Japan-US Business Report LogoJapan-U.S. Business Report

No. 340, January 1998

Issue Index

 American Companies in Japan


TELECOMMUNICATIONS

This summer, business customers in the Tokyo metropolitan area will be able to subscribe to a digital mobile communications service backed by the subsidiary of MOTOROLA INC. The iDEN service recently moved closer to launch when the provider of wireless communications equipment lined up two major Japanese companies — NICHIMEN CORP. and ORIX CORP. — as investors in the firm that will offer the integrated cellular telephone, paging and GPS (global positioning satellite) service. The trader will have a 25 percent stake in J-COM CO., LTD.; Orix, Japan's top leasing firm will own 5 percent. NIPPON MOTOROLA LTD. will retain a 21 percent interest in J- COM, which it formed last spring with a number of its business partners. That group will control the remaining 49 percent interest. J-COM plans to offer iDEN service nationwide. Its five-year goal is to have 700,000 subscribers.

Acceptance testing is underway on a prototype base station developed by LUCENT TECHNOLOGIES INC. for NIPPON MOBILE COMMUNICATIONS NETWORKS, INC.'s wideband CDMA system for the third generation of mobile communications services. Laboratory testing and further testing is being conducted on the prototype at NTT DoCoMo's facility in the Yokosuka Research Park southwest of Tokyo, where Lucent's Bell Laboratories now has its own research center (see Japan-U.S. Business Report No. 339, December 1997, p. 22). The cellular telephone arm of NIPPON TELEGRAPH AND TELEPHONE CORP. plans to be the first operator in the world to commercially deploy a third-generation mobile communications system. Such a system will be able to handle the higher data transmission rates required by multimedia applications. Future applications could include universal roaming, full- motion video transmission and a wide variety of Internet services. The prototype W- CDMA base station was designed and built at Lucent's Mt. Olive, New Jersey product realization center.

Another company has agreed to supply its performance-boosting Gigabit Ethernet switches to NEC CORP. on an OEM basis. EXTREME NETWORKS, INC. is shipping to Japan's top manufacturer of communications equipment six models in its Summit Switch family. These products share a common architecture based on a 17.5-gigabit- per-second nonblocking switch fabric to ensure the fastest data throughput available. As a result of this architecture, says the Cupertino, California company, full gigabit performance is delivered to every port, along with wire-speed Layer-2 and Layer-3 switching. Extreme Networks also sells the Summit Switch family under that name through TOKYO ELECTRON LTD. (see Japan-U.S. Business Report No. 334, July 1997, p. 23). NEC also is sourcing Gigabit Ethernet switches on an OEM basis from FOUNDRY NETWORKS, INC. and ASCEND COMMUNICATIONS, INC. (see Japan- U.S. Business Report No. 339, December 1997, p. 22).

Through its subsidiary, CABLETRON SYSTEMS INC. is taking orders for February shipments of the high-performance, stand-alone Fast Ethernet SmartSTACK 100 switch, the second member of the Rochester, New Hampshire firm's new family of affordable switching solutions for small but expanding LANs and workgroups (see Japan-U.S. Business Report No. 337, October 1997, p. 23). The new product provides 16 ports of wire-speed switching power, plus two Fast Ethernet uplinks for easy connection to 100 Mbps file server connections and departmental fiber-optic backbones. The SmartSTACK 100 is priced at just over $5,200. Given the features available for this price, Cabletron's local unit is forecasting first-year sales of 12,000 SmartSTACK 100s.

Continuing its push into the networking market, INTEL CORP.'s subsidiary released the Express 510T switch. A scalable workgroup switch, this product provides 10/100- megabits-per-second connectivity directly to the desktop. Intel is touting the Express 510T as offering features typically found in more expensive chassis-based solutions, including flexibility, expandability and fault tolerance, while providing the affordability and the ease of use typical of stand-alone switching options. The new product, the first in what Intel says will be a series of scalable Express switches, lists for $6,500.

A new router platform that 3COM CORP. simultaneously released in the United States and Japan is designed to ensure the security of enterprises resources, a growing concern for network administrators, while providing a seamless path to next- generation virtual private networks. The SuperStack II NETBuilder SI (short for secure Internet/intranet) router has dual 10/100 Ethernet LAN ports and flexible wide area network ports for high-performance network connectivity. Integrated with these capabilities are easy to configure and maintain advanced security features, including an Internet Protocol firewall. 3Com's subsidiary has priced the SuperStack II NETBuilder SI from $3,400 to $5,500.

CISCO SYSTEMS, INC.'s subsidiary is offering the networking equivalent of a turbocharger for the high-end Cisco 7500 Series of routers. Like earlier generations of SRAM-boosting Versatile Interface Processor cards, the VIP2-50 offers distributed switching and beefed-up performance for the application of Cisco IOS services providing security, quality of service and traffic management. This enhancement for Cisco 7500 routers is not cheap. The VIP2-50 starts at $24,300.

With the market in Japan for video-on-demand services poised for growth, NCUBE, the leading provider of VOD delivery systems, is expanding its local distribution network. It recently added HITACHI, LTD., a business partner of long-standing, as an authorized reseller. The big electronics company already has specified a nCUBE video server as part of a video delivery system for an unnamed Japanese organization. The Foster, California firm's products can be configured to deliver up to 20,000 MPEG video streams with a single system. They utilize ORACLE CORP.'s Oracle Video Server software, which facilitates the creation of VOD and other direct-to-consumer applications as well as information-on-demand applications.

DIVICOM INC., a maker of audio/video encoding and decoding systems for digital video broadcasting over satellite, wireless and other networks, has lined up VICTOR CO. OF JAPAN, LTD. to sell four of its products. These span two members of the Milpitas, California firm's family of digital video compression products for the professional broadcasting market, the MediaView MV10 and the MediaView MV25, plus the MediaNode MN20 and the MediaView System Controller SC20. JVC will target these products at video system integrators and value-added resellers. DiviCom is a wholly owned unit of C-CUBE MICROSYSTEMS INC., a developer of digital video semiconductor products.

High-speed Internet access will be available this spring to subscribers of two of Japan's largest cable television networks, thanks to cable modem systems developed by TERAYON CORP. of Santa Clara, California. TOKYU CABLE TELEVISION CO., LTD., which serves the Tokyo area, and KINTETSU CABLE NETWORK, LTD., which is based in Nara prefecture, currently are testing TeraComm cable modem systems over their all-coaxial CATV networks. They will launch commercial CATV-Internet service in April. Another major CATV operator also reportedly will use Terayon cable modems to deploy data services over its network. IIJ TECHNOLOGY INC. is the system integrator for Tokyu Cable Television's CATV-Internet service. The subsidiary of CISCO SYSTEMS, INC. is the router vendor, and the local arm of SUN MICROSYSTEMS, INC. is the server vendor. Terayon's product line is distributed exclusively by CROSS BEAM NETWORK CORP., a wholly owned subsidiary of SUMITOMO CORP. The trader is an investor in Terayon (see Japan-U.S. Business Report No. 328, January 1997, p. 5).
A June 1996 plan by MICROSOFT CORP., NINTENDO CO., LTD. and NOMURA RESEARCH INSTITUTE, LTD. to deliver Internet content to PCs via satellite feeds is on the verge of being scrapped. The service was to have started by the end of 1997, but at that point the prospective partners had not even formed their scheduled joint venture. The earlier-than-expected start of terrestrial digital broadcasting is a primary reason the proposed Japan-only service never got off the drawing board.

The first privately owned and operated undersea cable network to cross the Pacific should be in service in 1999. The fiber-optic Pacific Crossing cable system will have two landing points in both the United States and Japan. It is designed to help international carriers handle transpacific traffic that is ballooning because of the growth of the Internet and other high-bandwidth data applications. PC-1 is backed by GLOBAL CROSSING LTD., which is capitalized by Huntington Beach, California- based PACIFIC CAPITAL GROUP, INC. and other international investors, as well as such companies as MARUBENI CORP. The system will be built with a self-healing ring configuration that uses wave-division multiplexing technology.

An exchange rate of ¥130=$1.00 was used in this report.
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