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No. 353, February 1999

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Japanese Companies in the US


Reinforcing a 15-year relationship, TOSHIBA CORP. acquired a 5 percent interest in the Hauppauge, New York wireless subsidiary of AUDIOVOX CORP. for $5 million. AUDIOVOX COMMUNICATIONS CORP. has marketed nearly 10 million Toshiba-made cellular telephones under the Audiovox brand name or private labels since the mid-1980s. It currently handles the Japanese company's first-generation digital CDMA (code-division multiple access) phones, but ACC soon will introduce the CDM4000, which is said to contain the most advanced chipset on the market, a lithium ion battery with extended talk and standby times and data capabilities.

Unable to keep pace with the rapid changes occurring in the wireless industry, KOKUSAI ELECTRIC CO., LTD. liquidated its San Diego, California digital cellular telephone development subsidiary. KOKUSAI COMMUNICATIONS SYSTEMS, INC. was formed in May 1997 from the development unit of KOKUSAI ELECTRIC AMERICA, INC. in El Segundo, California. The shutdown cost Kokusai Electric roughly $6.3 million.

DDI CORP., Japan's number-two long-distance common carrier and a big cellular and PHS (personal handyphone system) services provider, has opened a wholly owned subsidiary in Los Angeles. The company's first solo foreign venture, DDI COMMUNICATIONS AMERICA CORP. hopes to begin facilities-based services in the spring of 2000. It will apply shortly to the Federal Communications Commission for permission to operate. DDI has contracted for capacity on the Pacific Crossing-1 undersea fiber- optic cable network being built by KDD SUBMARINE CABLE SYSTEMS INC., MARUBENI CORP. and GLOBAL CROSSING LTD. (see Japan-U.S. Business Report No. 345, June 1998, p. 7). Its L.A. subsidiary will offer leased private line, frame-relay and other services to Internet services providers and corporate customers.

In a major win, HITACHI TELECOM (USA), INC. is supplying OC-192 equipment to the Frontier Communications unit of FRONTIER CORP. as part of a major capacity increase in the nationwide Frontier Optronics Network. The Rochester, New York carrier is in the process of creating a "network express lane" that will carry data traffic among the company's top 20 markets at a capacity scalable to 1.28 terabits per second. Hitachi's AMN 5192 OC-192 four-fiber bidirectional line switched ring SONET (synchronous optical network) equipment will be incorporated in this backbone. Frontier says that it not only will exponentially expand network capacity but that the network also will be protected against outages, thanks to the four-fiber BLSR configuration of the Hitachi equipment. In the event of a failure, this technology automatically reverses the direction of traffic around the ring in milliseconds.

PIONEER DIGITAL TECHNOLOGIES, INC., the San Diego, California product development affiliate of PIONEER ELECTRONIC CORP., is working with SCM MICROSYSTEMS, INC. to develop a new generation of set-top boxes for the cable TV industry. Los Gatos, California-based SCM Microsystems is designing removable security modules that control access to digital information. This so-called point-of-deployment technology will be integrated into Pioneer's OpenCable-compliant digital set-top boxes. While standards-based, POD modules are specific to each CATV operator.

PANASONIC SYSTEM SOLUTIONS CO. has installed a turnkey high-definition TV system at ABC INC.'s affiliate in Denver. Since late 1998, the ABC Television Network has been airing prime-time theatrical presentations in a HDTV format. The broadcasts originate from the network's HDTV Release Center in New York City. PSSC, a Secaucus, New Jersey subsidiary of MATSUSHITA ELECTRIC INDUSTRIAL CO., LTD.'s principal North American operation, built and equipped the broadcast center. It is offering stations owned or affiliated with ABC turnkey HDTV station system packages that consist of prepackaged master control systems and Panasonic AJ-HD2700 videotape recorders.

As expected, BROADCASTING SATELLITE SYSTEM CORP. signed a contract with ORBITAL SCIENCES CORP. to build and launch two direct-to-home TV broadcast satellites (see Japan-U.S. Business Report No. 351, December 1998, p. 9). BSAT-2a and BSAT-2b, scheduled for launch in 2000 and 2001, respectively, will double the channel capacity of the pair of satellites BSAT now operates, which provide direct broadcast analog TV service to more than 13 million customers across Japan. The new equipment also will mark the start of satellite-based digital direct- broadcast service in the country.

Constantly scrambling to keep up with surging transpacific Internet demand, INTERNET INITIATIVE JAPAN INC. again has added bandwidth between Japan and the United States. The capacity of its Osaka-New York backbone, just expanded last December to 90 megabits per second, now is up to 265 Mbps. That is in addition to IIJ's 200-Mbps link between Tokyo and San Jose, California.

An exchange rate of ¥120=$1.00 was used in this report.

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