Japan's LAN and Winding Road
Every problem has a solution. But that solution can lead to a whole
new set of problems.
by John Boyd LAN. It's such a short, simple acronym, one that slides from the lips with slippery ease. Especially from the lips of those marketing Local Area Networks.
"The network is the computer." "LAN is the new client/server computing paradigm." "With a reliable local area network, what used to be insurmountable, isn't." Slogans like these are meant to convince us that we're now living in a networked world, and that there is no longer anything "personal" about the PC.
Computing at ground zero
In a sense, this is true. Networking is the art of connecting computers and peripherals to other computers, so that they are able to talk to each other and share information. A corporation's efficiency can indeed be boosted dramatically through such network-centric technologies as electronic mail, collaborative or workgroup computing, and timely distribution of hot data to those who can make best use of it. But that isn't the whole story.While productivity enhancement has been the experience for many companies, others have found that networks can also become a ground zero where the telecommunications and computer industries collide. Too often, the result is a mashing rather than a meshing of technologies.
Computer magazines are filled with "scare-tactic" advertisements that play on management's fear of problems afflicting their networks. Consider, for example, the following ad from LAN Magazine: "Running a typical department full of applications servers can be nerve-wracking. Systems failures and other tough problems constantly plague you. Hardware that's difficult to upgrade can limit your flexibility. Servers with single points of failure, like power supplies, can leave your users screaming!"
The true story
Melioration or tribulation? The truth of networking lies somewhere in between. The joys of networking are often tempered by the annoyances of technologies that are still evolving, changing, or getting to "know" each other. Managers of networks must be prepared to suffer through the growing pains."LANs are maintenance-intensive," says Makio Innui, an electronics and telecommunications analyst with Kleinwort Benson International in Tokyo. "And the bigger the LAN, the bigger the problems become."
Marc Simmons, founder of SimNet, a Tokyo-based computer network implementation specialist, puts it into perspective thus: "Think of the problems on your PC. Then multiply them two or three times because of the complexity [of the network]." There is a brighter side, though. Simmons, who has installed over 50 LANs, varying in size from 10 to 50 PCs and/or workstations, says he can fix 90% of his clients' problems sitting at his desk using remote support via the phone and a modem connection that monitors the clients' networks.
Different points of view
We can talk about networks from a number of perspectives. The simplest is according to their geographical layout, as when a LAN covers just one office, one floor, or an entire building. But when networking stretches further afield, it expands into a WAN, or Wide Area Network. (A WAN might best be thought of as a number of separated LANs hooked together through a telephone network, which can introduce a whole new set of headaches for a system administrator.)LANs can also be characterized by their topology: the way the PCs, workstations, servers, and other devices (like printers, hubs, and bridges) are interconnected. A bus topology simply hooks everything along a main cable line, called a backbone, and is relatively cheap to install. A star topology connects devices to a central point, which makes for easier troubleshooting.
We can also describe LANs according to their communications protocols: the transmission conventions or handshaking needed to ensure that data is sent and received without (too many) crashes or errors. The IBM-favored Token Ring uses a signaling (token) protocol that controls which station can send a specific block or packet of data to where, and when. Transmission rates for token ring networks are commonly 4M or 16M bps (bits per second). The most widely used transmission protocol today, however, is Ethernet, which eschews tokens in favor of an address system attached to each data packet. This allows multiple packets to move along a network at the same time. Though heavy use will slow the system and may also result in data "collisions," Ethernet is rated at 10M bps, with 100M-bps High-Speed Ethernet emerging.
Japan lags behind
All the technologies just described evolved during the 1970s, in the US, and have gradually been adopted throughout the world, including Japan. However, the rate of penetration of PCs in corporate Japan, while climbing, has been slow when compared to the US and Europe. Japan is generally regarded to be several years behind the US in networking."Look at what functions a network can provide you with. Then you walk into most Japanese offices [and] you won't see many of those functions being used," says Harry Behrens, manager of an Apple Macintosh Ethernet LAN at the German National Research Center for Information Technology (GMD) in Tokyo. "In most US companies, you will find -- from the CEO to the secretary -- people using e-mail and sharing files. In the Japan office, the level [of networking] is generally a lot lower."
Garry Hyman, senior network engineer with Fusion Systems Japan, a Tokyo-based computer systems integrator, agrees. "I was working in North America five years ago, when e-mail and technology downsizing was taking place," says Hyman. "Five years later, I see exactly the same thing happening here."
Such pessimistic views go largely unchallenged, even by Japan's major computer manufacturers. In describing his company's current focus, Hideaki Kobayashi, a department manager for network product planning at Hitachi, speaks for many local computer vendors. "Our first priority right now is to sell PCs. Networking is still a new business."
Besides a paucity of PCs to be networked, the high cost of telecommunications is also holding things back in Japan. "NTT's leased line monthly fees are very high, perhaps three or four times the cost in the US," says Kobayashi. "This is a problem."
Still another obstacle is the dearth of CIOs (Chief Information Officers; IT managers with executive status) in Japan. "No one has the responsibility to tell management how to use computers for strategic purposes," acknowledges Kenshi Tazaki, a telecommunications analyst at market researcher Dataquest Japan in Tokyo. "CIOs just don't exist here." The result, he says, is that "Japanese firms don't have a clear IT strategy. Many companies watch what the competition does with information technology and just follow the trend."
A business opportunity
Some multinationals with branches in Japan are working to exploit this LAN gap by leveraging the advantages of networking. Observes Neil Faulkner, regional vice president of New Jersey-based insurance giant AIU Insurance's computer operations in Asia, "Japanese competitors in the insurance business have not been so aggressive moving into LANs as foreign companies have -- and we're trying to exploit this."Like the local competition, AIU was dependent on a mainframe computer to manage its data. Since 1992, however, the company has been transitioning to a client/server set-up running on Microsoft's Windows NT operating system and IBM's OS/2 on the client side for mission critical business. One advantage, according to Faulkner, is that, "Our (life insurance) product developers and actuaries are now sharing files and working together on a LAN, on the same new product."
In the mainframe era, the creation of new insurance products was done in sequence by the two groups. Then, providing the Ministry of Finance approved a proposed product, it would go through another sequential process of incorporating it into the computer system and the working environment. "With our actuarial LAN, we're trying to collapse this cycle and cut down our time from coming up with a good idea to when we actually get it to the market," says Faulkner.
DIY networking
Nevertheless, transitioning from the mainframe to the network has been no smooth ride. "It's been bumpy, but acceptable," says Faulkner. One source of some of those bumps is the quality of local support provided by overseas equipment and software suppliers, such as Bay Networks, 3Com, Cisco Systems, Novell, Microsoft, Compaq, and IBM, which dominate much of Japan's networking scene at the LAN level."Getting through on some vendors' free-dial numbers is a joke," asserts SimNet's Simmons. He demonstrates by dialing several major suppliers in quick succession, only to get busy signals or recorded "please hold" messages in every case.
Further, Japanized versions of software upgrades already installed on corporate systems in the US are often longer in arriving on the Japanese market than vendors promise. This "vendor gap" means "we have to balance what we can put on the ground in Japan, and what is being used in New Jersey," complains AIU's Faulkner.
One answer to this lack of vendor backing is for a company to foster its own support in-house. Credit Suisse, a Zurich-based commercial bank active in foreign-exchange dealing, has taken this do-it-yourself route at its Tokyo branch. An IT department with a staff of 23 oversees the bank's computer needs, which include an IBM mid-range AS/400 system and a trading floor of 60 dealers in Tokyo.
According to Colin McCabe, who supervises the company's LAN system, the department recently replaced a Token Ring LAN with a switched Ethernet system, running Novell's NetWare operating system and OS/2 on the client side. McCabe says the new system allows him to segment heavy users so they don't impact others on the LAN. And because it is a modular set-up, notes McCabe, "it will be easy to upgrade in the future without changing things like cables and cards."
According to McCabe, local vendors expect corporate customers to automatically buy maintenance along with their purchase of networking equipment. He prefers to rely on internal support, instead of becoming dependent on a supplier whose key staff could quit and leave him stranded. "Besides, equipment suppliers don't understand your environment fully, especially if you're dealing with different vendors. Different products may not work well together, which can lead to a lot of work locating problems. It's better not to put your faith in vendors, but to support your own products." (McCabe acknowledges, however, that this raises the question of how many engineers a company can afford to hire.)
The big push
Yet, despite all this talk of Japanese firms lagging when it comes to networking computers, everyone in the industry agrees things are changing rapidly. Last year, for instance, PC sales growth jumped by 70%, to 5.7 million units, with business purchases accounting for over 60% of sales. "In 1995, companies big and small began buying PCs and LAN technology together," says Dataquest Japan's Tazaki. "A trend has started." And, with so many new users appearing, "businesses are now thinking seriously how to use their PCs, so we can expect record growth in the LAN market over the next five years," he predicts."With this surge in investment, the gap [between the US and Japan] can close right up, just as it did in manufacturing 30 or 40 years ago," points out Fusion's Hyman. "Japan could leapfrog ahead by jumping to new technologies. It only takes money and [the allocation of enough] people."
There are signs that preparations for a leap are underway. Major manufacturers like NEC, Fujitsu, and Hitachi have established networking-related divisions or business groups in the past couple of years. These units are drawing on the rich support of their semiconductor, telecommunications, hardware, and software divisions.
Expectations are running high. "It's a very exciting business, because it's changing so fast," says Hitachi's Kobayashi. "New areas are opening up all the time. There are no set winners. Anyone can enter at any time."
Japan's asynchronous future
One emerging networking area the Japanese have jumped into with both feet is ATM (Asynchronous Transfer Mode) technology. ATM is a high-speed (currently 155M bps, with 622M bps emerging) switching technology originally aimed at WANs, but now also targeting individual LANs. ATM works by divvying data up into fixed packets (cells) with addresses attached for easy and fast handling. These cells are suitable for dealing with various kinds of digital data, including multimedia applications. Many see ATM growing into a dominant technology, which is why Fujitsu, Hitachi, NEC, and others are staking out positions as leading equipment manufacturers.Until recently, notes Kenji Yoshiyama, general manager of NEC's LAN division, the vast majority of LANs in Japan have been based on traditional technologies, particularly Ethernet -- areas in which US firms dominate. But with the advent of Pentium-based PCs, client/server technology and burgeoning interest in corporate multimedia, he believes the market is ripe for a move to ATM.
"ATM is now our most strategic product," Yoshiyama declares. "Some people say it is high-priced and a 21st-century product, but we've changed that paradigm with the introduction of our desktop 25M-bit [per second] ATM: the first in Japan." The idea for desktop ATM -- as compared to the current 155M-bps technology used for high-speed WAN interconnections or as a backbone for heavy-duty LANs -- was originally proposed by IBM. A number of US manufacturers, including FirstVirtual and WhiteTree, have also recently unveiled 25M-bps ATM switches aimed at the local area network market.
Yoshiyama claims that NEC received 150 orders for its desktop ATM in the first two months following its announcement (near the end of 1995); he predicts that NEC will ship 2,000 units in fiscal 1996. Whereas Japan is probably five years behind the US in Ethernet technology, Yoshiyama declares, "In terms of ATM, we haven't anything to learn from anyone." This belief is echoed by other Japanese manufacturers.
Yet some critics contend that desktop ATM is too little, too late, and will not be able to seriously compete with the faster 155M-bps version that offers six times the speed for only about double the cost. Even Yoshiyama admits that it will take a lot of time and investment to promote 25M-bps ATM.
Users are interested in ATM for networking, but remain cautious. "ATM is still three or four years from acceptance," cautions Credit Suisse's McCabe. "Standards are needed for the connectivity issues. If you buy now, you must buy everything from the same vendor, or you risk connectivity problems."
There is general agreement, though, that "ATM is an exciting technology." Japan's computer manufacturers, who hope to make up for lost time in networking, are excited too.
How fast is your LAN?
A LAN's rated transmission speed can be misleading. As Harry Behrens, who has managed computer networks for German and US subsidiaries in Japan, explains, this is merely a statistical measure of the network's overall capacity to carry data. Actual data flow between stations will be considerably lower, because you must factor in such things as the number of PCs trying to access the LAN at the same time, the network's intrinsic overheads, and the delay inherent in the translation process that goes on between the different communications layers making up a network's architecture.So, how fast is a 10M-bps LAN? "You can end up getting between only a tenth to one-half [of overall capacity] in throughput," says Behrens.