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No. 353, February 1999

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American Companies in Japan


The Ministry of Posts and Telecommunications has given PRIMUS TELECOMMUNICATIONS GROUP, INC.'s subsidiary the go-ahead to build, own and operate its own communications facilities (see Japan-U.S. Business Report No. 346, July 1998, p. 27). With the big reduction in operating costs that a Type I license allows, the McLean, Virginia global facilities-based carrier can move ahead with plans to sign up residential customers as well as to develop more business and wholesale accounts. PRIMUS already has an international gateway switch operating in Tokyo. Via capacity the company owns on the TPC-5 transpacific fiber-optic cable, this switch is connected to a PRIMUS switch in Los Angeles. PACIFIC GATEWAY EXCHANGE, INC. and MCI WORLDCOM, INC. are the other American carriers with Type I licenses (see Japan-U.S. Business Report No. 351, December 1998, p. 26, and No. 341, February 1998, p. 23).

A high-speed, end-to-end network capable of delivering a wide range of broadband data and information services to businesses will be rolled out starting in May in Tokyo and Osaka. The system's developer is KDD WINSTAR CORP., a company that New York City-based WINSTAR COMMUNICATIONS, INC. (35 percent) formed with KDD CORP. (55 percent) and SUMITOMO CORP. (10 percent). The joint venture is drawing on WinStar's experience in providing high-speed local access to companies in more than 30 American markets over its own fixed wireless network. MPT already has granted KDD WinStar a fixed wireless access radio license for an initial spectrum grant in the 38-GHz band. It covers 42 million points of presence, including in Tokyo and Osaka. This reportedly marks the first time that MPT has awarded high-frequency spectrum. The ministry also gave KDD WinStar a Type I common carrier license. By its third year of operation, the new company expects to generate revenues of $8.8 million from Internet service providers and other businesses with high-speed data transmission requirements.

Atlanta's EQUANT, which provides international data network services to multinationals, will launch Internet Protocol voice and data services in Japan. Its IP@EQUANT integrates the corporate WAN and LAN into a virtual private network. Before the start of the new operation, the company will upgrade its branch office, which serves roughly 70 businesses, into a subsidiary. That is scheduled to occur at midyear. EQUANT claims to operate the world's largest commercial data network in terms of geographic reach, thanks to its use of the SITA network established by major airlines around the world to serve their communications needs.

A development effort among LUCENT TECHNOLOGIES INC., IBM JAPAN LTD. and DENSO CORP. has yielded a relatively inexpensive corporate communications system based on Japan's low-power cellular personal handyphone system standard. The scalable wireless system gives each employee mobile phone capability, whether he or she is in the office or out in the field. Data transmission at a throughput of 32 kilobits per second also is possible. Denso is providing the PHS handsets and base stations, while Lucent is in charge of the PBX gear that connects the in-office system to the publicly switched network. IBM Japan designed the customized software and will offer network technical support.

In its biggest break since forming a subsidiary last spring (see Japan-U.S. Business Report No. 345, June 1998, pp. 21-22), EXCEL SWITCHING CORP. has a tentative agreement with the systems integration unit of KDD CORP. to market its ONE Architecture Expandable Switching System platform. Equally important, KDD NETWORK SYSTEMS CORP. intends to use the EXS solution to provide tandem switching and enhanced services for its parent and other communications services providers. The Hyannis, Massachusetts manufacturer's open, scalable, carrier-class switches allow carriers to integrate network routing, enhanced services and media support on a single switching platform regardless of network signaling requirements.

STANFORD TELECOMMUNICATIONS, INC. signed TOSHIBA CORP. to resell its wireless broadband equipment in Japan and elsewhere in Asia. The Sunnyvale, California company's wireless broadband subscriber units and head-end network interface units support full-featured telephony and data transmission services, including high-speed Internet access. The equipment also provides the core technology for networks supporting local multipoint distribution services. Toshiba will market a wireless broadband system that uses Stanford's DAVIC-standard-based point-to-multipoint access links operating as fast as 42 megabits per second in downstream mode and multiple channels of up to 10.1 Mbps on the upstream side.

"Outa the Box, Onto the Net!" is FREEGATE CORP.'s marketing slogan for the OneGate 150 turnkey Internet access server. Designed for small businesses, the Sunnyvale, California company's product integrates Web server, e-mail, firewall, router, file transfer and remote management functions into a box that can be configured via a Web browser. FreeGate's exclusive distributor, NET ONE SYSTEMS CO., LTD., has priced OneGate 150 from $6,000. It is projecting first-year sales at 2,000 units.

For about $21,200, businesses can eliminate bandwidth bottlenecks with their CISCO SYSTEMS, INC. Series 7000 routers. That money buys FLOWWISE NETWORKS' RA 7000 router accelerator, which, in simplified terms, self-configures itself to take over the routing of local traffic while leaving the Cisco router to handle the WAN traffic. At the heart of the RA 7000 is the San Jose, California company's 4-gigabit-per-second hardware routing engine featuring the Xpressway routing ASIC (application- specific IC) developed in-house. FlowWise named MACNICA, INC. to distribute the RA 7000 router accelerator. DIT. CO., LTD. markets FlowWise's IMS 1600 router accelerator (see Japan-U.S. Business Report No. 347, August 1998, p. 26).

RADGUARD INC., one of the pioneers of the virtual private network market, has refined its Japan market approach in an attempt to boost sales of its dedicated hardware platforms to corporate Japan and the government. The Mahwah, New Jersey supplier named TOYO CORP. to serve as its master distributor. The systems integrator will support Radguard's existing distributors, CHIYODA JOHO KIKO CO., LTD. and TERILOGY CO., LTD., at the same time that it mounts a campaign to sell big business and the government on the cost savings and the enhanced security features of VPN technologies. Toyo will commit $3 million to this effort. Radguard's products are designed for small VPNs as well as the large ones it is targeting.

Start-up CLARINET SYSTEMS, INC. tapped a TOKAI RIKA CO., LTD. affiliate to market its product for connecting portable computers to the corporate network using the machines' built-in infrared port. The San Jose, California company's EthIR LAN is a high-speed IR and 10/100Base-T switching system that gives Windows 95/98 notebooks and Windows CE handheld and palmtop PCs instant LAN links without the use of a PCMCIA (personal computer memory card interface) card. Moreover, EthIR LAN provides each user with a dedicated 4-Mbps connection to the corporate network.

An exchange rate of ¥117=$1.00 was used in this report.aaaaaa

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