GOVERNMENT & POLICY

Real-world computer delayed
The Ministry of International Trade and Industry (MITI) is giving up on plans to develop a real world computing (RWC) system within its initial time frame of 10 years. The ministry launched its 10-year RWC project in FY1992 to develop a computer equipped with "real-world intelligence" that would enable it to understand human speech and actions without the need for keyboard-based input. With software and hardware research progressing at different speeds, MITI has decided to abandon the idea of completing the development by 2002 and instead will attempt to maximize the research resources available for individual software and hardware projects.

Mobile market grows
Japan's mobile communications industry, including cellular, personal handyphone system, and paging service providers, will have spent JPY1.78 trillion on equipment and infrastructure in fiscal 1996, according to estimates released by the Ministry of Posts and Telecommunications (MPT). This is up more than 76% from the previous year. The ministry also expects that the mobile communications market will have grown more than 65% year-on-year in FY1996, to JPY3.93 trillion in revenues. The MPT revised its estimates upward in light of continuing strong demand, primarily for cellular telephone services.

Manufacturing on the Web
Shinagawa Ward has put some 800 local manufacturers on the Internet in an attempt to provide them with more exposure and help them reduce their traditional reliance on subcontract jobs from large manufacturers. The Shinagawa Ward office is talking with many of Tokyo's 22 other wards and eventually hopes to get several local governments participating in the effort. The experimental website offers information on the companies, ordering information, and electronic conferencing functions.

Tentative accord on NTT's future
In December, NTT and the MPT reached broad agreement on the future shape of the telecommunications giant. It was agreed that NTT itself would become a pure holding company from April 1998, with actual service operations divided between one long-distance and two local companies (one covering eastern Japan, and the other covering western Japan). Japanese law does not yet permit holding companies, so some changes in the legal structure will be required for the plan to be instituted. The long-distance operator will be permitted to offer international services. The agreement, if all proceeds smoothly, will mark the end of over a decade of debate about the structure of NTT.

Proposed Asian cellular standard
The MPT has agreed with the governments of Korea and China to form an Asian alliance in the hopes of setting the standard for the next generation of cellular phones. Asia lost out to European and US formats for the current generation of cellular equipment, but nations in the region will work together from the R&D stage in hopes of creating a second-generation standard that can gain worldwide acceptance. The Japan-Korea- China group met for its first research gathering in Beijing in December. Japan is being prompted to develop a next-generation cellular system both by the desire to set the international standard and by the looming shortage of frequencies to support the current generation of services.

BUSINESS & MARKETING BRIEFS

Loans for copyrights
Tokyo-based multimedia developer Dome has obtained JPY640 million in funding from four Japanese banks (Japan Development Bank, Dai-Ichi Kangyo, Sanwa, and Japan Securities Credit Bank) to support the commercialization of data compression technology that it is currently developing. Dome, which has put up collateral in the form of software copyrights, is being granted a two-year deferment on repayment of the principal. It is rare in Japan for a small venture business (FY1996 revenues of JPY1.2 billion) to obtain such a level of funding.

Cellular recycling
With over 16 million cellular subscribers using cellular phone batteries with a lifespan of just one year, NTT DoCoMo has decided to take a stronger stance towards recovery and recycling. The company therefore has launched a nationwide campaign to recover used batteries. Each DoCoMo Shop will feature a used battery recovery point, and will encourage users to bring in batteries by offering gift coupons. The company ran similar campaigns twice in the past, and saw battery recovery rates soar by 80% over normal months.

Retail store PC sales up
PC sales in Japan's three major electronics shopping districts soared 36% year-on-year, to 402,200 units, in the first half of FY1996, according to a survey by Multimedia Research Institute. PC sales in Tokyo's Akihabara district accounted for 8% of PCs sold in Japan during the April-September 1996 period. Akihabara PC sales rose by 35%, to 257,400 units; sales in Nagoya's Osu district reached 37,700 units, up 37%; and sales in Osaka's Nipponbashi district surged 40%, to 107,100 units. NEC PC sales accounted for 34% of PCs sold in the major districts, followed by Apple (17%), Fujitsu (17%), IBM Japan (13%), Toshiba (6%), Sharp (4%), and Compaq (3%).

NT backup market moves forward
The market for automated Windows NT backup software is expected to expand from about 30,000 packages in FY1996 to over 50,000 units in FY1997, according to a survey conducted by Nikkei BP. Cheyenne Software's ArcServe dominates the market, but with the Windows NT market growing it is likely to face challenges. Seagate Software, which offers Backup Exec for Windows NT, intends to increase shipments from 2,000 copies in FY1996 to 12,000 copies in FY1997. Other competitors include Soliton Systems, Digital Technology, and Lifeboat, which will all enter the Japanese market with US-developed products.

Banking online
Sumitomo Bank has become the first of Japan's "city banks" to offer PC banking services. Account holders who pay a small annual fee can access their account balances and details of entries and withdrawals, and transfer funds between Sumitomo branches. The bank intends to strengthen security aspects, including user ID verification and encryption of communications between the bank and its customers. The move is expected to put pressure on Japan's other banks to follow suit.

PB-NEC Japan to sell DOS/V machines
Packard Bell-NEC Japan, the local affiliate of PB-NEC, is strengthening its marketing structure with the goal of selling 10,000 PCs per month this year. The company, which launched full-scale marketing of IBM-compatible PCs in November, is boosting its marketing staff (from 40 to more than 50) and will double the head office floor area devoted to sales. The company plans to grow further, and expects to sell at least 150,000 units in 1997 and more than 300,000 in 1998.

INTERNATIONAL NEWS

International CALS trials
Forty Japanese electrical and electronics firms, led by Fujitsu, Matsushita Electric, and Mitsubishi Electric, will conduct joint trials of CALS systems in Singapore, Malaysia, China, Thailand, and Indonesia. The systems will initially be used to exchange electronic part catalogs and design data via the Internet. The trials are being coordinated by the International Information Cooperation Center (CICC), with support from the CALS Technology Research Association and the Electronic Industries Association of Japan (EIAJ). The move is an attempt to broaden the scope of trials that were previously limited to Japan.

Japanese consortium wins China contract
A consortium formed by five Japanese companies and the Chinese Academy of Science has won an order for a financial settlement system from the People's Bank of China (PBC). NTT Data, NTT, Hitachi, Marubeni, and Itochu will set up the $40-million online China National Automated Payment System, which will connect via satellite and terrestrial networks the bank's branches in 100 cities and about 500 branches of five Chinese commercial banks by mid-1999. The system will eventually be expanded to cover some 2,000 cities in the future. PBC will open computer centers in Beijing and Shanghai, where it will install four Hitachi mainframe computers. NTT Data will handle overall project and application software development.

PRODUCTS & SERVICES

Explorer by default
Fujitsu has announced that it will make Microsoft's Internet Explorer the single, default browser that it will pre-install on the PCs that it sells. The company has decided to adopt a single "bundled browser" policy in order to assure continuity and compatibility with its support of other Microsoft products. The decision is a blow to Netscape Communications, makers of the popular Navigator browser. Thanks to a Justsystem agreement with Netscape, however, Netscape's Navigator browser will still be automatically installed on all Fujitsu hard drives that come bundled with Ichitaro, Justsystem's popular word processing software package.

An Internet software sales solution
CSK Tohoku Systems, a subsidiary of information services giant CSK, has released its Internet Sales Solution System (ISSS) - software that gives computer vendors the ability to procure and sell software via the Internet. The JPY2 million software, which runs on Microsoft's Internet Information Server and Windows NT platform, provides online estimation, request, and ordering functions; secure payment management features; ID and password issuance and verification capabilities; and other features that enable computer resellers to procure software from wholesalers online and market it directly to consumers via the Internet.

Remote NT network support
ASCII Network Technology (ANT) has started offering NT Mihari VAN, a remote network monitoring and support service aimed at small and midsize corporations that have Windows NT-based client/server systems but who lack dedicated systems integration personnel. ANT has set up an in-house network control center and will use ISDN and NTT's OCN (Open Computer Network) lines to perform a number of services for clients. The services include system development support, remote monitoring, management and maintenance, help desk support, and provision of statistical data.

Job-seeking by encrypted e-mail
Tokyo-based Recruit Personnel Center, Japan's largest personnel agency, has started offering free encrypted e-mail service to all its registrants. Aspiring job seekers are able to download dedicated e-mail software, called RIPP, from Recruit's server, and thereafter communicate confidentially with agency managers. Since most of its registrants are currently employed but seeking other positions, Recruit decided that confidential communications are critical to the success of its e-mail service. The company will eventually offer a similar free e-mail service to the public in a bid to raise its profile among both job seekers and potential corporate clients.

TELECOM TOPICS

KDD hopes to add digit
In a document circulated to NTT and the long-distance new common carriers, KDD has proposed that its current system of number prefixes be consolidated around 0010. The move, which is seen as preparation for a KDD move into the domestic services market, would bring the company into line with other carriers that use a 4-digit prefix. KDD would reserve its current 001 prefix for its international services and consolidate its other services (those presently using the 002, 003, and 005 prefixes) under the new 0010 prefix. If implemented, the move would begin at the end of 1997 and be completed by the end of 1999.

NTT to offer combo discounts
NTT plans later this year to introduce discounts based on combined voice and leased line service usage. The move, aimed at corporate customers, recognizes that data traffic now forms a large part of users' communications needs. Although some VAN (value-added network) operators already offer similar combined discounts, NTT would become the first Type 1 carrier to do so. The corporation has begun to modify its billing system to accommodate the new combined service, since it is currently geared to billing only on a service-by-service basis.

Cellular accessibility effort
NTT DoCoMo has launched development of a cellular phone designed for hearing- and sight-impaired users. The company was to generate a concrete development concept in February, after which it will test prototypes in collaboration with welfare organizations. As part of the effort, NTT DoCoMo has analyzed the functions required by disabled users, run simulations of performance, and evaluated production cost. The company also is working on an adapter for the hearing-impaired that can be attached to existing phone models.

Parental guidance suggested
The Tokyo-based Electronic Network Association is promoting an Internet "filtering mechanism" that would, for example, enable parents to prevent their children from viewing licentious, violent, or other objectionable Internet-based material. ENA will support an effort by the World Wide Web Consortium to establish PICS, a standard system for rating material that is available via the Web, and will promote development of filtering software to be used in conjunction with the rating system.

Proposed OCN charges lowered
NTT is considering offering Internet service providers the same Open Computer Network (OCN) line rates as it charges to itself. Providers have been saying that they would be able to compete with NTT only if their line cost was the same as that borne by NTT. NTT decided to lower the charges since the MPT's Telecommunications Council declined to accept the company's initial proposal.

New long-distance entrants
Sanyo Electric is leading a rush by consumer electronics firms into Japan's long-distance telephone market. Earlier this year, Sanyo launched a service that offers a rate of JPY98 for a three-minute daytime call between Tokyo and Osaka, approximately 30% cheaper than NTT rates. The company has said it will respond to any rate cuts NTT makes in February to maintain its price differential, and forecasts that revenues in 2000 will reach JPY1 billion. Mitsubishi Electric and Matsushita Electric will also enter the long-distance market using their own leased-line networks. These moves were made possible by the recent lifting of the ban on public-leased-public connections.

IN 50 WORDS OR LESS

DDI intends to link its Multimedia Access Line (MAL) data network with its PHS network, and will expand MAL access to its other group firms, including the Cellular Phone group, to combat recent NTT data communications initiatives.

The world's leading modem maker, US Robotics, has set up a Japanese subsidiary. The new subsidiary, capitalized at JPY150 million, has signed distribution contracts with seven firms, including Softbank.

Hitachi Information Systems, which has been developing client/server package software based on Unix, NetWare, and other platforms, intends to standardize around the Windows NT 4.0 platform.

PC peripheral maker SMC Microsystems of Germany will set up a Japanese subsidiary this spring to make a full-fledged entry into the Japanese market.

US company Data General has entered Japan's Windows NT PC server market with the release of a model with a clustering function. In spring it will introduce a Unix model based on the new NUMA specifications.

New ISDN subscriptions in 3rd quarter 1996 for the first time exceeded the number of new regular phone subscriptions. In the July to September period, NTT signed 139,000 ISDN and 96,000 regular phone subscribers.

Newsbriefs are based on materials provided to Computing Japan by Digitized Information