GOVERNMENT & POLICY

MPT invests in Net infrastructure
The Ministry of Posts and Telecommunications (MPT) hopes to develop technologies for implementing a Japanese version of the Global Information Infrastructure (GII) first proposed by US Vice President Gore in March 1994. The ministry will invest some \200 million in FY1998 to develop technologies for interconnecting local area networks, cable television, and other kinds of networks. An MPT spokesman says the move is being made out of concern over US and European dominance of the GII concept, which could provide the West with strategic economic advantages over Japan if the resulting standards favor Western infrastructure providers.

An Asia standards-setting alternative
The Ministry of International Trade and Industry (MITI) plans to sponsor an Asia-Pacific Standards Network that would function much like the ISO and IEC in setting international standards for industrial products. Because the ISO (International Organization for Standardization) and IEC (International Electrotechnical Commission) are led by the nations of Europe, the nations of Asia are effectively left out of the standards-setting process, charges a ministry spokesman. MITI is proposing the establishment of a new organization of 22 nations, including ASEAN members, the US, and China; it hopes to set up an Internet-based system for sharing data and polling members on various issues. MITI was to present a formal proposal at a February meeting in Malaysia.

Home networking made easy
The MPT will devise a unified home wiring system standard in FY1998. Today, the wires used for home-based communications, broadcasting, and power supply each have their own standards. The new unified standard will integrate these different standards; the goal is to enable people to easily network TVs, PCs, and other home electrical and electronic appliances via a home network, and control such appliances from outside over a phone line. The MPT will also consider means for incorporating digital satellite broadcast content into a PC. The ministry estimates that wiring and terminal controller installation could cost some \1.2 million per household, meaning the domestic market for new systems could eventually reach \50 trillion. Through its efforts, the ministry wants to take the initiative in establishing an international standard for the home wiring system.

MARKET NEWS

ActiveX for accounting promoted
Microsoft KK has teamed up with NTT Data, Seiko-Epson, and six other corporations to launch the ActiveX Financial Accounting Working Group. The organization will strive to make ActiveX the standard format to be used by financial system developers, vendors, and systems integrators when transferring computerized accounting data. Financial accounting professionals must currently deal with differing systems as well as inconsistencies in data formatting when transferring from one system to another. The new group's efforts will focus on standardizing accounting software around ActiveX, and will include the drafting of a standards document entitled "Accounting Data Transfer Specifications."

ECOM's lifespan extended
The Electronic Commerce Promotion Council of Japan (ECOM) will extend its activities by two years. The MITI-initiated organization with more than 350 corporate participants was scheduled to end its operations as of March 1998. However, with electronic commerce becoming an increasingly important topic for Japanese industry, the ministry has decided to financially support ECOM's activities through 2000. Focus will be placed on coordinating efforts between a working group dealing with administrative and technical problems and experimental projects.

PC server shipment forecasts
NEC should stay in front of its competitors in the PC server market, according to a survey conducted by Nikkei BP. The company forecasts that NEC will ship 54,000 units in FY1997, expanding to 65,000 units in FY1998. Compaq Japan, meanwhile, which was knocked from the number one spot by NEC in FY1996, should see sales of 30,000 PC server units in FY1997 and 45,000 units in FY1998. Fujitsu will rank third for FY1997, with shipments likely to reach 34,000 units, and could surpass Compaq in FY1998 by shipping 57,000 units. IBM Japan's shipments should reach 27,000 units in FY1997 and 43,000 units in FY1998. Fifth-place Hitachi will accelerate its sales drive by shipping 24,000 units in FY1997, and 36,000 units in FY1998.

TELECOM AND NET NEWS

KDD building fiber-optic ring network
International carrier KDD will construct a fiber-optic ring network for phone services in the Kanto region. The network will use part of the Japan Information Highway (JIH) submarine optical cable system that KDD is now constructing around the Japanese archipelago, as well as ground lines that are to be installed between the carrier's Ibaraki and Ninomiya relay stations. The ground lines will support 100G-bps transmission, the same as the submarine system. The 1,200-jkm ring network will be ready for operation within two to three years after the JIH goes into service in March 1999.

Global Internet faxing?
The Internet facsimile service market may get into full swing as early as June, according to the MPT. In January, the MPT announced that it expects the International Telecommunications Union to accept Japanese technology as the international standard for Internet-based fax transmission services. If this prediction proves correct, faxes will soon be able to be transmitted from Japan to anywhere in the world for the cost of a local telephone call, according to a ministry spokesman.

NTT starts xDSL trials
NTT from February launched xDSL (digital subscriber line) experiments in the Kanto and Kansai areas. xDSL is a digital technology that makes possible data transmissions over existing copper telephone wires at speeds of up to 9M bps (about 70 times the speed possible with ISDN lines). NTT will experiment with the xDSL technology in cooperation with Internet Service Providers and some 250 volunteer households through the end of 1998. NTT has no specific plans to commercialize xDSL service at this time, according to a company spokesman.

Online repair information
Fifteen leading consumer electronics manufacturers, including Matsushita Electric, Sony, Hitachi, Toshiba, Mitsubishi Electric, Sanyo, and Sharp, will put product repair information on the World Wide Web where it can be accessed by consumers at no charge. The move is designed to improve both customer service and support to retailers affiliated with each of the manufacturers. The firms, all members of a Household Appliance Association working group, have agreed to set up dedicated database URLs and offer information in a standardized format. The new online service will be launched this spring.

Web usage down
Web browsing time and website access frequency are both declining somewhat in Japan, according to an Internet user survey conducted by Nomura Research Institute (NRI) and a University of Tokyo research group. The survey, which drew conventional mail and online responses from over 4,300 Asahi-Net subscribers, found that the number of persons considering themselves "heavy users" declined by 13% over the course of a year, while the number of "light users" increased by 4%. Average Web session times also declined. Those who stated they "find the Internet extremely interesting, and want to continue using it" dropped from 39% to only 20% of the entire sample.

Unbiased Net equipment evaluations
Tokyo-based Internet Research Institute and Keio University, led by professor Jun Murai (often called the father of the Japanese Internet), will cooperatively establish a new membership-based organization to provide unbiased evaluations of the interoperability and functionality of Internet-related equipment, including routers, servers, and other devices. The new organization, called Network Operational Engineering Laboratory (NOEL), will address the growing needs of both users and manufacturers for objective testing of network interoperability and compatibility. The new group hopes to initially attract 50 corporate members, and will start operations with a staff of about 20.

NTT IN accelerates international leased line plans
Tokyo-based Type-1 international carrier NTT International Network (NTT IN), a subsidiary of phone giant NTT, now plans to start offering international leased line services in December 1998 rather than in April 1999, as originally planned. The earlier startup date is the result of increasingly vicious customer acquisition competition in the international leased line sector, say industry watchers. NTT IN hopes to initially offer services to more than 20 overseas locations, rather than just 11 locations as originally planned. The company was established in October 1997 and currently has some 70 employees.

BUSINESS NEWS

Fujitsu teams with NSI for smart card development
Fujitsu and Siemens have teamed up in the multifeature smart card business to develop a dedicated smart card operating system (OS) and applications. The OS, to be developed in cooperation with Siemens Nixdorf Informationssysteme, will enable the software on a smart card chip to be rewritten. Siemens will manufacture the IC chips to be implemented with the OS, and supply them to Fujitsu. Siemens is the world's largest IC card chip supplier, with a more than 40% share of the global market. Fujitsu decided to form this alliance with the German company in an attempt to catch up with Japanese competitors such as Hitachi, Toshiba, and NEC, which are already producing smart card chips.

NEC targets increased notebook sales
NEC plans in FY1998 to boost to 50% the portion of total unit PC sales accounted for by notebook models. To do so, the company will reduce prices of models designed specifically for corporate customers, and will try to develop replacement demand for currently installed desktop units. It will also increase the number of applications bundled with consumer-oriented models, aiming to win first-time consumer buyers. Because the notebook segment is still relatively robust amid a sluggish overall PC market, NEC hopes to maintain its current level of earnings in the PC sector by shifting its focus to notebook models. Notebook models accounted for approximately 33% of NEC's FY1996 PC shipments, and are expected to account for some 40% of FY1997 shipments.

HP Japan targets data warehousing
Hewlett-Packard Japan (HPJ) hopes to boost its data warehouse business sales by 33% year-on-year, to \20 billion, in the year through October 1998. The company's aim is to be a solid No. 2 in the Japanese data warehousing market, behind NCR Japan. HPJ has assigned some 100 consulting staff and 20 systems engineers to its data warehouse business in order to speed up application development, and will strengthen its alliances with SAP of Germany to develop and propose R/3 ERP (enterprise resource planning) software-based data warehouse systems and with Oracle Japan to support terabyte-class data warehouse construction.

Fujitsu offers Java resources
Fujitsu plans from this spring to start using Java-based software resources both in-house and with its partners and suppliers. The company plans to provide the Java-enabled software technology in a bid to develop stronger cooperative development relationships, and quickly establish a network of developers and suppliers who are working with a common set of resources. Fujitsu anticipates that Java's platform-independence will break down the traditional keiretsu relationships in the software industry that have traditionally tied software makers to particular manufacturers.

INTERNATIONAL NEWS

NTT opens Asia-Pacific offices
NTT has set up a subsidiary in Australia. Capitalized at A$4.4 million, NTT Australia is headquartered in Sydney. The new company will provide nearly 700 Japanese companies in Australia with telecom services, including international leased line, frame relay, IP (Internet protocol), and systems integration services. NTT is aiming for annual revenues of \700 million from its Australian operations by 2000. In a move to beef up its overseas operations in the Asia-Pacific region, NTT also opened offices in Seoul and Taipei in December 1997.

NRI forms partnership with DigiCash
Tokyo-based Nomura Research Institute (NRI) has formed a sales and marketing partnership with California-based DigiCash, developer of the "e-cash" electronic money system. NRI has a non-exclusive license to market DigiCash's e-cash system in Japan, and the two companies are cooperating to create a Japanese-language version (tentatively scheduled to ship this spring). NRI has had a licensing agreement with DigiCash since July 1997, and has been involved with e-cash experiments in cooperation with Sakura Bank.

CSK teams with HCL in Singapore
Leading information services firm CSK has established a data services firm in Singapore under a joint venture with HCL, India's largest data technology group. The new firm is capitalized at about $1.9 million, with CSK and HCL-subsidiary NIIT each holding a 50% stake. The new corporation will provide systems integration, software development, and consulting services primarily to Japanese firms, both in Japan and throughout Asia. CSK has one other overseas subsidiary in China.

Fujitsu establishes German subsidiary
Fujitsu has established a communications equipment sales and maintenance subsidiary in Germany. Capitalized at about \200 million and initially staffed by about a dozen staff, Fujitsu Telekom Deutsche is located in the outskirts of Frankfurt. This is the second subsidiary that Fujitsu has set up in Europe, after Fujitsu Telecommunications Europe of Birmingham, UK. The German subsidiary will market and provide technical support for ATM (asynchronous transfer mode) switches and xDSL (digital subscriber line) and SDH (synchronous digital hierarchy) network equipment in Germany, the Netherlands, and Scandinavian and East European countries. Fujitsu hopes to double its communications equipment sales in Europe to \40 billion in FY1999.

New photo object-separation technology
IBM Japan and the MPT Communications Research Laboratory have jointly developed a technology that can separate an object in a still picture from the background. The technology divides a picture into six-pixel blocks, and identifies the outline of an object by assembling similar elements using such attributes as texture, color, and brightness. This technology reportedly makes it easy to extract a person's hair and clothing, or any object, from the background of the picture. The separated parts can be treated as searchable components. The developers hope to incorporate the technology into a next-generation MPEG video compression technology standard.

RESEARCH AND DEVELOPMENT

ICs that evolve
A group formed by Nagoya University, the Nagoya Institute of Technology, and the Nagoya Industrial Science Research Institute have developed a self-evolving IC (intergrated circuit) in cooperation with researchers from companies including Toyota Motor, Matsushita, and Oki Electric. The IC has a logic circuit that can flexibly switch wires in response to signals coming in from the outside. In an experiment, the group succeeded in evolving an IC into a circuit capable of identifying error signals by feeding into the IC conditions for discovering errors in digital signals. According to researchers, the IC can process signals 500 times faster than a computer microprocessor performing a similar task using software.

IN 50 WORDS OR LESS

Japan's PC backup tape drive market has been growing rapidly. Leader Hewlett-Packard Japan is aiming for a 60% market share in 1998. Sony, which has been enjoying brisk domestic OEM sales to NEC, is considering launching sales under its own brand name in FY1998.

Toshiba and Microsoft have jointly developed DVD driver software for Windows 98. Toshiba has also provided Microsoft with a DVD decoder chip controller and DVD player applications.

Hitachi and Acer have jointly developed a DVD player and launched production in Taiwan in February through HTT, a Hitachi subsidiary in which Acer has a capital stake. Hitachi will supply parts to HTT, while Acer will cooperate in software development and market the players under its brand name.

The International Telecommunications Union has agreed to adopt a Japanese paging standard, the FLEX-TD system, as a global standard. FLEX-TD supports five times the transmission capacity of conventional paging systems.

In December, PHS (personal handyphone system) subscriptions shrank by 10,900, to a total of 6,993,900. This was the third consecutive month-to-month decline. The DDI Pocket group lost 16,100 subscribers and the NTT Personal group lost 4,100 users, while the Astel group gained 9,300 subscribers.

Back to table of contents