Company profiles. (Japanese computer industry) David H. Ahl.
While in Japan, we visited people at 13 computer manufacturers, Waseda University, ICOT (Fifth Generation Project), Microsoft, ASCII (publishers), JEIDA (trade association), the U.S. Embassy, Micro Agency (advertising agency), and nine retail computer stores. In many cases, we paid more than one visit to an organization to see different people. Needless to say, our nine days in Japan were jam packed--three to six appointments every day, discussions with Yasuko Morihara (my interpreter) between and after interviews, writng up as much as possible every night and early morning on the NEC 8201.
I filled the computer and external memory cartridge three times over with material. This turned out to be quite a nuusance Friday night as I had no way to dump it out, and I wanted an empty computer and cartridge to use over the weekend. So, first thing Saturday, I trekked over in bitter, unseasonably cold weather to the NEC Bit Inn at Akihabara. There I purchased 100 yen (44 cents) worth of printer paper (38 sheets), hooked my 8201 up to a printer, and printed out my files.
Many of the computer manufacurers in Japan operate chains of stores (usually called inns) where prospective customers can get hands-on experience with machines they are considering buying. Sord attributes much of their success to their chain of inns in which they taught people to use their innovative PIPS language. Of course, on weekends the inns fill up with youngsters writing programs, playing games, and generally hacking. As I was printing out my files, I was doing that was funny I have no idea--perhaps they thought of me as a quaint sideshow.
In any event, although we had a free hour or so late one Monday and early one Wednesday, we were unable to see every Japanese computer manufacturer. We think we got a good flavor of what is going on, but if we missed something important, we apologize. Please don't get the idea that the companies that do not have seperate writeups areunimportant--nothing could be further from the truth--it is just that we couldn't see everybody. Following are some random facts about four of the companies we did not see in Japan.
Nippon Gakki is not a familiar name; their brand name is Yamaha. The company is one of the largest manufacturers of musical instruments, manual and electronic, in the world. It is only in the past year that Yamaha has gotten into the computer business with the introduction of three MSX machines. Emphasizing their musical heritage, Yamaha has produced an interesting line of keyboards and music composition software for their computers. As result, according to the editor om MSX Magazine, Yamaha has some of the best-selling MSX computers today. This was evident as I visited the ratail computer shops; the Yamaha machines always had crowds around them and were rearely discounted.
Sanyo is the seventh largest with sales of over $4 billion. They are deeply involved with video, audio, household appliances, solar systems, factory automation, and electronic components as well as computers and office automation products. More than 62 percent of Sanyo's sales comes from outside of japan with 45 percent of that coming from U.S.
Major personal computer products sold in the U.S. include the 8-bit MBC 1100/1200 machines, 16-bit MBC 4000/ 4050,new MBC 550/555 (see review in an upcoming issue), CRX 1100 CRT display, and PR 5500 daisywheel printer.
The company also makes an MSX machine, the only one with a built-in light pen, and several smaller home computers which are sold in Japan and Europe but not the U.S.
The Vicor Company of Japan (JVC) ia a powerhouse in video products, particularly TV sets and VCRS. Their first computer entry ia an MSX machine which, at this point, is not slated for the
U.S. market. reflecting their heritage in
video, Victor makes a line of video-oriented peripheral equipment including a low-cost video mixer. This allows the signal from the computer to be super-imposed on a video signal from a TV set, VCR, or other source. At the moment, there is little software t take advantage of this capability, but we expect to see some in the future.
In November 1983, JVC announced their entry in to the U.S. peripheral market. Initially, products will be sold to original equipment manufacturers (OEMS) and not oend users. Products include CRT displays, hard and floppy disk drives, a cassette data recorder, floppy disks, and other components.
Epson Corp. is part of an international conglomerate, perhaps the most widely recognized member of which is the 100-year-old ,seiko Watch Company. Epson Corp., one of the youngest members of the Seiko group, was established in 1961 as Shinshu SeikCo. to manufacture watch parts for Seiko. In 1968, Epson put its first non-watch product on the market--the EP-101 printing head for electric desktop calculators. It was the first calculators printer made.
In 1983, Epson had annual sales of *389 million, 48 percent of corporate sales come from computer products, up from just 2 percent in 1977. The company is the leading manufacturer and marketer of dot matrix printers in the world. Interestingly, another major maker of dot matrix printers, Seikosha, is also part of the Seiko group.
Epson exports six printers, two computers, a floppy disk drive, and an acoustic aoupler to the U.S. The first computer made by the company, the HX-220, was the first notebook portable introduced. The computer has done reasonably well in Japan and Europe, but has been eclipsed by the Tandy Model 100 in the U.S.
The Epson QX-10 desktop computer uses the unique Valdocs operating system develop by Rising Star Industries (see Creative Computing, June 1984) which is exceptionally easy to use. Rising Star is a rather interesting concept; its president, Chris Rutkowski, described it as an "artist's stable in which some of the brightest minds could be brought together to work onthis integrated software system called Valdocks. It was set up so they could work their own hours, in their own homes, on the parts of the project that most interested them, and they could share financially in the product."
Conceptually, the Valdocs operating system is quite different fronm CP/M or MS-DOS; Epson describes it as "human compatible." Perhaps as a result, the QX-10 is the best selling Japanese computer in the U.S. today. But Rutkowski feels that it could and should do even better.
Like many Japanese compaies, Epson has a curious marketing philosophy which, to some extent, may be responsible for their computers not selling better in the U.S.
The name Canon is generally associated with cameras, and with good reason: Canon today is the largest producer of 35mm SLR cameras in the world. Nevertheless, the other operations of the company have grown to the point where photo-related equipment accounts for just one-third of total corporate sales.
On 1983 sales of *2.8 billion, Canon earned *122 million, a return of 4.3 percent. Of total sales, 70 percent is outside of Japan, and 34 percent comes from the United States.
The photo sector has been growing the slowest and, in fact, from 1982 to 1983 declined by 2.3 percent. On the other hand, the sales of copiers and "other business machines" ar growing rapidly. Computers are lumped into this "orher" category and account for something less than 5 percent of corporate sales although sales growth was more than 40 percent last year.
In contrast to many other Japanese companies, Canon USA is wuite independent. Ornery, too. Over the years, we have repeatedly requested Canon products for review and have never had a single letter or phone call answered. In japan, however, Yoshiaki Niizawa and Tomio Hirao of the small business computer division were most courteous and helpful. We wish thi attitude could be communicated to the folks in the U.S.
The two low-end computers in Canon's lineup, the X-07 notebook portable (see Creative Computing January 1984) and the new V-10 Msx machine, are not marketed in the U.S. However, the 16- bit AS-100, a sophisticated personal business computer is available in the U.S. The AS-100 includes Canobrain integrated software (software (spreadsheet, data-base, and graphics); it is also able to run CP/M-86, an dthe UCSD p-system, as well as Canonword, a very nifty word processing package.
Recently announced at the Japan Data Show was Canonet, a local area network with amazing imaging capabilities. Of course, personal computers can tie in to the net, as can a new handheld device for capturing data from remote locations.
Combining optical and computer technology is Canon's integrated elecronic filing system. This includes a document reader, high definition laser printer/copier, optical laser disk, and electronic microfilm storage/retrieval device.
Also part of Canonet is a multi-function workstation which provides image handling on a 896 x 1196 pixel display, data processing, word processing, and communications. The display has multiple windows, and utilizes icons and a mouse. It also permits final page makeup with any type size and font, and insertion of graphics and charts, with final reproduction being to a high definition laser printer. Actually, Niizawa admitted to liking the Macintosh, although he felt that color would have been nice for graphics
We are impressed with Canonet and the AS-100--now if canon USA can just get its marketing act together perhaps the potential of these products can be realized.
Casio is a leading manufacturer of electronic watches, calculators, electronic musical instruments, cash registers, and personal computers. Sales in crease over 1982. Net income was *29 million, a 3.9 percent return on sales. Nearly two-thirds of Casio's sales came from countries other than Japan, with the U.S. accounting for 18 percent.
The largest product line is calculators and, because that product line is so influential in the company, several low-end computers are considered part of the calculator line
The largest product line is calculators and, because that product lie is so influential in the company, several loe-end computers are considered part of the calculator line.
The calculator line consists of a wide variety of "four function" calculators, two scientific units, nine programmable (Basic) units, and the FP-200, a notebook computer with built-in spreadsheet and Basic software. Computers include the PV-2000 (a game-oriented machine), the FP-1000 and 1100 (Z80A-based CP/M machines), and the FP-3000 (a 16-bit MS-DOS machine). Of the computers, sold in the U.S., and if our experience is any guide, the marketing of them is half-hearted at best.
This opinion is conistent with the views expressed by Yoshida with whom we talked in Japan. They feel that the greatest opportunities for Casio lie in powerful calculators with computer capabilities, a market shared primarily by Casio and Sharp, rather than in the over-crowded computer field.
Casio does not plan to market an MSX machine, primarily because they see it as a game unit and, for other applications, it does not measure up to 16-bit machines. They are even taking a cautious approach introducing their MSDOS computer in the U.S. because it is not fully IBM-COMPATIBLE, something they see as necessary to compete effectively.
Casio is also approaching integrated software with caution. While they see it as a good concept, they feel it must be easy to use and not add unduly to the cost of the machine. Furthermore, they don't want users to look at a computer and think, "I don't need all of that capability; why should I pay for it?"
The Apple Macintosh? "It's okay, but it should have color." The FP-3000, Casio's 16-bit entry, is designed accept input from a mouse, but no software has been developed to use one so far.
Managing the U.S. operation is a mixture of a once-a-year meeting with top U.S. managers and placing a few Japanese in key positions. Beyond that, the U.S. managers are free to run the operation as they see fit.
On the other hand, we found it curious that all manuals and brochures are written and produced in Japan. Apparently, Casio feels that a direct translation from Japanese is suitable for the U.S. and Britain, a decision we seriously question.
But perhaps we are wrong. Casio's earnings have been increasing steadily over the past five years and, despite the recent economic downturn, increased 26 percent from 1982 to 1983. Just imagine what they might do in a good year!
Fujitsu is the largest computer manufacturer in Japan with annual sales (1983) of *4 billion. Net income was *201 million, from the Americas. Since Fujitsu has just recently introduced its microcomputer in the U.S., sales here are relatively insignificant at this point.
The semiconductor and electronic components group is the fastest growing in the company, sparked particularly by the sales of 64K RAM chips in overseas markets. Fujitsu has delivered trial quantities of several varieties of 256K chips and expects this business to be quite important in the next few years.
Fujitsu is divided into four divisions of dramatically different size: data processing (Facom mainframe and supercomputers; 59 percent of corporate sales), telecommunications (18 percent of sales), electronic components (16 percent), and car audio (5 percent). In the supercomputer area, Fujitsu is one of the few companies giving Cray and CDC a run for their money.
Fujitsu is an enthusiastic participant in the Fifth Generation Project, but Hiroyuki Nishimi, general manager of the semiconductor marketing division, expects the main beneficiaries to be mainframe computers. Although he and Yoshiharu Ichida, manager of overseas marketing, believe that in the future microcomputers increasingly will be hooked into mainframes which may employ advances from the Fifth Generation Project, they do not see these advances being implemented directly on the micros.
The low-end Fujitsu product line is quite broad starting with the FM-z, one
of the l owest priced MSX computers.
Next up is the FM-7, a 6809-based machine. The FM-8, uses on e6809 for the cpu and a second one for display and I/O control.
The FM-11 is based on the 16-bit 8088; two versions offer either floppy or hard disk. Fujitsu offers a complete line of peripherals for the FM series: disk drives, bubble memory cartridges, displays, light pens, and interfaces.
The top-of-the-line microcomputer is the Micro 16s, a dual processor (Z80a and 8086) offering either MS-DOS or CP/M-86 (see Creative Computing, March 1984). this is th eonly Fujitsu micro sold in the U.S. at present. Fujitsu feels that the current generations of MSX computers is unsuitable for the U.S., but that the addition of a disk drive might make them more viable. They, like so many other Japanese manufacturers are obsessed with IBM and think that IBM compatibility is almost a prerequisite to selling computers in the U.S. However, and, oddly enough, whether IBM is going to survive in the small business market.
Like many other Japanese companies, Fujitsu leaves their American operation alone as much as possible but admits to setting goals an doverall direction in Japan. we found it interesting that in "our" interview, Fujitsu asked as many questions of us as we did of them. That is the mark of an open-mided, receptive company; no wonder they are number one in Japan.
You may think of Hitachi as the name on your TV set or auto sound system, however, those areas of business are nits in the *16.4 billion corporate empire of Hitachi. Indeed, the company is so large, that it has set up a separate subsidiary, Hitachi Sales Corp., just for marketing its consumer products--a subsidiary which, with *3.2 billion in sales, is larger than most primary manufacturers. In 1983, the overall corporation earned *627 million for a 3.8 percent return on sales.
Hitahci puts out a 162-page booklet just to describe briefly its products. The company makes all types of power plants, chemical plants, motors, generators, control equipment, construction machinery, locomotives and rolling stock, pumps, industrial robots, elevators, escalators, TV stations, scientific and industrial instruments, medical equipment, semiconductors, electronic devices, and computers. The computers range from the S-series supercomputers to home-oriented systems.
In 1983, Hitachi derived *3., billion, 23 percent of its annual sales, from computers and communications products. This area grew at 14 percent per year, one of the highest growth rates in the corporation.
Hitachi has three division involved with making computers. The computer division makes large mainframe machines; the office systems division makes small business computers (minis) and bbusiness personal computers (micros); while the home division makes hobby computers including two low-end MSX machines, the H1 and H1E.
Shigero Yokoyama, manager of the office systems division, told us that at present Hitachi does not think that the U.S. represent the best export market for their computers. As far as MSX is concerned, they plan to wait and see what kind of reception it gets in Europe.
Cornerstone of the office systems division is the B-16, a 16-bit 8086-based unit with floopy or hard disk. Although it runs MS-DOS and CP/M-86 and even has a Hitachi-produced integrated software package, Ofis/Pol, Hitachi believes that IBM-compatibility is necessary for success in the U.S., a view that seems to be shared by a majority of the Japanese makers with whom we spoke.
Yokoyama thinks that integrated software is important necessary for office computers in the future; indeed, again and again in our discussion, he emphasized the importance of software. Even regarding the Fifth Generation Project, to which Hitachi has several researchers assigned, Yokoyama believes that unless it produces practical software, it will have little impact on the use of small business computers.
Like several other people with whom we spoke, Yokoyama thinks that the Fifth Generation Project will have its greatest impact on supercomputers and that it will be difficult to apply the results to smaller computers. He also made the interesting observation that most people, even Japanese computer industry managers, do not really understand the Fifth Generation Project in any depth.
Currently in the computer field, Hitachi sees the greatest opportunities in manufacturing OEM components-- semiconductors, particularly high capacity memories, along with displays and disk drives. They also see a good future for home computers, although they have no firm idea of when this market might take off.
We took a quick tour around the Hitachi showroom and made the appropriate oohs and ahs at the fancy equipment. One machine which particularly caught our eye was the HitFile 60. This is a videodisc storage and retrieval system, completely computerized with a display terminal capable of displaying a document (like a microfilm reader) along with a menu of icons (like the Macintosh). Oh, yes, it uses a mouse too. Tha attached printer/copier reproduces documents with exceptional resolution. We sure would like one of these in our office, but alas, *hitachi has no plans to export the device.
Incidentally, Yokoyama took pains to write out in English the name of the U.S. affiliate, Hitachi America, ltd. and then said, "Look at those letters--H-A-L--does that mean something to you?" We weren't quite sure whether he was referring to the computer in 2001 or one ahead of IBM--or perhaps both.
In 1983, Matsushita edged pass Hitachi to become Japan's largest electronics manufacturer and the second largest company in the country (behind Nissan Motors). In 1983, sales were $16.9 billion and net income was $774 million for a 4.6 percent return--well above average for similar companies.
Overseas sales account for 47 percent of total corporate sales. Matsushita has been active in the U.S. for more than 30 years and today is a leader in the VCR and audio equipment market.
There is virtually no product on which the name Matsushita appears; instead the company uses four brand names: National, Panasonic, Technics, and Quasar. The company is divided into six major divisions: video equipment, audio equipment, home appliances, communications and industrial equiment, energy and kitchen-related products, and electronic components. The communications and industrial equipment division includes computers, peripherals, copiers, telephone equipment, and factory automation equipment. In 1983, this division accounted for 15 percent of corporate sales and had the highest growth rate, 27 percent, in the corporation.
In Japan, Matsushita offers a range of word processing machines, point of sale terminals, and personal computers including handheld units, an MSX machine, and 16-bit business systems. However, success in the U.S. computer market has eluded the company to date. Although we were very impressed with the JR-200 in our review, it never achieved widespread distribution and was recently withdrawn from sale. The handheld computers, marketed by both Panasonic and Quasar were also good performers that never did anything in the U.S. market. Nevertheless, S. Fukushima, general manger of the information equipment department in Osaka, told us that the handheld machines would continue to be emphasized. Design goals include making them even smaller and enlarging the single line display.
Fukushima also recognizes the importance of software and believes that no computer can possibly succeed without the "right" software.
Despite mediocre results in the past, Matsushi once again appears to be making a determined effort to get into the U.S. market, this time with computer peripherals and an IBM PC compatible portable computer. In late March, Ken Kurahashi, president of Panasonic Industrial Company, announced a new daisywheel printer, three new dot matrix printers, and three new monitors. The line now includes eight monitors, five dot matrix printers, two plotters, and a daisywheel printer. Kurahashi also hinted that an optical disk memory device, currently being marketed in Japan, might be introduced here in the future, but made no promises.
The Panasonic Sr. Partner portable computer boasts impressive specifications: 16-bit 8086 mpu; 128K; low profile 360K double sided, double density floppy drives; high-resolution 9" display
for t ext or graphics; built-in thermal
printer; and ports for RGB monitor, parallel printer, RS-232 device, and option board. Also, $1500 worth of software is bundled in. (Yes, we have asked to borrow one for review, but have not received a response--perhaps indicative of Panasonic's marketing in the U.S.)
On the other hand, Kurahashi had some strong words about Matsushita's commitment to the office automation market when he recalled the beginnings of the company. In 1918, Konosuke Matsushita was peddling electric sockets, and it wasn't going well. But he had sunk every cent he could raise--about $50--into the venture. Realizing he had been thinking too much about selling and not enough about what customers wanted, he went back to the drawing board and designed a two-way electric socket that was better than anything else on the market. This was the beginning of the Matsushita creed, "the commitment to build a better product at a fair and reasonasble cost to customers."
Kurahashi went on, "From that beginning he built a $17 billion company. That's commitment."
Mitsubishi Electric Corp, one of several companies bearing the Mitsubishi name, is a giant of a company with 1983 sales of $6.5 billion. Earnings were $146 million for a 2.2 percent return on sales, the lowest since 1979.
The company is divided into four major product groups: heavy machinery, electronic products and systems, industrial products, and consumer products. Fastest growing (14.2 percent annually) is the electronic products group with $2.4 billion sales in 1983 (36.2 percent of corporate sales). This group includes semiconductor products, computers, and satellite communications. A $96 million investment in the semiconductor segment strengthened production capacity to the point where Mitsubishi is now the worldwide leader in 64K RAM chips.
Mitsubishi makes a complete line of small computers. At the low end is the ML-8000 MSX computer, one of the few in relative short supply. Nevertheless, despite its success in Japan, the company has no immediate intention of selling it in the U.S., preferring to wait and see how it does in the U.K. Furthermore, Suketaka Tachibana, manager of the group that handles it, thinks it is risky to export anything to the U.S. that is not IBM compatible--even a low-end machine.
One step up is the Multi 8, a capable Z80A-based machine that has found good acceptance in Japan, but for which there are no U.S. plans. Nor will the Multi 16, an 8088-based computer, be introduced to the U.S. market even though it runs CP/M-86 and MS-DOS and boasts a comprehensive line of applications software.
Instead, Mitsubishi is relying upon a joint venture with Sperry for penetrating the U.S. market. The computer, made by Mitsubishi under an OEM contract, is completely compatible with the IBM PC.
We were very impressed with the insight of Toru Tsuruta, planning manager of office automation markerting. He is one of just two people with whom we spoke who has a personal computer (actually two of them) at home. He thinks that access to on-line databases is very important. "It is quite troublesom," he said, "to input data by hand. Without easy access to an on-line database, integrated software is of little use."
Thus, he thinks that the Apple Macintosh is "very interesting, but not particularly useful" because of its lack of good data communications capability. Nor is he enthusiastic about the mouse and icons, because "the system is not as accurate as keys and it is difficult to remember the meanings of the three buttons on the mouse." On the other hand, he thinks the mous is probably good for CAD applications, but not office work.
Tsuruta is not anti-Apple at all; indeed he boasted that he was the first person at Mitsubishi to use an Apple almost four years ago. He got it hooked into a mainframe--no easy task--and down-loaded daily sales data for his sales force. "They loved it," he reported.
Tsuruta is also proud of Mitsubishi's robot products. The RM-101 Move Master is aimed primarily at educational institutions and experimenters and sells for under $1700. A more capable, but still entry level assembly line robot, the RM-501, sells for under $5000, about the same, he noted, as the annual salary of a part-time assembly line worker.
Although telvision products fall under the consumer products group, we were impressed enough with the newly-announced
television print er, a 280 x 234
dot thermal printer with a built-in frame grabber, to buy one on the spot. Not yet introduced in the U.S., the SCT-P50 sells in Japan for just over $300. Although the resolution is on the low side, it produces an excellent 4" x 3.3" image.
At this point, Mitsubishi is not a well-known brand name in the U.S. However, given the innovative nature of their products, we think that will change in the near future.
NEC Corporation, founded in 1899, is one of the world's leading suppliers of communications systems, computers, industrial electronics, electron devices, and home electronics products. In our meetings with Messrs. Hamada, Senda, Okuwa, and Igarashi of NEC, they emphasized the increasing importance of "C&C" systems which integrate computer and communications technologies. They expect such systems to be the backbone of the company in the coming decades.
Sales of NEC in 1983 totaled $6.1 billion, a 15 percent increase over 1982; net income was $138 million for a 2.2 percent return on sales. Computers and industrial electronics account for about one-quarter of corporate sales. Nearly 34 percent of NEC's sales come from outside Japan, although only 10 percent of
the sales of the comput er group come
This is perhaps understandable considering that NEC dominates the desktop computer market in Japan (70 to 75 percent share), and is a major force in the mini, mainframe, and supercomputer markets as well.
NEC and Sharp, the two leading markers of low-end systems in Japan, have both ignored the passing of the MSX bandwagon. Shunzou Hamada, general manager of the personal computer division, does not believe that MSX will truly become a standard because it tends to be game oriented and the graphics resolution is relatively low. He does not think that the addition of disk operations will help, and, while he didn't rule out the possibility of NEC producing an MXS machine, we got the impression it was very low on their priority list.
NEC has a strange organization in the U.S. The charter of NEC Home Electronics in Illinois is to market home-oriented products, yet they have the PC-8800 desktop system (see Creative Computing, November 1983) and PC-8201 notebook portable (see Creative Computing, January 1984). NEC Information Systems in Boxborough, MA