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

No. 347, August 1998

Issue Index

American Companies in Japan


TELECOMMUNICATIONS

The nationwide rollout of Japan's first CDMA (code-division multiple access) digital cellular network has started. Three of DDI CORP.'s eight regional cellular operations have launched the service, marketed under the cdmaOne name, in such cities as Osaka, Kobe, Kyoto, Nagasaki, Fukuoka and Naha. The five other affiliates will introduce the high-capacity technology with its enhanced voice and call quality between December and April 1999. By then, NIPPON IDOU TSUSHIN CORP., which operates in the dense Tokyo-Nagoya corridor, also will have put into service its CDMA digital cellular network. Both companies are using equipment and software designed, built and installed by MOTOROLA INC., the supplier of their analog systems. Their network consists of the SC family of base stations and EMX 5000 mobile switches, a product Motorola codeveloped with DSC COMMUNICATIONS CORP. and sources from the Plano, Texas company. When DDI and IDO ordered the infrastructure for their CDMA network in March 1997, Motorola valued the contract at a minimum of $2.4 billion and more likely at $3 billion-plus.

Over the winter, CISCO SYSTEMS, INC.'s subsidiary will start shipping four products designed to deliver the next generation of carrier-class, Internet Protocol-based services through the integration of IP and ATM technologies. Tag switching tightly ties the two together to give service providers the privacy characteristics and quality of service benefits of ATM along with the universal connectivity of IP. The new platforms — the Cisco BPX 8650 IP+ATM switch, the Cisco MGX 8800 wide-area edge switch, the Cisco BPX 8680 universal service node and the Cisco TGX 8750 optical core switch — all use Cisco IOS software to ensure end-to-end network interoperability within carrier-class ATM networks. New, full-line distributors of PACKET ENGINES INC.'s Gigabit Ethernet products include not only HI-TACHI INFORMATION TECHNOLOGY CO., LTD. (see Japan-U.S. Business Report No. 346, July 1998, p. 26) but also NTT PC COMMUNICATIONS, INC. The business communications network services provider will market, sell and support the Spokane, Washington company's PowerRail family of enterprise routing switches, FDR Gigabit Ethernet hubs and G-NIC Gigabit Ethernet network interface cards.

The HP ProCurve Switch family, an aggressively priced line of scalable Ethernet desktop switching solutions, has doubled in size (see Japan-U.S. Business Report No. 345, June 1998, p. 22). The HP ProCurve Switch 4000M comes with 40 autosensing 10/100Base-T ports, plus five expansion slots for 10/100Base-T, 10-megabit-per-second, 100-Mbps or Gigabit Ethernet modules. It can handle up to 80 autosensing 10/100-Mbps switch ports and as many as five Gigabit ports. HEWLETT-PACKARD JAPAN LTD. priced the basic configuration at $5,000. The HP ProCurve Switch 2400M, which features 24 autosensing 10/100Base-T ports with a 2.4- Gbps switch bus, is designed to migrate small workgroups to 10/100- Mbps desktop switching at a cost of just $3,000. Given the low price per port, HP Japan expects to sell 1,600 HP ProCurve Switch 4000M models and 2,200 HP ProCurve Switch 2400M products in a year.

A new FRAD (frame relay access device) product from MOTOROLA INC.'s subsidiary addresses the bandwidth management problem on congested WAN links. The Vanguard 6450 concentrates data traffic from remote branch offices, whether this information is moving over multiple analog/digital leased lines, an ISDN, a frame relay network or a X.25 link. Voice and video also can be combined with the data traffic over dedicated or public frame relay lines without undermining the multimedia traffic. The Vanguard 6450 lists for $6,000.

In short order, FLOWWISE NETWORKS, a supplier of what are known as router accelerators, lined up a distributor and opened a sales office in Tokyo. The San Jose, California company named DIT. CO., LTD. to market its self-configuring IMS 1600 Router Accelerator. Said to be a simpler alternative to conventional multilayer switches for boosting network performance, the product eases congestion by offloading the routing of IP traffic from existing backbone routers. It works with routers from such vendors as CISCO SYSTEMS, INC., BAY NETWORKS, INC. and 3COM CORP. Tokyo-based DIT. priced the IMS 1600 at $17,000.

This fall, XIRCOM, INC., ranked second in the world in PC card modems and network interface cards for linking mobile and remote computer users to the corporate network, the Internet and other on-line services, will elevate its year-old branch office to a subsidiary. That move is part of the Thousand Oaks, California company's strategy for boosting its Japan sales to $10 million in the year through September 1999. The upgraded operation will handle marketing and technical support. It also will be responsible for product localization. The subsidiary's primary marketing focus will be the cable-free RealPort integrated PC Card family, which supports modem speeds up to 56 kilobits per second and can be used anywhere in the world.

TUT SYSTEMS, INC. named RIKEI CORP. to distribute several of its xDSL (digital subscriber line) products for delivering high-speed Internet/intranet access or home networking over ordinary copper telephone lines. Two of the Pleasant Hill, California supplier's Expresso GS products for network service providers are available: the XL1500 Series of repeaters, which transmit 10-Mbps Ethernet at distances up to 1,500 feet, and the XL600L long-distance Ethernet repeater reaching up to 600 feet. Rikei also is marketing the new HomeRun for building Ethernet- compatible LANs in the home that can accommodate the simultaneous operation of as many as 25 different devices, including PCs, peripherals and Web browsers. HomeRun is priced at an affordable $660. Between these two lines, Tut expects to do $5.3 million worth of business in Japan in 1999.

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Next Generation Internet is the term applied to the new broadband Internet being deployed by service providers and companies for integrated delivery of voice, video and data applications. Networked video over the NGI is coming to Japan via a joint distribution and product development arrangement between FIRST VIRTUAL CORP. and NEC CORP. The agreement combines the Santa Clara, California manufacturer's complete line of video networking products, including NGI Access devices, adapters, gateways and video storage servers, with NEC's Mediapoint codec and other products in its Advanced Video Network System line. Distance learning, distance meetings and distance medicine are among the likely uses of networked video.

The subsidiaries of COMPAQ COMPUTER CORP. and LUCENT TECHNOLOGIES INC. have teamed up to sell an Internet telephone system. The ITS-E System incorporates a network system, Windows NT-based PC server and Internet telephone software from the PC leader and Lucent-supplied PC Cards. The two companies, which also are working together on product planning and technical evaluation, are targeting the ITS-E System at companies interested in cutting communications costs.

NATURAL MICROSYSTEMS CORP. opened a subsidiary in Tokyo to provide technical and business development support to developers of IP telephony, IP fax and other value-added, open-standards telecommunications services. The Framingham, Massachusetts company supplies hardware and software technologies to communications providers, including a CT (computer telephony) board. Its Japanese partners already include NTT INTERNATIONAL CORP. and SKYWAVE, INC.

The first Internet telephony peering relationship for the Japanese market has been established by VIP CALLING, INC., a facilities-based wholesaler of international Internet telephony services, and RIMNET CORP., an ISP that runs the country's largest Internet telephony network. The agreement enables VIP Calling to deliver and originate Internet telephony traffic in Japan while helping its Tokyo partner build traffic for the Rimnet network, both in Japan and elsewhere in Asia where VIP Calling offers service.

A new transpacific agreement will enable the wireless communications products subsidiary of AUDIOVOX CORP. to move into the worldwide market for GSM (global system for mobile communications) cellular telephone handsets. SHINTOM CO., LTD., which builds analog mobile phones for the Hauppauge, New York company, will manufacture these products, starting in the fourth quarter with a 900-MHz GSM handset. The phones will be developed by TALK CORP., a Japan-based joint venture between Shintom and Audiovox that is the exclusive development and marketing arm for cellular products made for the American company by Shintom. Key to Audiovox's move into the GSM market is the use of COMMQUEST TECHNOLOGIES, INC.'s digital expertise and GSM-XL chipset. The Encinitas, California supplier, now an INTERNATIONAL BUSINESS MACHINES CORP. company, valued its new business in the multimillion-dollar range. CommQuest, Shintom and TALK plan to develop next-generation dual-band and triband GSM handsets in addition to the current-generation 900-MHz GSM handset.

A Japanese cellular service provider described only as a leader in this field is evaluating the capability of CONDUCTUS, INC.'s superconductive wireless subsystem to improve cellular coverage and reject radio- frequency interference. The Sunnyvale, California company's ClearSite product uses a combination of superconducting filters and cryogenically cooled, low-noise amplifiers to reduce RF interference and coverage problems while improving voice quality. RF interference is a particular problem in Japan for operators of wireless systems.

WORLDCOM INC., which is in the process of building its own fiber-optic network (see Japan-U.S. Business Report No. 341, February 1998, p. 23), reportedly has signed its first marketing deal. ICUBENET INC., a provider of international Internet fax services, will sell WorldCom capacity to companies among its 2,000 or so corporate customers that are looking for dedicated voice lines or dedicated international lines for data communications. The Japanese firm also will switch its business over to WorldCom circuits.

In the hope of attracting more subscribers, cable television operator TITUS COMMUNICATIONS CORP. will start offering Internet access to its customers in Chiba prefecture this fall. Equally owned by TIME WARNER INC., US WEST INC., ITOCHU CORP. and TOSHIBA CORP., the company will be the first CATV firm to offer a combination of cable TV, cable telephone and Internet access. Subscribers to the new service will have a choice of high-speed Internet access via cable modems for $35 a month or through dial-up services using a conventional modem and a cable phone for a monthly charge of $21. Titus had nearly 55,900 cable subscribers at the end of June and almost 2,100 homes that also subscribed to its cable telephone service.

The Nickelodeon 24-hour channel for children is coming to Japan in the fourth quarter. All of the programming, including animated series, preschool programs and live action shows, will be in Japanese. The Nickelodeon channel will be available via cable and through DIRECTV JAPAN INC., the exclusive direct-to-home satellite broadcaster of the VIACOM INTERNATIONAL INC. programming service. Launched last December, DirecTV Japan reached 140,000 homes as of last June.

An exchange rate of ¥141=$1.00 was used in this report.
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