JIN-128 -- On Sharp Using Linux for its PDA OS

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J@pan Inc Magazine Presents:
T H E J @ P A N I N C N E W S L E T T E R
Commentary on the week's business and technology news
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Issue No.128
Wednesday, April 11, 2001
Tokyo

CONTENTS

+++ Viewpoint: On Sharp Using Linux for its PDA OS
+++ Noteworthy news
- Ito-Yokado's online bank to win govt go-ahead
- Japanese convenience store chain sells mobile phones
- EAccess Starts Pilot Contents Delivery for Broadband
+++ Random thoughts

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+++ Viewpoint

On Sharp Using Linux for its PDA OS

Call me crazy, but I'm guessing the worldwide PDA market will
eventually be dominated by Japan's consumer electronics giants.
Now that the creative US firms have proven a concept, the
practical Japanese firms will move in and take over the
market. (That's a cliche, but I think it applies here.)

The PDA market leader in Japan is Sharp. Sharp puts out a
mega-hit handheld called Zaurus. (One of its many cool
features: users can watch recorded TV programs on it.) The
company has been king of the domestic PDA market since the
early '90s, and it's hoping the incorporation of Java into
Zaurus will help it expand worldwide.

The interesting thing about the Zaurus, though, is that it's
using not Palm OS, but open-source Linux. This opens up all
kinds of interesting questions about the fate of Palm OS and
Palm Inc. If Sharp can use a free open-source alternative to
Palm OS, why can't Sony or Handspring, which recently said it
may also use a different OS?

Sharp's OS strategy also opens up questions about Japan's
traditional perceived status in consumer electronics. This can
be summed up, however inaccurately, as, "Strong in hardware,
weak in software." How does free, open source software change
this formula? It's a question worth pondering, especially for
makers of mini-OSes, embedded systems, and microbrowsers. (That
goes for Japanese companies, too, including Access, which makes
embedded systems and the Compact NetFront browser found in
i-mode phones.)

Palm has hinted that it will eventually become more of a
software play, but if Palm OS hardware makers start to gobble
up too much market share too quickly, it may have second
thoughts. On the other hand, if it stops licensing its OS to
other handheld makers (Apple pulled a similar stunt a few years
back with its Mac OS), those competitors could follow Sharp's
lead and switch to Linux. Which would leave Palm as -- to use
one of its ad campaigns -- simply Palm.

Your thoughts?

-- Steve Mollman

Sources:
** "Handspring may consider software switch"
http://news.cnet.com/news/0-1006-202-5512205.html
** "Analyst: Palm may burn half its cash this quarter"
http://news.cnet.com/news/0-1006-202-5549051.html
** "Sharp PDAs to premiere in Europe, US"
http://news.cnet.com/news/0-1006-202-5230235.html

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+++ Noteworthy news

** Ito-Yokado's online bank to win govt go-ahead
(Reuters via Yahoo)
http://biz.yahoo.com/rf/010405/t49283.html

EXTRACT: 7-Eleven parent company Ito-Yokado is getting the
green light to be an official bank and will offer 24-hour ATM
services in Japanese 7-Eleven branches.

COMMENTARY: One thing I've been mystified by ever since moving
to Japan is that the ATMs close. Think about that ... what's
the point of closing an ATM? It's a machine. 7-Eleven getting
permission to bank is another example of Japanese deregulation
finally doing away with those old, weird rules.

** Japanese convenience store chain sells mobile phones
(Global Wireless)
http://www.rcrnews.com/news_gw.php3?id=16050

EXTRACT: 7-Eleven will sell mobile phones. Customers will order
them by scanning their ID cards into a multimedia kiosk, which
will spit out a receipt that they can pay at the counter. A few
days later they can pick the phone up, next time they need
snacks and drinks.

COMMENTARY: Maybe that's one way to get shoppers to use the
7-Navi multimedia terminals at 7-Eleven. Not one of us
at JI has seen anyone using them, ever. (And I, for one, go to
my local 7-Eleven nearly every day.) We'll see if this
works ...

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** EAccess Starts Pilot Contents Delivery for Broadband
Networks (Nikkei Electronics)
http://www.nikkeibp.asiabiztech.com/wcs/leaf?CID=onair/asabt/cover/127720

** Sony PlayStation 2 gets hard disk, broadband slot (Reuters)
http://biz.yahoo.com/rf/010409/t70373_2.html

** Nifty to Offer Access to ADSL through Five Broadband Service
Providers (BizTech News Dept.)
http://www.nikkeibp.asiabiztech.com/wcs/leaf?CID=onair/asabt/news/127714

COMMENTARY: Broadband in Japan isn't just a pipe dream. The
infrastructure is being laid, and however ridiculous the
government's e-Japan initiative, it is a sort of green light to
make broadband a reality. I just wonder if enough Japanese
really want it. At my residence we were offered Usen's 100-Mbps
service for a remarkably low price, but ... why bother? Within
five minutes of our place there are three konbinis and a
variety of other stores at which we can buy or order just about
anything. So why sit at home chained to a computer?

** Bluetooth Wireless Products Reach Market in Japan (Nikkei
Computer)
http://www.nikkeibp.asiabiztech.com/wcs/leaf?CID=onair/asabt/fw/127706

** Java I-Mode Handsets Assessed: Discrepancies Seen in
Processing Speeds (Asia BizTech Editorial Dept.)
http://www.nikkeibp.asiabiztech.com/wcs/leaf?CID=onair/asabt/news/127609

** Japan's browser phone user numbers top 34 million
(RCR wireless news)
http://www.rcrnews.com/news_gw.php3?id=16044

COMMENTARY: Interesting phrase: "browser phone." As editors
we've been looking for the right phrase to describe Net-enabled
cellphones, and this may be it.

** Motorola Develops Japanese Input Software with Prediction
Feature (Nikkei Electronics)
http://www.nikkeibp.asiabiztech.com/wcs/leaf?CID=onair/asabt/news/127710

** NTT DoCoMo To Launch Net Linking Phone In Europe (AP)
http://sg.biz.yahoo.com/010408/15/m8hd.html

** NTT DoCoMo set to enter foreign markets (Yomiuri Shimbun)
http://www.yomiuri.co.jp/newse/20010410wo11.htm

** Softbank, Lehman to liquidate online brokerage (Reuters)
http://forbes.com/newswire/2001/04/08/rtr230551.html

** Goldman Sachs To Start Online Conv Bond Trading In Japan
(Dow Jones)
http://sg.biz.yahoo.com/010409/15/ma6f.html

** e-Lux Corporation Introduces .AI And .EC Domains For Japan's
Internet Market (Internet Wire)
http://biz.yahoo.com/iw/010409/0101025587.html

COMMENTARY: I had a chat with this company's new executive
president the other day, an English gentleman named Edward
Milward-Oliver. According to him, e-Lux traditionally has been
a maker of high-quality amplifiers (as in hardware). One
problem was that the equipment was so good it lasted a long
time and needed few repairs. Not much profit margin there. In
danger of being de-listed from the OTC Jasdaq market at one
point, the company under its new management is being
reorganized to focus on two high-margin areas: 1) domain names,
and 2) e-commerce billing via long-distance phone charges.
e-Lux's Web site and the company descriptions of it found on
other sites haven't caught up with the changes yet, so trying
to figure out online what the company does is (for the moment)
a mystifying task.

** ID system keeps alcohol vending machines handy (Japan Times)
http://www.japantimes.co.jp/cgi-bin/getarticle.pl5?nn20010410b4.htm

** Konami Opens Web Site for Online Games (BizTech News Dept.)
http://www.nikkeibp.asiabiztech.com/wcs/leaf?CID=onair/asabt/moren/127390

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+++ Random thoughts

** MP3 players in rental cars
Every time I rent a car I wonder why pre-loaded MP3 players
aren't installed in every dashboard. A few weekends ago we
drove around the Izu Peninsula, a rural seaside area outside
Tokyo. Stuck in unexpected traffic in unexpected drizzle, we
searched hopelessly for decent tunes on the radio. If an MP3
player holding various genres had been available, we would have
happily agreed to pay a fee upon returning the vehicle. (Just
as we don't mind paying for hotel-room refrigerator cocktails
upon check-out.) Surely some enterprising music and car-rental
companies can harmonize on this ...

** Online ads on cellphone screens
News that advertisements placed on Japan's wireless Web have
been garnering better response rates than banner ads on the
regular Net has generated much speculation about the reasons.
Here's a thought: it's the percentage of screen real estate the
ads take up. A three-line ad dominates a cellphone display. A
banner ad on a regular Web site uses little of the available
window space. Note the latest breed of online ads taking up
more and more screen real estate. It's not about getting
eyeballs, it's about getting attention.

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STAFF
Written by Steve Mollman (steve@japaninc.net)
Assistance with news compilation:
Richard Ochero (richard@japaninc.com)

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