $463 million a year. They hope to achieve this target by focusing the "new" LTCB's operations on corporate pension plans, private banking and other potentially high-profit areas under a new management team that includes foreign executives as well as Japanese ones. No good estimate exists of how much money the consortium will have to put up in total, but it agreed for starters to add $1.1 billion to the bank's capital. Investors have some protection against their ultimate financial exposure because the government agreed that for three years after the sale went through, it would buy back LTCB's outstanding loans at book value if they fell 20 percent or more in market value. However, to win this open-ended guarantee, Ripplewood and its partners had to agree not to cut off any LTCB borrower for three years even if they are deadbeats. Some experts worry that this provision alone could slow the turnaround of LTCB's business.

October 1 marked the complete deregulation of brokerage commission rates as well as the launch of E*TRADE JAPAN K.K.'s financial services Web site. The joint venture between Menlo Park, California-based E*TRADE GROUP, INC. (42 percent) and SOFTBANK CORP. (58 percent) initially is offering Japanese equities and mutual funds. Until it gets a better feel for conditions in the on-line market, its fees — $23.15 per trade on orders up to $9,300 — will not be as low as some of the competition's. Nonetheless, E*TRADE Japan expects to have 100,000 on-line brokerage accounts by the end of the first year of operations. It believes that it can attract customers by offering such localized content on its Web site as news and stock quotes, mutual fund ratings reports, a proprietary mutual fund search engine and reports on publicly traded Japanese companies. Moreover, E*TRADE Japan already has an established customer base and customer service infrastructure through the late 1998 acquisition of OSAWA SECURITIES CO., LTD. (see Japan-U.S. Business Report No. 350, November 1998, p. 18).

GE CAPITAL CORP. already has its finger in many pieces of Japan's financial pie. In a year or two, another will be added. GE Asset Management, the investment services unit of GE FINANCIAL ASSURANCE CO., plans to offer as many as 30 mutual funds for individual investors, particularly those who take advantage of the 401(k)-type pension plan that Japan will introduce. In the meantime, GEAM launched the GE Japan Equity Focus fund, which has $55.6 million in assets.

Big mutual fund manager DREYFUS CORP. has added a third investment option for retail customers. Its global equity fund joins an international blended fund introduced in April 1998 and a global bond fund available since July 1998. All three are sold through traditional brokerage houses and the distribution channels of TOKYO-MITSUBISHI ASSET MANAGEMENT, LTD., a BANK OF TOKYO-MITSUBISHI, LTD. affiliate that cobrands them. However, Providence, Rhode Island-based Dreyfus says that it is exploring the possibility of marketing its family of funds through discount and on-line brokers.

After two years of discussions, insurance giant AMERICAN INTERNATIONAL GROUP, INC. and ORIX CORP., Japan's top leasing company, formed an equally owned business to develop new casualty insurance products tailored to the needs of corporate and individual customers alike. Sales of policies crafted by ORIX INSURANCE PLANNING CO., LTD., which had an October start date, will be handled by AIU INSURANCE CO., the Japanese property and casualty arm of AIG. Orix will participate on the sales side since its corporate client base will be a primary focus of the marketing effort. In time, the joint venture could have its own sales force as well as a broader portfolio of insurance products, including life policies.

The market for long-term disability policies in Japan is extremely underdeveloped, giving UNUM CORP. considerable room to expand its primary business. UNUM JAPAN ACCIDENT INSURANCE CO., LTD., which has sold these products through its own agents and smaller nonlife insurers since 1994, has enlisted a second major ally in this effort. MITSUI SEIMEI GENERAL INSURANCE CO., LTD. will market Unum's disability policies as part of the group coverage it offers. Its target customers are the some 7,000 corporate and government clients of parent MITSUI MUTUAL LIFE INSURANCE CO. The Portland, Maine company's disability products also are sold by CHIYODA MUTUAL LIFE INSURANCE CO. (see Japan-U.S. Business Report No. 355, April 1999, p. 19).

PHH VEHICLE MANAGEMENT SERVICES, the number-two global vehicle management company, formed a strategic alliance with SUMISHO AUTO LEASING CORP. to expand its business into Japan. Through the tie-up, mutual clients will have a complete range of products and services available in North America, Europe and Japan. Sumisho Auto Leasing, which has no operations outside Japan, operates 26 branches across the country. It has more than 126,000 vehicles under management. Hunt Valley, Maryland-headquar-tered PHH, which was acquired by AVIS RENT A CAR, INC. in June, provides vehicle-management services to 19,000-plus businesses in North America and Europe. Its fleet tops 700,000 cars and trucks. The new partners are discussing the possibility of working together elsewhere in Asia.

As early as June 2000, the subsidiary of TOYS "R" US INC. could go public on Japan's over- the-counter market. Already the country's largest toy retailer even though it has been in business for just eight years, the company plans to use the money raised through its initial public offering to help finance the construction of 10 more stores. Toys "R" Us now operates close to 100 outlets. The local unit had sales of nearly $1.1 billion in the year through January 1999, a gain of 17 percent, although pretax profits dropped to $25 million because of higher distribution costs and new store openings. MCDONALD'S CO. (JAPAN) LTD., which tentatively is planning an IPO on the local OTC in 2002, owns 20 percent of the firm.

An exchange rate of ¥108=$1.00 was used in this report.

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In exchange for a payment of $750,000, LMC CORP. licensed its low-ground-pressure vehicle product and process technology for snow-grooming machines to NIIGATA ENGINEERING CO., LTD., a new business for the Tokyo company. The contract also covers sales of this equipment under the LMC name. Niigata Engineering initially will make and market two of the Brigham City, Utah firm's models. One, the 260C, can groom 81,000 square yards of ski slopes an hour. It will list for $355,600. The 300CF model, which can reform close to 98,000 square yards of snow in 60 minutes, will cost $384,300. About 150 snow-grooming machines are sold annually in Japan. Niigata Engineering hopes that 10 or more of these vehicles will be its.

With the hike in public works spending creating one of the best markets in years for earth- moving equipment, SHIN CATERPILLAR MITSUBISHI LTD. has unveiled one product after the other to capitalize on this opportunity. Its latest releases are a pair of redesigned midsize CATERPILLAR INC. wheel loaders that are engineered to handle heavy loads without straining the engine. The $342,600 CAT 966G has a bucket capacity of 5 cubic yards, while the CAT 972G, which goes for $379,600, can handle 5.6 cubic yards of material at a time. In the first year of marketing, Shin Caterpillar Mitsubishi estimates, it will sell 120 of the smaller wheel loader and 20 of the larger model.

By next spring, TOSHIBA CARRIER CORP. — which was formed in April through the combination of TOSHIBA CORP.'s air-conditioning equipment division and CARRIER CORP.'s local operation (see Japan-U.S. Business Report No. 356, May 1999, p. 20) — hopes to have ready for commercialization air conditioners for sale in overseas markets. Such a diversification would help to offset potential sales downturns in Japan. Moreover, sales to countries in the Southern Hemisphere would help to even out the now seasonal nature of the business. The products, which basically must be tailored to climatic conditions and housing in each market, will be marketed through Carrier's global distribution channels. .....In the meantime, TOSHIBA CARRIER CORP. is projecting combined annual sales of 100,000 units for three air purifiers that just went on sale. The energy-saving models use HEPA (high-efficiency particulate air) filters. Scaled to room size, the products range in price from $315 to $490.

An exchange rate of ¥108=$1.00 was used in this report.

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Whatever marketing shortcomings might hinder EASTMAN KODAK CO.'s business in Japan, an inadequate product lineup is not one of them, at least in digital cameras. In late October, its subsidiary was scheduled to introduce yet another model. The higher-end DC290 Zoom Digital Camera generates photo-realistic pictures with its 2.3-million-pixel resolution and its autofocusing 3X zoom lens. A USB card reader for faster downloads is standard. For more versatile business applications, the DC290 Zoom incorporates San Jose, California-based FLASHPOINT TECHNOLOGY, INC.'s Digita Script for automating digital imaging tasks. .....EASTMAN KODAK CO.'s local unit has applied its digital camera expertise to a new use: taking pictures of accident scenes and sending the information to the appropriate authorities. The Mobile Adjuster MA-215 pairs the recently introduced DC215 Zoom Digital Camera (see Japan-U.S. Business Report No. 360, September 1999, p. 19) with a compact case that houses transmission equipment.

An exchange rate of ¥108=$1.00 was used in this report.

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A year ago, APPLIED MATERIALS, INC. was seriously thinking about pulling out of APPLIED KOMATSU TECHNOLOGY INC., a company equally owned with KOMATSU LTD. that makes production equipment for flat-panel displays, because of a slumping FPD market. With AKT's business prospects brightening because of booming demand for active-matrix TFT screens, the Santa Clara, California manufacturer has changed its mind. It will buy out Komatsu's stake in AKT for an undisclosed amount and make the Kobe company, formed in September 1993, a wholly owned unit. As a result of restructuring last fall (see Japan-U.S. Business Report No. 350, November 1998, p. 20), AKT's product line is limited to chemical vapor deposition equipment. .....Even though its future was in doubt, APPLIED KOMATSU TECHNOLOGY INC. developed a CVD system for working on FPD glass substrates that measure as much as 27.3 x 35.1 inches. Marketing of the AKT-5500 PECVD will start in early 2000.

HARMON INDUSTRIES, INC. sublicensed its Advanced Automatic Train Control system to NIPPON SIGNAL CO., LTD. for marketing in Japan and elsewhere in Asia. AATC is a communications-based train control system that uses a radio network of transmitters and receivers to determine a train's location much more precisely than the Automatic Train Control system now in use. Blue Springs, Missouri-based Harmon exclusively licensed the AATC technology from RAYTHEON CO. It is installing the system on the San Francisco Bay Area Rapid Transit system, with operations scheduled to start in 2001. Nippon Signal, Japan's largest supplier of signaling equipment, reportedly is making AATC devices for the tops of trains for the BART project.

OVS Physical Stress Systems produced by Denver's QUALMARK CORP. will be represented in Japan by SUMITOMO CORP. These accelerated life testing systems and associated services give manufacturers, particularly electronics makers, the information needed to improve product reliability by quickly exposing design and manufacturing-related problems. The typical accelerated life test using OVS equipment takes only four to five days to finish. Sumitomo has been demonstrating one of QualMark's systems at a facility in Zama, Kanagawa prefecture. More than 280 OVS Physical Stress Systems already are in use in 14 countries.

With the bankruptcy last year of OKURA & CO., LTD., its primary distributor, HIPOTRONICS, INC. gave NIPPON KOEI CO., LTD. rights to market its high-voltage test systems to users and manufacturers of power-delivery apparatus. The Brewster, New York supplier reportedly has little in the way of Japanese competition and vies basically with a small number of other foreign producers for sales of test equipment to electric utilities, manufacturers of electric power equipment and cable makers. Hipotronics' automatic test sets, dielectric breakdown testers, first-response cable fault locators, resonant systems and other high-voltage test equipment are priced between $370,400 and $463,000. Nippon Koei, one of the world's leading engineering consulting companies, projects sales of $1.9 million in the initial year.

Start-up ANTARA, LLC signed Tokyo's SANKEI SHOJI CO., LTD. to distribute its Port Authority suite of network test products. The Campbell, California company's open-architecture line includes Port Authority/Manufacturing for quality assurance applications, Port Authority/GT for general network device and simulation testing and Port Authority/IT for applications performance analysis. This array of products allows network testing all the way from device testing on the manufacturing floor to monitoring real-world enterprise networks.

The Ministry of Agriculture, Forestry and Fisheries' decision to require labeling of 30 food products that contain detectable amounts of genetically modified organisms already is creating business opportunities for U.S. suppliers of GMO testing services or test kits, even though the regulation will not go into effect until April 2001. An early beneficiary is STRATEGIC DIAGNOSTICS INC., the maker of the GMO Check test kit. For starters, the Newark, Delaware company signed an agreement with TAKARA SHUZO CO., LTD. that gives that firm's Biomedical Division the right to use the GMO Check test kit as part of its commercial testing operations to quantitatively determine the extent of GMOs in soybeans and other bulk agricultural commodities and in so-called food fractions like flour and protein concentrates. Takara Shuzo also has the nonexclusive right to market GMO Check in Japan, where the kit will cost $1,700, and in South Korea. .....STRA-TEGIC DIAGNOSTICS INC. also licensed JAPAN OILSTUFF INSPECTORS CORP. to use the soybean version of the GMO Check test kit in the laboratories that it runs at Japanese ports. Certified by MAFF, JOSIC is the leading inspector of imported oilseeds. To date, it has performed quality tests on soybeans and other oilseeds for importers, usually trading companies, and crushers. Now, it will add GMO testing to its services.

NORTHERN INSTRUMENTS CORP., a Cleveland maker of electronic sensing instruments, has tapped NEW BEX CO., LTD. of Saitama prefecture to market its Foodoil Sensor. Billed as taking the guesswork out of changing shortening in deep-fryer operations, the portable system is said to provide a quick, easy test for indicating when a batch of frying shortening should be discarded to prevent an accumulation of harmful components. It does this by monitoring the change in the dielectric constant of the fat. NIC notes as well that the Foodoil Sensor is designed to be used by food-processing and food-service personnel that have no scientific training.

A revolutionary line of ultrasound devices soon will be available in Japan. SONOSITE, INC.'s miniaturized, high-performance, all-digital equipment will be distributed by OLYMPUS OPTICAL CO., LTD. The first product, the SonoSite 180, can be hand-carried since it weighs just 5.4 pounds. Nonetheless, the Bothell, Washington developer says, it produces images comparable to those generated by larger, more expensive ultrasound machines. The SonoSite 180 will be marketed initially for use in gynecology, obstetrics, urology and general-purpose abdominal imaging.

With MHW approval in hand, CENTURY MEDICAL INC. has begun marketing three neurovascular access and delivery products made by MICRO THERAPEUTICS INC. of Irvine, California (see Japan-U.S. Business Report No. 355, June 1999, p. 21). The EASY RIDER Micro Catheter, FLOW RIDER Flow Directed Catheter and the SilverSpeed Hydrophilic guidewire are all used to access small, remote vessels in the brain to enable the delivery of blood clot-dissolving agents. These products will be parts of MTI's ONYX Liquid Embolic System, which is awaiting regulatory clearance.

ENCORE MEDICAL CORP., an Austin, Texas supplier of orthopedic total joint, trauma and spinal implants, has added another distributor. SENKO MEDICAL TRADING CO., LTD. of Tokyo will market the Ultimax line of trauma products. CENTURY MEDICAL INC. is Encore's primary sales agent.

The primary subsidiary of big drug manufacturer JOHNSON & JOHNSON is in the process of absorbing the company's formerly freestanding JOHNSON & JOHNSON MEDICAL K.K., which supplies medical devices, medical equipment and various surgical and medical consumables. Like other parts of JOHNSON & JOHNSON K.K., the medical business will operate as an independent unit. Efficiency considerations dictated the merger.

An exchange rate of ¥108=$1.00 was used in this report.

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To help ensure that it remains a first-rank competitor in semiconductors as well as in cellular communications equipment, especially next-generation wideband-CDMA, MOTOROLA INC. has established its first technology center in Japan. The 10 engineers initially staffing the facility, which is located at NIPPON MO-TOROLA LTD.'s headquarters in Tokyo, are charged with tracking technological developments in the chip and wireless fields. Motorola recently agreed to buy out TOSHIBA CORP.'s half interest in TOHOKU SEMICONDUCTOR CORP. (see Japan-U.S. Business Report No. 360, September 1999, pp. 20-21), a move that also should help the company capitalize on emerging market opportunities in Japan.

By 2001, ADVANCED MICRO DEVICES, INC. hopes to control 30 percent-plus of Japan's processor market versus the 20 percent or so it now has. The first products in the performance-geared Athlon family are one key to the planned expansion. AMD hopes that this series of processors, available now running at clock speeds of 500 MHz, 550 MHz, 600 MHz and 650 MHz, will enable it to take sales away from the Pentium III in the high end of the desktop, server and workstation markets. The other part of AMD's strategy is to fortify its bread-and-butter business with faster and otherwise improved versions of the K6-2, which a number of big American PC manufacturers and one or two Japanese rivals have adopted for some of their low-end machines.

As early as sometime in 2000, Tokyo sources report, FUJITSU, LTD., HITACHI, LTD., MITSUBISHI ELECTRIC CORP. and NEC CORP. could roll out microcontrollers that support Sunnyvale, California-based INTEGRATED SYSTEMS, INC.'s pSOS+ operating system, a rival to Windows CE for embedded systems. The planned parts are seen as helping to unleash a new generation of portable information appliances that not only are less expensive and smaller than today's versions but that also will provide high-speed Internet access and improved word- processing capabilities as well as spreadsheet and scheduling functions.

The next home video game console from NINTENDO CO., LTD., code-named Dolphin, will feature graphics technology from S3 INC. The Santa Clara, California company's advanced S3TC texture compression technology will be embedded right on the graphics chip, which ARTX, INC. is developing for Nintendo. This chip will decompress textures automatically, enabling what is said to be a dramatic improvement in graphics performance in terms of both complexity and color without increasing programming challenges.

The first product incorporating MICROTUNE INC.'s breakthrough tuner-on-a-chip technology will be marketed by INTERNIX, INC. The Plano, Texas manufacturer's MicroTuner2000 is a dual-conversion tuner that supports the reception of multiple digital broadband standards while maintaining compatibility with analog NTSC standards. In short, it works with today's TVs and VCRs as well as with the coming generation of digital TVs, digital cable set-top boxes and converged PCs/TVs. On top of its technical achievements, the MicroTuner2000 is competitively priced, costing $20 each in quantities of 10,000 in the United States.

VCR technology has just taken a big step forward, according to C-CUBE MICROSYSTEMS INC. Through a collaborative effort with VHS inventor VICTOR CO. OF JAPAN, LTD., the Milpitas, California company's DVxplore MPEG-2 codec (coder/decoder) chip for the emerging D-VHS digital recording standard enables JVC's HM-DR10000 digital recorder to record up to 24 hours of high-quality digital video onto a single tape, undertake high-speed fast-forward and reverse seek of stored video and record directly from digital camcorders. For now, JVC's D-VHS recorders will be sold only in Japan.

Chipmaker ROHM CO., LTD. has built the state of the art in audio, represented by BBE SOUND, INC.'s signal processors, into a sound processor chip for car audio equipment and another for minicomponent stereo systems. In simplified terms, the Huntington Beach, California company's technology compensates for the loss of fidelity that occurs when music is amplified through a loudspeaker. By harnessing this power, Kyoto-based Rohm says, its single-chip BD3860K Sound Processor for car audio and BD3876KS2 Sound Processor for minicomponent stereos deliver the clear, crisp and lively sound that consumers now demand in audio equipment. The two parts are sampling now at $5.55 each.

HEWLETT-PACKARD JAPAN LTD. is forecasting annual sales of 2 million units for the HCPL- 314J half-bridge gate-drive optocoupler. This part is designed specifically for low-power motor-control inverter applications, such as air conditioners and washing machines that use inverters based on IGBT (insulated gate bipolar transistor) technology. It also is suitable for low-power industrial applications. The HCPL-314J is sampling for $2.00 or so each.

Over the last 18 months, Japanese wafer-fabrication facilities have awarded millions of dollars worth of orders to ASYST TECHNOLOGIES, INC., a provider of isolation, materials management, robotics and software solutions for semiconductor tool automation. Now, the Fremont, California company has positioned itself to do even more business in Japan. It agreed to acquire a minority stake in MECS CORP., a supplier of robotic systems used to automate chip and flat-panel display manufacturing tools, and to buy a majority interest in the Nagoya company once certain business milestones are achieved, a process expected to take three to six months. MECS, which has five offices across the country and employs 160 people, had revenues of $43.5 million in the year through March 1999. Once the transaction is wrapped up, MECS will handle all engineering, manufacturing and systems integration services for Asyst's isolation and automation products. The pending partners also will cooperate on product development, marketing and support for the installed base of Asyst products.

The first order for ULTRATECH STEPPER, INC.'s latest wafer stepper, the Saturn Spectrum 3, came from longtime customer CASIO COMPUTER CO., LTD. The tool, which will be installed at Casio's Core Technology Research Laboratory outside Tokyo, was developed in cooperation with the maker of chips as well as watches, calculators and other electronics products. It is designed specifically for flip-chip packaging, a technique that is starting to make inroads in the semiconductor world as line geometries shrink. According to San Jose, California-based Ultratech, the Saturn Spectrum 3 is the only stepper in the world configured with a broadband 1X optics lens. That enables automatic selection of the exposure spectrum.

STEAG RTP SYSTEMS, the world's top installer of rapid thermal processing equipment, gave CANON SALES CO., INC. exclusive rights to sell and service its RTP systems. These include the AST3000 for high-volume production using both 200mm (8-inch) and 300mm (12-inch) wafers; the AST2800e for 0.25-micron processing; the Heatpulse 8800, a third-generation RTP tool for 0.25-micron and 0.35-micron design requirements; and the STEAMpulse, which is targeted at the sub-0.25-micron market. San Jose, California-based STEAG RTP systems was formed in May after Germany's STEAG AG bought AG ASSOCIATES, INC. and merged that Sunnyvale, California company with its existing RTP operations. Canon Sales was a minority investor in AG Associates.

TOSHIBA CORP. is the latest Japanese company to take out a license for TESSERA INC.'s chip- scale packaging technology. The electronics giant will use the San Jose, California firm's Micro BGA (ball-grid array) know-how for such products as high-bandwidth Direct Rambus DRAM memories. In this application, chips can be mounted on both sides of a Rambus in-line memory module, thereby enabling module capacities of 256 MB and 288 MB.

An exchange rate of ¥108=$1.00 was used in this report.

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On-line auctions are one of the latest Internet trends in Japan, and several American companies hope to capitalize. For instance, YAHOO! CORP.'s subsidiary set up a free, interactive auction site that features local merchandise and multilingual capabilities. Thus, sellers and buyers can find each other regardless of language differences. Including the new Japan and Singapore services, Yahoo! has set up 10 local auction sites around the world over the past five months, all of which are interlinked. Moreover, the Santa Clara, California-based Internet services pioneer launched a charity auction site in Japan to raise funds for local nonprofit organizations.

Auction sites for business-to-business commerce also are red-hot. INFORMATION SERVICES INTERNATIONAL-DENTSU, LTD. has created an open procurement system that digitizes negotiations between manufacturers and suppliers via an on-line auction system. SONY CORP., the system's first outside customer, sources parts and materials for its acclaimed VAIO line of PCs using the Trading Process Network. ISID charges $13,900 a month to buyers for TPN access and the same fee on an annual basis to sellers. The joint venture between GENERAL ELECTRIC CO. and DENTSU INC. is hustling to sign up 10 buyers and 1,000 suppliers by March 2000 to entrench itself before competing systems from FUJITSU, LTD. and NEC CORP. come on- line.

A B2B e-commerce package is being offered by COMMERCE CENTER K.K., a new company led by Tampa, Florida-based TRADEX TECHNOLOGIES INC. (formerly TRADE'EX Electronic Commerce Systems, Inc.). Commerce Center 6.0, which has a proven track record in the United States, has been fully translated into Japanese. TRADEX's partners include three resellers of the package — CANON SALES CO., INC., MITSUI & CO., LTD. and a TOYO ENGINEERING CORP. affiliate — plus CRAYFISH CO., LTD. and JAFCO CO., LTD. The joint venture is looking for annual revenues of $27.8 million in two years. NTT COMMUNICATIONS CORP. already has decided to deploy Commerce Center 6.0J (see Japan-U.S. Business Report No. 352, January 1999, p. 25).

After six months of work (see Japan-U.S. Business Report No. 356, May 1999, p. 23), Portland, Oregon's VIRTUAL RELOCATION.COM, INC. and partner NISSHO IWAI CORP. have launched their on-line moving and residential relocation service. is entirely in Japanese and its content is localized. The guide includes such information as banking, dining and recreational resources near each listed location. is being marketed by Nissho Iwai and its many affiliates. It also is available on the trader's intranet. Virtual and Nissho Iwai now are seeking partners in the travel, hospitality and recreation industries to add exclusive content to

With on-line sales of new and used vehicles in the pipeline (see Japan-U.S. Business Report No. 360, September 1999, pp. 22-23), AUTOBYTEL.COM INC.'s Japanese arm is ready to take the next logical step: on-line sales of parts and accessories. To do this, it enlisted the help of NETVILLAGE CO., LTD., which already operates a site providing information on some 40,000 automotive-related products. Visitors to the Autobytel site will be able to buy listed merchandise through dealers that participate in the Autobytel network. The parts and accessories site should be up and running next spring.

E-PARCEL, LLC continues to expand the list of resellers for its self-named Internet data- delivery system. HITACHI CHUBU SOFTWARE, LTD. joins 26 other companies (see Japan-U.S. Business Report No. 359, August 1999, p. 26) that market, customize, integrate and support the e-Parcel Delivery Service, e-Parcel API software and e-Parcel Mini Virtual Warehouse data-delivery server. Hitachi Chubu Software said that it chose the Newton, Massachusetts firm's solution because of its uninterruptible/autoresuming data transfers and its real-time data delivery tracking, among other features.

IBM JAPAN LTD. and development partner KIMEC CORP. are ready to challenge E-PARCEL, LLC with a digital content-delivery system that features strong intellectual property protection. Written in cooperation with the Ministry of International Trade and Industry, Digital Content Market uses IBM Japan's electronic watermark know-how to prevent pirating of copyrighted material. A powerful server installed at Kimec's headquarters in Kobe acts as a go-between among content creators and Internet customers, allowing digital information to be exchanged and distributed securely. Kimec is owned by IBM Japan, KOBE STEEL, LTD., NEC CORP. and other local firms.

A new entry in the back-end e-commerce payments processing market is the team of HEWLETT- PACKARD CO.'s subsidiary and DATA APPLICATIONS CO., LTD. The Tokyo partner is responsible for localizing HP's Integrated Payment Solution, which already is in use at financial institutions and retailers in the United States and Europe. Data Applications' main job is to make IPS compatible with Japan's unique interbank and credit-card settlement systems.

In what is likely to be the first of many such deals, MTCI CO., LTD. has formed a company with VERITEL CORP. to market and support the Chicago firm's voice-recognition software. The Japanese ISP's new HYBRID CORP. unit owns 75 percent of the Veritel joint venture. Hybrid is actively seeking out other small, Internet-related American companies that want to establish a presence in Japan but lack the cash and experience to do so. Like a venture capital fund, MTCI will help these businesses open subsidiaries and market their Internet products in exchange for an equity stake in the new units.

MICROSOFT CORP. and MATSUSHITA ELECTRIC INDUSTRIAL CO., LTD. have established a Web portal where Internet surfers quickly can find a wide range of services and products. Trying to unseat established portal operators such as YAHOO! CORP.'s subsidiary, the pair is emphasizing their unique content, which includes specialty products and regional foodstuffs. The portal also gives users quick access to an on-line shopping mall with more than 250 retailers. Following an early summer tie-up (see Japan-U.S. Business Report No. 358, July 1999, p. 26), Microsoft and MEI will continue to integrate the software powerhouse's Internet know-how with the consumer electronic giant's broad range of Internet services.

Despite having fought hammer and tongs for dominance of Japan's word-processing market, MICROSOFT CORP. and JUSTSYSTEM CORP. have inked a pact to codevelop an Internet search engine specializing in corporate data. In early 2000, Justsystem plans to publish a family of natural-language data base applications that work with Microsoft's Exchange messaging software. The ConceptBase series will allow company employees to quickly access and analyze information available over the Internet and to share large amounts of in-house corporate data. Justsystem's customers urged it to come up with search software compatible with Microsoft's offerings.

AMERICA ONLINE, INC. has debuted a new version of its wildly popular AOL Instant Messenger software for Japan. AIM 2.0J allows users to exchange messages over the Internet without bothering with e-mail. They also can immediately see which of their Internet buddies is logged on and ready to "chat." AIM 2.0J can be downloaded for free from AOL's local Web site. It is available in both Windows and Macintosh versions.

Seeking a big slice of Japan's Web-hosting outsourcing business, VERIO INC. and NTT COMMUNICATIONS CORP. have forged an alliance that pairs the Englewood, Colorado firm's top- tier Web hosting services with NTT Communications' marketing muscle. The two companies currently are working on a new data center at NTT Communications headquarters in Tokyo — the vital back-end operation to launch the Powered by Verio Web-hosting service in the spring of 2000. NTT Communications owns 10 percent of Verio, which it acquired through a $100 million investment in May 1998.

HEWLETT-PACKARD JAPAN LTD. is offering a specialized Web service: integrating, operating and maintaining corporate e-mail systems. It is using its parent's Smart Internet Messaging Solution, which is built on SOFTWARE.COM, INC.'s InterMail e-mail server. It offers carrier- scale solutions to ISPs and operators of other large networks. The e-mail system also integrates tightly with HEWLETT-PACKARD CO.'s OpenView enterprise-level network and computing resources management platform.


Another specialized piece of software for ISPs — a streaming video server — is available from PICTURETEL CORP.'s Osaka office. Priced from $17,200 to $31,900, PictureTel 330 NetConference Multipoint Server easily schedules, enables and manages virtual conferences held over the Internet or the corporate intranet. Built on Windows NT and employing the H.323 protocol, the server can link up to 24 clients with full audio, video and T.120 data collaboration while still preserving critical WAN bandwidth.

CYLINK CORP. is distributing its virtual private network package through MITSUI & CO., LTD. The Santa Clara, California company's PrivateWire 2.0 integrates seamlessly with existing enterprise applications, adding the solid security, functionality and scalability needed as companies move to embrace e-commerce. PrivateWire 2.0 authenticates the identities of the parties, protects the integrity and privacy of the transaction, and completes the exchange with digital signatures. Mitsui has priced a 50-user license at $25,800.

Claiming a global first, ENTRUST TECHNOLOGIES INC. said that it digitally "signed" an agreement with SECOM CO., LTD. authorizing the big Tokyo security services provider to represent its new business unit. Officials of the Plano, Texas firm used the deal to showcase their digital signature technology as well as's digital certificate services for e-commerce. The entire signing was conducted electronically, with both Entrust Technologies and Secom officials attaching their digital signatures to the electronic legal contract and verifying that the party at the other end of the transaction was indeed who they claimed to be. Secom is the lead Japanese investor in the joint venture that markets Entrust Technologies' products (see Japan-U.S. Business Report No. 352, January 1999, p. 21).

The Tokyo office of SECURITY DYNAMICS TECHNOLOGIES, INC. is offering an alternative enterprise-strength security solution. Developed by RSA SECURITY, INC. (the name of the now- integrated Security Dynamics and RSA Data Security, Inc.), the RSA Keon 5 public-key infrastructure family can handle everything from single, stand-alone certificate authority services to a highly scalable, comprehensive PKI system. In particular, Keon 5 Advanced PKI supports digital certificates issued by any standards-based certificate authority, thus freeing users to adopt the CA of their choice. A package that includes Keon Security Server and 500 Keon Desktop clients is priced at $138,900.

Rival VERISIGN, INC. has answered with several initiatives of its own. For starters, the Mountain View, California security software developer tied up with NEC CORP. on a new Internet security service. By combining VeriSign's OnSite PKI digital ID server software with NEC's digital certificate verification system, the service will issue digital certificates, authenticate users, encrypt data transmissions and protect on-line transactions. NEC hopes the new partnership will generate $46.3 million in sales over the next three years. .....VERISIGN, INC.'s subsidiary also has begun marketing Go Secure! for Web Applications, which confers the security of its digital certificate know-how on large-scale intranet and extranet Web applications. Unlike OnSite, which can take more than 10 days to set up digital IDs for new users, Go Secure! can generate up to a million digital IDs in a few days. It also meshes easily with existing Web applications. This makes the solution more suitable to replace less-secure, password-based systems for granting large numbers of users access to Web applications and extranet/intranet resources.

Targeting the same market segment, newcomer GRADIENT TECHNOLOGIES, INC. has brought its NetCrusader family of security software products for distributed computing to the Japanese market through G-LINK SYSTEM CONSULTING CORP. NetCrusader offers modules for Web-based applications, object-oriented applications using CORBA (common object request broker architecture), and Windows and Unix applications employing DCE (distributed computing environment). NetCrusader Commander is a graphical tool that manages users, groups and access privileges for all NetCrusader products. G-Link not only will handle Marlborough, Massachusetts-based Gradient's NetCrusader in Japan but in China and Hong Kong as well.

VERISIGN, INC. has licensed its Global Server ID package to six financial institutions for installation on their servers that process on-line trades and transactions. DAIWA SECURITIES CO., LTD., MARUHACHI SECURITIES CO., LTD., NIKKO BEANS INC., NOMURA ASSET MANAGEMENT CO., LTD., NOMURA SECURITIES CO., LTD. and YAMATANE SECURITIES CO., LTD. will be able to reassure their clients that any on-line transaction made through their servers will be protected by VeriSign's 128-bit encryption technology. .....VERISIGN, INC.'s subsidiary announced in addition that IBM JAPAN LTD. had licensed the Global Server ID software. IBM Japan is using the digital certificate system to add 128-bit security to the portfolio of electronic banking services being marketed to regional financial institutions (see Japan-U.S. Business Report No. 360, September 1999, p. 13).

Also taking advantage of Washington's recent decision to ease controls on the export of advanced encryption technologies, NETWORK ASSOCIATES, INC.'s subsidiary is bolstering its mix of utilities for networks and individual users. Besides antivirus software and network management programs, NAI will begin offering before yearend its PGP (pretty good privacy) Data Security public-key encryption system. To help double sales in Japan to a projected $92.6 million in 2000, the local NAI office recently added SOFTBANK CORP. to its 100-strong force of sales affiliates. It also set up a Network Associates Solution Center at the big software distributor.

Similarly, COMPUTER ASSOCIATES INTERNATIONAL, INC. and Tokyo's ASGENT INC. have established a center to promote and expand sales of CAI's security products. The CA Security Solution Center, located in Tokyo, provides information on the Islandia, New York firm's entire line of security software, including SessionWall-3, AutoSecure (SeOS) server, InoculateIT and GuardIT. The center also offers consulting, education and technical support services. At the same time, Asgent became the first Japanese company to distribute CAI's eTrust end-to-end e- business security solution. It also is handling SessionWall-3 and AutoSecure (SeOS), mainly distributing these packages to other companies. In time, Asgent will carry CAI's full line of security-related products.

The Japanese market continues to clamor for Linux software, and several firms have stepped in to deliver. For instance, CALDERA SYSTEMS, INC. is focusing on the corporate market by teaming with FUJITSU, LTD. The big computer maker has agreed to offer the Orem, Utah company's OpenLinux 2.3 operating system on its entire line of servers, including the GranPower series. Fujitsu will provide pre- and post-sale hardware support and front-line technical help. Caldera will train Fujitsu's support team and act as behind-the-scenes technical experts. The two also will work to make Caldera's Linux Curriculum available throughout Japan. In addition, they will begin to codevelop a range of Internet appliances that operate under the open-source operating system.


While not as glamorous as the operating system itself, Linux utilities are no less vital to wide use of the operating system. COMPAQ COMPUTER CORP., for example, has ported its OpenPrint series of printer drivers to Linux. Its subsidiary expects the $70 utility, which links Linux- based PCs to a variety of printers, to encourage corporations to adopt the Unix variant.

A direct sales operation and dependable after-sale support are even more critical to Linux's acceptance in Japan's business world, at least according to Linux market leader RED HAT, INC. After terminating its sales contract with ITSUTSUBASHI RESEARCH CO., LTD., the Durham, North Carolina company established a wholly owned subsidiary in Tokyo just for these reasons. The new unit will expand both its staff and its office space. One of its first moves was to release a $95 update of the Red Hat Linux operating system. In time, the subsidiary plans to offer complete Linux solutions to customers.

LINUXCARE, INC., a provider of Linux technical services via e-mail, the Web and 24x7 telephone support, also is strengthening its local backup for the open-source OS. The San Francisco company has added support for LASER5 Linux 6.0, a successful homegrown version. LASER5, spun off from ITSUTSUBASHI RESEARCH CO., LTD. in August, has shipped more than 1 million copies of its Linux variant. This past summer, Linuxcare announced a technical services agreement with an affiliate of HITACHI, LTD. (see Japan-U.S. Business Report No. 359, August 1999, p. 27).

NOVELL, INC. and SOFTBANK CORP. have opened a jointly staffed marketing support center at the Japanese firm's Tokyo office. The staff of the NDS Solution Center are promoting sales of Novell Directory Service and other network software. The team faces a tough challenge from the imminent debut of MICROSOFT CORP.'s Active Directory Service, which will be part of the new Windows 2000 family of operating systems.

Clearly signaling its intent to win more business in Japan and elsewhere in Asia, TIVOLI SYSTEMS INC. opened an Asian Pacific software R&D center at its Tokyo subsidiary. The new facility will collaborate with local customers to develop products specifically for the Japanese market. It also will accelerate localization of its Austin, Texas parent's products and provide increased technical support. The research center will be connected through dedicated links with Tivoli offices in China, South Korea, Taiwan and Australia to provide customers in these countries with similar services.

In preparation for the March 2000 debut in Japan of SONY COMPUTER, INC.'s PlayStation2 home video game console, METROWERKS CORP. released a version of its popular CodeWarrior software development kit for the new platform. CodeWarrior for PlayStation2 runs under Windows 95/98/NT and is based on the C/C++ languages. The $3,600 SDK comes with one year of technical support.

A new SDK for embedded and real-time operating system devices now is available from PHAR LAP SOFTWARE, INC. The Cambridge, Massachusetts firm's TNT Embedded ToolSuite runs on Windows machines, providing an inexpensive platform for developing embedded Windows-based software through its support for the Win32 tool set. Phar Lap also claims that its product has the only Windows-friendly real-time operating system engine, the Realtime ETS Kernel, which supports multitasking and multithreading. Also included in the ToolSuite are: a MicroWeb server, Ethernet support and modules for a file system, floating-point emulator and flash- memory management. Distributor AI CORP. has priced the SDK at $12,500. The Tokyo company hopes to sell 200 packages a year for revenues of $1.9 million.

Through distributor TOKYO ELECTRONIC DEVICE, INC., Santa Clara, California-based INTOTO, INC. has rolled out several modules that allow embedded, real-time operating systems to integrate easily with three of the latest technology standards. eFireStack and eUSBStack are ready-made frameworks for linking RTOS programs with IEEE-1394 (FireWire) and USB devices, respectively. Intoto also offers a package that gives RTOS programs the ability to conduct VPN sessions. The Yokohama company hopes to sell $4.6 million worth of Intoto software over three years.

Orienting its products to meet the software demands of e-business, INFORMIX CORP. revamped its application development platform. Informix Internet Foundation.2000 includes the Dynamic Server.2000, the J/Foundation, the Web DataBlade, the Excalibur Text DataBlade and the Office Connect modules. The software blends the Menlo Park, California firm's on-line transaction processing products with object-relational technology to reduce development cycles for Java, HTML and XML solutions. Informix's Tokyo subsidiary plans to release the application development package, which is available for Unix, Linux and Windows NT machines, in December.

Another entrant in this field, TECHNOLOGY DEPLOYMENT INTERNATIONAL, INC., has convinced two firms to adopt its Web application development solution. A unit of FUJITSU, LTD. as well as ALPHA SYSTEMS INC. will begin using the Santa Clara, California firm's E-Business Management System to put their business processes on the Web. The Fujitsu affiliate will allow customers to select, deploy and manage communications services as part of their overall network management services package, while Alpha Systems, a developer of communications software, will deliver customer services on-line. EBMS has three main modules: a development environment, a Web portal to manage operations and a portal for management tasks.

AIMAGINE GLOBAL SOFTWARE CO. has entered a third horse in this race, authorizing MITSUBISHI CORP. and that firm's SIRIUS INC. subsidiary as well as FUJITSU KEIYO SYSTEMS ENGINEERING, LTD. to distribute its Synergy family of Web-enabling business applications. Synergy rounds out the Internet/intranet menu of services and software marketed and supported by these companies with its mix of robust, richly structured and secure multitiered solutions. One of the first adopters of Synergy in Japan is NIHON KEIZAI SHIMBUN, INC., which is using the enterprise edition for companywide Internet collaboration and communications applications. Aimagine Global Software is part of Austin, Texas-based AIMGLOBAL TECHNOLOGIES.

Established Web application development suppliers are not standing still. IBM JAPAN LTD., for one, has released a new version of its popular WebSphere Studio rapid application development and server environment. Version 3 supports Java, Enterprise JavaBeans, Java servelets, Java server pages, dynamic HTML and XML with visual layout of Web pages and sites. WebSphere Studio, which costs $740, also allows integrated team development of Web projects.

Dallas-headquartered OBJECTSPACE INC. has plunged into the market for business application development software by signing TOMEN INFORMATION SYSTEMS CORP. as its distributor. ObjectSpace's Voyager and C++ tools are based entirely on Java in order to build scalable, enterprise-class applications that interface with a wide range of hardware and software. TISCO will develop Voyager-based client-server systems as well as provide before- and after-sale technical support. Voyager products are priced between $7,400 and $9,300.

Fujitsu 6680 mainframe users likely will welcome a Web-enabling tool for their applications developed by ENTERPRISELINK TECHNOLOGY CORP. The Campbell, California company's SmartTran package builds Internet-friendly interfaces on top of legacy mainframe software. Already in use at many major Japanese manufacturers and financial institutions (see Japan- U.S. Business Report No. 360, September 1999, pp. 25-26), FUJITSU, LTD. hopes SmartTran for 6680 will stabilize its customer base as well as give its Big Iron a key role in the rush to embrace e-commerce and boost its mainframe marketing efforts throughout Asia. ITOCHU TECHNO-SCIENCE CORP. and NTT COMMUNICATIONS CORP. market SmartTran.


COMPUTER ASSOCIATES INTERNATIONAL, INC. has landed another customer for its enterprise IT infrastructure management solution, Unicenter TNG. NISSEN CO., LTD., a major mail-order retailer, recently transitioned its IT department from a hierarchical mainframe structure to an open, distributed environment. With its priority on reliable scheduling of product purchases and shipments, Kyoto-based Nissen chose Unicenter TNG for its ability to integrate a wide range of hardware and software and its reliability track record.

Hoping to gain mutual advantage from their strong customer bases, MICROSOFT CORP. and FUJITSU, LTD. are offering a joint enterprise information management solution. The electronics giant has used Microsoft's Systems Manager Server SDK 2.0 to port its SystemWalker EIM to the SMS environment. Together, SystemWalker for SMS can automate a wide range of IT operations, extend remote control capabilities, enhance scheduling functions, and promote system reliability and interoperability. The English-language version of the software already has been released in the United States. A Japanese edition will be available in December.

Since Big Iron mainframes are far from being dinosaurs in Japan's corporate IT world, TIVOLI SYSTEMS INC.'s subsidiary continues to roll out updated management products for S/390 machines. Tivoli Management Framework, Security Management, Service Desk v1.2, NetView, Global Enterprise Manager and Enterprise focus on the mainframe's new role as the backbone of e-commerce. The new framework and plug-ins help IT departments deliver enhanced levels of services while supporting the continuous availability of e-business applications throughout the enterprise.

CANDLE CORP.'s subsidiary is offering an alternative industrial-strength, e-business-centered set of programs for OS/390 users. The El Segundo, California firm added double-byte character set and national language support to its Omegamon II for MVS, CICS, DB2, DBCTL and IMS performance monitors, the OmegaView integration tool and the Candle Command Center for MQSeries management tool. Candle's products monitor and optimize a broad range of mainframe functions, improving system performance and reliability. The Tokyo subsidiary also offers a complete range of consulting and support services, including application integration, response- time management and messaging middleware optimization. Omegamon II for MVS goes for $60,000, while the OmegaView integration tool costs $26,200. The Candle Command Center for MQSeries management tool is priced at $9,700 for the server version and at $945 and up for each client machine.

HEWLETT-PACKARD JAPAN LTD. is marketing a network-performance management solution for Windows NT systems. Listing for $9,000-plus, HP OpenView NetMetrix Performance Center monitors a company's entire LAN and WAN networks, regardless of protocol or transmission media. Assessments of network performance and status can be made in real time or as an overview of the previous 24 hours of operation.

INTEL CORP.'s marketing unit is offering PC makers a new version of the LANDesk Management Suite. Version 6.3 integrates Web tools for managing networked PCs over an intranet, automatic distribution of software to client machines, versatile tools to track and manage network resources, software metering for calculating license fees and close collaboration with antivirus utilities.

To meet the data-protection needs of continuously available systems, SUN MICROSYSTEMS, INC. released Sun StorEdge Instant Image software. Sun Enterprise server users now can perform backups, instant data recovery, application testing and development, and data warehouse loading without impacting the full availability of the system's resources. Not only does this avoid system downtime for vital routine maintenance tasks, but it allows customers to recover from a disaster more quickly since backups can be scheduled frequently. Depending on the server, Sun StorEdge Instant Image costs anywhere from $5,600 to $92,600.

MANUGISTICS, INC.'s subsidiary has expanded its Open Application Interface family of enterprise resource planning software. To the core OAI Enterprise, which automates and optimizes supply chain management functions, Manugistics rolled out OAI/Net. This product extends the reach of the $185,200 core package throughout the Internet/intranet/extranet. The Rockville, Maryland firm hopes that its software's ability to integrate with existing off-the- shelf and industry-specific applications will appeal to customers adopting the e-business model.

In an unusual strategy to expand its business in Japan, ORACLE CORP.'s subsidiary agreed to provide comprehensive training in its ERP and customer relations management software to 20 engineers at CSK CORP., one of its distributors. Besides becoming familiar with the technical aspects of the software, CSK personnel will study Oracle's approach to consulting and integration services. The big systems integrator will deploy the Oracle-trained staff in its recently created Internet Solutions Division. Oracle will help the new unit get off the ground by contributing one marketing specialist to the team. CSK hopes that these moves will multiply its $4.6 million-a-year Oracle-related business tenfold within just three years.

CRM software developer RELAVIS CORP. has added a powerful marketing partner: IBM JAPAN LTD. Since the New York City company's OverQuota CRM and sales force automation package works on top of the Notes/Domino groupware suite produced by LOTUS DEVELOPMENT CORP., a subsidiary of IBM Japan's parent, the pairing is a natural evolution of Relavis' marketing strategy. Both IBM Japan and the local unit of Lotus Development have launched OverQuota sales campaigns, bolstering Relavis' initial marketing effort (see Japan-U.S. Business Report No. 355, April 1999, pp. 27-28).

With e-businesses proliferating, NET EFFECT SYSTEMS of North Hollywood, California has teamed with CORPORATE SOFTWARE LTD. to offer customers its Internet-based Live Help customer-care service. The instant messaging-based software features skills-based routing, multisession management, real-time session escalation, transcript capture, knowledge-base integration, remote Web browser administration and solution development tools. Corporate Software — a joint venture between STREAM INTERNATIONAL INC. and FUJITSU, LTD. that now has more than 400 employees at two locations in the Tokyo area — has targeted the highly scalable package at large companies with global customer bases.

To protect its significant customer base, Mountain View, California-based ASPECT DEVELOPMENT, INC. strengthened the support, engineering and marketing staffs of its subsidiary and rolled out a Web-friendly version of its customer service management solution. eXplore 2000 adds tools to better manage interactions with both customers and suppliers, expanding the software's functions into another category.

Neighbor SAGENT TECHNOLOGY, INC. signed agreements with two key firms to deliver its customer service management solutions. INFORMATION SERVICES INTERNATIONAL-DENTSU, LTD. and INTEC INC. are using Sagent's data warehousing solution to link back-end data resources with front-end customer relations operations. The system determines what data is appropriate for each customer, automates delivery of that information to them, and keeps management informed of trends in customer profiles and needs. Sagent and its partners are courting end-users as well as the nascent application services provider market with their CRM-oriented data warehouse service. By the end of March 2000, ISID hopes to win contracts from 10 companies to install the Sagent system.


ORACLE CORP.'s marketing unit is shipping a version of its Web-enabled Oracle8i relational data base management system for the Linux open operating system. The Japan-only Oracle8i Workgroup Server for Linux 8.1.5 will be available from NEC CORP. as well. .....Similarly, SYBASE, INC.'s subsidiary issued a new version of its RDBMS for Linux users. Adaptive Server Enterprise 11.9.2 is priced at just $2,900.

Interest in the market for data-mining and decision-support software also remains strong. SAS INSTITUTE INC.'s Tokyo office announced a marketing partnership with the data-processing outsourcing unit of TOPPAN PRINTING CO., LTD. The new allies will promote the Cary, North Carolina firm's SAS Enterprise Miner package to a wide range of clients. They also will offer consulting and technical support. Toppan staff will use SAS Enterprise Miner in particular to evaluate the effectiveness of a client's marketing programs.

SPOTFIRE, INC. has taken aim at the pharmaceutical market with its technical and scientific decision-support package. To give it a head start in this ambitious effort, the Cambridge, Massachusetts company picked an ITOCHU CORP. affiliate with strong ties to the industry: CTC LABORATORY SYSTEMS CORP. Spotfire's software lets researchers collaborate via the Internet and gives these virtual meetings access to the project's complete data base as well as to tools to analyze the pool of knowledge.

Continuing the drive to diversify its product lines, ORACLE CORP. has released version 6.2.1 of its Financial Analyzer. The new on-line analytical processing and decision-support tool is based on the Redwood Shores, California firm's Express Server OLAP engine. It integrates tightly with Oracle General Ledger, giving users the power to conduct complex financial planning, forecasting and reporting. The Financial Analyzer engine is priced at $23,100, while client licenses are $2,300 each. Oracle's subsidiary believes that it can sell as many as 150 packages in the first year of marketing.

The software unit of EASTMAN KODAK CO. granted exclusive distribution rights to its family of collaborative knowledge management software products to CIS CORP., the Japan marketing and training partner of EASTMAN SOFTWARE, INC. since May 1998. The Billerica, Massachusetts firm's Work Manager Suite provides out-of-the-box solutions that work on top of Microsoft Outlook and Exchange Server messaging software. CIS specializes in groupware solutions, supporting offerings from both MICROSOFT CORP. and LOTUS DEVELOPMENT CORP. (see Japan- U.S. Business Report No. 356, May 1999, p. 30).

A Japanese version of MAPINFO CORP.'s latest geographic information system is available from MI-TSUI ZOSEN SYSTEMS RESEARCH, INC. MapInfo Professional 5.5J can create highly detailed maps for presentation. Its output also can assist corporate decisionmaking by providing sophisticated analysis of geographic information, forming the basis for managing geographically based assets and helping to plan logistics and responses to emergencies. The subsidiary of MI- TSUI ENGINEERING & SHIPBUILDING CO., LTD. priced an upgrade from a previous version of MapInfo Professional at $1,600 and a full version at $4,400.

VISIO CORP. has updated its business graphics package for the new millennium. Visio 2000 Standard Edition produces organizational, flow and time-line charts more quickly, thanks to built-in artificial intelligence, which helps users pick the proper symbols, and a large library of templates and examples. Visio 2000 is Web-enabled, allowing on-line collaboration on projects as well as providing real-time feedback for editing. .....VISIO CORP.'s subsidiary also released Visio 2000 Technical Edition, which brings the new, Web-friendly 2000 architecture to creators of technical and engineering diagrams. A key productivity enhancement is the software's ability to create illustrations by importing engineering data from a wide range of computer-aided design packages and other data sources. An upgrade costs $275, while the full package is priced at $760. Seattle-based Visio promises to deliver shortly 2000 editions of its professional and enterprise graphics software.

An alternative graphics package from MICROGRAFX, INC. is billed as being the "Swiss Army knife" of business illustration programs. iGrafx Designer can produce business diagrams, interactive Web graphics and highly precise technical illustrations. The subsidiary of Allen, Texas Micrografx is pitching the $460 iGrafx system to the construction, automotive and electrical machinery industries, hoping to sell 10,000 copies in the first year.

SYMANTEC CORP. has refreshed its entire line of antivirus utilities for business and individual users. Norton AntiVirus Enterprise Solution, which will be released in Japan in December at $90-plus, and the $60 Norton AntiVirus 2000 can combat the latest iterations of destructive programs, such as those embedded in e-mail messages.

Embracing the Internet tidal wave, INTUIT INC. has made its best-selling QuickBooks2 accounting package more Web-friendly. Aimed at both small businesses and homes, the localized version of QuickBooks2 enables users to tap into the Web site run by BANK OF TOKYO- MITSUBISHI, LTD. to obtain financial information as well as conduct on-line banking. Users also can go directly to DAIWA SECURITIES CO., LTD.'s Web site to engage in on-line stock trading. To top it off, the new version of QuickBooks2 costs $280, or about 45 percent less than its predecessor. .....Separately, INTUIT INC.'s marketing unit will integrate its Obanto financial analysis package and Yayoi accounting software into a new product, Yayoi Pro. Intuit is realigning its small-business products under the new brand. Eventually, it will offer software to automate purchase orders, sales accounting and salary management in addition to the finance/accounting module.

MICROSOFT CORP. is not leaving this market to INTUIT INC. Later this year, the subsidiary of the software giant will release a localized version of the follow-on to Money 98. Slanted more toward home users, Money 2000 offers enhanced financial asset management tools and direct links to investment tools sponsored by Microsoft and on-line information sources created by such companies as DC CARD CO., LTD., NOMURA RESEARCH INSTITUTE, LTD., NOMURA SECURITIES CO., LTD. and SUMITOMO BANK, LTD. The new version is expected to have the same street price as Money 98, or about $110. .....The marketing arm of MICROSOFT CORP. also is selling a Japanese-language version of the new Encarta Encyclopedia Deluxe 2000 for around $270. Besides the encyclopedia entries, the latest version includes a world atlas and a complete dictionary. Despite the significant increase in data resources, the electronic knowledge compendium still fits on one piece of media because it is published on a DVD-ROM. If the previous CD-ROM format were used, the new Encarta would require seven discs.


IBM JAPAN LTD. will collaborate with HITACHI, LTD., JUSTSYSTEM CORP. and big appliance retailer KOJIMA CO., LTD. to promote sales of the latest iteration of its ViaVoice voice- recognition software for PCs. Intended mainly for use with word-processing programs, the $90 ViaVoice Millennium boasts an improved accuracy rate of 98 percent to 99 percent and a reduced user voice-training time of 10 minutes as opposed to 30 minutes with earlier editions. The $170 Pro Millennium version allows users to direct with spoken commands almost the complete range of computer operations. Hitachi plans to integrate ViaVoice into a special version of its Flora 220MP PC for use in situations where a keyboard is impractical. Justsystem will add ViaVoice to its Ichitaro word-processing software, creating the $260 Voice Ichitaro 10 e- Talk package. Finally, Kojima and IBM Japan will develop an English-language study program that uses the speech-recognition software to check students' pronunciation.

Taking aim at the high end of the CAD software market, PARAMETRIC TECHNOLOGY CORP.'s subsidiary introduced Pro/ENGINEER 2000i. The $11,600 package has more than 500 enhancements compared with the previous edition. It changes the collaborative design process to promote excellence through object-driven design tools. Besides being completely Internet- enabled, Pro/ENGINEER 2000i employs behavioral modeling. The software starts by asking for product specifications and requirements and works backward to provide engineers with the tools that can achieve these goals.

In the midrange CAD software field, VISIONARY DESIGN SYSTEMS, INC. released a kanji version of its IronCAD 2.0 solid modeling program. This is the first time that the Santa Clara, California company has offered a localized product. Exclusive distributor HITACHI ZOSEN INFORMATION SYSTEMS CO., LTD. (see Japan-U.S. Business Report No. 355, April 1999, p. 30) expects that the new version's support for Japanese, ability to run under Windows 95, 98 and NT, and price of just $7,300 will give a big boost to sales.

AUTODESK, INC. is not ignoring the low end of the CAD market. It created AutoCAD LT 2000 by paring bells and whistles from its flagship product and restricting it to two-dimensional designs. Nevertheless, Autodesk's subsidiary expects strong sales of the LT version, thanks to a low base price ($1,200), inexpensive upgrade cost ($370) and special pricing for educational institutions ($505).

In the process modeling software segment, ASPEN TECHNOLOGY, INC. has won a contract from KURARAY CO., LTD. to install its Aspen Engineering Suite at six of the Osaka manufacturer's chemicals and plastics facilities in Japan. The Cambridge, Massachusetts firm's software will help Kuraray plant engineers boost production efficiency by accurately modeling complex physical and chemical interactions. Installation of the software actually started in July. Aspen Technology's manufacturing execution software know-how already is on display at TONEN CHEMICAL CORP.'s ethylene plant in Kawasaki, Kanagawa prefecture.

MONTEREY DESIGN SYSTEMS INC. has put its Dolphin physical design system in the rough waters of Japan's electronic design automation software market. The Sunnyvale, California firm's EDA solution is a complete and fully integrated physical design system that shortens time-to-silicon for submicron, million-gate chips. Monterey chose SOLITON SYSTEMS K.K. as its distributor. A team of 12 Soliton sales people and engineers will sell and support Dolphin to the firm's established base of customers.

With advanced wireless Internet access the latest rage in Japan, PHONE.COM, INC. announced that it has licensed its UP.Browser small-memory-footprint Web browser to 10 communications gear makers. They are: CASIO COMPUTER CO., LTD., DENSO CORP., HITACHI, LTD., KYOCERA CORP., MATSUSHITA ELECTRIC INDUSTRIAL CO., LTD., NEC CORP., SANYO ELECTRIC CO., LTD., SHARP CORP., SONY CORP. and TOSHIBA CORP. All these firms will use the Redwood City, California firm's microbrowser to deploy Wireless Application Protocol- compatible Web browsers on their wireless phones. Before yearend, they expect to be shipping the phones to DDI CORP. and to NIPPON IDOU TSUSHIN CORP. (see Japan-U.S. Business Report No. 359, August 1999, p. 26), which are trying to catch up with NTT MOBILE COMMUNICATIONS NETWORK, INC. and its popular iMode phone.

Equally important for wireless phone users is the ability to quickly, accurately and securely transfer data between remote servers and their handheld devices. Help is on the way. NETTECH SYSTEMS, INC. granted exclusive distribution rights to its wireless middleware to ITOCHU TECHNO-SCIENCE CORP. That company will promote the Princeton, New Jersey firm's Smart IP and ExpressQ software to mobile phone makers, highlighting the former's automatic network reconnection feature and the latter's data transfer optimization abilities.

With major communications services providers already using its data-synchronization solution (see Japan-U.S. Business Report No. 356, May 1999, p. 29), PUMA TECHNOLOGY, INC. continues to make headway in the wireless middleware market. In its latest move, the San Jose, California company tied up with Tokyo's AICON INC. to jointly market a software development kit for Puma's Intellisync solution. The partners see a wide variety of potential customers for the automatic data-update program, ranging from businesses that need to keep in-the-field sales agents' data bases current to individuals synchronizing address lists between their home computers and cellular phones. The development kit costs $27,600, including support, training and upgrades.

An exchange rate of ¥108=$1.00 was used in this report.

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The premier government communications research organization in Japan will install CONTINENTAL ELECTRONICS CORP.'s PowerStar L50 50-kilowatt transmitter, which is known for its accurate, synchronized timekeeping and frequency capability. The Communication Research Laboratory will use the transmitter to coordinate time and frequency with other stations around the world. DENKI KOGYO CO., LTD., Dallas-based CEC's representative, arranged the deal with the Ministry of Posts and Telecommunications-run lab.

With its Pacific Crossing-1 U.S.-Japan undersea fiber-optic cable system nearing completion, GLOBAL ACCESS LTD. has decided to build out its broadband, seamless global network by extending it into Asia. It enlisted MICROSOFT CORP. and SOFTBANK CORP. as minority participants in project organizer ASIA GLOBAL CROSSING LTD. This company will construct a nearly 11,000-mile-long undersea network linking Japan with its neighbors. It also will build high-capacity city rings and terrestrial systems tied to the undersea cables. That infrastructure, known as East Asia Crossing, will enable the partners to offer an array of services throughout the region, including state-of-the-art telehouses, Web hosting, e- commerce and other advanced services as well as low-cost, high-quality telephony to businesses and consumers. Global Crossing, which will be responsible for the management and operation of the East Asia Crossing network, contributed to Asia Global Crossing its 57.75 percent share of PC-1. Microsoft and Softbank each put up $175 million in cash, giving them a combined 7 percent stake in the joint venture. East Asia Crossing, expected to cost some $1.3 billion to build, will be constructed in two stages. The first phase, a length of 6,300 miles, will be finished by yearend 2000. It will connect PC-1 at a landing station in Japan with Taiwan, Singapore, Hong Kong, Malaysia and the Philippines. The second phase, covering 4,700 miles, has a June 2001 completion date. This part of the project involves linking Japan to two stations in China, one in South Korea and one in Taiwan. Composed of four fiber pairs that have self- healing capabilities in case of an outage, East Asia Crossing initially will have a capacity of 80 gigabits per second, but it is upgradable to 2.56 terabits per second through dense wavelength- division multiplexing. KDD SUBMARINE CABLE SYSTEMS INC. is the prime contractor for East Asia Crossing's first phase. This company partnered with MARUBENI CORP. and Global Crossing, which operates from Los Angeles, on PC-1. KDD-SCS also is that project's primary subcontractor.

INTEL CORP. has moved into the Internet services hosting business — a diversification that extends to Japan, where one of a network of worldwide Internet services centers should be operational in the first half of 2000. The new INTEL ONLINE SERVICES, INC. specializes in what are called second-generation Internet application hosting services. These include better hosting reliability and faster development of e-business solutions for customers of all sizes. They also encompass the purchase, integration and deployment of all the hardware and software needed to run e-business applications. The site of the Internet services center in Japan has not been chosen, but the facility will duplicate Intel Online Services' initial center in Santa Clara, California. This location can host more than 10,000 servers and has the capability to deliver second-generation application hosting services as well as first-generation colocation. It also features redundancy and heightened physical security. Intel Online Services already has the first customer for its Japanese center — NEC CORP. and its Biglobe Internet on-line service. The two plan as well to collaborate in the Internet services field, although many of the details are still up in the air. Intel's announcement of an Internet hosting center in Japan came just weeks after PSINET INC. launched a similar initiative there (see Japan-U.S. Business Report No. 360, September 1999, p. 28).

On a related front, INTEL CORP. brought its Internet Service Provider Program to Japan. Targeted at ISPs, application service providers and value-added resellers that could benefit from help in designing and constructing Internet infrastructure, the program draws on Intel's expertise in semiconductor technology as well as in network equipment and virtual private networks. The company's subsidiary already has signed agreements with the local unit of PSINET INC., OSAKA MEDIA PORT CORP. and seven other ISPs, plus MITSUBISHI CORP., NTT SOFTWARE CORP. and OKI ELECTRIC INDUSTRY CO., LTD.

RAPID LINK, which offers Internet Protocol-based voice and data services, acquired ICSC, an Internet services provider located in Okinawa. The purchase enables the Atlanta company, which already operates a long-distance service in the prefecture, to give its customers the option of adding dial-up Internet access to their accounts.

Accessing the Internet through a TV set would seem to be an extremely marketable service in a country like Japan where home computers are not the norm. However, WEBTV NETWORKS INC., the provider of such a service, has found the going harder than anticipated. It now has marketing help beyond that supplied by FUJITSU, LTD., which owns 25 percent of WebTV's subsidiary. Major cellular phone distributor HIKARI TSUSHIN, INC. is selling the WebTV service at its 1,750-plus stores under the HIT-Mail TV name. Unlimited Internet access costs $39.80 a month, including the cost of a keyboard and a set-top box. WebTV is owned by MICROSOFT CORP.

Even if it is the undisputed world leader in networking equipment for the Internet, CISCO SYSTEMS, INC. had to be pleased to be selected to supply NTT COMMUNICATIONS CORP.'s IP- based virtual private network service. The long-distance/international carrier will use Cisco's Gigabit Switch Router 12000 series products for the optical IP networking core backbone and Cisco 7500 series routers for edge routing. The result will be a seamless, end-to-end solution based on Multi Protocol Label Switching. That technology will enable NTT Communications to differentiate service classes for individual data flows, thereby ensuring privacy, quality of service and any-to-any connectivity. Its platform scalability largely sold the carrier on Cisco's IP VPN solution. NTT Communications is set to roll out IP VPN services in the first quarter of 2000.

Although contracts with big corporations obviously are vital to its business success, CISCO SYSTEMS, INC. has decided that there are many unexploited sales opportunities among smaller companies that are starting to look into LAN and networking technologies. To reach this market, its subsidiary, which now deals mainly with 100 or so systems integrators, hopes to sign up as many as 300 sales agents in the next year. It already has reached agreement with a DAIWABO INFORMATION SYSTEM CO., LTD. affiliate. Sales through that company could total $92.6 million over three years. CABLETRON SYSTEMS INC. also is trying to broaden its marketing channels (see Japan-U.S. Business Report No. 360, September 1999, p. 30).

Existing CISCO SYSTEMS, INC. distributors have two new products to sell. The Cisco 7100 Series of integrated VPN routers gives enterprise customers a secure, scalable platform for cost-effective remote access, intranet and extranet connectivity using public data services. It does this by integrating high-speed routing with six key VPN components: tunneling, data encryption, security, firewall, advanced bandwidth management and service-level validation. The Cisco 7100 Series lists for $46,300 and up. New as well is the Cisco 3660 Multiservice Platform for branch and regional offices. An extension of the Cisco 3600 Series, it provides the density, performance and expansion capability required for applications combining data, video, analog voice and digital voice. Pricing of the platform starts at $18,200.

Switching technology pioneered by ARROWPOINT COMMUNICATIONS, INC. has enabled what the Westford, Massachusetts company calls a new breed of Web-specialized switches. These products optimize not only connectionless IP traffic (packets per second) but also the connection-oriented traffic generated by e-commerce applications. Put another way, Web switches direct Web content requests to the best site and the best server at a given moment based on server loads and proximity as well as application and content availability. ArrowPoint's pair of Content Smart Web switches is being marketed by SUMISHO ELECTRONICS CO., LTD. The CS-100, which costs $40,300, is a compact switch that provides a combination of high-speed flow switching and content intelligence for small to midsize Web sites. The CS- 800, a carrier-class modular switching platform, enables the provisioning of high-volume Web hosting, e-commerce, application hosting or other Internet application services. It lists for $111,100.


Bandwidth constraints increasingly are hamstringing the operations of ISPs in Japan. INFOLIBRIA, INC., a developer of content distribution and management products, has a solution for this problem. Moreover, its answer soon will be more widely available now that the Waltham, Massachusetts company has signed MARUBENI SOLUTIONS CORP. as a distributor in addition to TOKYO ELECTRON LTD. InfoLibria's DynaCache Web cache system enables ISPs to move frequently requested content to the edge of their networks, close to end users, so that when sought, it does not need to travel across the Internet. Marubeni Solutions will sell this product, which starts at $21,800, as well as the MediaMall streaming media device, which gives Internet users access to broadcast-quality audio and video on their PCs, and the Content Commander management system. It thinks that DynaCache sales could total $9.3 million over three years.

LUCENT TECHNOLOGIES INC.'s subsidiary has on the market a product designed to facilitate the convergence of voice, video and data over the same network at the pace a company requires. The Cajun P330 Switching System provides modular functionality. Up to 10 units can be stacked together for a total of 400 10/100 ports per stack, yet the system can be managed as a whole. Redundancy is built into the system, as is the ability to have Ethernet and ATM (asynchronous transfer mode) access in the same stack. A Cajun P330 unit costs about $5,600. CHIYODA JOHO KIKI CO., LTD. is one of the firms that will be marketing the switch.

DSL (digital subscriber line) technology is ready for prime-time, large-scale deployment, according to LUCENT TECHNOLOGIES INC. Its breakthrough Stinger DSL access concentrator allows services providers to deliver high-quality voice to their business and residential customers over a single copper connection along with high-speed data, Internet access and video services. Thus, the platform, which resides in the central office and supports all versions of DSL, can cost-effec-tively meet the growing demand for new broadband services. The system can provide up to 16 phone lines per customer as well as dedicated data and Internet access. Lucent's subsidiary will ship Stinger before yearend. Although pricing has not been decided, it starts at $440 per port in the United States. The platform can handle 672 ports per chassis and 2,016 ports per rack.

In what both describe as a win-win situation, LUCENT TECHNOLOGIES INC. and IWATSU ELECTRIC CO., LTD. tied up to develop and sell private branch exchange-based CTI solutions for small and midsize businesses. For the big American manufacturer of communications gear, the alliance gives it the chance to extend its PBX market reach beyond corporations and call centers to Iwatsu Electric's customer base of smaller companies. At the same time, the Japanese partner will be able to draw on Lucent's technical expertise in CTI systems.

The SoundStation conference phone, a POLYCOM, INC. product, will be marketed by SUN TELEPHONE CO., LTD. The SoundStation features three directional microphones, a volume- adjustable speaker and all-digital speech processing. That technology, the San Jose, California manufacturer says, enables the system to adapt automatically to changing room and telephone line conditions for natural, full-duplex conversations without clipping or distortion. Sun Telephone expects the SoundStation to duplicate its success elsewhere in the world, where it is the top-selling conference phone. It projects annual sales of 2,000 units of the $1,300-and-up system.

With Japan likely to be the first country to roll out third-generation, or wideband, mobile communications systems, INTERDIGITAL COMMUNICATIONS CORP. plans to open an office in Tokyo early in 2000 to position itself as a key supplier of the coming technology through sales and licensing. The King of Prussia, Pennsylvania company already has licensed its second- generation TDMA (time-division multiple access) and CDMA know-how to a number of Japanese makers of wireless equipment, giving it an inside track on licensing the 3G technology that it now is developing to these and other makers. InterDigital is working on both system-on-a-chip solutions and components for the coming era of mobile communications. ......In the meantime, the licensing arm of INTERDIGITAL COMMUNICATIONS CORP. signed a royalty-bearing TDMA patent license agreement with JAPAN RADIO CO., LTD. Under it, the company received an up-front payment from JRC covering the manufacturer's past sales of handsets for the PHS (personal handyphone system) and PDC (personal digital cellular) standards. InterDigital also will receive money on future sales of these products.

The 10-month-old subsidiary of the self-described world leader in PC Card modems and network interface cards for linking mobile and remote computer users to the corporate network, the Internet and other on-line services, XIRCOM, INC., has found the going in Japan tougher than it expected, even though portable machines are so prevalent. It now is projecting sales in the year through September 1999 at $7.4 million rather than the $13 million originally estimated. To get revenues on a faster growth track, the Thousand Oaks, California supplier wants to work with five distributors rather than the one it uses now to get its products into more retail channels. At the same time, the Xircom unit hopes to trim distribution costs and its margin so that retail prices can be cut by as much as 20 percent to 30 percent.

PROXIM, INC., the Sunnyvale, California maker of the very popular RangeLAN2 wireless LAN product family, is bringing its Symphony Cordless Networking Suite to Japan. Billed as the first consumer wireless networking solution available there, the line eliminates the constraints imposed by the installation of just one phone jack in most homes and small offices because Symphony allows PCs and laptops to be located in the most convenient place for the user. I-O DATA DEVICE, INC. will market and sell the suite, which employs frequency-hopping spread- spectrum radio frequency technology for secure and interference-free connections. Symphony products include the Cordless PCI Card for desktops; the Cordless PC Card for laptops; the Cordless Modem, an optional stand-alone product for shared Internet access; and the Cordless Ethernet Bridge, another stand-alone solution for shared broadband Internet access.

Atlanta's ACCORD TELECOMMUNICATIONS named NISSEI SANGYO CO., LTD. to market what it calls a next-generation multipoint control and gateway unit for the videoconferencing and collaboration market. The MGC-100 connects up to 84 ISDN remote sites. It also provides a single platform for handling IP and ATM conferences, linking together 132 of the former sites and 80 of the latter. Within 1999, Nissei Sangyo expects sales of the MGC-100 to total $1.9 million. It priced the base, eight-port model at $18,500. The high-end configuration goes for $555,600.

An exchange rate of ¥108=$1.00 was used in this report.

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CUTTER & BUCK, a Seattle manufacturer of golf and business casual apparel, signed an exclusive distribution pact with SEIBU DEPARTMENT STORES LTD. Effective immediately, seven of the retailer's top-selling stores will carry Cutter & Buck's upscale men's golf sportswear. All 22 Seibu stores are scheduled to stock the brand in 2000. The partners also plan to introduce a line of women's golf apparel. Although the time frame is uncertain, Seibu will open a freestanding Cutter & Buck store in the Aurora Mall at Higashi Totsuka, near Yokohama.

The Joe Boxer brand of underwear for fashion-con-scious young men will be available in Japan before yearend. San Francisco's BOXER HOLDINGS, INC. licensed manufacturing and marketing rights to the line to ITOCHU CORP., which turned around and sublicensed them to FUKUSUKE CORP. The long-estab-lished Osaka maker of socks and underwear expects the 70 department stores and the 30 specialty shops that initially will carry Joe Boxer products to generate retail sales of $1.9 million in the first year. Targeted at men between 18 and 26 years old, the merchandise will include knit boxer shorts priced at $16.65, cotton boxer shorts listing between $13.90 and $18.50 and T-shirts in the $13.90 to $25.90 price range.

With input from people who subscribe to a parenting magazine published by RECRUIT CO., LTD., the subsidiary of TOYS "R" US INC. is introducing a line of original products at stores that have Babies "R" Us sections. Six products, including a $25.90 blanket that attaches to a stroller and a $32.40 diaper bag designed specifically for vehicles, already are stocked by 17 Toys "R" Us outlets. By next April, the company plans to have 20 of its own products in its stores.

An exchange rate of ¥108=$1.00 was used in this report.

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Success in Japan hinges on a clear brand identity, executives of FORD MOTOR CO. have concluded. Accordingly, the company will phase out the sale of rebadged vehicles built by MAZDA MOTOR CORP., which the number-two U.S. automotive maker controls through a 33.4 percent stake. This decision, to be implemented by 2003, represents a fundamental turnabout in Ford's Japan marketing strategy since fully 70 percent of the nearly 22,000 Ford-badged vehicles sold there in 1998 were built by Mazda. At the end of the transition, the company plans to be selling seven or eight Ford-exclusive products, such as the midsize Explorer sport-utility vehicle, the Mustang sporty coupe, the new Focus subcompact car and the European-built Mondeo subcompact sedan. The lineup also will include a compact SUV that Ford and Mazda are codeveloping for world markets. Starting in the latter part of 2000, Mazda will assemble the right-hand-drive version of the truck in Hiroshima for both itself and its parent to market in Japan. While the two vehicles will share the same platform and engine, the Ford model will have a distinctive body. The switch in marketing tactics obviously will cost Ford sales over the near term. Some of its 200-plus dealer locations also could close because of the change. Management is optimistic, however, that in time, volume can be build up to 25,000 or even 30,000 units a year.

With no fanfare, DAIMLERCHRYSLER JAPAN CO., LTD. rolled out the redesigned Dodge Neon subcompact sedan. Company officials hope that the car's European styling and more luxurious look and feel will help sell this model. The original right-hand-drive Neon, which first appeared in dealer showrooms in May 1996, never lived up to the relatively modest sales projections for it despite aggressive pricing, at least at first. The new, upmarket Neon lists for $19,900, considerably more than its predecessor.

Five vehicles that TOYOTA MOTOR CORP. builds in Japan, including the Celica and the Crown, will be equipped with mufflers that incorporate OWENS CORNING FIBERGLAS CORP.'s Silentex muffler filling technology. The mufflers will be manufactured by FUTABA INDUSTRIAL CO., LTD., Japan's top maker of this product and Toyota's primary muffler supplier, and SANGO CO., LTD. Silentex mufflers use Owens Corning's proprietary Advantex high-temperature glass- fiber insulating material for improved efficiency, durability and acoustic performance. The Toledo, Ohio company tailored its glass-fiber materials and the muffler filling system to Toyota's requirements with help from the automotive maker and its two muffler suppliers. The Toyota contract marks the first time that Owens Corning's muffler technology has been applied in Asia.

HARLEY-DAVIDSON MOTOR CO.'s dealers in Japan now are linked to each other and to the motorcycle manufacturer's marketing subsidiary through a Web site. Dealers can use it to order parts and accessories and to check the inventories of other Harley retailers for particular products they need. In the future, the Harley subsidiary will use the Internet exclusively to provide information to its dealers.

An exchange rate of ¥108=$1.00 was used in this report.

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Bar-coding to track materials, monitor inventory and perform other supply chain-related functions could become a thing of the past if an alliance between MO-TOROLA INC. and TOPPAN FORMS CO., LTD. lives up to its potential. They have agreed to develop and market "smart" label solutions that integrate Motorola's unique BiStatix radio frequency identification technology into Toppan Forms' labels and forms. The information contained in the paper-based smart labels and forms will be readable and modifiable through a wireless interface, giving these products a distinct advantage over bar codes. Moreover, BiStatix tags can be read without a clear line of sight and are not rendered useless by moisture, dirt, dust or paint. Motorola and its partner — which also is working on smart label solutions using technology licensed from POLYMER FLIP CHIP CORP. (see Japan-U.S. Business Report No. 359, August 1999, p. 24) — expect to have their first products on the market early in 2000.

New York City's BROWNE & CO., INC., the world's largest financial printer, has established a full-service financial printing office in Tokyo. Open 24 hours a day, seven days a week, the office has the resources to prepare, translate and print documents for Japanese companies listing their shares overseas or selling bonds abroad. It also is prepared to handle all information-management services for its multinational financial clients operating in Japan. In 2000, the new Browne office expects to do $4.6 million worth of business.

ZipLock plastic containers from S.C. JOHNSON & SON, INC. are on store shelves. At $3.70 for a package of three, the product costs about half of what similar, locally made containers do. ASAHI CHEMICAL INDUSTRY CO., LTD. is the exclusive importer of the ZipLock containers, while Tokyo-based SARAN WRAP SALES K.K. is in charge of marketing. It is projecting sales of $9.3 million in the first year. Together with already introduced ZipLock storage bags, Saran Wrap Sales believes that the ZipLock line can generate revenues of $92.6 million in five years.

GOLFGEAR INTERNATIONAL INC. awarded exclusive East Asian distribution rights to its golf clubs and other golf equipment and accessories to M.C. CORP. The pact excludes South Korea, where distribution arrangements already are in place. To improve its chances of success, the Huntington Beach, California company will design products specifically for the Asian market. As part of the deal, M.C., which has interests in real estate and construction, made a $2 million equity investment in GolfGear.

To promote the sale of its movie titles on DVDs in Japan as well as elsewhere in Asia and in Australia, the home entertainment international division of TWENTIETH CENTURY FOX FILM CORP. signed a tie-in deal with DVD player manufacturer MATSUSHITA ELECTRIC INDUSTRIAL CO., LTD. The two-year exclusive arrangement covering Japan began in October with the release of "Titanic" on DVD. Under it, MEI will provide TV and print advertising, point-of-sale materials and trade-show sponsorship.

Information on on-line user behavior soon will be available to advertisers, media planners, Web site operators and e-commerce firms in Japan on a weekly and monthly basis. The recently established Tokyo subsidiary of NETRATINGS, INC., an Internet media tracker and market researcher, will use randomly selected terminals to calculate how many hits particular Web sites get and which ads are clicked on and how often. The Milpitas, California start-up expects its Japan revenues to total $3.2 million in FY 2000 and $4.6 million in FY 2001. NetRatings financed its move into Japan in part by using money TRANS COSMOS INC.'s Bellevue, Washington investment unit invested in it in August.

An exchange rate of ¥108=$1.00 was used in this report.

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