No. 362, November 1999

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Japanese Companies in the United States

American Companies In Japan

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The decade-long relationship between MITSUI CHEMICALS, INC. and ROGERS CORP. has resulted in an agreement to make a flexible circuit board laminate used in the read/write head suspension assemblies of cutting-edge hard disk drives. Equally owned POLYIMIDE LAMINATE SYSTEMS LLC will build a factory in Chandler, Arizona to produce the specialty adhesiveless laminate, comprised of copper, polyimide and stainless steel. Custom-manufactured for demanding flexible circuit applications, the material now is turned out by Mitsui Chemicals at a Nagoya factory. PLS will sell the imported product until the Arizona plant is operational, which should be no later than 2003. A primary customer will be HUTCHINSON TECHNOLOGY, INC. of Hutchinson, Minnesota, the world's leading supplier of suspension assemblies for HDDs in the form of TSA Trace Suspension Assemblies. In addition to its ties to Mitsui Chemicals, Rogers, Connecticut- based Rogers has an equally owned joint venture with INOAC CORP. that makes high- performance elastomer products at facilities in Nagoya and Mie prefecture.

North American automotive production is so strong that JSP CORP. is having trouble meeting demand for the expanded polypropylene bead foam used to make the cores of the plastic bumpers found on most of today's vehicles. Accordingly, the dominant (three- quarters or so of the market) manufacturer of EPP bead foam in the United States has committed $2.8 million to build its sixth American production facility. Located in Tullahona, Tennessee, the factory is scheduled to be completed in July 2000. It will boost the capacity of JSP's Malvern, Pennsylvania subsidiary by 20 percent to roughly 18,500 tons a year. The Tennessee location, which will have a work force of 15, could add $11.3 million to JSP's annual U.S. revenues. The company's other EPP bead foam plants are in San Bernadino, California, Milledgeville, Illinois, Detroit, Butler, Pennsylvania and Monoca, Pennsylvania. It also has a Mexican facility.

Now that commercial production of biaxially oriented polyamide film has started at its Canadian joint venture, NICHIMEN CORP. has launched marketing of the material. Recently formed BIAXIS PACKAGING SALES, INC. of Arlington Heights, Illinois initially is targeting sales of the nylon film for meat packaging. It is projecting first-year revenues of $18.9 million. Manufacturer AMERICAN BIAXIS, INC., owned by the trader and a Canadian company, is located in Winnipeg, Manitoba.

In the latest phase of a relationship that dates back to 1980, FUJIKURA KASEI CO., LTD. and RED SPOT PAINT & VARNISH CO., INC. are pursuing the development of water- based, environmentally friendly paints for polypropylene plastic automotive parts. Coatings containing potentially harmful organic solvents now typically are applied to this material. Ecologically sound yet high-performance coatings for automotive plastics is an area in which the Evansville, Indiana-headquartered manufacturer has made a name for itself. A joint research and development team already is at work at Red Spot, hoping to commercialize products within three years. If successful, the partners say that they will consider forming a manufacturing and marketing venture aimed at supplying the paints to Japanese vehicle builders operating in North America.

Japan's number-two pharmaceutical company is positioning itself to better capitalize on business opportunities in the United States. For starters, SANKYO CO., LTD. will merge its two wholly owned U.S. subsidiaries at the end of 1999 in a move designed to accelerate decisionmaking and to forge closer ties between product development and marketing. SANKYO PHARMA INC., based in New York City, will be the surviving company. Moreover, to buttress its U.S. development capabilities, Sankyo planned to open in November a research facility in Edison, New Jersey. The center could have as many as 30 people on staff in the next few years. The company's current U.S. product development research efforts are spearheaded by a 35-member team in New York City. Sankyo also announced that by the middle of 2000, it expects to file its first independent new drug application with the Food and Drug Administration. CS-866 (olmesartan medoxil) is an oral antihypertensive angiotensin-II receptor antagonist that the drug company discovered in its Japanese laboratories. Three Sankyo products already are on the American market, but they are all licensed to major U.S. pharmaceutical firms (see Japan- U.S. Business Report No. 360, September 1999, pp. 2-3). Although Sankyo made clear on this occasion as it has in the past that it wants to build its own U.S. marketing capability, nothing was said about the future of SANKYO/PARKE-DAVIS CO., its Parsippany, New Jersey venture with WARNER-LAMBERT CO. The company's other operations here are a discovery research information center in San Diego, California and LUITPOLD PHARMACEUTICALS INC. of Shirley, New York, a manufacturer of multisource injectable drugs and animal health products acquired in 1990.

TEIJIN LTD. gave TAP PHARMACEUTICALS INC. the right to develop in the United States TMX-67, a xanthine oxidase inhibitor that is in Phase II clinical trials in Japan, as a possible treatment for gout and to market it in North America if testing is successful. Reportedly, no new oral therapy to treat gout has been introduced in this country for more than 30 years. The disease is characterized by sudden, recurring attacks of very painful arthritis caused by deposits of monosodium urate crystals. These accumulate in the joints because of an abnormally high level of uric acid in the blood. TAP Pharmaceuticals is a long- standing venture between TAKEDA CHEMICAL INDUSTRIES, LTD., Japan's biggest drug company, and ABBOTT LABORATORIES. It recently filed a new drug application for UPRIMA (apomorphine HCI tablets) sublingual for the treatment of male erectile dysfunction (see Japan-U.S. Business Report No. 359, August 1999, p. 3).

One of the gaps in MERCK & CO., INC.'s current product lineup is a treatment for prevalent adult-onset or Type II diabetes. That hole could be plugged if a product that KYORIN PHARMACEUTICAL CO., LTD. licensed to the leading prescription drug manufacturer pans out. KRP-297, which is undergoing Phase I clinical trials in Japan, is an insulin sensitizer that also corrects certain lipid abnormalities. Merck plans to begin clinical testing in the United States in the first quarter of 2000. Its development and marketing rights to KRP-297 cover all areas of the world outside of Japan, the People's Republic of China, South Korea and Taiwan. Kyorin Pharmaceutical received an up-front licensing fee. It also will get royalties on sales if Merck commercializes KRP-297.

Through a private placement, SANGAMO BIOSCIENCES, INC. raised $7.5 million from existing investor JAFCO CO., LTD. as well as from three other companies. The Point Richmond, California biotechnology firm's technology platform, based on engineered zinc- finger proteins, is used to accelerate the functional analysis of newly discovered genes and to validate genes. It also has application in the areas of human therapeutic, plant genomic and clinical diagnostic products. Over the last year, Sangamo has launched collaborations with 14 generally major pharmaceutical and biotechnology companies. One of those is JAPAN TOBACCO INC. (see Japan-U.S. Business Report No. 355, April 1999, p. 2).

The shift in production of aluminum substrates for hard disks to Southeast Asia has forced a reorganization of the North American operations of C. UYEMURA & CO., LTD. The Osaka manufacturer is one of the world's biggest suppliers of plating chemicals for this product. Its Ontario, California marketing subsidiary, formed in 1992 with MITSUBISHI CORP. as a minority (13.3 percent) partner, had outsourced production of the plating chemical to a Mexican firm for U.S. sale, but that arrangement has ended. Instead, UYEMURA INTERNATIONAL CORP. will import it while trying to build up sales of chemicals used in the manufacture of integrated circuit packages and printed circuit boards. To that end, it opened a technical center in Southington, Connecticut. Trial production of PCB-use chemicals already is underway. If successful, Uyemura says that it will consider commercial U.S. production of that and related chemicals.

An exchange rate of ¥106=$1.00 was used in this report.

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The restructuring plan that NISSAN MOTOR CO., LTD. announced in October contained some far-flung prescriptions for returning the automotive maker to financial health. Near the top of the list for North America was the unexpected decision to hand over to INTERNATIONAL BUSINESS MACHINES CORP. management of all of the company's information technology operations in the United States and Canada. The $1 billion contract, which will run for nine and a half years, covers the computer systems at Nissan's big manufacturing complex in Smyrna, Tennessee, its parts production affiliates, the firm's distribution/sales, finance, R&D and design units, and its Torrance, California- headquartered holding company, NISSAN NORTH AMERICA, INC. Beyond indicating that the deal would save Nissan a significant amount of money, neither the vehicle builder nor IBM assigned a hard number to the cost-cutting. Much of the savings will come from transferring roughly 240 Nissan North America IT employees to the computer giant, which has been very successful this year in expanding its services division both in the United States and in Japan. The personnel shift also will help Nissan North America reach the restructuring plan's goal of trimming employment in the United States and Canada by 1,400 people.

In a much more limited restructuring but one probably driven as much by cost considerations as by the stated goal of better serving its mobile computing customers, FUJITSU, LTD. combined its two U.S. personal computer companies. The merger folded FUJITSU PERSONAL SYSTEMS, INC., said to be the undisputed leader in the Windows pen-tablet market, into notebook computer supplier FUJITSU PC CORP. The new FPC is headquartered in Santa Clara, California rather than in Milpitas, California, although offices remain there. It also continues to operate a build-to-order/service center in Memphis, Tennessee.

The most powerful mainframe on the market is how HITACHI DATA SYSTEMS CORP. describes the just-released Hitachi Skyline Trinium. The Santa Clara, California supplier says that its flagship mainframe platform is the first such product to process more than 2 billion instructions per second and that the Trinium tops the competition in executing up to 320,000 simultaneous input/output operations per second. Both characteristics obviously help companies handle surges in trading volumes and electronic-business transactions. So does the Trinium's complete redundancy and dynamic failover on all critical components.

SONY ELECTRONICS, INC., one of the innovators behind thin, sleek desktop PCs, has added functionality to the newest member of the VAIO Slimtop LCD Computer series. The VAIO PCV-L620 is equipped with a 500-MHz Pentium III processor, 128 megabytes of synchronous dynamic random access memory, a 13-gigabyte hard drive, a DVD-ROM (digital video disc-read-only memory) drive and 8 MB of video memory. It also has a dedicated Memory Stick media slot for quick transfers of digital data, text, graphics, audio and video between digital camcorders, still cameras, desktop PC and portables, plus two iLINK (IEEE 1394) ports, a like number of USB (universal serial bus) ports, a pair of PCI (peripheral component interconnect) ports and a Type II PC Card Slot. The monitor is a 14.1-inch active-matrix TFT (thin-film-transistor) liquid crystal display with XGA (extended graphics array) resolution (1024 x 768 pixels) and integrated multimedia speakers. The VAIO PCV-L620 has an estimated street price of $2,500.

The new 650 MHz and 700 MHz Pentium III processors are options with the build-to-order Equium 7100 series of commercial desktops from TOSHIBA AMERICA INFORMATION SYSTEMS, INC.'s Computer Systems Group. The first desktop computing line to offer a standardized motherboard and components as well as a single software profile across multiple chassis styles -- full-size, minitower and slim line -- and feature sets, the Equium 7100 family is aimed at business customers interested in lowering the total cost of ownership while still obtaining solid performance. Pricing starts at $1,500 for a system with a 650-MHz Pentium III and at $1,700 for one equipped with a 700-MHz engine. Neither price includes a monitor.

Going after the corporate buyer that ranks a low purchase price and a reduced total cost of ownership as its first and second most important purchasing criteria, TOSHIBA AMERICA INFORMATION SYSTEMS, INC. CSG rolled out the Equium 7300 family of BTO full- size and slim-line commercial desktop machines. The base configuration costs as little as $750. That buys a 366-MHz Celeron chip as well as INTEL CORP.'s new i810 chipset. Celeron processors running at 400 MHz, 433 MHz, 466 MHz or 500 MHz also are available.

The NEC Computer Systems Division of PACKARD BELL NEC, INC. introduced a second line of PowerMate commercial slim desktop, desktop and minitower machines that share a common motherboard. PowerMate 5250 systems can be equipped with either Celeron or Pentium III processors with clock speeds ranging from 400 MHz to 600 MHz to complement their 440BX chipset. Hard-drive capacity extends from 4.3 GB to 18 GB, while up to 512 MB of internal memory is possible. A PowerMate 5250 costs as little as $800 or as much as $3,800.

Strong holiday season sales are critical to the future of money-losing PACKARD BELL NEC, INC. Its Consumer Division is counting on a new line of affordable, easy-to-use, full- featured home PCs to help turn the tide. The machines are powered by 400-MHz to 500- MHz AMD-K6-2 processors with 3DNow! technology. PC audio and three-dimensional AGP (accelerated graphics port) graphics complement the multimedia-oriented engine. Standard memory is 32 MB, expandable to 96 MB. A 40X compact disc-ROM drive and a hard drive holding as much as 10.2 GB of data provide ample storage space. The PCs come preloaded with such home-focused software as Microsoft Works, Microsoft Money, Intuit Quicken and MGI PhotoSuite. They also have one-button Internet access. Prices start as low as $450. Even the top-of-the-line model costs just $700. A mail-in rebate trims both prices by $50.

Nearly 22,700 configuration choices are possible with the Tecra 8000 notebook computer from TOSHIBA AMERICA INFORMATION SYSTEMS, INC. CSG. The latest options include the new, performance-boosting 500-MHz mobile Pentium III processor with 256 kilobytes of integrated Level-2 cache and a 100-MHz system bus. The Tecra 8000 also can be built with the latest high-speed PC100 memory, starting at 32 MB and going up to 256 MB. An 18-GB hard drive is available as well, as are capacities of 6.4 GB, 10.1 GB and 14.1 GB. The base Tecra 8000 model with a 500-MHz mobile Pentium III costs $3,500. For volume buyers, TAIS offers a system for $4,000 that includes the new processor, 64 MB of PC100 memory, a 10.1-GB hard drive, a 4X DVD-ROM drive, a 14.1-inch XGA active-matrix TFT display and Windows 98.

TOSHIBA AMERICA INFORMATION SYSTEMS, INC., the top seller of portable computers, also made several additions to its Satellite series of value-priced notebooks. One is the $2,000 Satellite 2615DVD, which includes a 433-MHz mobile Celeron processor, 64 MB of SDRAM, a 6-GB hard drive and a 12.1-inch active-matrix TFT display. Its companion, the Satellite 2665XDVD, lists for $2,400. This machine has the same memory and storage capacities as well as the identical integrated V.90/K56flex modem and one-touch Internet access button, but it provides the performance of a 466- MHz mobile Celeron and the easier viewing experience of a 14.1-inch active-matrix TFT display. TAIS also released Satellite models for more budget-conscious small businesses, students and families. The Satellite 1555CDS costs as little as $1,200 for a 380-MHz AMD mobile K6-2 processor and 32 MB of SDRAM. For more demanding computing requirements, the Satellite 2100/2105CDS notebooks use a 400-MHz AMD mobile K6-2 chip. The Satellite 2100CDS, which has 32 MB of internal memory, costs $1,300, while the Satellite 2105CDS with 64 MB of system memory goes for $100 more. A 12.1-inch Color Bright display, an all-in-one 4.3-GB hard drive/diskette drive/24X CD-ROM drive, an integrated V.90/K56flex modem and easy Internet access are common to all three of these models. For people willing to spend $1,700, the Satellite 2100CDT delivers a 400-MHz AMD mobile K6-2 processor, 64 MB of synchronous memory and a 12.1-inch active- matrix TFT display.

Giving mobile professionals desktop performance on the go is how SONY ELECTRONICS, INC. introduced the VAIO F Series of high-performance notebooks. The five-model line is headed by the VAIO PCG-F390, a $3,700 or so system that features a 500-MHz mobile Pentium III processor, 128 MB of SDRAM (expandable to 256 MB), a 12-GB hard drive and a 15-inch XGA active-matrix TFT display. Like its F Series counterparts, this notebook also has an all-in-one design that includes a fixed floppy drive, hard drive and CD-ROM or DVD-ROM drive built in, dual battery capability, an iLINK digital interface, a complete suite of Sony digital video software and its PictureGear software for enhanced management of digital content. .....With some trade-offs, the high-end features of the stylish VAIO F Series are available in a sleek package that measures just 1.75 inches thick and weighs six pounds. SONY ELECTRONICS, INC.'s VAIO PCG-XG9 combines a 500-MHz mobile Pentium III processor with 128 MB of SDRAM, an 18.1-GB hard drive and a 13.3-inch XGA active-matrix TFT display. Its estimated selling price is $3,500.

The "new" FUJITSU PC CORP. marked its arrival with two new product lines in the LifeBook family of notebook computers, major redesigns of two others and a refreshment of a fifth. Its desktop replacement candidate is the new LifeBook X Series. Powered by a 500-MHz mobile Pentium III processor, these products can be configured with as much as 256 MB of system memory and up to 12 GB of hard-drive storage. Standard features are a 15.1-inch XGA active-matrix TFT display, 8 MB of video memory, a built-in floppy disk or SuperDisk 120 drive and a flexible bay that supports hot-swapping of CD-ROM, DVD or CD-Rewritable drives. Pricing of the LifeBook X Series starts at $3,400. The other new line is the thin, lightweight LifeBook S Series. A skinny 1.25 inches high and an easy-to- carry 3.74 pounds, these models run off a 400-MHz mobile Pentium III processor. They offer a choice of 64 MB or 128 MB of RAM and either a 6-GB or a 9-GB hard drive, plus a 12.1-inch active-matrix TFT display with a SVGA (super video graphics array) resolution of 800 x 600 pixels and an internal flexible bay for as little as $2,300.

FUJITSU PC CORP. also reengineered the LifeBook B Series to give business buyers even more configuration choices. The processor can be a 450-MHz or a 500-MHz mobile Pentium III, a 433-MHz Pentium II or a 433-MHz Celeron. Systems are available with either a 13.3-inch or a 14.1-inch XGA active-matrix TFT display, up to 256 MB of RAM, a 6.4-GB or a 10-GB removable hard drive and a modular CD-ROM, DVD or CD-RW drive. LifeBook E Series pricing starts at $1,700. The LifeBook E Series of mininotebooks also got a makeover with the addition of a larger 10.4-inch SVGA TFT display with touch screen and a bigger keyboard. The line, which currently runs off a 400-MHz mobile Celeron processor, offers as much as 192 MB of system memory and a 6-GB hard drive. A built-in 56K2 V.90 modem and integrated 10/100Base-T Ethernet local area network capabilities are included in the starting price of $1,800. Finally, Fujitsu PC brought the power of the 450- MHz and the 500-MHz mobile Pentium III processors to its line of multimedia notebooks, the LifeBook C Series. An AMD mobile K6-2 running at 450 MHz also is an option on these systems.

The line of ruggedized Windows-based notebooks from PANASONIC PERSONAL COMPUTER CO. has been shrunk to an ultraportable 3.8 pounds. The new, 1.7-inches- high Toughbook 17 and Toughbook 34 also are the first models to sport integrated wireless communications capabilities. Both use a 300-MHz mobile Celeron processor and offer 64 MB of RAM and a shock-insulated 4.3-GB hard drive. The screen is an 8.4-inch SVGA active-matrix TFT color display with touch capability and antireflective treatment. The two models, which lists for $3,240 and $3,190, respectively, differ only in the design of their magnesium case.

The first 10,000-rotations-per-second drives from HITACHI, LTD. for high-end workstation and server products and for storage systems will ship in the spring of 2000 after sampling in the first quarter. The 3.5-inch family includes a 1.6-inch-high drive providing 73.9 GB of storage, plus a pair of 1-inch packages with capacities of 36.9 GB and 18.4 GB. These boosts result from the application of high ariel density technologies that Hitachi incorporated in its 2.5-inch drives. All three drives are available with either a 100-MB-per-second Fibre Channel interface for storage area network and server farm installations or a 160-MB-per- second Ultra 160 SCSI (small computer system interface) data storage system interface.

FUJITSU, LTD., reportedly the world's fifth-largest supplier of hard drives, signed a cross- licensing agreement with its bigger rival, QUANTUM CORP. By giving each other access to its patented know-how, the two hope to remain competitive at a time when continuously falling PC prices are putting constant pressure on drive manufacturers.

To capitalize on the convergence of printers and scanners with such previously stand-alone products as copiers and facsimiles that digital technology is fostering, TOSHIBA CORP. created TOSHIBA AMERICA BUSINESS SOLUTIONS, INC. Irvine, California-head- quartered TABS, which has annual sales in excess of $500 million, combines three divisions that were parts of TOSHIBA AMERICA INFORMATION SYSTEMS, INC. These are the Electronic Imaging Division, which makes plain paper copiers and fax machines in Irvine and distributes these and imported products; the Toner Products Division, a producer/distributor of toner products with a plant in Mitchell, South Dakota; and the Document Solutions Engineering Division, a digital controller R&D organization. Also coming under TABS is a wholly owned subsidiary that runs a network of U.S. copier/fax dealers.

To extend its market share in the graphic arts, print and imaging fields, especially the print- on-demand part of the business, MINOLTA CO., LTD.'s Ramsey, New Jersey subsidiary signed LONDON LITHO to distribute, integrate and support its digital color printer/copier and printer products. Minolta's first value-added reseller for the POD market, the Lincolnwood, Illinois company will handle the Minolta MicroPress Cluster Printing System, a midvolume, short-run, on-demand, digital system for printing both black and white and color documents. Other products covered by the contract are the CF Series of color products, including the networkable CF910 digital color printer/copier and the CF911P and the CF911PE full-color laser printers.

The combination of MINOLTA CO., LTD.'s laser imaging technology and IMATION CORP.'s patented color management software has yielded what the partners calls a breakthrough digital color proofing system for creative and design professionals. The Minolta-Imation Matchprint Color Laser System, which should be available in the first quarter of 2000, will include Minolta's CF910 digital color printer/copier or CF911P networkable color laser printer, new Matchprint Color Laser Software from Oakdale, Minnesota-based Imation and 12 x 18-inch cobranded Minolta-Imation Matchprint Color Laser Paper. The software is expected to cost less than $2,500. Pricing of the paper will be decided later.

Mount Laurel, New Jersey-based OKI DATA AMERICAS, INC. introduced the OKICOLOR 8 Series to meet the stand-alone and workgroup color printing needs of small and midsize businesses. The line's two machines, which include a network-ready product, print eight color pages per minute. This speed is due in large part to the incorporation of OKI Single Pass Color technology, which features arrays of light-emitting diodes rather than lasers and four individual print stations. The paper moves along a straight path, picking up all four colors in a single pass instead of making four trips around the drum. The OKICOLOR 8 has a suggested price of $3,300, while the OKICOLOR 8/n lists for $3,800.

Small businesses can buy a six-ppm color or seven-ppm black text ink-jet printer for as little as $200 with a mail-in rebate. That is the price of SEIKO EPSON CORP.'s EPSON Stylus Color 760. Also priced to move at $270 is the new EPSON Stylus Color 860, which produces up to 7 ppm of color output and 9.5 ppm of black text. Both printers deliver a resolution of 1440 dots per inch, what is said to be the smallest droplet size in their classes and the company's Micro Piezo print technology. They also are equipped with built-in USB and parallel ports for compatibility with APPLE COMPUTER, INC.'s iMac and Power Macintosh G3 machines as well as Windows PCs. .....SEIKO EPSON CORP.'s Long Beach, California marketing unit also introduced the first laser printer designed to work with the iMac. The EPSON EPL-5700i, which costs $350 after a mail-in rebate, prints up to eight ppm with a resolution of 1200 dpi. Another major selling feature, Epson believes, is a low-cost, 6,000-page toner cartridge.

KYOCERA ELECTRONICS, INC., the Duluth, Georgia marketer of the Ecosys page printers, launched a family of products for printing checks, money orders, bank drafts and other financial documents. The three initial magnetic ink character recognition printers in the line incorporate a number of features to ensure the security of sensitive financial information. The entry-level model, which is designed for such applications as automatic teller machines with its 14-ppm speed, is priced at $2,000. The $4,500 top-of-the-line model outputs 28 ppm, making it suitable for high-volume check printing and MICR printing in a networked environment.

Ten months of development work by SHARP CORP. and OPENLCR.COM, INC. of Fort Collins, Colorado have yielded the first fax machines that automatically select the least- expensive carrier for each call, depending on the day of the week, the time of day and the area called. That capability is the result of openLCR technology, which also updates the long-distance carrier rate table embedded in Sharp openLCR-Ready fax machines every quarter. The first such products released by the company's Mahwah, New Jersey sales and marketing arm will be for personal and SOHO (small office/home office) use.

Volume shipments have begun of an input system for both PCs and Macintoshes that pairs a cordless scrolling mouse with a cordless pressure-sensitive pen. The $100 Graphire is manufactured by WACOM CO., LTD., the world's leading maker of computer graphics tablets and electronic pens, and marketed by its Vancouver, Washington subsidiary. The system is designed not only for more natural drawing and writing but also to add signatures to computer documents.

An exchange rate of ¥106=$1.00 was used in this report.

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The Ihilani Resort and Spa on Oahu, Hawaii, one of the crown jewels of JAPAN AIRLINES CO., LTD.'s once far-flung real estate empire, will be sold to a Hawaiian company as part of the restructuring of the airline's investment portfolio. The nearby Ko Olina Golf Club also is part of the deal. The price of the transaction was not disclosed, but industry sources place it somewhere around $94.3 million. The resort and its 387-room luxury hotel opened in 1993. A JAL HOTELS CO., LTD. affiliate currently manages the properties, but that job will be handed over to MARRIOTT INTERNATIONAL, INC. when the sale is finalized.

An exchange rate of ¥106=$1.00 was used in this report.

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NITTO DENKO CORP. is scouting sites in Ohio and California for a R&D facility that it hopes will help put the company on the cutting edge of the electronics materials field. The Osaka prefecture firm currently makes such related products as LCD display polarizing sheets and flexible printed circuit boards. The facility, which will have a start-up staff of 10 and equipment to do prototype production, could be operational within a year. Among Nitto Denko's varied U.S. operations are HYDRANAUTICS, INC., a San Diego, California maker of reverse osmosis membrane elements, ultrafiltration elements and systems, and GRAPHIC TECHNOLOGY, INC., which makes bar-code labels and systems in New Century, Kansas.

In an alliance aimed at delivering integrated process control solutions to their respective customers, YOKOGAWA ELECTRIC CORP. has teamed with DRESSER EQUIPMENT GROUP, INC. to develop and market products, systems and management tools that comply with the international Foundation field-bus data-transmission standard. New products will include industrial automation systems, measurement devices and control valve systems. Initially, the partners will cooperate on technology and systems integration for a Foundation field-bus positioner. They bring complementary strengths to this task. YEW provides a wide variety of process field instruments, test and measurement equipment, distributed control systems, systems integration, software and services to customers worldwide, while Dallas-based Dresser, a HALLIBURTON CO. unit, is a global leader in equipment and services for the energy industry, including valves, instruments, engines, fuel dispensers and gas meters. Sources in Japan say that Yokogawa Electric pursued the alliance to keep pace with such rivals as YAMATAKE CORP.

The combination of a manufacturing license from MATSUSHITA ELECTRIC INDUSTRIAL CO., LTD. and its own expertise enabled CMK CORP. to commercialize an ALIVH (any-layer interstitial via hole) printed circuit board for digital cameras. It already is delivering this product to EASTMAN KODAK CO. for its DC215 digital camera. MEI's ALIVH is an advanced substrate technology that specifically targets the design challenges created by shrinking vias, the pathways that carry a signal from one PCB layer to another. CMK initially applied this fix for high-density PCBs to cellular telephones before moving on to digital cameras; handheld electronic devices are a third target market. About 10 percent of its ALIVH PCB output now goes to Kodak.

DAISHINKU CORP., Japan's leading maker of crystal resonators, relocated one of its U.S. marketing subsidiaries to Marietta, Georgia from Overland Park, Kansas to better serve East Coast customers. A warehouse also was built at the new site to cut one or two days off delivery times. The Hyogo prefecture manufacturer also reorganized the distribution channels of its Costa Mesa, California subsidiary.

Four Japanese companies are among the members of a San Francisco organization formed to promote a common global infrastructure for smart-card implementation across multiple industries. GLOBALPLATFORM, INC.'s efforts should be aided by VISA INTERNATIONAL INC.'s decision to transfer its Open Platform card specifications and terminal framework to the group. This technology, now used by the financial services and telecommunications industries, can be implemented with the Java Card platform from SUN MICROSYSTEMS, INC. and Microsoft Windows for Smart Cards. GlobalPlatform's Japanese participants are JCB CO., LTD., the number-one credit-card issuer in Japan, NIPPON TELEGRAPH AND TELEPHONE CORP., NEC CORP. and TOSHIBA CORP.

VICTOR CO. OF JAPAN, LTD. is working with PHOENIX TECHNOLOGIES LTD., the San Jose, California supplier of the BIOS software found in today's PCs, to develop a new audio/visual intellectual property technology standard for networking consumer electronics products and Internet appliances. AVIP will be designed to facilitate quick and easy connectivity to a network without a PC or PC-related equipment for directly downloading digital movies, digital music and the like. It also will provide automated configuration of the products and appliances. In addition, AVIP's security features will ensure the protection of copyrighted materials. By drawing on Phoenix's expertise in linking computing and communications technologies through its system-enabling technology, the partners hope within a year to develop AVIP and then win its acceptance as the international standard for connected devices.

A Pennsylvania state government program that has the dual objectives of fostering the development of next-generation technologies in such areas as digital networks and mobile communications and making Pittsburgh a technology center will have at least one Japanese participant. CASIO COMPUTER CO., LTD. signed on to the Pittsburgh Digital Greenhouse project, which brings together businesses, academic institutions and the government. The company will contribute $100,000 to the effort. Casio executives will be on the program's advisory board and also will help select proposals for funding.

Still fine-tuning the organization of its U.S. businesses (see Japan-U.S. Business Report No. 359, August 1999, p. 13), CASIO COMPUTER CO., LTD. gave CASIO COMMUNICATIONS INC. responsibility for sales and marketing of its audio products in North America. These include CD boom boxes, personal CD and cassette players, and travel clock radios. Over the next year, the line will be expanded to MD (minidisc) players, MP3-related products, DVD equipment and karaoke products. Torrance, California-based Casio Communications now markets telephone products for home and small business users.

An exchange rate of ¥106=$1.00 was used in this report.

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One of the largest independent power producers in the world, which doubles as a major U.S. electricity wholesaler, is for sale. Closely held SITHE ENERGIES INC. hired GOLDMAN, SACHS & CO. to find a buyer after first majority owner (60 percent) VIVENDI of France and then minority owner (30 percent) MARUBENI CORP. indicated that they wanted out. Neither investor gave a reason for its decision. Trader Marubeni paid $250 million for its stake in March 1996 and committed money to finance the construction or the purchase of electricity-generating plants. New York City Sithe has more than 28,000 megawatts of capacity in operation, under construction or in active development in the United States and elsewhere.

An exchange rate of ¥106=$1.00 was used in this report.

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SUMITOMO LIFE INSURANCE CO.'s strategy to get the asset-management expertise to succeed in the pension and mutual fund management fields at home includes buying into foreign investment-man-agement "boutiques." Last spring, it acquired what became FARRELL-SL INVESTMENT MANAGEMENT, INC. (see Japan-U.S. Business Report No. 355, April 1999, p. 6). Now, Sumitomo Life has bought a 20 percent stake in SPRINGFIELD & CO., L.L.C. The Chicago firm, which managed assets $1.5 billion worth as of September 1999, exposes the big life insurer to a different set of investment skills: global fixed-income arbitrage.

Broker/investment banker NOMURA SECURITIES CO., LTD. has had its ups and downs in the United States recently. After pulling back from or out of certain activities, its NOMURA SECURITIES INTERNA-TIONAL, INC. unit has moved into the North American private equity market. Following the lead of its London sibling, Nomura Securities International's Manhattan unit formed the Principal Capital Group, also based in New York City. Its mandate is to acquire mature companies in the basic services field that are low technology but asset-intensive. The target purchase price is between $1 billion and $3 billion. The group is selling itself as offering interested sellers quick finalization of the deal and the ability to commit large sums of capital. Since 1994, the London Principal Capital Group has acquired 11 businesses with a total value of $11.7 billion.

The Bellevue, Washington subsidiary of TRANS COSMOS INC. has emerged as a major source of funding for Internet-based start-ups in the United States, particularly those that want to extend their operations to Japan. It now has more money to expand its investment portfolio, having raised $100 million through a second round of private equity financing.

An exchange rate of ¥106=$1.00 was used in this report.

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At a projected cost of $145 million, a partnership between MITSUI & CO., LTD. (30 percent) and LAND O'LAKES, INC. (70 percent) will build the world's biggest cheese and whey production facility in California's Central Valley. Located in Tulare, which is about halfway between Fresno and Bakersfield, the plant should be operational by early 2001. It will make mozzarella and cheddar cheese as well as dried whey and whey fractions. On start-up, the factory will have a capacity of 3 million pounds of milk per day. By 2003, the owners of the yet-to-be-named joint venture expect to double capacity. The plant's output will be marketed initially in the United States, but Land O'Lakes, an Arden Hills, Minnesota- based cooperative of 6,000 dairy producers, obviously hopes that the Mitsui connection will lead to sales in Asia. Through its majority ownership of VENTURA FOODS, LLC, a City of Industry, California-headquartered manufacturer of edible vegetable oils and related products, the trader already has a substantial presence in the U.S. food products market, including margarine (see Japan-U.S. Business Report No. 352, January 1999, p. 5).

PIETRO CO., LTD., a Fukuoka manufacturer of salad dressings and similar products, is looking into U.S. production. Through a Hawaiian subsidiary, the company has been selling about 12,000 bottles of salad dressing a month in the United States, mainly to Asian- oriented grocery stores. A newly formed subsidiary in Dallas is spearheading the project. Current plans call for the plant to be open next spring. Sales are forecast to total $4.7 million a year. Pietro also is exploring the possibility of opening a chain of restaurants on the mainland. It already has five offshore establishments, including one in Hawaii.

A Hawaiian company that farm-raises abalone has received a $2 million investment from Hokkaido fish processor IHARA & CO., LTD. By mixing deep-sea water with regular ocean water, BIG ISLAND ABALONE CORP. is able to raise the mollusk to maturity in two years instead of the normal three. Ihara sees a market for the abalone in Asia and Australia as well as on the West Coast. It is projecting annual sales of Big Island's output at $7.6 million in five years.

Since 1996, SUNTORY WATER GROUP, INC. has acquired 32 bottled water suppliers, making it the undisputed number two in the business with a 9 percent U.S. market share and customers in 40 states. The last two additions were made in the same month. First, the Marietta, Georgia company, which SUNTORY LTD. formed in 1985, bought AQUA- COOL/BREWED HOT COFFEE, INC. of Portland, Oregon. That long-established firm produces a full range of bottled water products for residential and commercial delivery as well as for retail sale in Oregon, Washington and Idaho. It also provides coffee break service and traditional office coffee service. Suntory Water Group then acquired CLEARIDGE, INC. of Nashville, Tennessee. It, too, supplies a complete line of bottled water products to residential and commercial customers. This purchase bolstered Suntory Water Group's presence in markets like Orlando and Tampa, Florida and Nashville while giving it entree to the Memphis, Tennessee market.

An exchange rate of ¥106=$1.00 was used in this report.

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In an unusual move for a Japanese company, JAPAN ENERGY CORP. put its GOULD ELECTRONICS INC. subsidiary in charge of the company's worldwide printed circuit board materials businesses, including R&D, production and marketing. NIKKO MATERIALS CO., LTD., a wholly owned Japan Energy unit, and three of that firm's subsidiaries are being consolidated with Eastlake, Ohio-headquartered Gould Electronics. The combined organization makes copper foil, copper-aluminum-copper and adhesiveless flexible laminates for the PCB industry at 10 manufacturing facilities in North America, Europe and Asia. Its international copper foil capacity is estimated at close to 4,000 tons a month. The expanded Gould Electronics has some 1,300 people on its payroll and annual revenues on the order of $566 million.

An exchange rate of ¥106=$1.00 was used in this report.

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In December, KITO MACHINE INDUSTRIAL CO., LTD. of Aichi prefecture will open its own plant in Lexington, Kentucky after leasing space from another company to turn out welding machines for the automotive industry as well as washing systems and assembly and leak-testing systems. The KITO U.S.A. CORP. factory is equipped with a machining center, various milling machines, a lathe, drill presses, band saws, a grinder, a shearer, a breaker and welding equipment to customize its products to buyers' specific requirements. It will make three varieties of multispot welding systems, plus an intelligent welding system for flexible body welding lines. Kito U.S.A.'s clients include TOYOTA MOTOR CORP.'s North American operations, but the company, which had sales of $2.3 million in the year through March 1999, hopes to win orders from other vehicle makers. It currently employs 12 people.

Another Aichi prefecture manufacturer is building a plant in the United States to better serve its primary customer, TOYOTA MOTOR CORP.'s affiliated forklift manufacturing operation. OKUNO INDUSTRY CO., LTD. has formed a wholly owned subsidiary in Huntington, West Virginia to produce hydraulic cylinders for the lifting mechanisms of TOYOTA INDUSTRIAL EQUIPMENT MANUFACTURING, INC.'s forklifts. Commercial production is scheduled to start in August 2000 at a rate of 2,500 cylinders a month. At that point, Okuno expects to have a work force of 15 people, but staffing could increase to 50 employees in three years. Columbus, Indiana-based TIEM, in which TO-YODA AUTOMATIC LOOM WORKS, LTD. has an 80 percent stake, has been in business since 1990. It encouraged Okuno to manufacture here as part of its drive to expand local sourcing.

MITSUBISHI HEAVY INDUSTRIES, LTD. is conducting a top-to-bottom review of its struggling machine tool, plastic injection molding and other industrial machinery operations at home and abroad. That examination could produce some major near-term changes in MHI's American business activities, executives acknowledge. At a minimum, the company will consolidate its three U.S. machine tool and injection molding marketing subsidiaries. However, closing MHI MACHINE TOOL U.S.A., INC., a Hopkinton, Kentucky manufacturer of machining centers and computer numerically controlled lathes, is a definite possibility. Set up in 1990, MMT had sales of $112 million in FY 1998, but it apparently is not as efficient as MHI's Japanese factories. Any changes in the company's U.S. presence will take place before the end of the current fiscal year.

Like other makers of earthmoving equipment, HI-TACHI CONSTRUCTION MACHINERY CO., LTD. sees an expanding market in North America for compact hydraulic excavators, especially those with a short-radius arm for working in confined spaces. Through its Houston marketing subsidiary, the company released its first such product, a 5-ton machine. That model will be followed in December by 3-ton and 3.9-ton excavators. Hitachi Construction Machinery also will supply these miniexcavators to DEERE & CO. on an original equipment manufacturer basis. The two are equal partners in 10-year-old DEERE-HITACHI CONSTRUCTION MACHINERY CORP., a Kernersville, North Carolina manufacturer of larger-capacity hydraulic excava-tors. Hitachi Construction Machinery is aiming for North American sales of 1,800 compact excavators in FY 2001, which, if achieved, could produce revenues of $66 million.

SUMITOMO (S.H.I.) CONSTRUCTION MACHINERY CO., LTD. is weighing a request from CASE CORP. for it to supply compact hydraulic excavators for North American sale through the Racine, Wisconsin construction equipment manufacturer's distribution channels. Case has marketed Sumitomo Construction Machinery excavators in the 12-ton to 50-ton segment in the United States and Canada since 1992. However, its inquiry presents a dilemma for the Japanese company. It does not make small excavators. The ones it sells in Japan are supplied by ISHIKAWAJIMA CONSTRUCTION MACHINERY CO., LTD., and their contract prohibits Sumitomo Construction Machinery from mar-keting these products in the United States and Europe. Sumitomo Construction Machinery reportedly will decide by yearend whether it will move into the compact end of the excavator market on its own. For the last year, Case has been an equal partner with Sumitomo Construction Machinery in LINK-BELT CONSTRUCTION EQUIPMENT CO. of Lexington, Kentucky, which makes medium and heavy-duty excavators designed by its Japanese parent as well crawler and truck cranes.

In quick succession, JUKI CORP. formed JUKI AUTOMATION SYSTEMS HOLDING, INC. in Raleigh, North Carolina to sell, service and support Juki-brand SMT (surface-mount technology) and semiconductor assembly systems in North America, South America and Europe and then turned around and bought ZEVATECH, INC. That Morrisville, North Carolina company had been selling Juki's PCB assembly systems in these three markets on an OEM basis since 1987 (see Japan-U.S. Business Report No. 353, February 1999, p. 8). The seller was Switzerland's ESEC HOLDING SA, which acquired Zevatech in 1996. Juki, the number three in the world in terms of installed SMT units, initiated the transfer because it did not believe that sales of its equipment in the Americas and Europe were as strong as they could be, particularly from the vantage point of the company's direct sales in Asia.

The March 1998 order that SUMITOMO HEAVY INDUSTRIES, LTD. received from big stainless steel manufacturer ACERINOX S.A. for a skinpass mill and a tension leveler has resulted in a contract for the same equipment from the Spanish corporation's NORTH AMERICAN STAINLESS subsidiary. The skinpass mill will be installed first at the Ghent, Kentucky supplier's hot strip and plate rolling mill, followed three years later by the tension leveler. Like other recent customers, North American Stainless apparently was sold on the SHI equipment in part because of its ability to produce an extremely bright, defect-free strip surface with excellent metal flatness. The mill's ease of operation and quick roll changeovers also were strong selling points.

Market newcomer MATSUSHIMA MACHINERY RESEARCH CO., LTD. gave WOODINGS INDUSTRIAL CORP. of Mars, Pennsylvania exclusive rights to sell its microwave leveling system and related blast and electrical furnace equipment to steel mills for five years. The Kitakyushu, Fukuoka prefecture manufacturer expects the tie-up to produce fast business results, with revenues projected at $943,400 by March 2000. Woodings has strong industry contacts since it is a leading supplier of tap hole drills, clay guns and a long list of other products that are integral to the production of steel and other metals.

In a major win, MITSUBISHI HEAVY INDUSTRIES, LTD. will be the primary equipment supplier for a pair of natural gas-fueled power plants that SITHE ENERGIES INC. plans to build in Massachusetts. MHI won the contract, valued at some $566 million, from RAYTHEON ENGINEERS & CONSTRUCTORS, INC., the turnkey contractor for a 1,600-MW plant at the Mystic Station in Everett and an 800-MW plant at the Fore River Station in Weymouth. Both plants will employ combined-cycle technology, with each of the three 800-MW blocks built consisting of two of MHI's extremely efficient M501G gas turbines, a like number of its heat-recovery steam generators and one MHI steam turbine generator. Work at both sites is expected to start in the first quarter of 2000 and to be completed in early 2002. Thanks in large part to MHI's technology, the new plants will be among the cleanest-burning generating facilities in New England.

Ironically, news of this contract award came right before TOKYO ELECTRIC POWER CO., INC. executives let it be known that the company had decided to buy a natural gas- fueled combined-cycle generating system from GENERAL ELECTRIC CO. for installation at its Futtsu, Chiba prefecture power station. GE claims a 52.8 percent efficiency rating for its state-of-the-art gas turbine versus 51 percent for MITSUBISHI HEAVY INDUSTRIES, LTD.'s competing gas turbine, which TEPCO is installing as part of a combined-cycle system at its Kawasaki, Kanagawa prefecture complex. Engineers at Japan's top electric utility calculate that every percentage point increase in thermal efficiency saves the company some $103.8 million in annual fuel expenses. That and other cost reductions will be key as greater deregulation comes to Japan's electricity market. The Futtsu plant is scheduled to go onstream in 2003, the same year the Kawasaki station is operational.

An exchange rate of ¥106=$1.00 was used in this report.

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Switching positions, FERROTEC CORP., a Tokyo manufacturer of products based on ferrofluid (magnetic fluid) technology founded in part by FERROFLUIDICS CORP. in 1980, is buying its former Nashua, New Hampshire parent. The acquisition cost is around $36.2 million. Ferrotec, an independent company since 1987, had consolidated revenues of $53.3 million in the year through March 1999. Most of its business is in Asia. By buying Ferrofluidics, which reported sales of about $28 million for the year ending June 30, the Japanese company gains a worldwide distribution and marketing network as well as a broader range of products. Ferrofluidics manufactures all its ferrofluids and ferrofluid-based products in Nashua. It has sales and technical support facilities there as well as in Germany and the United Kingdom. Ferrotec's production facilities are located in Japan and China.

Water treatment system manufacturer MORIOKI INDUSTRY CO., LTD. is looking for a company to distribute its magnetic-field water treatment devices for plants and other industrial applications. Known in Japan as Mamoru-Kun, the system uses an electromagnetic field to coagulate and remove iron from water and to minimize concentrations of other impurities. It also prevents the buildup of scale and slime as well as rust. Beyond improving water quality, the system has several environmentally friendly benefits. It also is cost-effec-tive, the Tokyo supplier says. The device is expected to be priced from $12,300 in the United States.

As specified in their September 1998 tie-up agreement, CENTURY MEDICAL INC. has invested a total of $5 million in MICRO THERAPEUTICS, INC. The Irvine, California company manufactures minimally invasive devices for the diagnosis and treatment of vascular disease. Century Medical is its exclusive distributor in Japan (see Japan-U.S. Business Report No. 361, October 1999, p. 23).

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Two affiliates of MITSUI HIGH-TEC, INC. invested a total of $2 million in GATEFIELD CORP., the developer of a flash-based, field-programmable gate array architecture and the resulting ProASIC (application-specific IC) family of high-gate-count, nonvolatile, reprogrammable products. Kitakyushu, Fukuoka prefecture-based Mitsui High-tec, a major supplier of lead frames and packages for the chip industry, is the third major investor in the Fremont, California company. It owns 4.5 percent of Gatefield's shares. Gatefield was spun off from ZYCAD CORP. in 1997.

Soaring demand for flash storage in such products as digital cameras and MP3 audio players has helped to turn two competitors in the flash-memory business into collaborators. Under a memorandum of understanding due to be finalized by January 2000, TOSHIBA CORP., the market leader in NAND-type flash memories, and fabless SANDISK CORP., a prime mover behind the NOR flash-memory architecture and the world's largest supplier of flash data-storage products, will partner to develop and make gigabit-scale flash memories. Their immediate challenge is to come up with 512-megabit and 1-gigabit chips, a costly and technically demanding job, and SD (secure digital) Memory Card controllers. Toshiba brings to this work its future 0.16-micron and 0.13-micron NAND flash-memory technology. Sunnyvale, California-based SanDisk will contribute its multilevel-cell flash technology and controller system integration know-how. The two also will form an equally owned company to share the huge investment required to manufacture the jointly developed flash memories. They initially will use Toshiba's wafer-fabrication facility in Yokkaichi, Mie prefecture. However, sometime in the first half of 2001, production will start at DOMINION SEMICONDUCTOR LLC in Manassas, Virginia. By then, that fab will be wholly owned by Toshiba (see Japan-U.S. Business Report No. 359, August 1999, pp. 8-9). By 2002, the pending partners estimate, their joint venture should be producing more than $1 billion worth of flash memories a year. The Toshiba-Sandisk collaboration also will strengthen their efforts with MATSUSHITA ELECTRIC INDUSTRIAL CO., LTD. to make the SD Memory Card the industry standard for secure memory cards (see Japan-U.S. Business Report No. 360, September 1999, p. 8).

An equally ambitious technology alliance has been forged by HITACHI, LTD. and LSI LOGIC CORP. The big manufacturer of memory products and the system-on-a-chip leader have combined forces to work on process technologies for 0.10-micron designs and beyond. This effort spans not only joint development of a 0.10-micron device architecture but also cooperation on next-generation lithography tools, including direct-write electron- beam technology, and interconnect know-how for 0.13-micron devices. The near-term goal of the collaboration, which already is underway, is a SOC product with an embedded DRAM core. To be available from LSI Logic as soon as mid-2000, the so-called eDRAM will be based on Hitachi's 0.20-micron process technology and the Milpitas, California company's CoreWare design methodology. The Japanese semiconductor maker will serve as LSI Logic's foundry on this and future eDRAM offerings.

Some of the first personal electronic devices to incorporate the radio frequency-enabled wireless communications technology known as Bluetooth could result from the tie-up between module manufacturer TAIYO YUDEN CO., LTD. and SILICON WAVE, INC., a supplier of RF-powered system-on-a-chip solutions. Under their development pact, the Tokyo company will build a line of small modules for cellular telephones, notebook computers and future consumer appliances around the San Diego, California company's small, energy-efficient RMC (radio modem controller) Bluetooth ICs. Sampling of the Taiyo Yuden-Silicon Wave modules could start next spring. HITACHI, LTD. also is working with Silicon Wave but on a Bluetooth chip solution (see Japan-U.S. Business Report No. 361, October 1999, p. 9).

FUJITSU, LTD. and SUN MICROSYSTEMS, INC. will work together to extend the capabilities of the high-end SPARC processor in the market for enterprise-class systems while at the same time enhancing the software compatibility of their respective implementations of the SPARC V9 64-bit architecture. Specifically, they will develop a common programmers' reference model for future generations of the performance-geared, scalar SPARC processor. That will ensure that software written for forthcoming versions of Sun's UltraSPARC processor will run on Fujitsu's new SPARC64 GP products and vice versa. The agreement does not include joint SPARC design work.

As part of its strategy to sell more value-added automotive-use products in the United States, SANKEN ELECTRIC CO., LTD. introduced through subsidiary ALLEGRO MICROSYSTEMS, INC. several high-performance, compact and lightweight Hall-Effect sensors. These include a gear-tooth engine sensor and airbag and antilock braking system sensors. Worcester, Massachusetts-based Allegro, which specializes in mixed-signal ICs, also hopes to commercialize an accelerator chip. Much of its business in the automotive field has been in the power and signal-processing fields.

Japan's largest supplier of recycled silicon wafers, used by semiconductor manufacturers to monitor and optimize their manufacturing processes, is moving into the American market. RASA INDUSTRIES, LTD. plans to set up a subsidiary in California staffed initially by transferred employees to market reclaimed wafers to U.S. chipmakers as well as to Japanese fabs in the United States. Rasa believes that this new business can generate annual sales of $9.4 million in three years. It will be going up against a KOBE STEEL, LTD. subsidiary in Hayward, California, which runs what is said to be the largest silicon wafer reclamation facility in North America (see Japan-U.S. Business Report No. 351, December 1998, pp. 7-8).

Full-scale operations have begun at TOKYO ELECTRON TEXAS, INC. in Austin. By the end of March, the company expects to turn out 15 resist-coating systems for such next- generation products as 1-gigabit DRAMs. For now, all of the parts are imported from owner TOKYO ELECTRON KYUSHU LTD. However, the Texas unit, which has 50 or so employees, is in talks with American manufacturers about outsourcing some components. TOKYO ELECTRON LTD., the parent of the Kyushu company and one of the world's largest makers of semiconductor production equipment, has manufacturing operations in Gilbert, Arizona and Hillsboro, Oregon.

An exchange rate of ¥106=$1.00 was used in this report.

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The largest provider of services designed to help small businesses succeed on-line has won a $39 million vote of confidence from SOFTBANK CAPITAL PARTNERS LP. San Francisco's SMARTAGE.COM will use the money to build its brand, develop its infrastructure and continue its growth. The company's expansion plans include joint ventures in Japan, the United Kingdom and France as well as more U.S. business. already is helping 700,000-plus small firms build Web sites, access free e-mail, promote and advertise their services, and track how often their sites are visited. Softbank Capital Partners, which raised $1.25 billion for late-stage, pre-initial public offering and post-IPO financing, has made at least four other major investments since it was formed in June.

Prior to filing for an IPO, EMBARK.COM raised $24 million in financing from a number of venture capital funds and companies, including ITOCHU CORP. and RECRUIT CO., LTD. The San Francisco firm's Web site targets the higher-education market. Students can research colleges and graduate schools and apply on-line. The site also helps guidance counselors provide better college and career advice. At the same time, academic institutions can use the system to recruit students, handle inquiries and process applications from students around the world.

Some of the biggest American names in the Internet and communications fields participated in a $40 million round of financing for NUANCE COMMUNICATIONS. They were joined by NTT SOFTWARE CORP., OMRON CORP. and TRANS COSMOS INC. Menlo Park, California-based Nuance specializes in natural speech interface software for communications, enterprise and Web-based systems. Its newest product is the Voyager voice browser. Omron, a Nuance distributor, has deployed several speech-recognition systems in Japan based on the American company's technology (see Japan-U.S. Business Report No. 358, July 1999, p. 31).

ANDOR CO., LTD., an up-and-coming Kobe developer of computer-aided design and manufacturing systems, has now committed more than $5 million to APPLIED 3D SCIENCE, INC. The latest transaction included a $1.2 million investment in the Merrimack, New Hampshire venture, which is working on 3D design technology and products for the mechanical engineering marketplace. Andor also will pay nearly $1.4 million in licensing fees to Applied 3D Science. Its first commercially available OEM toolkit had a November release date. A suite of end-user 3D modeling tools will come out in the first quarter of 2000.

The development of cutting-edge computer-aided engineering technologies is the ambitious goal of a technical alliance between FUJITSU, LTD. and the huge Visteon Automotive Systems unit of FORD MOTOR CO. Using its computational analysis capabilities, the Japanese company will develop exclusive hardware and software applications for the world's second-biggest manufacturer of automotive parts to enable it to optimize the use of CAE modeling in the design process. That, in turn, should shorten development cycles. Visteon will employ Fujitsu hardware and software in two of its major simulation technologies: the unified parametric vehicle system and the interior climate comfort engineering system. UPV is used to optimize front-end airflow and to perform exterior aerodynamics analysis. ICCE allows engineers to design interior climate control systems that deliver the best in passenger comfort. In return for Fujitsu's help, Visteon will provide detailed feedback on the developed applications. It also will work with Fujitsu on simulation-based design systems for nonrelated automotive programs.

To help big corporations handle unpredictable surges in electronic-transaction volumes, HITACHI DATA SYSTEMS CORP. launched Hitachi iSuite. This set of integrated solutions is designed to optimize enterprise-class infrastructures in such areas as e- business, enterprise resource planning, availability management and server consolidation. The Santa Clara, California company will backstop Hitachi iSuite by offering four major services: e-business infrastructure optimization, high-availability continuum, enterprise server consolidation and software portfolio management.

The developer of the popular Dragon Quest series of role-playing video-game software is ready to try again to make a go of it in the big North American market. In December, ENIX CORP. will establish a wholly owned subsidiary in Seattle. That new company is expected to launch sales in April 2000 of seven titles for SONY COMPUTER, INC.'s PlayStation video-game console and NINTENDO CO., LTD.'s portable Game Boy machine. Enix moved into the North American market in 1989, but poor sales forced it out in 1995.

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In a deal that was too good to pass up, NIPPON SHEET GLASS CO., LTD. agreed to sell EPITAXX, INC. to JDS UNIPHASE CORP. for $400 million payable in the San Jose, California firm's common stock. West Trenton, New Jersey-based Epitaxx supplies optical detectors and receivers for fiber-optic communications and cable television networks. Its products include long-wavelength detectors and receivers that have application in such much-in-demand products as DWDM (dense wavelength-division multiplexing) and SONET/SDH (synchronous optical network/synchronous digital hierarchy) transmission equipment. Nippon Sheet Glass bought Epitaxx in 1990 for roughly $10 million. The Japanese company already has ties to JDS Uniphase -- a maker of components for optical communications systems that has used acquisitions to fuel its rapid growth -- as a supplier of microlens products.

The restructuring plans that Japan's big, vertically integrated consumer and industrial electronics manufacturers have announced in recent months might be targeted mainly at businesses in Japan, but they also can impact operations in the United States. The latest example of this growing reality is the announcement by NEC AMERICA, INC. that it would sell its Hillsboro, Oregon production facility to a contract manufacturer. Opened in 1985, the plant currently makes a variety of NEC CORP. communications network products, including access network systems, integrated communications systems and SONET equipment. It also produces electronic systems for cars and trucks. Some 500 people work at the factory, which reportedly ships $200 million worth of products annually. Whatever contract manufacturer buys the plant will continue to make NEC-brand communications network equipment and automotive electronic systems, but it presumably will attempt to win business from other companies. NEC America's decision to make the Hillsboro factory a contract manufacturing facility is still rare for a Japanese-affiliated company. It is not unprecedented, though. In late 1998, MITSUBISHI CONSUMER ELECTRONICS AMERICA, INC. turned its Braselton, Georgia cellular telephone plant over to SOLECTRON CORP., the top contract manufacturer.

Two other announcements accompanied this news. First, NEC CORP. disclosed that it planned a "significant" expansion of its network integration and systems integration operations in the United States over the next three years. The buildup will include a roughly 50 percent increase in staffing to about 1,600 people. Although details were scarce, Irving, Texas-based NEC BUSINESS NETWORK SOLUTIONS, INC. apparently will be the primary vehicle for this growth (see Japan-U.S. Business Report No. 353, February 1999, p. 11). Second, NEC USA INC. revealed that it had established the Venture Development Center in San Jose, California to support its parent's strategic reorientation toward R&D and Internet solutions. The facility has the job of commercializing technological breakthroughs that are not necessarily part of NEC's mainstream businesses today and establishing ventures capable of bringing these new technologies to the market. The Venture Development Center will be staffed by R&D specialists from other NEC organizations around the world, including the USA Development Center opened in 1997 in Princeton, New Jersey, although outsiders are expected to be brought in.

These changes ironically are occurring against the backdrop of NEC CORP.'s increasing business with AT&T CORP. Earlier this year, the world's premier provider of voice and data communications started wide-scale deployment of the NEC ITS-2400A, an OC-48 (2.5 gigabits per second) SONET multiplexer. AT&T is using the system to carry all types of sub-OC-48 private line and switched traffic and for SONET ring restoration. The carrier also is using NEC's SpectralWave-32/64 system to help it meet the skyrocketing demand for greater speed and bandwidth. Like other members of the SpectralWave family, this equipment is designed to carry traditional SONET traffic as well as Internet Protocol and other data traffic. AT&T is expected to be a major customer for NEC's forthcoming compact, small-footprint SpectralWave-160, which incorporates the company's L-band (long wavelength) optical amplifiers to deliver high channel counts and large capacity. This system moves traffic at OC-48 and OC-192 (10-Gbps) rates.

Traffic is being carried at 10-Gbps on the coast-to-coast network layer of GLOBAL CROSSING LTD.'s North American Crossing network, thanks to HITACHI TELECOM (USA), INC.'s AMN 5192 OC-192 SONET system. This equipment was ordered before Global Crossing acquired the former Frontier Corp. (see Japan-U.S. Business Report No. 355, April 1999, p. 10). By installing the Hitachi Telecom equipment in its backbone, Global Crossing not only is able to increase its network capacity in large increments, but the four-fiber BLSR (bidirectional line switched ring) technology featured in the AMN 5192 ensures the network's reliability and survivability. The North American Crossing network connects more than 120 metropolitan areas around the United States.

For the first time, KDD SUBMARINE CABLE SYSTEMS INC. has gone outside its traditional group of Japanese suppliers to buy optical fibers for undersea cable systems. It has signed a multiyear contract with CORNING INC. for its Submarine LEAF and Submarine SMF-LS optical fibers. KDD-SCS first will deploy these products in the TAT- 14 transatlantic system, which is scheduled for completion in October 2000. Sources in Japan estimate that about 20 percent of the optical fibers KDD-SCS uses for this project will be purchased from Corning. They also say that the yen's appreciation and the technical sophistication of the Corning optical fibers were behind the contract. Corning's year-old Submarine LEAF optical fiber is designed to minimize the occurrence of nonlinear optical effects, which can degrade the performance of advanced undersea systems. Its Submarine SMF-LS optical fiber, which has been commercially available since 1997, reduces the impact of four-wave mixing, a nonlinear optical effect that can impact the transmission characteristics of multiwavelength systems.

NTT MOBILE COMMUNICATIONS NETWORK, INC. tapped the team of LOCKHEED MARTIN CORP. and ORBITAL SCIENCES CORP. to build and launch the N-STAR c geosynchronous communications satellite. Scheduled to be delivered into space in the first quarter of 2002, the satellite will provide S-band communications services to mobile users in Japan, augmented by a C-band feeder link. It will be designed to operate for 10 years, supplementing NTT DoCoMo's current pair of U.S.-built N-STAR satellites. Prime contractor Lockheed Martin Commercial Space Systems of Sunnyvale, California will supply the entire payload, which it will mate with Orbital's STAR bus. Dulles, Virginia-based Orbital also will be in charge of providing the ground system, securing a launch vehicle and conducting initial satellite operations. This is the first time that Lockheed Martin and Orbital have teamed up to bid for a satellite contract. On their own, both companies broke into the Japanese commercial satellite business last year, ending the hold that HUGHES SPACE AND COMMUNICATIONS CO. and SPACE SYSTEMS/LORAL INC. had on the market (see Japan-U.S. Business Report No. 351, December 1998, p. 9).

An exchange rate of ¥106=$1.00 was used in this report.

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The California Fuel Cell Partnership, established this past April, has its first Japanese member. HONDA MOTOR CO., LTD. joins DAIMLERCHRYSLER AG, FORD MOTOR CO., VOLKSWAGEN AG, three oil suppliers, a Canadian maker of fuel cells and the California Air Resources Board and the California Energy Commission. The group was formed to demonstrate the future potential of fuel-cell vehicles, identify issues concerning possible fuels and fueling technologies and to raise public awareness of this alternative to gasoline engines. Honda plans to have a fuel-cell vehicle ready by 2003. Both hydrogen-fueled and methanol-fueled prototypes are under development. In December, U.S. sales will start of the Honda Insight, the first gasoline-electric hybrid model available in this country.

Filling in details of their spring agreement to cooperate over five years on the development of vehicles powered by fuel cells and other replacements for gasoline (see Japan-U.S. Business Report No. 356, May 1999, p. 11), TOYOTA MOTOR CORP. and GENERAL MOTORS CORP. announced that 15 teams are at work in at least four different areas. Each company is developing its own four-wheel-drive hybrid system. The best technologies from each eventually will be combined into a single system. The collaboration also extends to creation of a smaller inductive charging coupler for electric vehicles, research on fuel-cell vehicles and standardization of the hydrogen supply system for fuel-cell vehicles. Toyota and GM disclosed at the same time that a June 1998 project to develop a compact charging system for electric vehicles was nearing completion.

With output of stamped and welded chassis and suspension parts nearing capacity at CALSONIC YOROZU CORP. because of increasing orders from GENERAL MOTORS CORP. and other customers, majority owner YOROZU CORP. has committed $9.4 million for new equipment at the big Morrison, Tennessee company. Most of the money will go for a hydroforming press that should be operational by the start of 2001. The press not only is designed for precision handling of complexly shaped parts but also offers several other advantages. For one, it reduces time in process by eliminating the need to weld together several smaller parts. The press is said as well to cut the weight of parts by 10 percent and to slash production costs by 20 percent to 30 percent. CYC, which opened in 1988, now can turn out 35,000 stamped parts a month.

Beginning in July 2000, ARVIN SANGO, INC. will make exhaust manifolds for vehicles assembled at TO-YOTA MOTOR CORP.'s Georgetown, Kentucky complex. This part currently is imported from Japan. SANGO CO., LTD. and ARVIN INDUSTRIES, INC., the equal owners of the Madison, Indiana maker of exhaust systems, will spend roughly $4.7 million to add production of manifolds. Output is projected at 12,500 units a month, which is not high enough to completely displace imports but a volume that could boost the joint venture's revenues by $11.3 million a year. Arvin Sango has been in business since 1988.

By 2003, a fourth production line for compressors for automotive air-conditioning systems will be operational at MICHIGAN AUTOMOTIVE COMPRESSOR, INC.'s factory in Parma, Michigan. TOYODA AUTOMATIC LOOM WORKS, LTD., the majority (60 percent) owner of the 10-year-old factory, sees this expansion as integral to its goal of boosting its share of the world vehicle AC compressor market to 40 percent or so from 30 percent at present. Michigan Automotive Compressor, in which DENSO CORP. has a 40 percent stake, currently makes 2.5 million compressors a year for such customers as GENERAL MOTORS CORP. and DAIMLERCHRYSLER AG. The installation of the fourth line will lift annual capacity to 3.5 million units.

The strategic alliance that VALEO S.A. and ZEXEL CORP. tentatively have agreed to form in the areas of automotive climate control and engine cooling is mainly designed to strengthen both firms' operations in Asia. However, under the memorandum of understanding, the big French automotive parts manufacturer will buy the Japanese supplier's climate control businesses in North America and Europe. Zexel operates two vehicle air-conditioning component plants in the United States. Its Grand Prairie, Texas factory, acquired in 1984, manufactures evaporators, condensers and tube assemblies, while a facility in Decatur, Illinois that opened in 1988 produces evaporators and compressors. Together with marketing and sales people in North America and Europe, these operations have 550 employees. Zexel's combined AC parts sales in the two regions are about $245 million a year. The agreement with Valeo could be finalized as soon as the beginning of 2000. It has the support of Zexel's majority owner, ROBERT BOSCH GMBH.

The Plumley Division of DANA CORP. is shipping seven low-emission fuel tank hoses to NISSAN MOTOR CO., LTD.'s Smyrna, Tennessee complex for the 2000 Altima sedan. The Paris, Tennessee-based supplier expects to sell 1.5 million hose components under the new contract.

Big bearing manufacturer NTN CORP. and the NTN TECHNICAL CENTER (U.S.A.), INC. in Ann Arbor, Michigan have developed a new type of four-wheel-drive system for the high-end sport-utility vehicles that are increasingly popular in the United States. The Lock-On-Demand transfer case clutch system sends power to the front wheels when speed sensors detect slippage in the vehicle's rear wheels. Compared with the viscous couplings and multiple plate friction clutches typically used today in full-time four-wheel-drive systems, NTN says that the LOD delivers better fuel economy and improved drivability and traction, even under the severest of conditions. NTN has not yet decided where the LOD, which consists of a two-way roller clutch and an electronic control unit that actuates the clutch when tire slippage is detected, will be manufactured, but one of its various U.S. bearing factories would seem to be an obvious candidate.

All the money that New York City's Metropolitan Transportation Authority is spending to upgrade the subway system has meant big business for subway car maker KAWASAKI HEAVY INDUSTRIES, LTD. and its Yonkers, New York assembly subsidiary (see Japan-U.S. Business Report No. 354, March 1999, p. 12). However, SUMITOMO HEAVY INDUSTRIES, LTD. also has benefited. For the second time in two years, it has won through SUMITOMO CORP. a contract to supply high-performance, noiseless wheels for MTA's subway cars. The latest order covers 15,000 wheels. Shipments of these parts will start at the end of 1999.

An exchange rate of ¥106=$1.00 was used in this report.

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American Companies in Japan


Although it had built 55 precipitated calcium carbonate satellite plants for paper manufacturers everywhere else, SPECIALTY MINERALS INC. never had been able to break into the world's second-largest paper market. That finally has changed. The Bethlehem, Pennsylvania company's majority-owned SPECIALTY MINERALS FIMATEC LTD. venture has won a contract from a paper producer described only as a major player in the business to build a PCC satellite plant at one of its mills. Expected to be operational in the second quarter of 2000, the facility will provide both filling and coating- grade PCC for the paper company's fine printing and writing papers. The plant will have an annual capacity of between 50,000 tons and 70,000 tons of PCC, which is a specialty pigment used in place of more expensive wood fiber and other, equally high-cost pigments to fill and coat high-quality paper. Specialty Minerals Fimatec was formed in 1997 by the local subsidiary of Specialty Minerals' parent, MINERALS TECHNOLOGIES INC., and FIMATEC LTD., a supplier of ground calcium carbonate to the Japanese paper industry.

Competitive pressures are forcing FURUKAWA CO., LTD. to end production of rutile titanium dioxide and to import this product from E.I. DUPONT DE NEMOURS & CO., INC. for distribution in Japan. Shipments will start in January 2000, presumably at the rate of about 12,000 tons a year, which is the volume that Furukawa currently makes at its Osaka factory. The diversified Japanese company will use part of the freed-up capacity to increase output of anatase titanium dioxide, a white pigment.

FUTURA COATINGS, INC., a St. Louis-based maker of high-performance coatings, elastomers and structural resins made from such things as polyurethanes, polyureas, acrylics and epoxies, has moved into the Japanese market. It formed a subsidiary in Osaka, with most of the money supplied by CREATE CLUB CORP. Sales already have started of Futura's polyurethane-based ULTRATHANE RSM (reaction spray molding) Series. These materials are being marketed as an alternative to fiberglass-reinforced plastics, the use of which as a stiffening agent increasingly is restricted because of environmental considerations, particularly their role in producing dioxins when incinerated. Futura's products not only yield no toxic substances when burned but also are highly recyclable. Other advantages include fast cure and demolding rates and high-impact resistance.

PHARMACIA & UPJOHN, INC. gave SATO PHARMACEUTICAL CO., LTD. marketing rights to a topical acne treatment known in the United States as Cleocin T Gel (clindamycin phosphate) but sold elsewhere as Dalacin T Gel. Action on P&U's March application to the Ministry of Health and Welfare for marketing approval is pending. Sato Pharmaceutical believes that sales of the antibiotic, which has been available in America since 1987, could total $14.2 million a year.

The popularity in Japan of PHARMACIA & UPJOHN, INC.'s Rogaine (minoxidil) for treating hair loss (see Japan-U.S. Business Report No. 354, March 1999, p. 13) no doubt encouraged BANYU PHARMACEUTICAL CO., LTD. to file a new drug application with MHW for Propecia (finasteride). Discovered and commercialized by parent MERCK & CO., INC., the drug blocks the formation of a male hormone that has been implicated in the development of inherited male pattern hair loss. Propecia was released in the United States in 1998. It is the first FDA-approved pill to treat hair loss in men. Banyu Pharmaceutical could start clinical testing of Propecia as soon as 2000. Its goal is to have the drug on the market in 2003.

With the human genome analysis business growing rapidly in Japan, GENEFORMATICS, INC. decided that the time was right to move into the market. The San Diego, California company made RIKEI CORP. the exclusive channel for selling and marketing its products and services, which are designed to expedite the identification of biologically relevant targets from the vast amounts of sequence data produced by various genomics projects underway around the world. GeneFormatics also trained a number of Rikei scientists so that they can provide full technical support to customers. The Japanese company estimates that this new activity could produce revenues of $2.8 million in FY 2000.

A Japanese start-up has begun a DNA (deoxyribonucleic acid) paternity testing service with help from GENETIC PROFILES CORP. The San Diego, California firm does the actual testing of samples collected by GLOBAL I INC. from medical facilities. Testing two adults and a child costs about $1,400. Global I expects to handle about 300 tests in FY 2000.

An exchange rate of ¥106=$1.00 was used in this report.

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Every move that SOFTBANK CORP. makes in the Internet-related field seems to pay off, often handsomely. However, this success has not extended to the world of PCs. Earlier in the year, Softbank announced plans to sell generic or no-name machines supplied by big electronics distributor INGRAM MICRO INC. of Santa Ana, California (see Japan-U.S. Business Report No. 354, March 1999, p. 16). What the firm never envisioned was that sellers of brand-name PCs, especially American vendors, would introduce well-equipped models for as little as $800 or so. Accordingly, Softbank is cutting its losses by ending its contract with Ingram Micro.

In what is being billed as the largest outsourcing agreement by a manufacturer in Japan, MAZDA MOTOR CORP. is handing over to IBM JAPAN LTD. responsibility for running most of its computer systems. The deal, which extends from December 1999 through March 2010, will cost the automotive maker an estimated $471.7 million, but the FORD MOTOR CO. subsidiary expects to save as much as $47.2 million of what it otherwise would have spent on information technology requirements. More importantly, the arrangement allows Mazda to focus on its core business. IBM Japan will be in charge of developing the vehicle builder's IT resources outside of the R&D area as well as operating and maintaining its current systems, which include a pair of supercomputers, three host computers and roughly 10,000 PCs, plus networking equipment. The computer maker will set up a wholly owned subsidiary in Hiroshima to service the contract. This company will be staffed initially by about 350 people, including employees of Mazda's soon-to-be- disbanded IT unit. IBM Japan has been quite successful in the last year or so in winning IT outsourcing contracts, but most of its business to date has come from firms in the financial sector.

IBM JAPAN LTD. has enlisted a key partner to support a related business thrust -- developing solutions for financial institutions that take advantage of the Internet. Before yearend, the computer giant expects to form a company with TOSHIBA CORP. to build systems around its RS/6000 Unix-based servers that will help merging banks achieve some of the promised efficiencies by handling back-office or administrative functions on-line. Toshiba, which will have a 51 percent stake in the joint venture, brings experience in this field to the partnership since it currently markets financial systems centered on SUN MICROSYSTEMS, INC. Unix servers. Both IBM Japan and Toshiba will transfer technical and sales personnel to the new company, which is projecting revenues as high as $47.2 million in the first year of operations.

In a marketing strategy aimed directly at price-sensitive buyers of computers for the home, GATEWAY 2000, INC.'s subsidiary is offering deep discounts to people who purchase its consumer desktop and portable machines if they sign up before yearend for two or three years of Internet access. The best deal is on the new-to-Japan Neo (Astro) PC, a low-price, easy-to-use, all-in-one system equipped with a 400-MHz Celeron processor, 64 MB of memory, a 4.3-GB hard drive, an integrated 40X CD-ROM drive and a 15-inch screen. It lists for $850, but buyers who purchase three years of service can get a Neo for just $375. Unlimited Internet access costs $28.30 per month.

A broader range of products soon will be available at COMPAQ COMPUTER CORP.'s on-line store in Japan. Compaq DirectPlus, opened in July, now carries an exclusive line of Prosignia servers, desktop systems and notebooks (see Japan-U.S. Business Report No. 359, August 1999, pp. 14-15). Certain models of the ProLiant PC server, Deskpro desktop, Armada corporate-use notebook and handheld Aero 8000 families will be added to this lineup, as will a wider variety of peripherals and software.

The latest UNISYS CORP. enterprise server designed for high-volume transaction processing is on the market at monthly lease rates of $157,600 and up. Like other members of this series, the ClearPath HMP IX6800 is what is called a heterogeneous multiprocessing system since it integrates system software for Unisys' 2200 mainframe platform with Intel-based servers running the Windows NT or the SCO UnixWare operating system. One innovation of the IX6800 is a new cache storage design that delivers a 60 percent performance improvement. Another is the use of 0.25-micron CMOS (complementary metal-oxide semiconductor) technology.

With the EV67 implementation of its 64-bit Alpha 21264 processor now shipping, COMPAQ COMPUTER CORP. is claiming application performance gains of 30 percent to 40 percent for its Unix-based AlphaServer GS Series of enterprise-class servers. This jump, the company says, is the result of a combination of speed improvement and a larger cache. The new engine powers the latest version of the entry-level AlphaServer GS60E, which now can be equipped with as many as eight processors rather than the six Alpha 21264 (EV6) chips that were the outside option when the machine was introduced in Japan in August. Pricing of the more powerful model starts at $153,800. The pumped-up Alpha processor also is at the heart of the new-to-Japan AlphaServer GS140 system. This server can be configured with as many as 14 Alpha 21264s, and it is expandable to 28 GB of 64-bit Very Large Memory. The base, two-way AlphaServer GS140 lists for $584,300.

By yearend, IBM JAPAN LTD. thinks that it can sell 1,000 of the new AS/400e Dedicated Server for Domino to small and midsize customers. As its name suggests, this system is designed specifically to run Domino groupware applications. Obviously, that is possible with almost any PC server configuration. The beauty of its alternative, IBM Japan says, is that it allows businesses to run all their Domino applications on one machine rather than on multiple Domino servers due to the partitioning capabilities of the AS/400e. This makes operations not only easier and more affordable but also more reliable and secure, according to the company. Three versions of the AS/400e Dedicated Server for Domino are available. The middle one lists for $32,900, plus $9,400 for a 100-user Domino license.

A new systems architecture engineered specifically to boost both systems throughput and performance in 2D/3D graphics applications is the source of INTERGRAPH CORP.'s claim that its Zx10 ViZual Workstation is the fastest Windows NT workstation available. According to the Huntsville, Alabama firm, its Wahoo Technology with Streaming Multiport Architecture outperforms Windows NT architectures based on the Intel i840 chipset and the Intel BX chipset by supporting the latest Pentium III and Pentium III Xeon processors with their 133-MHz front-side buses, considerably more memory and better operation of that SDRAM, and much higher I/O bandwidths. Shipments of the Zx10 ViZual Workstation will start in late December. In the United States, pricing will begin at about $7,200 for a 733- MHz Pentium III processor, 256 MB of memory, an 18-MB hard drive, Wildcat 4110 VIO 3D graphics and Windows NT Workstation.

The performance advantages of the 600-MHz Pentium III processor are available in more companies' product lines. For instance, this engine powers the top model in IBM JAPAN LTD.'s entry-level IntelliStation E Pro workstation as well as its midrange IntelliStation M Pro, which can use one or two such chips. Both models also feature IBM Fire GL1 for 3D graphics capabilities rather than the Matrox Millennium 2D package standard on other products in the two series. Each of the base units has 128 MB of ECC (error checking and correcting) SDRAM. The IntelliStation E Pro, which starts at $3,800, offers 9.1 GB of storage, while its M Pro mate has 13.5 GB.

IBM JAPAN LTD. also made the 600-MHz Pentium III the new high-end option for those members of its broad Netfinity server series that are powered by this chip. Pricing of the new models starts at $7,700. At the same time, the company introduced the 550-MHz Pentium III Xeon in the rest of the Netfinity server line, which includes uniprocessor, two- way, four-way and eight-way models. The base configuration costs $16,000.

DELL COMPUTER CORP.'s subsidiary is one cycle ahead of its rivals. In a worldwide release, the direct marketer announced the PowerEdge 2400 as the latest addition to its family of workgroup servers. This machine features the 667-MHz version of the Pentium III processor with its 133-MHz front-side bus. The Power-Edge 2400 also is the first Dell workgroup server to offer hot swappable/redundant power supplies for enhanced availability. Embedded RAID (redundant array of independent disks) technology and a 64- bit PCI bus for higher data bandwidth are other selling points. The system memory of the PowerEdge 2400 scales up to 2 GB of SDRAM, and it can support as much as 144 GB of internal storage. Entry-level prices start at $3,600.

The 600-MHz Pentium III also now represents the state of the art in processor technology for corporate desktop systems. It is the power behind the high-end model in IBM JAPAN LTD.'s PC 300GL line, which is targeted at commercial customers looking for a combination of price and performance. The 6564-SKJ model has an estimated street price of $2,800. For buyers that are even more budget conscious, IBM Japan is offering a PC 300GL model (6288) that uses a 466-MHz Celeron processor for as little as $1,200. Among the eight new PC 300 systems that include these two machines is an additional member of the Japan-only PC 300PL Slim line of space-saving PCs. Equipped with a 500-MHz Pentium III chip, the newcomer starts at $1,900.

Business users who want the performance of Pentium III technology at an affordable price are the target market for DELL COMPUTER CORP.'s new OptiPlex GX110. Less than $1,200 buys a system with a 450-MHz Pentium III chip, 64 MB of SDRAM and a 4.3-GB hard drive. That price also includes the new Intel 810e chipset, which provides a higher level of component integration, such as of graphics and audio, but it does not include a monitor.

COMPAQ COMPUTER CORP. continues to cater to corporate purchasing managers that give priority to value in buying desktop machines. Its subsidiary released 28 models in the Deskpro line that start at less than $1,400. These PCs feature Celeron processors running at 466 MHz or 500 MHz. They also include the 810e chipset for optimized price/performance.

The Japan-only Aptiva E line of desktop PCs for the home that IBM JAPAN LTD. introduced in June has proved to be a hot seller in the ¥100,000 and under market. The company hopes to extend the success of the Aptiva 20J family with the 11-model Aptiva 24J series, which uses the 450-MHz version of the AMD-K6-2 processor rather than the 400-MHz release of its predecessor. The entry-level model costs just $940, but that price covers more than ample memory and storage, plus a monitor, a modem, LAN capabilities and a long list of family-oriented software titles.

Also going after the home desktop PC market, COMPAQ COMPUTER CORP.'s sales unit unveiled the four-model Presario 3500 series. This line offers a choice of Celeron processors with clock speeds of 433 MHz to 500 MHz, hard drives with a storage capacity of 8.4 GB to 10 GB, and a 32X CD-ROM or a 10X DVD-ROM drive. Internal memory is a uniform 64 MB of SDRAM. A 56-kbps modem and one-button Internet and e-mail access are standard. The entry-level 3500 model, the 3560, has an estimated street price of $945 without a monitor.

For individuals who want the flexibility that a notebook PC offers at an affordable price, COMPAQ COMPUTER CORP.'s subsidiary added the Presario 1246 model to its Presario 1200 line. It offers a 400-MHz AMD-K6-2 processor, 32 MB of SRAM, a 4.3- GB hard drive, a 24X CD-ROM drive, a 56-kbps modem and one-button Internet access for roughly $1,500. People willing to pay for more performance in a thin, lightweight design with a detachable wedge have two new choices in the Presario 1900 series. The Presario 1928 and the Presario 1929 share a 400-MHz Celeron processor, 64 MB of SDRAM and a 6.4-GB hard drive. They differ in the inclusion of a 24X CD-ROM drive or a DVD-ROM drive.

The revolutionary iMac home and classroom computer breathed some much-needed life into APPLE COMPUTER, INC.'s business in Japan as well as in the United States after it was introduced just over a year ago. The company now hopes to build on that success with a three-model line of iMacs completely redesigned to be faster, sleeker, quieter and more Internet friendly. The basic iMac, which lists for $1,100, sports a 350-MHz PowerPC G3 processor, 64 MB of SDRAM (expandable to 512 MB), a 6-GB Ultra ATA hard drive, a "slot-load" 24X CD-ROM drive, high-end graphics acceleration, a built-in V.90/56K modem, 10/100Base-T Ethernet and dual USB ports. It is engineered to operate without a fan and supports Apple AirPort wireless networking for fast Internet access from anywhere in the home or the classroom. The new iMac DV, short for digital video, uses a 400-MHz version of the PowerPC G3 processor and provides 10 GB of storage. What really distinguishes this $1,400 model from the basic iMac, though, are a 4X slot-load DVD-ROM drive with DVD video playback, two 400-megabit-per-second FireWire (IEEE 1394) ports and Apple's new iMovie software for creating professional-quality home and classroom movies. Rounding out the series is the iMac DV Special Edition. It has the same configuration as its namesake but comes with 128 MB of SDRAM and a 13-GB Ultra ATA hard drive for roughly $1,700.

Twelve years after PINNACLE SYSTEMS, INC. started marketing its video broadcast and production editing tools in Japan, the Mountain View, California firm opened a wholly owned subsidiary in Tokyo. At the same time, Pinnacle gained a new marketing partner: HITACHI ELECTRONICS, LTD. That company had been designing video server systems for broadcasters around equipment from HEWLETT-PACKARD CO., but in August, Pinnacle bought this part of HP's business. Hitachi Electronics is especially excited about Pinnacle's high-capacity video servers, which can store 1,000 hours of material and even more.

The new class of Fibre Channel solutions that start-up TROIKA NETWORKS, INC. introduced in September will be distributed by NISSHO ELECTRONICS CORP. The Westlake Village, California firm's equipment addresses the storage demands that e- commerce and e-business have placed on corporate IT systems. It does this by adding server cluster and Internet Protocol communications to Fibre Channel-based storage area networks, thereby creating a system area network. The resulting multifunctional network, which Troika Networks dubs SAN2 or SAN squared, provides a single-wire, fully open network infrastructure for building reliable, scalable and manageable IT systems. The first product that Nissho Electronics will resell is Troika Networks' SAN2 Controller 2000, a PCI- to-Fibre Channel adapter that enables network managers to support and administer storage and/or system area networks with a single device.

Answering the call of Solaris users for more storage capacity, increased throughput and faster response time for data warehouse applications, SUN MICROSYSTEMS, INC.'s subsidiary released new versions of the Sun StorEdge A5100 and Sun StorEdge A5200 arrays. The revamped A5100 marks Sun's introduction of 36.4-GB drives operating at 10,000 rotations per second. Fourteen drives fit in an enclosure. Six of these can be linked together to provide 3 terabytes of capacity. As much as 2.4 TB of storage in a 132-drive configuration is available with the upgraded A5200. This model uses 9.1-GB or 18.2-GB drives also operating at 10,000 rpm. Each subsystem has room for 22 drives. Pricing of the latest Sun StorEdge arrays starts at $66,000.

Seemingly helping a competitor, HEWLETT-PACKARD JAPAN LTD. has agreed to provide components and peripheral equipment for large-format ink-jet printers to GRAPHTEC CORP. Japan's largest maker of plotters and recorders plans to improve the speed and the printing definition of the HP products and sell the equipment under the Graphtec name to graphics companies. Graphtec, which had been selling San Diego, California ENCAD, INC.'s large-format printers, expects the tie-up with HP Japan to boost its annual revenues by $14.2 million in two or three years.

High-quality digital photos can be printed directly from a wide range of digital cameras with HEWLETT-PACKARD JAPAN LTD.'s HP PhotoSmart P1000 and HP PhotoSmart P1100 ink-jet printers. A PC is not necessary because these machines accept input directly from CompactFlash cards and SmartMedia cards. Both also function as desktop machines for everyday printing. The HP PhotoSmart P1000, which lists for $565, outputs up to 11 ppm in black and white with a 600-dpi resolution and 8.5 ppm in color with a 2400 x 1200 resolution. The faster HP PhotoSmart P1100 printer delivers 12 ppm in black and 10 ppm in color. It is expected to sell for $660. .....At the same time, HEWLETT-PACK-ARD JAPAN LTD. complemented the recently introduced HP DeskJet 970Cxi Professional Series with the HP DeskJet 955C. It provides photo-quality reproduction at speeds of 11 ppm in black and 8.5 ppm in color for $450.

EASTMAN KODAK CO. and SANYO ELECTRIC CO., LTD. have codeveloped the world's first commercially viable full-color, active-matrix organic electroluminescent display. The 2.5-inch (diagonal) demonstration product has a 190,000-pixel count. The breakthrough, the result of a development alliance forged earlier this year (see Japan-U.S. Business Report No. 354, March 1999, p. 17), is significant because OEL displays are easier to view than today's LCDs, plus they are much thinner, weigh less and consume considerably less power. Those characteristics mean that information-rich, user-friendly displays can be built into even more electronics products.

Now that it has a marketing subsidiary (see Japan-U.S. Business Report No. 361, October 1999, p. 19), RARITAN COMPUTER, INC. is bolstering its line of switches that allow multiple computers to be controlled through a single keyboard, monitor and mouse. Its latest product is the SwitchMan, a plug-and-play desktop product for operating two to four PCs. Pricing is open, but in the United States, the SW2 (two-channel SwitchMan) is $170, while the SW4 (the four-channel unit) costs $250.

In what INTERGRAPH CORP.'s Intense 3D unit considers a critical design win, FUJITSU, LTD. selected the new Wildcat 4110 graphics accelerator as the graphics subsystem for its next-generation FMV-PRO Workstation, a product used by many engineers and designers in Japan. According to the Huntsville, Alabama supplier, Wildcat 4110 delivers the industry's fastest graphics on any platform. It has double the performance of previous Wildcat products, but the pricing has remained basically the same.

An exchange rate of ¥106=$1.00 was used in this report.

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NCR JAPAN, LTD. has decided that there is little benefit to the company from owning its headquarters in the Akasaka area of Tokyo. Consequently, it has agreed to sell the 37- year-old building, which has 191,125 square feet of floor space and stands on a 22,400- square-foot piece of property, to the Nippon Foundation for $125.5 million. NCR Japan will use the proceeds to fund its pension plan and strengthen its core businesses; that could include acquisitions. The sale is slated to close in April 2000. NCR Japan executives and the company's marketing unit will move to a building in Tokyo's Chiyoda district. The sales and consulting divisions will be relocated to existing NCR Japan offices in the Shibuya section of Tokyo, Yokohama and Oiso, Kanagawa prefecture.

One of the first American companies to exploit the opportunities created by the plunge in commercial property prices in Japan's big metropolitan areas has brokered the sale of its sixth office building in 1999. KENNEDY-WILSON, INC. arranged the sale of an eight- year-old, 60,000-square-foot, seven-story office building in central Tokyo owned by a stumbling real estate company to a U.S. real estate fund for $15.1 million. According to Kennedy-Wilson, the real value of the property is $300 per square foot. The transaction brought the firm's year-to-date sales in Tokyo alone to more than $150 million.

An exchange rate of ¥106=$1.00 was used in this report.

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The market in Japan for uninterruptible power supplies is expanding at about 20 percent a year. The demand for scalable, redundant power protection for data centers and centralized servers is particularly strong. That has prompted big UPS supplier AMERICAN POWER CONVERSION CORP. to introduce its first enterprise-level system, the Symmetra Power Array. Priced from $17,900, this unit has a modular architecture that enables data centers and server farms to ensure nearly continuous power availability in a range of capacities as they expand.

VICOR CORP.'s subsidiary is projecting first-year sales of $7.6 million for a new line of Japan-only AC/DC and DC/DC switching power supplies. The MultiPack Family 600- Watt Series and the MultiPack Family 800-Watt Series feature modules that slide into a chassis to provide the output voltage and the power required. Both series of power supplies, which range in price from $830 to $925, are field-configurable so that industrial users easily can add or replace modules on-site to meet changing requirements.

Roughly 80 percent of the world output of lithium-ion batteries, which provide the power to portable devices like notebook computers and cellular telephones, comes from Japan. That makes this market a prime target for a novel safety switch developed by THERM-O- DISC, INC. that protects high-energy-density lithium-ion batteries from thermal runaway. The part does this by using a shape memory alloy as a temperature/current sensor. The sensor returns to its "remembered" high-temperature shape on transformation, resulting in an open circuit before reaching thermal-runaway temperatures. Beginning in December, the Mansfield, Ohio manufacturer, an EMERSON ELECTRIC CO. business, will make 1.5 million shape-memory-metal battery protectors a month specifically for the Japanese market. Emerson's Tokyo subsidiary will handle sales. The device will cost between 19 cents and 28 cents.

From December, start-up SOFT SERVO SYSTEMS, INC. will ship to Japan what it says is the first direct PC-based motion controller. The Waltham, Massachusetts firm's SoftServo performs all time-critical control computations using a single, powerful central processor unit that runs on such operating systems as Windows NT and Linux and that is integrated with low-cost FPGA (field-programmable gate array) interface boards and a software library.

An exchange rate of ¥106=$1.00 was used in this report.

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The late September nuclear fission chain reaction at a nuclear fuel processing plant in Tokaimura, Ibaraki prefecture has forced sourcing changes at JAPAN NUCLEAR FUEL CO., LTD. The company, a supplier of nuclear fuel rods that is owned by GENERAL ELECTRIC CO., HITACHI, LTD. and TOSHIBA CORP., now buys about half of its powdered uranium dioxide requirements from JCO CO., LTD., but the operator of the Tokaimura plant will be shut down in the wake of Japan's worst nuclear accident. As an interim step, JNF will increase imports of uranium dioxide from GE while it searches abroad for other suppliers of this critical input. Despite the disruption, GE, Hitachi and Toshiba are moving ahead with their plan to form a company in January 2000 to take over their respective nuclear fuel businesses on both sides of the Pacific (see Japan-U.S. Business Report No. 356, May 1999, p. 5). The new firm will have two subsidiaries, one based on JNF and the other encompassing GE's Wilmington, North Carolina nuclear fuel operations. The American partner will own 60 percent of the holding company.

The freedom that independent power producers will have starting in April 2000 to sell electricity directly to industrial users has lured a heavyweight into the market. ENRON CORP., the top wholesaler of electricity and natural gas in the United States, has formed a subsidiary in Tokyo and is scouting out both partners for its proposed business and potential customers. The diversified Houston-based multinational has not disclosed, however, whether it plans to build its own power-generating facilities or buy existing plants. TEXACO INC. also is exploring the opportunities emerging in Japan's IPP market (see Japan-U.S. Business Report No. 360, September 1999, p. 17).

An exchange rate of ¥106=$1.00 was used in this report.

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WIT CAPITAL JAPAN, INC. has raised $30.2 million in a second round of financing. With a total of $40 million at is disposal, the venture is closer to its goal of becoming the country's first Internet investment bank and, in the process, transforming how capital is raised in Japan. Wit Capital Japan was established by New York City's WIT CAPITAL GROUP, INC., MITSUBISHI CORP. and TRANS COSMOS INC. (see Japan-U.S. Business Report No. 359, August 1999, p. 19). Participating in the latest fund-raising were ENCOMPASS GROUP INC., HIKARI TSUSHIN, INC., a HONDA MOTOR CO., LTD. unit, NIKKO SECURITIES CO., LTD., an ORIX CORP. company, four brokerage houses affiliated with SANWA BANK, LTD. as well as Mitsubishi and Trans Cosmos. These Japanese investors now own 70 percent of Wit Capital Japan, but the American parent has the option to increase its stake to 40 percent from 30 percent within the next six months. Once Wit Capital Japan receives a securities license, it will offer a variety of investment banking services to Japanese Internet and Internet-centric companies. It also will develop electronic brokerage services that will give individual investors the chance to invest in public offerings and venture capital funds.

The opportunities available in Japan's underdeveloped investment banking field also have caught the eye of LEHMAN BROTHERS INC. It is in talks with BANK OF TOKYO- MITSUBISHI, LTD. about formally teaming up in this area as soon as the spring of 2000. Such an alliance would enable the New York City broker/investment banker to exploit the ties that Japan's top commercial bank has to corporate Japan while giving BTM access to Lehman's investment banking expertise. One particular initiative reportedly being explored is the establishment of a Lehman-managed private equity fund that would buy struggling or failed companies, turn them around and then sell them. The tentative partners also apparently are discussing the possibility of moving into the mergers and acquisitions business, another area where the demand for knowledgeable advice and guidance is growing.

The idea of setting up private equity funds to invest in underperforming or even bankrupt companies seems to have fairly widespread appeal to American investment banks and more adventuresome Japanese financial services providers. For instance, Manhattan's ROTHSCHILD INC. and DAIWA SECURITIES SB CAPITAL MARKETS CO., LTD. planned to form an investment fund in November that in time could have $471.7 million with which to work. The pending partners already have identified their first candidate -- NIKKO ELECTRIC INDUSTRY CO., LTD. The automotive parts manufacturer is operating under bankruptcy protection. Rothschild and Daiwa SBCM will inject $14.2 million into the Tokyo company. They expect to make money by taking Nikko Electric public once it is healthy or selling their shares.

The hottest investment scene in Japan, however, is the venture capital part of the market, particularly the provision of start-up capital for promising Internet entrepreneurs. For instance, San Francisco's WALDEN INTERNATIONAL INVESTMENT GROUP, which has invested in more than 200 companies in the Asian Pacific region and in the United States since 1987, and NIKKO SECURITIES CO., LTD.'s investment arm are managing the $30 million WIIG Nikko IT Fund. FUJI-TSU, LTD. is committed to putting up one-third of the financing, hoping that the fund managers will find companies that can help it expand its Internet-related business.

For its part, J.H. WHITNEY & CO., the first organized private equity firm in the United States, has invested a total of $28.3 million in four Japanese companies, including Internet content supplier LINK MEDIA INC. The company, which opened a Tokyo office in February, plans to invest an additional $94.3 million over the coming year. J.H. Whitney's areas of industry expertise and focus go beyond the Internet and include communications, health care, "transforming" industries and the consumer market.

No decisions have been finalized, but the NATIONAL ASSOCIATION OF SECURITIES DEALERS, INC. and SOFTBANK CORP., its equal partner in bringing the NASDAQ automated quotation system to Japan, could have the Osaka Securities Exchange manage the envisioned over-the-counter market rather than create an independent market structure, the original plan (see Japan-U.S. Business Report No. 358, July 1999, p. 18). The three parties confirm that talks are underway but have said nothing else. Analysts, however, see definite advantages to such a strategy, especially since the NASD-Softbank team reportedly is having trouble enlisting securities firms as market makers. An alliance with the OSE also could accelerate the debut of NASDAQ Japan, initially targeted for the fourth quarter of 2000.

The presumed elephant in Japan's on-line securities market, CHARLES SCHWAB TOKIO MARINE SECURITIES CO., LTD., will start operations December 1. The joint venture between CHARLES SCHWAB & CO., INC., which is the top on-line trading company in the United States as well as the number-one discount broker, and a group of Japanese investors headed by TOKIO MARINE & FIRE INSURANCE CO., LTD. initially will offer trading in U.S. stocks and investment trusts (Japanese-style mutual funds) (see Japan-U.S. Business Report No. 358, July 1999, p. 18). Trading in Japanese shares will start sometime in the spring of 2000. The biggest news, however, is that CSTM will follow the lead of MERRILL LYNCH & CO., INC. and set up a full-service retail brokerage network. At present, the company is talking about opening six to 10 offices over the next three to four years. By the end of that period, the joint venture hopes to have some 500,000 customers through its on-line operations, call center and branches.

CITIGROUP INC. has found another channel through which it can market its banking and investment products to individuals in Japan. The world's biggest financial services provider will acquire a 19 percent stake in on-line broker NIKKO BEANS INC. from founder NIKKO SECURITIES CO., LTD. Operational since October 1, Nikko Beans offers brokerage, investment trust and insurance products to customers through the Internet as well as a call center. CITIBANK N.A.'s financial products and services now are available at its own Web site in addition to its branch network and call center. MITSUI TRUST & BANKING CO., LTD. and NIPPON LIFE INSURANCE CO. also have minority interests in Nikko Beans.

This deal is only the second one between CITIGROUP INC. and NIKKO SECURITIES CO., LTD. on the retail side of the financial services business since the American multinational acquired a 9.5 percent share in the big broker in 1998 and the two tied up in the investment banking field earlier this year (see Japan-U.S. Business Report No. 354, March 1999, p. 19). However, other alliances are under discussion. One possibility, Citigroup and Nikko Securities say, is the establishment as soon as spring 2000 of a joint Web site that would offer an array of financial services broader than either company provides on its own.

FIDELITY INVESTMENTS JAPAN LTD. managed an estimated $967 million worth of investment trust assets as of September 30, 1999. FIDELITY BROKERAGE SERVICES (JAPAN) LLC expects a boost in that total when it begins sales over the Internet of the 11 Fidelity Investments funds now available. That could happen before yearend. In another bid to attract customers in the increasingly competitive Japanese investment marketplace, Fidelity Brokerage became the first financial services company to launch an automated telephone system. In operation since November 1, Fidelity Voice Access allows customers to get up-to-date information on their account balances, price quotes and other information 24 hours a day.

The Ministry of Finance has given YASUDA KASAI-CIGNA SECURITIES CO., LTD. the go-ahead to market to businesses and individuals an after-tax, payroll-deduction retirement savings program. The joint venture, formed last spring to provide pension and investment fund products and services (see Japan-U.S. Business Report No. 357, June 1999, p. 19), is the first company to offer such a program. Customers will be able to invest in existing investment trusts managed by the Tokyo subsidiary of CIGNA CORP.'s international investment management unit or by YASUDA FIRE & MARINE INSURANCE CO., LTD.'s asset management arm; funds offered by independent asset managers will be available in the future. At the same time, Yasuda Kasai-CIGNA Securities has opened a call center to acquaint prospective clients with its portfolio of retirement savings products, programs and services.

Roughly four months after it opened for business, money manager NOMURA BLACKROCK ASSET MANAGEMENT CO., LTD. won its first client, SHI-ZUOKA BANK, LTD. The regional bank entrusted $94.3 million to the equally owned joint venture between New York City's BLACKROCK, INC. and NOMURA SECURITIES CO., LTD.'s asset management subsidiary (see Japan-U.S. Business Report No. 355, April 1999, p. 17). The funds will be invested in such U.S. debt instruments as mortgage- and asset-backed securities.

New York City-based MAXCOR FINANCIAL GROUP INC., a brokerage firm specializing in such products as interest rate and currency derivatives through its various Euro Brokers entities, has used a merger to strengthen its operations in Japan and, by extension, elsewhere in Asia. Simplifying a complex deal, the company's half-owned YAGI EURO CORP. subsidiary in Tokyo is combining its derivatives, money market and forward foreign exchange businesses with those of Tokyo-headquartered NITTAN EXCO LTD. The derivatives operation now goes under the YAGI EURO NITTAN CORP. name, while NITTAN YAGI EURO CORP. is in charge of the money market and forward foreign exchange activities.

Direct sales of life, automobile, casualty and other types of insurance coverage to individuals barely registers on the current tally of marketing channels in Japan. However, the two call centers that AMERICAN HOME ASSURANCE CO. operates in Tokyo to sell nonlife policies, especially auto insurance, over the phone are running full out during peak calling hours. Consequently, the AMERICAN INTERNATIONAL GROUP, INC. affiliate, which has roughly 400 people staffing its existing call centers, is giving serious consideration to opening a third facility.

Extending its retail product lineup, CITIBANK N.A. in partnership with SUMITOMO MARINE & FIRE INSURANCE CO., LTD. will begin selling mortgage insurance. This type of coverage normally guarantees that mortgage payments will be made if the policyholder cannot do so because of illness or injury. However, the policy marketed by Citibank and Sumitomo Fire & Marine can be written to provide protection if the insured loses his or her job because of the bankruptcy of an employer. This feature could prove to be very attractive in today's business environment.

KENNEDY-WILSON, INC. purchased a loan portfolio with a face value of $250 million from a Japanese bank described only as major. It paid less than 10 cents on the dollar for the nonperforming assets, demonstrating again the money that experienced American companies potentially stand to make from Japan's economic misfortunes. Over the last year, the diversified real estate services firm has purchased eight pools of soured loans with a book value of more than $1 billion.

An exchange rate of ¥106=$1.00 was used in this report.

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Hoping to develop a market for its products among children, COCA-COLA (JAPAN) CO., LTD. has begun sales of a soft drink that contains 20 percent fruit juice. Qoo, which includes vitamin C and calcium, comes in orange and apple flavors. A 9-ounce can costs $1.15.

CANANDAIGUA WINE CO. is shipping Mystic Cliffs Cabernet Sauvignon and Mystic Cliffs Chardonnay to Japan in addition to the Inglenook red, white and rose wines it has marketed there since February. The Mystic Cliffs wines, priced at $11.30 per bottle, are produced by RIVERLAND VINEYARDS in California's Monterey County. A TAKARA SHUZO CO., LTD. affiliate serves as Canandaigua Wine's distributor.

The first Ruby Tuesday restaurant could open in Japan as soon as sometime in 2000, although RUBY TUESDAY, INC. still has not decided how it will enter the market. A leader in the $10.00 bar and grill segment of the casual dining industry in the eastern part of the United States, the company plans to position its Japanese outlets to attract customers who want a casual dining experience but something more than what a family restaurant offers. Ruby Tuesday is just the latest American restaurant chain to conclude that the time is right to move into Japan, the difficult economic times there notwithstanding.

An exchange rate of ¥106=$1.00 was used in this report.

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The second Costco Wholesale membership warehouse in Japan will be located in Makuhari, Chiba prefecture. It is scheduled to open in December 2000. COSTCO COS. INC. launched its first local outlet in April in Fukuoka prefecture (see Japan-U.S. Business Report No. 356, May 1999, p. 19). Since then, it has signed up 260,000 small businesses and individuals as members, disproving skeptics who questioned whether the warehouse retailing concept would work in Japan. At some 161,500 square feet, the Chiba prefecture facility will be even larger than the one in suburban Fukuoka (140,000 square feet). However, it also will carry roughly 4,000 products, everything from food to appliances, furniture and office supplies.

The biggest GAP INC. store in Japan is in business. Located in Tokyo's fashionable Harajuku shopping area, the outlet has 25,500 square feet of space devoted to casual clothing for men, women, children and infants. With 10 stores set to open this fall, including the Tokyo flagship location, Gap soon will have 49 outlets across the country. By the end of 2000, the retailer expects the total to hit 90-plus.

TOYS "R" US INC.'s new, customer-friendly store layout (see Japan-U.S. Business Report No. 356, May 1999, p. 19) has made its first appearance in an urban setting. What the company calls its C-3 format was employed at a 36,800-square-foot store that just opened in Yokohama's Minato Mirai 21 shopping area. The doors have opened at the first OfficeMax office supplies store in Tokyo, but in moving into the capital, OFFICEMAX, INC. and partner JUSCO CO., LTD. had to abandon for cost reasons the superstore format used at the joint venture's six other outlets. The new store, located in the Iidabashi area of Tokyo, has only 4,300 square feet of selling space. However, it offers such services as desktop publishing and PC rentals in addition to a variety of products for the office. For now, OfficeMax plans to focus on opening other stores in the Tokyo area that fall into the floor range of 3,550 to 5,400 square feet. That also is the strategy that rival OFFICE DEPOT, INC. is pursing in Japan.

An exchange rate of ¥106=$1.00 was used in this report.

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The Kobe subsidiary of PYROTEK, INC. has taken over FOSECO JAPAN LTD. The move follows the Spokane, Washington manufacturer's acquisition of the Foseco aluminum products division of BURMAH CASTROL PLC. The marketing staff of the former Foseco Japan has relocated to Pyrotek's office, where they will continue to sell a full range of aluminum products. The American company is in a related field. It makes high-temperature materials for industrial applications. Many of its products, which incorporate fabrics, ceramics and graphite, are used in the handling and the processing of molten aluminum at foundries as well as at aluminum reduction, sheet, plate, extrusion and wire plants. Pyrotek's enlarged subsidiary is projecting annual sales of $7.6 million over the near term.

An exchange rate of ¥106=$1.00 was used in this report.

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When PARKER HANNIFIN CORP. acquired a controlling (33.4 percent) stake in KURODA PRECISION INDUSTRIES LTD. this past summer (see Japan-U.S. Business Report No. 357, June 1999, pp. 19-20), the big manufacturer of motion, control, instrumentation and fluid-flow components and systems described the move as better positioning it to capitalize on opportunities in Japan's factory automation market. In the short run, however, the tie-up could have a larger impact on the operations of the struggling Kawasaki, Kanagawa prefecture producer of pneumatic equipment. For starters, beginning next April, Kuroda Precision will use Parker Hannifin's international sales channels to market its products overseas. Moreover, the Cleveland multinational reportedly will stop manufacturing ball screws in the United States and consolidate that output with Kuroda Precision's for worldwide sale. Parker Hannifin nonetheless will derive some immediate benefit from the alliance since its products will be distributed in Japan through Kuroda Precision's marketing network.

FLOW INTERNATIONAL CORP., the world leader in ultrahigh-precision water-jet technology for cutting, cleaning and food safety applications, believes that its Tokyo subsidiary can sell 10 Flying Bridge abrasive water-jet systems to job shops in the first year of availability in Japan. The Kent, Washington company's optimism reflects all the features that the Flying Bridge delivers for as little as $235,900. These include no tool changes for different jobs because abrasive-jet cutting is accomplished by software- controlled, robotic-motion systems, the ability to go from drawing to cutting in 10 minutes with the FlowMaster Windows-based software, a wide dynamic speed range, an integrated design, a small footprint and easy operator access.

Market newcomer EVEREDE TOOL CO., which specializes in indexable boring tools 12 millimeters and under, is shipping three types of boring bars and associated inserts for cutting steel, nonferrous metals and their alloys as well as such nonmetallics as plastic and fiberglass. HIROSHIMA CORP. represents the Chicago manufacturer. Its products are priced between $60 and $185. Sales could total as much as $943,400 in the first year.

An exchange rate of ¥106=$1.00 was used in this report.

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Determined to be a factor in the expanding market for high-resolution single-lens-reflex digital cameras for commercial applications as well as in the consumer end of the digital camera business, EASTMAN KODAK CO.'s subsidiary released the Kodak Professional DCS330. The $6,100 camera is equipped with a 3-megapixel charge-coupled device. It also incorporates a Kodak-developed indium-tin-oxide sensor for improved color accuracy, especially of blue and yellow hues. Printing, medicine and research are among the activities at which the company is targeting the DCS330.

Shopping centers have a new way of tracking the number of customers and what stores they patronize. Commercialized by Chicago's RCT SYSTEMS, INC. using video image- processing technology first developed by the U.S. Air Force to guide missiles to their targets, the system is said to be 99 percent accurate. It consists of several CCD-equipped cameras installed at various locations. The images are displayed on a PC, where an identifying mark is placed on a customer to follow his or her movements. RCT Systems' joint venture has priced a three-camera unit, including installation, at $23,600. By next April, it hopes to have orders from 16 mall operators for roughly 190 cameras.

An exchange rate of ¥106=$1.00 was used in this report.

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Dioxin emissions, a by-product of combustion and certain industrial processes, are a major environmental hazard in Japan. W.L. GORE & ASSOCIATES, INC. consequently expects to find a ready market among operators of municipal waste incinerators, hazardous waste incinerators and similar facilities for its new REMEDIA D/F catalytic filter system. This easy-to-install, relatively inexpensive system combines surface filtration and catalysis technologies to destroy dioxins -- not just remove them from the gas stream into the solid waste stream, as happens with the alternative sorbent-injection technology. REMEDIA is being marketed by JAPAN GORE-TEX, INC., a 25-year-old Tokyo joint venture between the Newark, Delaware-headquartered company and JUNKOSHA CO., LTD., in cooperation with ABB ALSTROM POWER K.K. of Kobe. The partners hope to sell 30 REMEDIA systems over the next three years. Japan Gore-Tex, which employs some 400 people, is engaged in the development, production and sale of Gore-Tex products in the industrial, fabrics and medical fields. It has a production and technical center as well as a polymer science center in Okayama prefecture.

Incidents of food poisoning and in-hospital infection also are on the rise in Japan, expanding the market for equipment that can identify and track the source of bacterial contamination. That is what QUALICON, INC.'s RiboPrinter Microbial Characterization System does. The wholly owned E.I. DUPONT DE NEMOURS & CO., INC. subsidiary bills its product as the only automated instrument for fingerprinting the DNA of bacteria. That process makes the RiboPrinter far more accurate than machines that use antigen-antibody reactions to identify bacteria. Qualicon has made TAKARA SHUZO CO., LTD., a big supplier to the biotechnology industry through its biomedical group, the sole distributor of the $198,100 RiboPrinter. Sales could reach 30 systems a year, according to Takara Shuzo's estimates.

In a deal key to its sales goals in Japan (see Japan-U.S. Business Report No. 354, March 1999, p. 21), the subsidiary of FISHER CONTROLS INTERNATIONAL, INC. has delivered a DeltaV scalable process control system with a Japanese-language interface to COCA-COLA HOLDINGS WEST JAPAN CO., LTD. That company, formed this past summer (see Japan-U.S. Business Report No. 353, February 1999, p. 18), is using the all-in-one package to improve efficiency at its Saga prefecture bottling plant.

MVE, INC., the world's top designer and manufacturer of vacuum-insulated solutions for the storage and the distribution of cryogenic gases, introduced a line of portable liquid nitrogen cylinders through DAIHO SANGYO CO., LTD. The product is based on the Burnsville, Minnesota company's Dura-Cyl portable cryogenic liquid containers. These are known for their long holding time, low evaporation rate and high gas withdrawal rate. Daiho Sangyo, the dominant supplier of ultralow-temperature cylinders in Japan, is eyeing sales of 2,400 or so MVE cylinders a year.

A third Japanese manufacturer of thin-film heads for high-density data-storage applications has bought a Versalock plasma processing system from PLASMA-THERM, INC. The St. Petersburg, Florida company's inductively coupled plasma technology delivers the advanced etching capability necessary for the development of a new generation of giant magnetoresistive thin-film heads. Over the next year, Plasma-Therm believes that it will add at least one more Japanese supplier as a customer.

After serving Japanese health-care facilities from its headquarters in Milwaukee, Wisconsin for many years, MERGE TECHNOLOGIES INC. opened a wholly owned subsidiary in Tokyo. Its products integrate the data generated by medical devices into standard medical data communications formats, including DICOM and HL-7, pro-vide clinical work-flow integration and produce multimedia electronic reports for distribution in a health-care enterprise information network.

SOMNUS MEDICAL TECHNOLOGIES, INC. gave MITSUBISHI CORP. subsidiary MC MEDICAL, INC. exclusive rights to distribute the Somnoplasty System for the management of upper airway disorders. The Sunnyvale, California company expects MHW approval of its system sometime in 2000 for the treatment of obstructive sleep apnea, chronic nasal obstruction and habitual snoring. The suite of products uses radio- frequency technology to reduce excess tissue in the upper airway in a minimally invasive procedure. MC Medical will handle not only sales and marketing but also physician training and customer service.

Hydroview, BAUSCH & LOMB INC.'s new foldable intraocular lens for use in cataract surgery, has been approved for sale. The Rochester, New York company believes that this product, distinguished by its high level of biocompatibility and ease of use, will double its share of Japan's IOL market in 2000. WYETH LEDERLE JAPAN LTD. is the exclusive distributor of Bausch & Lomb's cataract products. Its Hansatome microkeratome, the instrument used in most refractive surgery procedures worldwide, also recently received regulatory clearance. With refractive surgery still in its infancy in Japan, Bausch & Lomb expects strong growth for this product as well.

REICHERT OPHTHALMIC INSTRUMENTS named KONAN MEDICAL, INC. of Hyogo prefecture the sole distributor of its KR450 Auto Keratometer/Refractor and AR350 Auto Refractor. The Buffalo, New York manufacturer touts the ease of use of these ergonomically designed instruments. They simplify positioning of the patient by automatically aligning with his or her eyes. Moreover, accurate measurements occur with just the push of a button. Konan Medical priced the KR450 at $24,500 and the AR350 at $14,200. Reichert Ophthalmic is a LEICA MICROSYSTEMS INC. company.

An exchange rate of ¥106=$1.00 was used in this report.

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The strategic relationship that XICOR, INC., a supplier of nonvolatile, reprogrammable memories, forged in February 1997 with YAMAHA CORP. continues to evolve. Since 1998, Yamaha has served as a foundry for the Milpitas, California firm, supplying, for example, more than one-third of Xicor's wafers in the July-September 1999 period. Now, the two have agreed to codevelop proprietary products that integrate analog, digital and nonvolatile reprogrammable elements. These chips, to be sold under each company's name, will be manufactured at Yamaha's Kagoshima prefecture wafer fabrication facility. The first jointly developed parts will be targeted at the fast-growing market for battery power management in laptops and cellular phones. Xicor also has a foundry arrangement with SANYO ELECTRIC CO., LTD. (see Japan-U.S. Business Report No. 357, June 1999, p. 22).

In a transpacific release, INTEL CORP. rolled out 12 Pentium III processors for desktop PCs and notebooks that mark the company's transition to 0.18-micron process technology from 0.25-micron. Intel also pushed the speed of its desktop engines up to 733 MHz. That part, along with the new 667-MHz Pentium III, has a 133-MHz front-side bus. Processors that run at an even-number speed, like 700 MHz, still have a 100-MHz front-side bus. The three new mobile Pentium III chips — 400 MHz, 450 MHz and 500 MHz — all have a 100-MHz front-side bus and incorporate Intel's QuickStart technology, which helps conserve battery life by powering the processor up and down depending on the requirements of the application. In the United States, the 733-MHz Pentium III lists for about $775 in bulk.

Over the next two to three years, the subsidiary of INTEGRATED DEVICE TECHNOLOGY, INC. hopes to boost its annual sales to $188.7 million from today's $75.5 million. One potential source of this growth, the Santa Clara, California company believes, is its line of RISC (reduced instruction-set computing) processors optimized for embedded communications applications. IDT recently disclosed a new 64-bit platform. The first products based on the RISCore64600 architecture will operate at speeds in the 400-MHz to 500-MHz range and will perform more than 800 million instructions per second. This performance makes the part ideal for such next-generation embedded applications as high-speed switches and routers. IDT's subsidiary also is sampling a 32-bit RISC processor that draws less than 1 watt of power while operating at 150 MIPS. It is pitching this chip to makers of cellular phones for their third-generation devices.

Four USB chips from Mountain View, California-based NETCHIP TECHNOLOGY, INC. are on the market through distributor DIA SEMICON SYSTEMS, INC. One such product is the NET2888 TurboUSB, a processor-independent, high-speed USB interface controller chip that supports USB's data transfer rate of 12 megabits per second between a generic local bus and the USB. Priced at $6.50 each, this small-footprint part is targeted at such applications as scanners, digital cameras and cable modems.

Analysts generally agree that broadband network access from the home is likely to be delivered in Japan through digital subscriber line services, which use the existing network of copper wire telephone lines for high-speed data transmission, because, unlike the United States, that country does not have a widespread coaxial cable infrastructure that can be upgraded to handle broadband communications. Two manufacturers are shipping chipsets to makers of DSL equipment like modems and access multiplexers to facilitate this delivery method. The products of both CENTILLIUM COMMUNICATIONS, INC. of Fremont, California and GLOBESPAN, INC. of Red Bank, New Jersey support Annex C of the ADSL G.lite (ITU-T G.992.2) standard. Annex C addresses the unique characteristics of copper loop plants in Japan. These require different modem and central office technology than in the United States. In particular, Centillium's CopperLite central office and Optimizer customer premises equipment chipsets and the Titanium chipset from GlobeSpan allow asynchronous DSL and ISDN (integrated services digital network) services to share the same telephone wire bundles without interfering with each other. MITSUBISHI ELECTRIC CORP. as well as NEC CORP. have tied up with Centillium (see Japan-U.S. Business Report No. 350, November 1998, p. 8).

In the latest evolution of a relationship that dates back to the early 1990s, DSP COMMUNICATIONS, INC. is supplying chipsets and software for SANYO ELECTRIC CO., LTD.'s latest CDMA (code-division multiple access) wireless handsets. The Cupertino, California firm's new D5431 chipset and software protocol stack are claimed to dramatically lower the power consumption and to improve the operating performance of Sanyo Electric's small, lightweight handset. In fact, the D5431 enables up to 350 hours of standby time.

The longtime team of ZORAN CORP. and FUJIFILM MICRODEVICES CO., LTD. engineered the decoder chip for SHARP CORP.'s first portable DVD player, said to be the world's smallest such device. The low-power Vaddis III-LV IC was designed specifically to capture the portable DVD market by enabling features found in home players. It builds on the widely employed Vaddis III DVD decoder for home consumer electronics products. Sharp has used Santa Clara, California-based Zoran's Vaddis DVD decoders since it introduced its first DVD player in 1997.

INFORMATION STORAGE DEVICES, INC.'s ChipCorder and VoiceDSP (digital signal processing) ICs are being distributed by FUJITSU DEVICES, INC. instead of MARUBUN CORP. The San Jose, California company attributed the switch in part to Fujitsu Device's experience in key ISD markets, including communications, consumer, industrial and automotive applications. Its ChipCorder family provides strong sound quality, low power consumption and nonvolatility in a single chip, while the VoiceDSP line delivers an array of digital features and functionality to such products as digital telephone answering devices.

BURR-BROWN CORP.'s subsidiary has added several products to its line. The VSP3010 is a three-channel image signal processor for CCD or contact image sensor systems that operates at 12 MHz. The three inputs are multiplexed into a high-speed, 12-bit analog-to-digital converter. Priced at $14.45 per unit in quantities of 100, this part is designed for CCD and CIS scanners, fax and multifunction machines, and industrial and medical imaging systems. Burr-Brown is looking for sales of 100,000 VSP3010 chips a month. .....New as well is BURR-BROWN CORP.'s ADS1250. This A/D converter with a 25-kHz data rate is based on a delta-sigma architecture to ensure a wide dynamic range and full 20-bit resolution. It is designed for high-resolution measurement in such applications as cardiac diagnostics, smart transmitters and industrial process control. The Tucson, Arizona manufacturer's marketing unit is projecting sales of 10,000 units a month at $15.10 each in 100-unit lots. .....For compact, battery-powered and cost-sensitive applications, BURR-BROWN CORP.'s subsidiary is offering the OPA342 series of low-cost, low-power operational amplifiers in microsize packages. These parts, which cost from $1.30 to $3.50 in 100,000-unit volumes, provide the rail-to-rail behavior needed to maintain high performance — in other words, a wide dynamic range — while operating on low power-supply voltages.

Shipments also are underway of two new products from NATIONAL SEMICONDUCTOR CORP. The LM20, priced at 72 cents, is a temperature sensor that operates over a wide range, especially with a 5.5-volt power supply but also at just 2.4 volts. The LM431 is a three-terminal adjustable shunt regulator with guaranteed temperature stability over the entire temperature range of operation. It costs 16 cents. Both parts are available in a chip-size package, thanks to National Semiconductor's micro SMD packaging technology.

Former partners VARIAN SEMICONDUCTOR EQUIPMENT ASSOCIATES, INC. and TOKYO ELECTRON LTD. have entered into a patent licensing agreement. Under it, TEL, which ranks second in the semiconductor production equipment field, is able to use on a worldwide basis VSEA's technology for controlling the temperature of the thin films applied to wafers. The Japanese company will make an initial payment of $25 million and pay royalties on future equipment sales. Industry analysts speculate that TEL sought the license to avoid a patent infringement case. From 1978 until April 1997, VSEA and TEL were equal partners in a Yamanashi prefecture-based company that manufactured and marketed ion implanters and sputtering equipment. Moreover, from 1990 until mid-1994, the two companies had a 50-50 business in Santa Clara, California that assembled TEL's diffusion furnaces.

Details are sketchy, but the subsidiary of world semiconductor production equipment leader APPLIED MATERIALS, INC. has developed a rapid thermal processing system that supports the fabrication techniques for next-generation 0.13-micron devices. The Radience Centura platform boosts throughput for increased yields. It also provides a heating speed of 250 degrees per second and a cooling speed of 90 degrees per second combined with highly accurate temperature control. Shipments of the Radience Centura will start in July 2000.

By its count, more than half of the Direct Rambus DRAMs now shipped are tested on HEWLETT-PACK-ARD CO.'s HP 95000 HSM Series of test systems. Those systems currently have 16 sites in a single test head. Starting sometime in the first quarter of 2000, the HP 95000 line's test-head electronics will be mounted in a 32-site configuration that is totally compatible with the existing tester. Just as important, HP expects its volume customers to be able to cut their testing costs by 20 percent to 30 percent. The single-pass HP 95000 tests any high-performance memory device with a data rate of up to 1 gigabit per second. Pricing of the 32-site system in Japan will start at $1.4 million.

An exchange rate of ¥106=$1.00 was used in this report.

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The starting flag has dropped in the two-company race to capture the on-line automotive sales market in Japan. By start-up in mid-November, CARPOINT JAPAN K.K. had lined up eight manufacturers, including NISSAN MOTOR CO., LTD., MITSUBISHI MOTORS CORP., MAZDA MOTOR CORP. and FORD MOTOR CO., and roughly 800 participating dealerships. For now, only information on new cars and light trucks will be available at the CarPoint Japan site, but early in 2000, the company plans to expand into used vehicles. Right before the launch of the site, SEVEN-ELEVEN JAPAN CO., LTD. acquired a 10 percent stake in the Internet vehicle broker by buying shares from each of CarPoint Japan's founders: SOFTBANK CORP. (now 45 percent), MICROSOFT CORP. (37 percent) and YAHOO! JAPAN CORP. (8 percent) (see Japan-U.S. Business Report No. 358, July 1999, p. 25). Although details still need to be decided, CarPoint Japan will provide content for Seven-Eleven Japan's planned virtual convenience store.

Actually, competitor AUTOBYTEL.COM INC. got a slightly faster start. Ahead of its November 1 launch, it had signed up approximately 200 dealers around Japan, including some in the Tokyo, Osaka and Nagoya areas that sell Nissan, Honda, Subaru and Isuzu vehicles. Stores handling Ford, Jaguar and Volvo products also are participating in the localized version of Like its rival, the e-commerce site will offer used vehicles and other services in 2000 (see Japan-U.S. Business Report No. 361, October 1999, p. 25).

The firm that E-LOAN, INC. formed last spring with SOFTBANK CORP.'s consumer finance unit (see Japan-U.S. Business Report No. 357, June 1999, p. 23) will help people who buy cars and trucks through VERTEX VISION INC.'s on-line used-vehicle auctions to arrange financing. A localized version of the Dublin, California firm's virtual loan broker takes information about the vehicle, lets users choose insurance options, calculates likely premiums and submits loan applications to finance companies.

In their continuing effort to make the Web part of everyday life, the subsidiaries of MICROSOFT CORP. and EXCITE, INC. have banded together to revamp the software giant's on-line personal finance products. The MSN Money section of Microsoft's MSN home page has been reworked with the ongoing liberalization of Japan's financial markets in mind. Microsoft also released the companion Money 2000 package, which integrates closely with MSN Money, for $65 or $110, depending on the version.

The Japanese-language version of Engineering Information Village, ENGINEERING INFORMATION INC.'s on-line engineering information data base and portal, is up and running (see Japan-U.S. Business Report No. 360, September 1999, p. 23). The Hoboken, New Jersey company engaged IRM, INC. to handle marketing and membership administration. That Tokyo-headquar-tered marketing and public relations firm helped Engineering Information Village editors develop the Japanese edition. IRM also will ensure that the English-language content continuously being added to the portal has headings and descriptive information in Japanese.

ADOBE SYSTEMS, INC.'s Tokyo unit is shipping a Japanese version of its Web and software solution for sharing photographs and digital images. The ActiveShare software package lets users move photos from a digital camera or a scanner to the Web with one-click simplicity. Once uploaded to the Japanese section of the Web site, the images easily can be viewed on-line or downloaded by family and friends. The software can be downloaded from the ActiveShare. com home page or purchased on a CD-ROM directly from Adobe for about $25.

Japanese movie buffs are the target audience of BIG ENTERTAINMENT, INC.'s Web site. Reachable through YAHOO! JAPAN CORP.'s Internet portal, the site initially is selling merchandise tied in with popular movies, entertainment and pop culture. Boca Raton, Florida-based Big Entertainment is working with partner US-STYLE.COM INC. (see Japan-U.S. Business Report No. 357, June 1999, p. 22) to localize the site's movie information content, including reviews, celebrity interviews, box office results and movie trailers.

With Japanese mobile phone users rushing to embrace wireless Web browsing, MOBIUS MANAGEMENT SYSTEMS, INC. is hurrying to make its document archiving and retrieval software Internet-friendly. The Rye, New York firm has signed up NTT COMMUNICATIONWARE CORP. to distribute and support its Mobius ViewDirect technology, which can handle high-volume document storage, access and distribution over the Internet and corporate intranets (see Japan-U.S. Business Report No. 357, June 1999, p. 26). NTT Communicationware is the third company to work with Mobius Management's wholly owned Tokyo subsidiary, joining KANEMATSU ELECTRONICS LTD. and STK JAPAN, INC.

Distributing electronic documents and data via the Internet also is the forte of TUMBLEWEED COMMUNICATIONS CORP.'s Integrated Messaging Exchange package but with the added feature of top-flight security (see Japan-U.S. Business Report No. 358, July 1999, p. 26). The Redwood City, California firm's latest customer is ASIA SECURITIES PRINTING CO., LTD., which will build its ASPNET secure electronic delivery service on Tumbleweed's IME platform. ASP prints financial materials required by Japan's Commercial Code and Securities and Exchange Law and naturally is interested in secure electronic document delivery.

Under Tokyo's "E-Government" plan, most license and permit applications, requests for information and public notices will be handled on-line by FY 2003. UNISYS CORP.'s subsidiary has rolled out an integrated suite of software and consulting services tailored specifically for this initiative. OnNet Government Solution 21 will evaluate the bureaucracy's legacy computer systems and information, determine the hardware and software required to implement the plan and coordinate operations among government agencies.

BEA SYSTEMS, INC. has fine-tuned its WebLogic Server 4.5 for dishing up e-commerce applications by adding Java2 Enterprise Edition modules. The object-oriented language offers ease of programming, support for a wide range of Internet standards, and enhanced reliability and scalability. The San Jose, California company expects the special version of WebLogic to retail for around $22,100. It will be available from all six of BEA Systems' distributors.

With companies rushing to embrace e-commerce, competition to provide consulting and support services for this market is intensifying. HEWLETT-PACKARD JAPAN LTD., for example, is concentrating its efforts on a few partners, such as the subsidiary of ORACLE CORP. Just as their parents agreed to do in September, the Japanese units will bundle and market each other's products to boost sales of Internet-related HP hardware and Oracle software packages for e-commerce. .....In another tie-up, HEWLETT-PACKARD JAPAN LTD. is partnering with PSINET INC.'s subsidiary and MI-TSUBISHI CORP. to market, support and operate an e-commerce consulting and outsourcing business. EC Delivery 30 not only will set up Web sites and virtual stores for customers, but it also will handle back-end payment operations and the physical delivery of goods in 30 major cities.

Offering a more traditional menu of e-commerce consulting services are new partners ARTHUR D. LITTLE INC. and NTT SOFTWARE CORP. The two are banking on strategic business planning backed by the U.S. firm's management expertise plus NTT Software's enterprise-level computing experience to win clients in Japan's competitive market.

Also in this vein, the subsidiaries of Santa Clara, California-based NETWORK APPLIANCE, INC. and Houston's BMC SOFTWARE, INC. have teamed up with CSK CORP.'s network systems affiliate to construct and operate corporate Web sites for $1,900 to $4,700 a month. The CSK unit is building a new data center with plenty of storage and communications capacity to handle the 100 clients that the partners aim to cultivate in 2000. The group hopes to evolve into a full-fledged application service provider.

EPRISE CORP. and TEIJIN SYSTEMS TECHNOLOGY LTD. are working to localize the Framingham, Massachusetts firm's Web site content-manage-ment package, hoping to have it ready for release during the first half of 2000. Eprise's Participant Server will form a key component of the TEIJIN LTD. subsidiary's Internet solutions business. By adding on-line purchasing and bidding systems for business-to-business e-commerce, the Teijin unit hopes to generate new sales of $9.4 million annually in three years.


To broaden its market base and brand-name recognition, EXCITE, INC.'s two-year-old subsidiary has begun customizing its powerful Internet search engine for corporate clients. For NIPPON TELEVISION NETWORK CORP., for example, it has developed automated search routines that appear as two icons on a user's computer desktop. One icon checks NTV's on-line data base for program schedules, while the other icon triggers a search of the Web for the same information. Redwood City, California-based Excite owns half of its subsidiary, with the remainder split by ITOCHU CORP. and DAINIPPON PRINTING CO., LTD.

Instant Internet messaging remains red hot in Japan — a fact that led CYPOST CORP. to pay $3 million for PLAYA CORP., the developer of the popular Yabumi IM and electronic greeting card service. Dover, Delaware-based Cypost will add its expertise with broad-based privacy and security solutions for businesses and individuals to enhance Yabumi's already strong position in the Japanese IM market. One of NTT MOBILE COMMUNICATIONS NETWORK, INC.'s regional affiliates recently purchased a 100,000-user license for the Yabumi technology.

To help boost the launch of E*TRADE JAPAN K.K.'s on-line brokerage service (see Japan-U.S. Business Report No. 361, October 1999, p. 21), BIGCHARTS INC. is integrating its interactive charting software with E*Trade's Web site. The Minneapolis firm's tools allow users to tap data from all eight of Japan's stock exchanges and primary market indexes to create technical analysis charts, performance comparison charts and price/data figures. The E*Trade deal is the first big venture into overseas markets for the wholly owned subsidiary of MARKETWATCH.COM, INC.

ALIVE.COM signed a strategic marketing and technology alliance with MITSUI COMTEK CORP. The MITSUI & CO., LTD. unit will handle all localization, marketing and after-sale support for's multimedia-enabling technology for Web sites — e-Show Engine and e-Show Wizards. The Seattle firm's packages allows Web site users to create multimedia-enhanced content, including integrating multimedia resources into existing on-line applications and developing entirely new content.

Similar in function but narrower in scope, software from MSLIDE, INC. lets users add music, text and other types of electronic media to digital images and then create and broadcast streaming slide shows over the Internet. The Sausalito, California company not only has opened a Japanese version of its Web site, but it has struck a deal with IPOPCORN, a Palo Alto, California-based developer and operator of Web sites for Asian and Asian-American youth. The MSlide Engine can be accessed through ipopcorn's sites in English, Japanese, Chinese and Korean.

AMERICA ONLINE, INC.'s subsidiary has rolled out the Japanese version of its latest Internet access package. AOL 5.0 runs on Windows-based machines, offering greater ease of use and faster performance. Also included in the upgrade are new versions of AOL Instant Messenger.

To pave the way for the development of a native application service provider market, more than 40 Japanese companies, including affiliates of American businesses, have formed the ASP Industry Consortium Japan. The organization has established formal ties to the Wakefield, Massachusetts-based ASP Industry Consortium, an international advocacy group that sponsors research, fosters standards and works to promote the emerging ASP field.

INTERTRUST TECHNOLOGIES CORP. agreed to let MATSUSHITA ELECTRIC INDUSTRIAL CO., LTD. use its digital rights management software to develop DRM-enabled products, including software music players and content-packaging tools. The Santa Clara, California firm's platform provides a common foundation for authors, publishers, enterprises and others to define rules for using digital information and deriving commercial benefits from digital intellectual property. MEI is participating in an electronic media distribution trial with AT&T CORP., BMG ENTERTAINMENT and UNIVERSAL MUSIC GROUP (see Japan-U.S. Business Report No. 357, July 1999, p. 10). InterTrust already has relationships with these three companies.

Security services and software for e-commerce is another hot field in Japan. WATCHGUARD TECHNOLOGIES, INC. has added NEXTCOM K.K. of Tokyo to the list of network systems providers and Internet services providers that use its WatchGuard LiveSecurity for MSS software (see Japan-U.S. Business Report No. 360, September 1999, p. 24). NextCom will build its CyberWatch e-commerce security service around the Seattle firm's platform, including installation and management of firewalls, content filters, configuration administration and automatic software updating. Virtual private network services will be offered as well as a full palette of operations reports for $565 a month. INTERNET INITIATIVE JAPAN INC. also has adopted WatchGuard's LiveSecurity for MSS platform.

CISCO SYSTEMS, INC.'s unit has tied up with SECOM CO., LTD. to offer very secure electronic authentication services for e-commerce, especially among companies. Secom, which currently provides digital certificate authentication using ENTRUST TECHNOLOGIES INC.'s know-how (see Japan-U.S. Business Report No. 361, October 1999, pp. 26-27), will add another layer of protection by adopting Cisco's VPN technology and hardware.

The local arm of VERISIGN, INC., MITSUBISHI MATERIALS CORP. and TEIKOKU DATABANK, LTD. have released their jointly developed e-commerce back-end support system, COSMOSNET/EC. The service combines a corporate credit information data base and a digital certificate authority server to provide clients with a secure means of doing credit evaluations and sharing sensitive information.

Another name Japanese company has been sold on ENCOMMERCE, INC.'s Internet portal access management solution. FUJITSU, LTD. will integrate the Santa Clara, California firm's getAccess single sign-on system into its SystemWalker network management suite and public key infrastructure solutions for worldwide distribution. It hopes to generate $18.9 million over two years from using the enCommerce product. getAccess lets administrators tailor access to portal functions and resources to the specific needs of each user, creating a more individualized experience and enhancing security by preventing access to unused portal areas.

HNC SOFTWARE INC. has landed a major contract, signing the VISA Japan Association and its 41 members to use the Falcon fraud-detection software. The credit-card issuers have enlisted SUMITOMO CREDIT SERVICE CO., LTD. to handle transaction monitoring, antifraud intervention and card-activity reporting. Each member of the VISA Japan Association will pay Sumitomo Credit Service a fee for these services. San Diego, California-based HNC previously had licensed Falcon to a number of Japanese credit-card issuers, but this contract, valued around $3 million annually, is its largest to date.


An English version of Portland, Oregon-based TRIPWIRE SECURITY SYSTEMS, INC.'s network intrusion detection package is available through a KYOCERA CORP. affiliate for $1,200. Like other users of the package (see Japan-U.S. Business Report No. 356, May 1999, p. 26), that company will open a computer-communications center powered by TripWire and begin offering network security monitoring services. A Japanese version of TripWire is planned for release in February 2000.

RSA SECURITY INC.'s subsidiary released an Internet-friendly version of its BSAFE Crypto encryption engine for the C language. BSAFE Crypto-Ci allows software developers to embed in a wide range of applications an industrial-strength encryption engine that handles multiple algorithms and supports digital signatures and certificates, all important considerations in the e-commerce age. RSA expects to collect $47,200 in licensing fees for each application that incorporates BSAFE Crypto. .....Separately, RSA SECURITY INC. will merge its encryption software and e-certificate system marketing subsidiaries January 1 following the September consolidation of SECURITY DYNAMICS TECHNOLOGIES, INC. and its wholly owned RSA DATA SECURITY, INC. subsidiary. Before that occurs, Bedford, Massachusetts-headquartered RSA Security will buy out the 30 percent share of the encryption software marketer held by 12 Japanese companies, including NEC CORP. and SONY CORP. The merged subsidiary will operate under the name of RSA SECURITY JAPAN INC. In 2001, that business hopes to have sales of $18.9 million, double the 1998 total.

The Japanese market for the Linux open-source operating system continues to expand in size almost exponentially. TURBOLINUX, INC., which specializes in adapting the OS to the needs of users around the Pacific Rim, has announced what it is calling the world's largest commercial Linux deployment. SANYO ELECTRIC CO., LTD. will use TurboLinux's version in the projected 20,000 Newve medical workstations and related products that it expects to ship over the next four years. The San Francisco company worked with Sanyo Electric for almost a year to port, test and optimize the medical applications software for Linux. Under the terms of the deal, TurboLinux will provide ongoing technical services and support to Sanyo Electric and Newve customers.

LINUXONE, INC. of Mountain View, California is offering a competing Linux product through SRINET, INC. The Tokyo-based software distributor has nonexclusive rights to market the Japanese and Chinese versions of LinuxOne OS in Japan and China.

For its part, LINUXCARE, INC., which bills itself as the first company to offer comprehensive Linux technical services to multinationals, has landed a contract to provide in-depth technical support to developers at NEC CORP.'s systems integration subsidiary engaged in building Linux-based solutions. The San Francisco business will support all major distributions of the open-source OS in Japanese, including Red Hat, TurboLinux, Laser5, Caldera and others. NEC SOFTWARE, LTD. added Linux to its computing solution services in March 1999. .....Separately, LINUXCARE, INC. will certify INTER SPACE PLANNING CORP.'s Linux-based hardware and offer Linux support services. The first priority is to give the Tokyo-based firm's AQUILA server for small and midsize companies the Linux-compatibility stamp of approval of Linuxcare Labs. Next, the partners will train Inter Space Planning employees to provide front-line Linux support, which will be buttressed by Linuxcare's Level 3 behind-the-scenes technical expertise.

To maintain its leading position in the nascent market for eXtensible Markup Language programming tools, OBJECT DESIGN, INC. lined up a fifth distributor for its eXcelon wares (see Japan-U.S. Business Report No. 358, July 1999, p. 30). ITOCHU TECHNO-SCIENCE CORP. will support the Burlington, Massachusetts-based firm's XML development and run-time environment, focusing on helping Object Design's broad client base implement XML for e-commerce. .....Separately, OBJECT DESIGN, INC.'s subsidiary has tied up with Tokyo systems integrator EC-ONE, INC. to market and support its new data server software. Javlin is fully compliant with the Enterprise JavaBeans standard, easing its implementation in a wide range of companies with legacy and current computing hardware and software. It plugs into BEA SYSTEMS, INC.'s WebLogic server, making users of that package a primary target of EC-One's marketing effort. KASUMI CO., LTD., which operates supermarkets in the area north of Tokyo, already has chosen Javlin to manage its inventory and supply chain data.

HEWLETT-PACKARD JAPAN LTD. has released a new virtual machine of its Java work-alike, Chai. Chai Appliance Platform, which includes ChaiVM 4.0, is fine-tuned for developing and running Java programs on information appliances. Response speed in real-time applications has been cut to as little as 125 microseconds.

Targeting the market for embedded industrial/manufacturing computing, ACCELERATED TECHNOLOGY, INC. has ported its entire family of Nucleus PLUS real-time OS products to the Japanese µITRON (microITRON) operating system. This µIPLUS version of the Mobile, Alabama firm's software includes a real-time, multitasking kernel, TCP/IP support, a graphical user interface and a wide range of utilities and development tools. µIPLUS allows users to move their legacy applications to a wide range of embedded processors under a rare no-royalty license that matches µITRON's open-source nature. GRAPE SYSTEMS, INC. of Yokohama, which worked with Accelerated Technology, will begin marketing µIPLUS in late January. It has penciled in sales of 100 copies in the first year.

MICROWARE SYSTEMS CORP.'s subsidiary released a software driver development kit for intelligent home appliances designed to be networked via the IEEE 1394 high-speed data-transmission standard. Written with VICTOR CO. OF JAPAN, LTD.'s hardware development environment in mind, the Des Moines, Iowa firm's IEEE 1394 Driver SDK targets appliances with embedded PowerPC processors running Microware Systems' OS-9 real-time operating system.

UNISYS CORP.'s subsidiary and HITACHI, LTD. have teamed up to boost the open-computing solutions business of both companies. The two will mesh Unisys' Internet-enabled data analysis software with Hitachi's SCBank solutions development system to create more well-rounded products and services. Hitachi hopes the joint effort will double its solutions business to $2.3 billion by FY 2002.

In another powerful alliance, the subsidiaries of MICROSOFT CORP. and COMPAQ COMPUTER CORP. are jointly offering a fixed-call/fixed-price technical support plan for small business users of their software and hardware products. For $17,900 a year, clients can call on the partners' 24-hour support team up to 20 times. .....At the same time, MICROSOFT CORP.'s local operation announced plans to hire 200 experienced IT consultants by next June in order to expand technical support services for big corporate clients. General consultants and principal consultants able to use Microsoft products to develop, build and operate e-commerce systems will be lured with a $28,300 signing bonus, but they likely can get matching offers from other firms in Japan's highly competitive IT personnel market.

Even smaller American firms are willing to buy their way into Japan. Atlanta's GLOBAL A, INC., for example, has purchased for an undisclosed amount INFOCRAFT CO., LTD. The Tokyo-based software company designs, develops and maintains computer systems. Renamed GLOBAL A INFORMATION, INC., it has hired a president with 20 years of experience in banking systems software, perhaps indicating the new unit's future direction.


MAGIC SOFTWARE ENTERPRISES INC. also has acquired an instant market presence by assuming complete control of a joint venture with WACOM CO., LTD. After serving as the exclusive distributor of the Irvine, California company's Magic (or dbMagic, as it is known in Japan) rapid application development tool for more than a decade, Wacom took a 20 percent stake in a partnership with Magic Software last year (see Japan-U.S. Business Report No. 352, January 1999, p. 22). The joint venture has showed such promise — ringing up $9.4 million in sales in just the first nine months of 1999 — that Magic Software felt it was well worth the extra $3.6 million to buy Wacom's share. dbMagic users include FUJITSU, LTD., HITACHI, LTD., HONDA MOTOR CO., LTD. and MATSUSHITA ELECTRIC INDUSTRIAL CO., LTD.

With corporate information systems, especially those supporting e-commerce, becoming increasingly critical, IT managers are demanding more sophisticated tools. In response, TIVOLI SYSTEMS INC. developed the Cross-Site family of Internet commerce management applications. These are designed to: manage and distribute information and applications; ensure reliability and availability; coordinate problem resolution; protect sensitive data from intrusion; build cooperative relationships with partners and service providers; improve customer service; and strengthen communications with business partners and customers. Available in English immediately for $7,500, Tivoli Cross-Site will be released in Japanese in early 2000.

BMC SOFTWARE, INC.'s subsidiary released a competing integrated management and availability solution for e-commerce under the e-vailability name. The Houston firm modified two of its mainstay products for e-commerce: the PATROL application service management system and the MAINVIEW mainframe monitoring and management software. A package of products, services and methodologies to optimize and maximize the uptime of computing resources — Service Assurance Center for E-business — is the third leg of BMC's e-commerce support triad.

A new entry in the enterprise IT management market comes from Morgan Hill, California-based DIVERSIFIED SOFTWARE SYSTEMS, INC. Long a strong presence in the U.S. mainframe software market, Diversified Software has modified its full product line for Japan, including PRO/JCL, DOCU/TEXT and JOB/SCAN (job control language software) as well as the INFO/X, INFO/XL and INFO/XL Enterprise application and systems management packages. Diversified Software picked CLC CORP. of Tokyo to distribute and support its products on an exclusive basis.

A rival enterprise IT management solution is on the market from TIVOLI SYSTEMS INC.'s sales unit. Available in a fully localized package, IT Director v2.11 provides first-class centralized control and applications reliability management for both corporations and small firms. A fully configured package with a 1,000-seat license costs $122,300, while a basic setup with 20 seats lists for $11,500.

Companies interested in outsourcing their enterprise IT management functions have a new option in TRANS COSMOS INC.'s Enterprise Infrastructure Management Service. This offering is built on PEREGRINE SYSTEMS, INC.'s InfraCenter for enterprise and workgroup platforms, which track and project the total cost of ownership of a firm's IT infrastructure. With its appeal to both large and small companies, Trans Cosmos hopes to record $47.2 million in sales of enterprise IT management software and services the first year.

COMPUTER ASSOCIATES INTERNATIONAL, INC. released four stand-alone network performance tracking and work-load administration packages. ScheduleIT common-process automation, WatchIT monitoring, AdviseIT network data and performance evaluation, and CommandIT single-console management are integrated with CA's Unicenter TNG enterprise IT management framework. They run on the Japanese version of the OpenVMS operating system. As part of this initiative, CA and COMPAQ COMPUTER CORP. created a center at the Islandia, New York company's subsidiary to test CA products installed on Compaq hardware. .....Separately, COMPUTER ASSOCIATES INTERNATIONAL, INC. announced that it had landed a contract to install its Unicenter TNG management system throughout the operations of NATIONAL HOUSE INDUSTRIAL CO., LTD., the fourth-largest maker of prefabricated housing in Japan and a MATSUSHITA ELECTRIC INDUSTRIAL CO., LTD. company. NHI has a mixed computing environment, including several Unix and Windows NT systems. It wanted to take advantage of advances in distributed, open computing while improving administration and minimizing retraining.

With telecommuting becoming more common, LOTUS DEVELOPMENT CORP.'s Japanese unit released a low-cost version of its client software for Notes R5. The $55 package allows users to link with their company's Notes/Domino systems from home, accessing files and running applications as if they were at their office desks. .....Similarly, NOVELL, INC.'s Tokyo subsidiary introduced a Japanese version of its NetWare Client 5.12 for Macintosh computers. The package allows Macs to integrate seamlessly into corporate NetWare systems. It also supports some of APPLE COMPUTER, INC.'s latest hardware and operating system software.

The subsidiaries of SYMANTEC CORP. and TIVOLI SYSTEMS INC. have teamed up to offer corporate customers an integrated network management and antivirus package. Symantec coupled its Norton AntiVirus Plus 5.0 tightly with Tivoli's IT Director systems administration package. It also automated many antivirus duties, such as downloading the latest virus definitions and patches. The Symantec unit will handle marketing of the $85 add-on.

The Storage Management Division of Dallas-based STERLING SOFTWARE, INC. has rolled out a Japanese version of its distributed data storage management package, SAMS:Vantage. Available from Sterling Software's subsidiary, this product has helped firms reduce the cost of managing their enterprise storage resources. With its new support for double-byte languages (such as Japanese) and ability to work over the Internet or intranet, SAMS:Vantage is ready for multinational users.

The market for sophisticated data backup software is heating up. COMPUTER ASSOCIATES INTERNATIONAL, INC. has tweaked its ARCserveIT family to work with the NetWare 5 network operating system. Prices range from $3,700 for an enterprise-level package to $1,900 for a workgroup version. Available as well are such add-ons as a RAID option ($1,900), tape library ($1,900) and remote client support ($925).

For its part, VERITAS SOFTWARE CORP. is pushing its Backup Exec network backup solutions. The Mountain View, California firm has renewed its distribution arrangements with FUJITSU, LTD. and NEC CORP. and signed new reseller pacts with FUJI XEROX CO., LTD. and NK-EXA CORP. VERITAS Software's utility runs on both Unix and Windows NT systems. A version for protecting distributed network storage systems is on the drawing board. .....VERITAS SOFTWARE CORP. also is offering through its subsidiary a new version of its backup utility for Windows NT workstations. BackUp Exec Desktop v4.2 automates the protection of client data, using peer-to-peer copying and scheduling. The package, which supports a wide range of devices to ensure compatibility, is priced at $90 for a single license, $780 for a 10-user pack and $2,800 for a 50-user bundle.


Last but not least, NETWORK INTEGRITY, INC. of Marlborough, Massachusetts has launched its automatic, all-the-time backup package by striking an exclusive distribution deal with SUMISHO ELECTRONICS CO., LTD. Running in the background, LiveVault provides continuous, real-time backups of Windows NT systems. It consequently reduces system administrators' work loads, eliminates system downtime to perform a dedicated backup and ensures up-to-the-moment data protection. Sumisho Electronics hopes to sell 200 of the $6,700 LiveVault packages the first year and 2,000 over three years.

ORACLE CORP.'s marketing unit has introduced version 4.0.8 of the popular Application Server, which boasts support for such Internet essentials as Enterprise JavaBeans and load balancing. Prices run from $23,600 for an enterprise version down to $7,300 for a small-business package. A plug-in that adds COBOL support will soon be available for $450.

In short order, JUSTSYSTEM CORP. announced a second deal to make its software work with packages from other vendors (see Japan-U.S. Business Report No. 361, October 1999, p. 26). This one involves LOTUS DEVELOPMENT CORP. The two plan a knowledge-management solution based on the Japanese firm's on-line analytical processing package and the American company's groupware system. For $18,900, users will get Justsystem's K-Navi OLAP engine and a 20-client license integrated with Lotus Development's popular Notes groupware. Supporting software, such as application development kits, are planned for release in the spring of 2000.

COMPUTER ASSOCIATES INTERNATIONAL, INC. has tied up with JGC INFORMATION SYSTEMS CO., LTD. to design, integrate and support corporate data base systems. As firms find it increasingly necessary to give suppliers, distributors, resellers and customers access to corporate data with appropriate controls, data base design has become highly complex. The new partners have opened the CA Enterprise Modeling Center, where CA's ERwin data base design tool is being deployed to develop supporting data bases. JGC Information Systems, which brings to the job its expertise in modeling, is distributing the solutions. The center also provides after-sale technical support.

An alternative approach to aggregating and presenting a corporation's various data resources comes from COHERA CORP. Its Cohera Federation System is a middleware product that transparently pools, integrates and displays enterprise and Web-based information regardless of format, platform or physical location. Cohera and exclusive distributor NICHIMEN DATA SYSTEMS CORP. will introduce the Hayward, California firm's localized know-how by first using it to develop on-line catalogs for e-commerce.

ORACLE CORP.'s subsidiary has landed an order for the Linux version of the Oracle8i Workgroup Server system from BANK OF TOKYO-MITSUBISHI, LTD. Japan's top commercial bank will use the Internet-en-abled, relational data base management package to overhaul key operations by the spring of 2001, including capital transactions and trading of foreign exchange and financial derivatives. Oracle is trumpeting the contract as the first step toward breaking SYBASE, INC.'s near-monopoly in the market for financial industry data base software.

The Japanese unit of NCR CORP. has rolled out a localized version of Teradata for Windows NT v3.0.1. The latest version of the enterprise-level data warehousing system brings massively parallel processing to the Windows NT data base market as well as NCR's patented BYNET technology, which adds even more scalability to the RDBM package. Pricing of the new Teradata version, including a NCR WorldMark 4800 enterprise server, start at $745,300.

Also at this level, INFORMIX CORP.'s subsidiary has delivered a version of the Informix Dynamic Server multimedia RDBM to a Japanese customer. At a cost of $943,400, NIKKAN SPORTS PRINTING CO., LTD. will have a system capable of handling any kind of digital information it needs to produce general, sports and specialty newsletters for its clients as well as 24-hour technical support.

SYMIX SYSTEMS, INC. has decided to bolster its alliance with MITSUI & CO., LTD. in the market for enterprise resource planning solutions. Although the trader has been distributing the Dublin, Ohio firm's products since 1995, the two decided that greater technical support would help boost sales. The result is a joint venture in which Symix Systems has an 85 percent share. The venture has an initial staff of 15 and a goal of building annual sales to $28.3 million in three years.

Not interested in ceding any ground, ORACLE CORP. plans to beef up the list of companies reselling and supporting its ERP solution, Oracle Applications. About 40 firms currently provide a full range of sales, licensing, consulting and integration services for Oracle Applications, but the Redwood Shores, California firm wants to add an equal number of partners whose primary focus will be boosting sales and not technical support. In addition, Oracle expects to triple its 350-person roster of Oracle-certified consultants.

COMPUTER ASSOCIATES INTERNATIONAL, INC. has formed an alliance with BAAN CO.'s local arm and EXE INC. to offer end-to-end design, installation and support for supply chain management solutions. The three will integrate CA's Unicenter TNG enterprise management framework with Baan's Supply Chain Solution and EXE's Nexus II integrated distribution management package to provide what they expect to be the most advanced solution available for SCM. CA will handle marketing duties, initially targeting manufacturing, logistics and services firms.

MICROSOFT CORP.'s operation is marketing the latest version of its integrated productivity suite. Priced at just $85, Microsoft Works 2000 has many built-in Internet functions, such as Internet access, documents with hyperlinks and even the ability to download data to cellular handsets. It also has more than 220 ready-made documents for such everyday needs as letters and golf score sheets. Microsoft Works 2000 includes as well a built-in help function that will lead computer novices through basic and advanced functions. Microsoft also is offering Works Suite 2000, which adds advanced image-processing and financial planning modules to the basic package.

The subsidiary of PHOTODISC, INC. continues to add to its library of royalty-free digital images on CD-ROMs. The Seattle firm's latest Film Series is a six-disc collection of images taken from 16mm and 35mm film, grouped into skyscapes, wind and clouds, natural landmarks, business day, buildings and monuments, and transport and traffic. Each disc retails for around $550.

SYBASE, INC.'s subsidiary has teamed with CASIO COMPUTER CO., LTD. and ITOCHU TECHNO-SCIENCE CORP. to offer a data base solution for corporate computing on handheld devices. Sybase has stripped down its DB wares to create a package that works with the limited memory and display of these products. Casio will preload the software on its Cassiopeia family of handheld computers, while Itochu Techno-Science will provide the software to link the devices with remote corporate data servers. Given the explosive growth of Japan's mobile communications market, the partners expect sales to hit $47.2 million the first year.


Activity in the computer-aided design market runs from the high end to the low. SOLIDWORKS CORP., typical of the former, has added TOSHIBA ENGINEERING CORP. to its family of resellers. The Concord, Massachusetts firm's self-named CAD package starts at $9,300.

The Japanese operation of AUTODESK, INC. has teamed with FUJI XEROX CO., LTD. to boost sales of both companies' CAD programs and related software and hardware. The partners have mated Autodesk's versatile AutoCAD 2000 package with Fuji Xerox's EDMICS 2000 information-management system to produce a modeling and data system suitable for a wide range of manufacturing activities. They hope to sell 3,000 AutoCAD licenses and 500 EDMICS systems.

In a major endorsement of its technology, COCREATE SOFTWARE INC. has a contract to install its SolidDesigner 3D CAD system throughout CANON INC.'s global office machine products operations. The maker of copiers and PC printers already licenses 200 SolidDesigner seats for its laser and BubbleJet printer divisions. Canon said that it chose SolidDesigner because of its ease of use, dynamic modeling approach and the Fort Collins, Colorado firm's strong support capabilities. The bottom line, though, was that the divisions using SolidDesigner reduced time to market and developed more innovative products. .....Separately, COCREATE SOFTWARE INC. released a Japanese version of its ME10 2D CAD program for the Linux open-source operating system. Although the Linux OS can be had for free, CoCreate's ME10 will cost users about $6,000.

Tokyo's SOLIDWAVE CORP. — a joint venture of ARGO GRAPHICS INC., ARGOTECHNOS 21 CORP. and SEIKO INSTRUMENTS, INC. — has entered the CAD reseller market with a full line of American engineering software. At the high end, Solidwave offers UNIGRAPHICS SOLUTIONS INC.'s family of 3D CAD tools. The Maryland Heights, Missouri firm's Solid Edge covers the middle of the lineup. Rounding out the menu is the low-cost thinkdesign 4.0 by THINK3 of Santa Clara, California (see Japan-U.S. Business Report No. 356, June 1999, p. 28).

For the PC drafting market, INTERNATIONAL MICROCOMPUTER SOFTWARE, INC. released new Japanese-language versions of its popular TurboCAD product. Available through SUMITOMO METAL SYSTEMS DEVELOPMENT CO., LTD., TurboCAD v6 is priced from $120 for a bare-bones package to $740 for a deluxe setup.

With interest in system-on-a-chip designs rising fast, COWARE, INC. opened a wholly owned subsidiary in Tokyo to support its electronic design automation package. Already in use by such top manufacturers as FUJITSU, LTD., HITACHI, LTD., MATSUSHITA ELECTRIC INDUSTRIAL CO., LTD., MITSUBISHI ELECTRIC CORP., NEC CORP. and SONY CORP., the complex methodology of the Santa Clara, California firm's CoWare N2C allows firms to extensively test and model SOC designs before taping out. That capability cuts development and debug times by up to 50 percent.

HEWLETT-PACKARD JAPAN LTD. has joined hands with OKI ELECTRIC INDUSTRY CO., LTD. to develop, market and support an operations support system for the fast-growing communications industry. The aim of the new communications system management solution is to reduce the cost of administering and maintaining complex networks while making it easy to add new services. One goal is reduce the time between receiving a service order and initiating that service from the current two weeks to as little as a few minutes. HEWLETT-PACKARD CO.'s OSS solution has been deployed by 50 communications businesses around the world, but it has yet to be installed in Japan. The tie with communications equipment manufacturer Oki Electric could change that. It will start selling customized systems in April 2000.

Hoping to get in on the ground floor of the mobile data transmission market, MICROSOFT CORP. and NTT MOBILE COMMUNICATIONS NETWORK, INC. will establish an equally owned venture to develop and market mobile data services for NTT DoCoMo's wireless subscribers using the software giant's platforms and services. MOBIMAGIC CO., LTD. expects to be operational by mid-2000. It initially will offer corporate customers mobile access to e-mail, scheduling and other intranet-based applications over NTT DoCoMo's 64-Kbps circuit-switched PHS (personal handyphone system) wireless network. In the future, Mobimagic plans to target users of NTT DoCoMo's PDC (personal digital cellular) network and its upcoming third-generation wideband-CDMA network. The partners say that the rollout of Mobimagic services will be accompanied by an aggressive promotion of cellular phones using Microsoft's microbrowser technology and handheld PCs running Windows CE. Mobimagic will be the first tangible result of a March 1999 memorandum of understanding between Microsoft and NTT DoCoMo to collaborate in the wireless data and software fields. Executives of the two companies said they expect many other tie-ups down the road.

TEGIC COMMUNICATIONS, INC. has landed a second customer for its T9 Text Input software. MA-TSUSHITA COMMUNICATION INDUSTRIAL CO., LTD. will incorporate T9 into its Panasonic-brand wireless phones for release in the United States, where they will be compatible with the TDMA (time-division multiple access) standard, and in Europe and Asia, where the handsets will work with the GSM (global system for mobile communications) network. The Seattle firm's text-input system can handle a wide variety of Western languages as well as Japanese and Chinese. NEC CORP. was Tegic's initial Japanese licensee (see Japan-U.S. Business Report No. 358, July 1999, p. 33).

An exchange rate of ¥106=$1.00 was used in this report.

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A New York City company that provides round-the-clock, global, facilities-based data and voice communications for the financial community is the latest American services provider to receive a Type I operating license from the Ministry of Posts and Telecommunica-tions. IXNET, INC.'s subsidiary initially will provide high-speed voice and data services using the transpacific TPC-5 undersea fiber-optic cable network. When the Japan-U.S. Cable Network goes onstream next spring, consortium member IXnet will gain the international bandwidth to expand its extranet not only in Japan but elsewhere in Asia as well.

Industry sources report that MCI WORLDCOM, INC. is in talks with JAPAN TELECOM CO., LTD. about working together to build a fiber-optic network in Osaka's business district. Such collaboration has obvious appeal for both carriers, which are looking for ways to lower the stiff interconnection charges they pay NIPPON TELEGRAPH AND TELEPHONE CORP.'s regional subsidiary to initiate or terminate calls. Most notably, MCI WorldCom and JT could share the costs of laying the network and eliminate some of the red tape that each would encounter on its own. .....Closer to realization is a plan by MCI WORLDCOM, INC. and MORI BUILDING CO., LTD. to tie office towers in Tokyo run by the commercial property manager into the fiber-optic network that the carrier has been building in the capital since the fall of 1998. The deal would give Mori Building a marketing tool to use to secure multinational tenants for its buildings since these companies not only would have access to high-speed voice and data services but also could save a considerable amount of money, according to MCI WorldCom. The partners expect to be offering communications services to 10 office buildings by the start of 2000 and to have some 40 locations managed by Mori Building tied into the MCI WorldCom network by the summer.

P-COM, INC., a Campbell, California supplier of network access systems for the wireless communications market, has won a contract worth more than $3.5 million from the Information Systems Division of KOKUSAI ELECTRIC CO., LTD. for point-to-point, spread-spectrum radio equipment. The Tokyo firm will use these products for projects it is undertaking for NIPPON TELEGRAPH AND TELEPHONE CORP. and KDD WINSTAR CORP. (see Japan-U.S. Business Report No. 358, August 1999, p. 34). P-Com also makes wireless products for point-to-multipoint systems, a capability that should help it expand business in Japan.

Atlanta's EQUANT, a major source of managed, end-to-end data network services for global businesses worldwide, is a primary beneficiary of the contract that NINTENDO CO., LTD. awarded HITACHI, LTD. to build it a global private network. To connect the worldwide offices of the top developer of video games, Hitachi will employ Equant's international frame-relay services. Its network extends to key business centers in more than 220 countries. Hitachi offers Equant's services as part of its Compassport total network design package.

Subscribers to DDI CORP.'s nationwide PDC services that own phones equipped with PHONE.COM, INC.'s UP.Browser microbrowser now have access to Internet-based services, including e-mail and more than 140 content sites. Last spring, Japan's second-largest carrier brought wireless Internet access to its cdmaOne customers based on the Redwood City, California company's UP.Link Server Suite. Both the PDC service and the cdmaOne service are marketed under the EZweb brand name.

Slowly but surely, LUCENT TECHNOLOGIES INC. is making inroads into Japan's huge communications infrastructure market, primarily through alliances with various NIPPON TELEGRAPH AND TELEPHONE CORP. affiliates. The latest deal is an agreement with NTT COMMUNICATIONWARE CORP. to jointly develop and market Lucent's high-performance Softswitch to Japanese carriers. Developed by Bell Laboratories, Lucent's R&D arm, Softswitch is designed for Internet Protocol and ATM (asynchronous transfer mode) networks. It is said to enable carriers of all sizes to offer customers new services quickly and economically on either packet-switched or circuit-switched networks. Softswitch development work will begin before yearend at a new NTT Comware test facility in Makuhari, Chiba prefecture. The Japanese company currently participates in Lucent's Full Circle Program, which is aimed at making it easier for independent software vendors like NTT Comware and Web developers to quickly create new services that take advantage of broadband networks.

Six-month-old UNISPHERE SOLUTIONS, INC., which designs networking solutions exclusively for carriers and ISPs, has moved into the Japanese market through a distribution arrangement with NETMARKS, INC. The first of the Burlington, Massachusetts firm's products that it will sell and service is the two-model ERX Edge Routing Switch. Targeted at ISPs, this carrier-class platform is described as the industry's first wire-speed routing product designed to tackle the unique feature requirements at the edge of services providers' networks. The ERX1400, priced at $50,000, is aimed at ISPs that operate high-capacity points of presence. Its modular, 14-slot chassis features a wide range of interface options. The more economical, seven-slot ERX700 is designed for applications that require a midrange capacity; otherwise, it has the same features and performance as the ERX1400. Unisphere Solutions is a wholly owned SIEMENS AG company.

NETWORK EQUIPMENT TECHNOLOGIES, INC., a supplier of multiservice wide area network equipment, also has its sights firmly set on building business in the Japanese market. The Fremont, California firm has tapped TOYO COMMUNICATION EQUIPMENT CO., LTD. to sell, install, support and maintain the Promina 800 multiservice platform for aggregating voice, data and video for access to ATM and other WAN services and the Promina 4000 ATM switch, which is optimized to improve performance for IP-differentiated services. As part of their alliance, N.E.T. and TOYOCOM will develop Japan-specific interfaces for these products.

A company formed by San Francisco's little-known LIVEDOOR GROUP, INC. is offering Tokyoites something that NIFTY-Serve, Biglobe and other major ISPs so far have been unwilling to provide: free Internet access. livedoor users only have to pay telephone charges. LIVEDOOR, INC. plans to make money from advertisements and e-commerce commissions. It has very ambitious goals for a start-up in Japan's notoriously fickle market. With access points planned for other parts of the country over the near term, livedoor believes that it can have 1 million users by the end of 2000. In contrast, NIFTY-Serve, Japan's biggest ISP, currently has 2.7 million-plus subscribers.

For whatever reason, American suppliers of optical fibers, no matter how technically advanced, historically have had trouble breaking the hold that FUJIKURA, LTD., FURUKAWA ELECTRIC CO., LTD., SUMITOMO ELECTRIC INDUSTRIES, LTD. and other Japanese makers of optical fibers have on the business of domestic manufacturers of fiber-optical cables. CORNING INC. has managed that feat. It has a contract to supply about one-fourth of OCEAN CABLE CORP.'s optical-fiber requirements for about 18,600 miles of cable. Shipments are scheduled to start at the beginning of 2000. OCC gave several reasons for going with Corning, including cost considerations. What makes the contract all the more surprising is that OCC's principal shareholders are Corning's competitors in optical fibers — Fujikura, Furukawa Electric and SEI.

An exchange rate of ¥106=$1.00 was used in this report.

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Women's career clothing and sportswear designer LIZ CLAIBORNE INC. licensed manufacturing and marketing rights to its new Emma James brand to JUSCO CO., LTD. This line of dresses, jackets, skirts and blouses for working women costs about half what comparable Liz Claiborne clothing does. Jusco — the majority owner of the company that is opening freestanding and in-store Liz Claiborne and Dana Buchman shops in Japan — will modify the Emma Jones collection of 200 to 250 pieces for Japanese women. The clothing should be available at 20 stores by yearend 1999, including in-store shops in four Jusco outlets in Chiba and Kanagawa prefectures. By 2001, Jusco expects 120 stores to be carrying the Emma Jones line and generating sales of $53.8 million.

By February 2000, a new line of Japanese-designed B.V.D.-brand T-shirts, sweat suits, dresses and other "innerwear" clothing will be in specialty stores across Japan. FUJI SPINNING CO., LTD., the master licensee of the B.V.D. name for the last 27 years, arranged this expansion of its business with UNION UNDERWEAR CO., INC. of Bowling Green, Kentucky. FUJI APPAREL CO., LTD. will make the products. They will be distributed by an affiliate of WORLD CO., LTD., a manufacturer of women's wear that supplies some 7,000 outlets.

ASHWORTH, INC., a Carlsbad, California designer of upscale men's and women's golf-inspired sportswear, has decided to work with KOSUGI SANGYO CO., LTD. to bring its clothing to Japan. The Tokyo apparel maker/wholesaler, which already produces such sportswear brands as Jantzen and Jack Nicklaus, will import some products from Ashworth and manufacture other licensed items designed specifically for the Japanese market. Kosugi Sangyo will distribute these lines to better golf specialty and other stores beginning in the spring of 2000.

The Rusty and the R. lines of surfing-motif T-shirts, trunks and other activewear for men and women will be introduced in Japan in the spring of 2000. Irvine, California-based C&C PARTNERS, LTD., the master licensee of these labels, sublicensed the brands to trader SUMITOMO CORP., which turned around and worked out a deal with NIKKI CO., LTD. The Japanese side is projecting first-year sales at a very strong $5.7 million.

The Eden Prairie, Minnesota firm that is reintroducing the Norton brand of merchandise, named after the famous British motorcycle, has signed an agreement with INGRAM CO., LTD. Under it, the Japanese licensing company will act as an agent for NORTON MOTORCYCLES, INC., licensing various manufacturers to make clothing, including leather jackets and T-shirts, and such related products as gloves, boots and helmets under the Norton name for the Japanese market. Norton Motorcycles will maintain complete design and quality control over the licensed products.

Japan has been a major market for footwear manufacturer WOLVERINE WORLD WIDE, INC. since 1965 when Hush Puppies shoes were introduced there. The Rockford, Michigan firm's line now also includes Wolverine boots and shoes, Coleman footgear, Caterpillar footwear and Merrell outdoor footwear. Next to be added are 15 styles of Harley-Davidson boots and shoes for men, women and children. Wolverine World Wide gave exclusive distribution rights to these products to INTERNATIONAL TRADING CORP. under a five-year deal. The Harley-Davidson footwear, which will retail for $70 to $250, will be available through the motorcycle manufacturer's 100-plus dealerships, the 31 ABC-Mart stores owned and operated by International Trading and independent retailers.

Despite prices of $285 to $375 a pair, the Red Wing and the Irish Setter brands of outdoor footwear have been hits among young adults in Japan. In an attempt to broaden its market among these buyers, RED WING SHOE CO. of Red Wing, Minnesota introduced its less-expensive WORX line through MIDORI INTERNATIONAL CO., LTD. Eight ankle-high, midhigh and high styles of shoes and boots are available. The WORX line retails for $120 to $150 a pair.

An exchange rate of ¥106=$1.00 was used in this report.

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For years, GENERAL MOTORS CORP. has said that it aims to control over the medium term 10 percent of the poised-to-soar car and light truck market in developing Asia. How the world's largest automotive maker planned to manage this feat never was spelled out in detail. GM eliminated some of the question marks in September 1998 when executives announced that the company would work with affiliate SUZUKI MOTOR CORP., Japan's top maker of minivehicles, to design and develop vehicles for emerging markets. The first product resulting from this closer relationship recently was previewed. The Chevrolet-badged concept car, dubbed the YGM-1, is based on a subcompact Suzuki platform but styled by GM's Australian unit. Designed to seat five passengers, the sporty hatchback will be powered by either a 1.3-liter or a 1.5-liter four-cylinder engine. GM plans to launch production and sales of the YGM-1 in 2001. Where the car will be built has not been decided, although one possibility is Suzuki's Kosai factory in Shizuoka prefecture. GM now owns 10 percent of Suzuki.

The YGM-1 could be sold in Japan, but the next GENERAL MOTORS CORP. product launched there probably will be the new midsize Saturn L-Series. The exact timing has not been decided, but it might be as soon as the first quarter of 2001, SATURN CORP. executives say. Initially, only left-hand-drive versions of the three L-Series sedans and the two L-Series wagon models will be available. Sales of Saturn's S-Series of subcompact sedans, coupes and wagons have been disappointing since introduction in April 1997. Saturn's exclusive dealer network retailed just 1,375 vehicles in 1998. The company hopes a broader lineup will give a lift to sales.

The 2000-model-year version of GENERAL MOTORS CORP.'s Cadillacs are arriving at YANASE & CO., LTD. showrooms across Japan. The DeVille DHS sedan, available only with left-hand drive, lists at $65,900. The right-hand-drive, four-door Seville SLS and Seville STS have a manufacturer suggested retail price of $56,200 and $61,500, respectively. GM is eyeing sales of 1,000 or so DeVille DHSs in 2000 and 2,000 Sevilles. Moreover, various 2000-model-year Chevrolet products are showing up at Yanase dealerships. The sporty Camaro two-door coupe is available in three trim levels for $28,200 to $37,400. A like number of new Corvette sports-car models have been introduced as well at list prices of $56,100 to $64,800. Dealers also are selling four versions of the Blazer sport-utility vehicle; they range in price from $30,900 to $36,600. Finally, the 2000 Astro minivan comes in five trim levels. Their MSRPs are between $28,200 and $38,600.

The rebadged right-hand-drive Chevrolet Cavalier coupe for 2000 is showing up at TOYOTA MOTOR CORP. dealerships. Equipped with 2.4-liter engines, the two models start at $14,100 or $16,900. Toyota stores have sold the Cavalier since the beginning of 1997, but sales never have reached the targeted level of 10,000 units a year. In 1998, for example, they totaled roughly 6,800. Sales are doing no better this year despite a major price cut. This track record and changing times in the automotive business have suggested to some industry watchers that GENERAL MOTORS CORP. and Toyota will end their supply arrangement in 2000.

The American side of DAIMLERCHRYSLER AG will roll out two new products in Japan in 2000. At midyear, the all-new Chrysler 300M performance sedan will debut as a left-hand-drive vehicle. Then, in late 2000, the Chrysler PT Cruiser "panel van" will arrive in showrooms. This innovative yet affordable four-door vehicle combines retro styling with the versatility and the convenience of today's minivan. Interestingly, it will be built as a right-hand-drive product for Japan.

The 15th anniversary of BORG AUTOMOTIVE, INC. production in Nabari City, Mie prefecture coincided with the inauguration of new capacity at the plant, which is run by the Chicago manufacturer's Morse TEC group and makes automotive chain systems and components for engine timing, automatic transmission and four-wheel-drive applications. The 50 percent increase in capacity is geared to the continuing shift from belts to timing chain drives in overhead-cam engines. According to BWA, the new technology makes engines more fuel-efficient while reducing emissions. The company says that its chain has been designed to provide low noise, power and durability in a compact package.

The May 1999 acquisition of LUCASVARITY PLC by TRW INC. will result over time in the complete integration of the Japanese operations of the two major automotive components suppliers. Already, the people at the former LucasVarity's marketing and sales unit have moved over to TRW's Tokyo office, which now has about 30 people. In the next phase, LucasVarity technical facilities in Japan will be combined with the technical center that TRW expects to open in the fall of 2000. TRW and LucasVarity have complementary product lines, particularly in the vehicle control systems area, which includes braking systems (LucasVarity) and steering and suspension systems (TRW). Executives of the Cleveland-headquartered multinational believe that among other benefits, the acquisition will better position TRW to meet the increasing demand by vehicle manufacturers for complete modular systems.

The huge Visteon Automotive Systems operation of FORD MOTOR CO. believes that a five-year partnership with MITSUBOSHI BELTING LTD. will help it become the top supplier of automotive cockpits in the Asian Pacific. The two companies will codevelop molded components for cockpit modules, particularly for Visteon's superintegrated cockpit modules. These parts will be manufactured at Mitsuboshi Belting factories in Nagoya and Kanagawa prefecture and then integrated with Visteon's cockpit modules before shipment to customers in Japan and elsewhere in Asia.

Visteon rival DELPHI AUTOMOTIVE SYSTEMS CORP. reportedly plans to strengthen its substantial automotive electronics business by purchasing components for in-vehicle navigation systems from XANAVI INFORMATICS CORP. The joint venture between NISSAN MOTOR CO., LTD. and HITACHI, LTD. currently makes CD-ROM drive-equipped control units for navigation systems. These now go exclusively to Nissan, but Ibaraki prefecture-based Xanavi is looking for more customers to help it triple total revenues over the next five years. If the deal with Delphi is finalized, component shipments could start in the spring of 2000.

Already active on several fronts to develop the technology for commercially viable fuel cell-powered vehicles, DAIMLERCHRYSLER AG will work with NIPPON MITSUBISHI OIL CORP. on fuel options for these vehicles. Although Nippon Mitsubishi Oil is Japan's top oil refiner and distributor, it has expertise in fuel cells from work done by one of the merger partners with MITSUBISHI MOTORS CORP. Equally attractive to DaimlerChrysler no doubt is the fact that the company runs 29 Eco-Stations that provide electricity, natural gas, methanol and liquid petroleum gas. The initial fuel-cell test vehicles will run on methanol, but DaimlerChrysler and Nippon Mitsubishi Oil say that they will evaluate the potential for other fuels. Road testing is expected to start sometime in the first quarter of 2001.

An exchange rate of ¥106=$1.00 was used in this report.

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At a cost of $30 million, CORNING INC. is installing a second specialized kiln at its active-matrix liquid crystal display glass substrate factory in Osuga, Shizuoka prefecture. The announcement by the world's big-gest supplier of glass substrates to the booming flat-panel display industry follows by just months the start of a smaller expansion at the plant (see Japan-U.S. Business Report No. 357, June 1999, p. 31). The capacity that is being added in Japan is one key to Corning's plan to double its worldwide capacity for AMLCD glass substrates by the end of 2000. The new capacity in both Japan and South Korea will start to come on-line in January 2000. Corning also announced that it would use the expansion to commercialize a glass substrate that is lighter as well as more rigid than today's products. Those characteristics, the company noted, will help display manufacturers fabricate larger screens for desktop monitors and television sets.

ENTEGRIS, INC., which provides critical materials management solutions to the semiconductor, data storage, pharmaceutical and chemicals industries, has signed a licensing agreement with CDK CORP. Under it, the leading Japanese maker of valves for fluid management can incorporate the Chaska, Minnesota firm's Flaretek fitting connections into its perfluoroalkoxy fluid management products. In this way, Entegris gains entry into Japan's wet-processing equipment market.

SUMITOMO 3M LTD. estimates that its new Scrape Mat 9000 for commercial and industrial settings will develop into a $2.8 million annual business. The floor mat contains no polyvinyl chloride and, thus, will not produce dioxins when burned. Equally important, Sumitomo 3M says, its product is better at collecting dirt than the competition's while also being more durable and lighter. A Scrape Mat 9000 that measures roughly 3 feet wide by 20 feet long costs $1,700.

With input from the international economic consulting firm of NATIONAL ECONOMIC RESEARCH ASSOCIATES, INC., a JGC CORP. consulting company that specializes in energy and environmental matters plans to expand its business. The deregulation going on in Japan's electricity market and the movement toward tighter environmental controls provided the impetus for JAPAN NUS CO., LTD.'s tie-up with White Plains, New York-based NERA. Together, the two companies will be able to advise government and industry on the economic and financial impacts of changes in the energy and environmental areas.

By June 2001, PROCTER & GAMBLE CO. will shutter its factory in Haga, Tochigi prefecture. Since 1990, the plant has made Whisper and other brands of sanitary napkins for sale in Japan and elsewhere in Asia. Production equipment will be moved to the P&G plant in Akashi, Hyogo prefecture in an attempt to improve efficiency and allow the company to respond better to the pricing pressures in the sanitary napkin business. The Haga facility's 150 employees will be relo-cated to other P&G operations in Japan. The consumer products giant has not decided what it will do with the plant and the site. Selling them is an option, however.

SHISEIDO CO., LTD. has not been shy about using acquisitions to build up its hair-care products operations in the United States, particularly for the salon part of the business. Now, it is doing the same thing in Japan. At a cost of roughly $4.7 million, Shiseido acquired trademark and manufacturing rights to nine hair-care product brands from BRISTOL-MYERS SQUIBB CO., including the DeAGE line of professional coloring products. Sales of the brands in Japan amounted to $10.4 million in 1998. They also are sold in some other parts of Asia.

An exchange rate of ¥106=$1.00 was used in this report.

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