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

No. 343, April 1998

Issue Index

American Companies in Japan


For approximately $32 million, wireless services provider NEXTEL COMMUNICATIONS, INC. of McLean, Virginia acquired a 21 percent stake in J-COM CO., LTD., which later this year will launch iDEN (integrated digital enhanced network) services for business customers. MOTOROLA INC. is the prime mover behind the Tokyo-based company. It now provides specialized digital mobile radio services in the 1.5-gigahertz frequency band to about 40,000 corporate customers. Trader NICHIMEN CORP. and leasing company ORIX CORP. are among the other investors in J-COM (see Japan-U.S. Business Report No. 341, February 1998, p. 23).

To boost sales of its ATM, remote access servers, Internet telephone servers and other networking equipment, LUCENT TECHNOLOGIES INC.'s subsidiary formed a data networking system operations group. Lucent marketing people are in charge of sales to Internet service providers, while distributors handle sales to other business customers. A major focus of the in-house unit is the new Internet Telephony Server SP, which allows phone-to-phone, fax-to-fax, computer-to-phone and phone-to- computer communications over the Internet. This is possible because the ITS SP platform merges the publicly switched telephone network with packet-switched data networks. Lucent's subsidiary has priced the ITS SP at $67,400 for communications carriers and at $46,500 for corporate use. By yearend, the company expects to have sold 1,000 platforms to each group of customers.

Offering faster links to the Internet is one way the local affiliate of ISP PSINET INC. hopes to sign up more corporate customers, especially SOHO subscribers. Through NIPPON TELEGRAPH AND TELEPHONE CORP.'s new 128- kilobit-per-second dedicated leased line OCN service, it is offering businesses in the Akasaka area of Tokyo fast connections for about $370 a month. By July, PSINet's 128-Kbps service is expected to be available throughout Tokyo along with the standard 64-Kbps service. In time, the Herndon, Virginia company's subsidiary plans to offer businesses with high-volume communications requirement a choice of Internet links at 256 Kbps, 512 Kbps or 1.5 gigabits per second.

The InterJet all-in-one Internet solution for small businesses from WHISTLE COMMUNICATIONS CORP. has received a powerful endorsement. It is part of NIPPON TELEGRAPH AND TELEPHONE CORP.'s just-released Multinet Debut III Mini Internet solutions package for small and midsized companies. In addition to the InterJet, which integrates internal and external e-mail, Web access and Web publishing for the whole office into one device, the NTT package includes a digital service unit, a four-port hub and the OCN economy service. Systems integrator OTSUKA SHOKAI CO., LTD. is importing and supplying the Foster City, California company's product to NTT. RICOH CO., LTD. also distributes InterJet (see Japan-U.S. Business Report No. 341, February 1998, p. 24). It recently released a fully localized product, aiming for sales of 5,000 units a year.

The ADC Kentrox subsidiary of Minneapolis-based ADC TELECOMMUNICATIONS INC. signed a worldwide OEM agreement with NEC CORP. for the AAC-3 Multi-service Access Concentrator. As the name suggests, the Portland, Oregon company's product integrates multiservice protocols over private enterprise and public networks, concentrating voice, video and data traffic from customers' premises to public networks. NEC is selling the AAC-3 as the ATOMIS 2/2050 and the ATOMIS 2/2051. The electronics giant said that the new product strengthens its ability to supply customers with a cost-effective and comprehensive end-to-end ATM networking solution for native ATM and legacy "non-ATM" services.

A competing product is on the local market from CISCO SYSTEMS, INC.'s subsidiary. The Cisco MC3810 lists for $5,600 and up. Given this aggressive pricing and the product's functionality, the world's networking equipment leader is projecting sales of 3,000 Cisco MC3810s in Japan this year.

Market newcomer TORRENT NETWORKING TECHNOLOGIES CORP. has selected SOLITON SYSTEMS K.K. to sell its IP9000 Gigabit Router family, which is claimed to be the first in the industry to combine gigabit-scaled performance and comprehensive routing functionality with the ability to deliver guaranteed service to individual traffic flows. Torrent's full fast- path architecture forwards all packets of data via a nonblocking, low- latency fabric. Wire-speed Internet Protocol routing is available for 128 Fast Ethernet ports, 16 Gigabit Ethernet ports and 64 OC-3 ATM ports. In addition to the technical advances of the IP9000 Gigabit Routers, Torrent is touting their aggressive pricing, which starts at $52,500.

Sales will start in the second quarter of what developer BERKELEY NETWORKS describes as a new class of internetworking switches, one that integrates for the first time the Windows NT operating system onto a high-performance intelligent switching platform. The Milpitas, California company named NISSHO ELECTRONICS CORP. as the first local distributor of the exponeNT family. Two models will be available: the e8, an enterprise backbone switch with 48 Gigabit Ethernet ports or 384 Fast Ethernet ports, and the e4, a modular, stackable switch with 24 Gigabit Ethernet ports or 192 Fast Ethernet ports. That model starts at $38,800.

For between $5,000 and $8,000, network managers can buy the capabilities their companies need now and migrate to next-generation technologies when they are ready using the same chassis. That capability is available with the OmniSwitch from XYLAN CORP.'s subsidiary. This multilayer switching platform provides integrated LAN and ATM switching, wide area network connectivity, high-speed routing, virtual LANs and IP firewalls. The Calabasas, California maker projects that the five OmniSwitch campus backbone models marketed in Japan will generate combined sales of $7.8 million.

INTEL CORP.'s subsidiary is backing up its push into the networking equipment market with a steady stream of new products. Among the latest are the Intel Express 550T and 550F scalable routing switches for Fast Ethernet campus backbones. The 550T, priced at $4,600, supports eight 10/100-TX autosensing ports, while the 550F, which lists for around $11,600, supports eight Fast Ethernet ports. Both models are stackable, supporting up to 84 network segments with a scalable, high-speed backplane. .....Also new to Japan from INTEL CORP. is the Intel EtherExpress PRO/100 Intelligent Server Adapter. Part of a family of adapters for networking Pentium, Pentium Pro and Pentium II processor-based PCs and servers on Ethernet and Fast Ethernet LANs, the board costs $690.

Targeting the LAN and WAN networking requirements of small businesses and branch offices, CISCO SYSTEMS, INC.'s local operation has introduced several products in the Cisco Networked Office stack. These modular, scalable products are designed to work with a company's existing equipment, such as network interface cards, PCs and printers, as well as with major network operating systems, including NetWare, Windows NT and OS/2. The members of the Cisco Networked Office stack sold in Japan are: the Cisco 1500 Micro Hub with eight 10Base-T ports; the Cisco 1528 Micro Hub 10/100 for the desktop, which provides eight autosensing 10Base-T and 100Base-TX Ethernet ports for about $900; the Cisco 1548 Micro Switch 10/100, an affordable ($1,800) desktop Ethernet switch that delivers 10 Mbps or 100 Mbps of dedicated bandwidth to servers and workstations; and the Cisco Micro Webserver 200 for Internet and intranet Web publishing on a 40-MIPS PowerPC platform at a cost of $1,900.

Meanwhile, CISCO SYSTEMS, INC. announced for the American and Japanese markets a WAN interface card for its modular Cisco 1600 and 3600 Series routers. The card simplifies the deployment and the management of Internet and intranet connectivity by incorporating a fully managed, T1 DSU/CSU (data service unit/channel service unit) solution. The Cisco WIC-1DSU-T1 WAN interface card is priced at $1,000.

Portable computer users can get fast connections to corporate networks, the Internet and other on-line services with XIRCOM, INC.'s CreditCard Modem 56. The Calabasas, California company tapped Tokyo's CF CO., INC. to market the 56-Kbps data/fax PC Card modem.

In June, ORACLE CORP.'s subsidiary will launch a campaign promoting Internet access via set-top boxes hooked to television sets and a server. NCTV will allow users to browse the Internet and send e-mail while watching television programming. Oracle affiliate NETWORK COMPUTER, INC. developed the software for the digital cable TV set-top boxes, which will be manufactured on an OEM basis by Taiwanese companies for Japanese electronics suppliers. The boxes are expected to cost around $390.

Internet telephone service from AT&T JENS CORP. now is available in major cities in the Chugoku, Shikoku and Kyushu areas. Hiroshima- headquartered consumer electronics retailer DEODEO CORP. is helping to market the service, which uses regular telephones. Domestic calls are priced at 18 cents a minute regardless of distance, while calls to the United States cost 26 cents a minute. These charges undercut NIPPON TELEGRAPH AND TELEPHONE CORP. and KOKUSAI DENSHIN DENWA CO., LTD. pricing by anywhere from 20 percent to 70 percent, yet the quality of the calls is said to rival those over the publicly switched network. AT&T Jens has offered Internet telephone service since last August in Tokyo, Osaka, Sapporo and other cities in eastern Japan.

In late September, the Japanese affiliate of Washington, D.C.-based IRIDIUM LLC will begin global mobile voice and data services using a constellation of low-earth-orbit satellites. The launch will come within months of the start of a similar service by a consortium backed by ORBCOMM GLOBAL L.P. (see Japan-U.S. Business Report No. 341, February 1998, pp. 24-25). NIPPON IRIDIUM CORP. will charge a flat, dollar-based price per minute for all international calls. It hopes to sign up between 100,000 and 120,000 subscribers in the first year. Iridium cellular handsets will cost about $3,000, while pagers will be priced around $600. They will be supplied to the MOTOROLA INC.-spearheaded group by KYOCERA CORP., which, along with its affiliate, long-distance carrier DDI CORP., is the biggest shareholder in Nippon Iridium.

The 500 directly owned or franchised stores worldwide run by aftermarket automotive parts retailer AUTOBACS SEVEN CO., LTD. will be linked with headquarters in October via one of PANAMSAT CORP.'s satellites (see Japan-U.S. Business Report No. 341, February 1998, p. 25). The Osaka prefecture-based company reportedly is the first local business to contract with a non-Japanese satellite operator to host its information network. The cost to use Greenwich, Connecticut PanAmSat's PAS-II satellite is 20 percent to 30 percent lower than for a Japanese-operated satellite.

An exchange rate of ¥129=$1.00 was used in this report.

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