The decade-long relationship between MITSUI CHEMICALS, INC. and ROGERS CORP. has resulted in an agreement to make a flexible circuit board laminate used in the read/write head suspension assemblies of cutting-edge hard disk drives. Equally owned POLYIMIDE LAMINATE SYSTEMS LLC will build a factory in Chandler, Arizona to produce the specialty adhesiveless laminate, comprised of copper, polyimide and stainless steel. Custom-manufactured for demanding flexible circuit applications, the material now is turned out by Mitsui Chemicals at a Nagoya factory. PLS will sell the imported product until the Arizona plant is operational, which should be no later than 2003. A primary customer will be HUTCHINSON TECHNOLOGY, INC. of Hutchinson, Minnesota, the world's leading supplier of suspension assemblies for HDDs in the form of TSA Trace Suspension Assemblies. In addition to its ties to Mitsui Chemicals, Rogers, Connecticut- based Rogers has an equally owned joint venture with INOAC CORP. that makes high- performance elastomer products at facilities in Nagoya and Mie prefecture.
North American automotive production is so strong that JSP CORP. is having trouble meeting demand for the expanded polypropylene bead foam used to make the cores of the plastic bumpers found on most of today's vehicles. Accordingly, the dominant (three- quarters or so of the market) manufacturer of EPP bead foam in the United States has committed $2.8 million to build its sixth American production facility. Located in Tullahona, Tennessee, the factory is scheduled to be completed in July 2000. It will boost the capacity of JSP's Malvern, Pennsylvania subsidiary by 20 percent to roughly 18,500 tons a year. The Tennessee location, which will have a work force of 15, could add $11.3 million to JSP's annual U.S. revenues. The company's other EPP bead foam plants are in San Bernadino, California, Milledgeville, Illinois, Detroit, Butler, Pennsylvania and Monoca, Pennsylvania. It also has a Mexican facility.
Now that commercial production of biaxially oriented polyamide film has started at its Canadian joint venture, NICHIMEN CORP. has launched marketing of the material. Recently formed BIAXIS PACKAGING SALES, INC. of Arlington Heights, Illinois initially is targeting sales of the nylon film for meat packaging. It is projecting first-year revenues of $18.9 million. Manufacturer AMERICAN BIAXIS, INC., owned by the trader and a Canadian company, is located in Winnipeg, Manitoba.
In the latest phase of a relationship that dates back to 1980, FUJIKURA KASEI CO., LTD. and RED SPOT PAINT & VARNISH CO., INC. are pursuing the development of water- based, environmentally friendly paints for polypropylene plastic automotive parts. Coatings containing potentially harmful organic solvents now typically are applied to this material. Ecologically sound yet high-performance coatings for automotive plastics is an area in which the Evansville, Indiana-headquartered manufacturer has made a name for itself. A joint research and development team already is at work at Red Spot, hoping to commercialize products within three years. If successful, the partners say that they will consider forming a manufacturing and marketing venture aimed at supplying the paints to Japanese vehicle builders operating in North America.
Japan's number-two pharmaceutical company is positioning itself to better capitalize on business opportunities in the United States. For starters, SANKYO CO., LTD. will merge its two wholly owned U.S. subsidiaries at the end of 1999 in a move designed to accelerate decisionmaking and to forge closer ties between product development and marketing. SANKYO PHARMA INC., based in New York City, will be the surviving company. Moreover, to buttress its U.S. development capabilities, Sankyo planned to open in November a research facility in Edison, New Jersey. The center could have as many as 30 people on staff in the next few years. The company's current U.S. product development research efforts are spearheaded by a 35-member team in New York City. Sankyo also announced that by the middle of 2000, it expects to file its first independent new drug application with the Food and Drug Administration. CS-866 (olmesartan medoxil) is an oral antihypertensive angiotensin-II receptor antagonist that the drug company discovered in its Japanese laboratories. Three Sankyo products already are on the American market, but they are all licensed to major U.S. pharmaceutical firms (see Japan- U.S. Business Report No. 360, September 1999, pp. 2-3). Although Sankyo made clear on this occasion as it has in the past that it wants to build its own U.S. marketing capability, nothing was said about the future of SANKYO/PARKE-DAVIS CO., its Parsippany, New Jersey venture with WARNER-LAMBERT CO. The company's other operations here are a discovery research information center in San Diego, California and LUITPOLD PHARMACEUTICALS INC. of Shirley, New York, a manufacturer of multisource injectable drugs and animal health products acquired in 1990.
TEIJIN LTD. gave TAP PHARMACEUTICALS INC. the right to develop in the United States TMX-67, a xanthine oxidase inhibitor that is in Phase II clinical trials in Japan, as a possible treatment for gout and to market it in North America if testing is successful. Reportedly, no new oral therapy to treat gout has been introduced in this country for more than 30 years. The disease is characterized by sudden, recurring attacks of very painful arthritis caused by deposits of monosodium urate crystals. These accumulate in the joints because of an abnormally high level of uric acid in the blood. TAP Pharmaceuticals is a long- standing venture between TAKEDA CHEMICAL INDUSTRIES, LTD., Japan's biggest drug company, and ABBOTT LABORATORIES. It recently filed a new drug application for UPRIMA (apomorphine HCI tablets) sublingual for the treatment of male erectile dysfunction (see Japan-U.S. Business Report No. 359, August 1999, p. 3).
One of the gaps in MERCK & CO., INC.'s current product lineup is a treatment for prevalent adult-onset or Type II diabetes. That hole could be plugged if a product that KYORIN PHARMACEUTICAL CO., LTD. licensed to the leading prescription drug manufacturer pans out. KRP-297, which is undergoing Phase I clinical trials in Japan, is an insulin sensitizer that also corrects certain lipid abnormalities. Merck plans to begin clinical testing in the United States in the first quarter of 2000. Its development and marketing rights to KRP-297 cover all areas of the world outside of Japan, the People's Republic of China, South Korea and Taiwan. Kyorin Pharmaceutical received an up-front licensing fee. It also will get royalties on sales if Merck commercializes KRP-297.
Through a private placement, SANGAMO BIOSCIENCES, INC. raised $7.5 million from existing investor JAFCO CO., LTD. as well as from three other companies. The Point Richmond, California biotechnology firm's technology platform, based on engineered zinc- finger proteins, is used to accelerate the functional analysis of newly discovered genes and to validate genes. It also has application in the areas of human therapeutic, plant genomic and clinical diagnostic products. Over the last year, Sangamo has launched collaborations with 14 generally major pharmaceutical and biotechnology companies. One of those is JAPAN TOBACCO INC. (see Japan-U.S. Business Report No. 355, April 1999, p. 2).
The shift in production of aluminum substrates for hard disks to Southeast Asia has forced a reorganization of the North American operations of C. UYEMURA & CO., LTD. The Osaka manufacturer is one of the world's biggest suppliers of plating chemicals for this product. Its Ontario, California marketing subsidiary, formed in 1992 with MITSUBISHI CORP. as a minority (13.3 percent) partner, had outsourced production of the plating chemical to a Mexican firm for U.S. sale, but that arrangement has ended. Instead, UYEMURA INTERNATIONAL CORP. will import it while trying to build up sales of chemicals used in the manufacture of integrated circuit packages and printed circuit boards. To that end, it opened a technical center in Southington, Connecticut. Trial production of PCB-use chemicals already is underway. If successful, Uyemura says that it will consider commercial U.S. production of that and related chemicals.
An exchange rate of ¥106=$1.00 was used in this report.
The restructuring plan that NISSAN MOTOR CO., LTD. announced in October contained some far-flung prescriptions for returning the automotive maker to financial health. Near the top of the list for North America was the unexpected decision to hand over to INTERNATIONAL BUSINESS MACHINES CORP. management of all of the company's information technology operations in the United States and Canada. The $1 billion contract, which will run for nine and a half years, covers the computer systems at Nissan's big manufacturing complex in Smyrna, Tennessee, its parts production affiliates, the firm's distribution/sales, finance, R&D and design units, and its Torrance, California- headquartered holding company, NISSAN NORTH AMERICA, INC. Beyond indicating that the deal would save Nissan a significant amount of money, neither the vehicle builder nor IBM assigned a hard number to the cost-cutting. Much of the savings will come from transferring roughly 240 Nissan North America IT employees to the computer giant, which has been very successful this year in expanding its services division both in the United States and in Japan. The personnel shift also will help Nissan North America reach the restructuring plan's goal of trimming employment in the United States and Canada by 1,400 people.
In a much more limited restructuring but one probably driven as much by cost considerations as by the stated goal of better serving its mobile computing customers, FUJITSU, LTD. combined its two U.S. personal computer companies. The merger folded FUJITSU PERSONAL SYSTEMS, INC., said to be the undisputed leader in the Windows pen-tablet market, into notebook computer supplier FUJITSU PC CORP. The new FPC is headquartered in Santa Clara, California rather than in Milpitas, California, although offices remain there. It also continues to operate a build-to-order/service center in Memphis, Tennessee.
The most powerful mainframe on the market is how HITACHI DATA SYSTEMS CORP. describes the just-released Hitachi Skyline Trinium. The Santa Clara, California supplier says that its flagship mainframe platform is the first such product to process more than 2 billion instructions per second and that the Trinium tops the competition in executing up to 320,000 simultaneous input/output operations per second. Both characteristics obviously help companies handle surges in trading volumes and electronic-business transactions. So does the Trinium's complete redundancy and dynamic failover on all critical components.
SONY ELECTRONICS, INC., one of the innovators behind thin, sleek desktop PCs, has added functionality to the newest member of the VAIO Slimtop LCD Computer series. The VAIO PCV-L620 is equipped with a 500-MHz Pentium III processor, 128 megabytes of synchronous dynamic random access memory, a 13-gigabyte hard drive, a DVD-ROM (digital video disc-read-only memory) drive and 8 MB of video memory. It also has a dedicated Memory Stick media slot for quick transfers of digital data, text, graphics, audio and video between digital camcorders, still cameras, desktop PC and portables, plus two iLINK (IEEE 1394) ports, a like number of USB (universal serial bus) ports, a pair of PCI (peripheral component interconnect) ports and a Type II PC Card Slot. The monitor is a 14.1-inch active-matrix TFT (thin-film-transistor) liquid crystal display with XGA (extended graphics array) resolution (1024 x 768 pixels) and integrated multimedia speakers. The VAIO PCV-L620 has an estimated street price of $2,500.
The new 650 MHz and 700 MHz Pentium III processors are options with the build-to-order Equium 7100 series of commercial desktops from TOSHIBA AMERICA INFORMATION SYSTEMS, INC.'s Computer Systems Group. The first desktop computing line to offer a standardized motherboard and components as well as a single software profile across multiple chassis styles -- full-size, minitower and slim line -- and feature sets, the Equium 7100 family is aimed at business customers interested in lowering the total cost of ownership while still obtaining solid performance. Pricing starts at $1,500 for a system with a 650-MHz Pentium III and at $1,700 for one equipped with a 700-MHz engine. Neither price includes a monitor.
Going after the corporate buyer that ranks a low purchase price and a reduced total cost of ownership as its first and second most important purchasing criteria, TOSHIBA AMERICA INFORMATION SYSTEMS, INC. CSG rolled out the Equium 7300 family of BTO full- size and slim-line commercial desktop machines. The base configuration costs as little as $750. That buys a 366-MHz Celeron chip as well as INTEL CORP.'s new i810 chipset. Celeron processors running at 400 MHz, 433 MHz, 466 MHz or 500 MHz also are available.
The NEC Computer Systems Division of PACKARD BELL NEC, INC. introduced a second line of PowerMate commercial slim desktop, desktop and minitower machines that share a common motherboard. PowerMate 5250 systems can be equipped with either Celeron or Pentium III processors with clock speeds ranging from 400 MHz to 600 MHz to complement their 440BX chipset. Hard-drive capacity extends from 4.3 GB to 18 GB, while up to 512 MB of internal memory is possible. A PowerMate 5250 costs as little as $800 or as much as $3,800.
Strong holiday season sales are critical to the future of money-losing PACKARD BELL NEC, INC. Its Consumer Division is counting on a new line of affordable, easy-to-use, full- featured home PCs to help turn the tide. The machines are powered by 400-MHz to 500- MHz AMD-K6-2 processors with 3DNow! technology. PC audio and three-dimensional AGP (accelerated graphics port) graphics complement the multimedia-oriented engine. Standard memory is 32 MB, expandable to 96 MB. A 40X compact disc-ROM drive and a hard drive holding as much as 10.2 GB of data provide ample storage space. The PCs come preloaded with such home-focused software as Microsoft Works, Microsoft Money, Intuit Quicken and MGI PhotoSuite. They also have one-button Internet access. Prices start as low as $450. Even the top-of-the-line model costs just $700. A mail-in rebate trims both prices by $50.
Nearly 22,700 configuration choices are possible with the Tecra 8000 notebook computer from TOSHIBA AMERICA INFORMATION SYSTEMS, INC. CSG. The latest options include the new, performance-boosting 500-MHz mobile Pentium III processor with 256 kilobytes of integrated Level-2 cache and a 100-MHz system bus. The Tecra 8000 also can be built with the latest high-speed PC100 memory, starting at 32 MB and going up to 256 MB. An 18-GB hard drive is available as well, as are capacities of 6.4 GB, 10.1 GB and 14.1 GB. The base Tecra 8000 model with a 500-MHz mobile Pentium III costs $3,500. For volume buyers, TAIS offers a system for $4,000 that includes the new processor, 64 MB of PC100 memory, a 10.1-GB hard drive, a 4X DVD-ROM drive, a 14.1-inch XGA active-matrix TFT display and Windows 98.
TOSHIBA AMERICA INFORMATION SYSTEMS, INC., the top seller of portable computers, also made several additions to its Satellite series of value-priced notebooks. One is the $2,000 Satellite 2615DVD, which includes a 433-MHz mobile Celeron processor, 64 MB of SDRAM, a 6-GB hard drive and a 12.1-inch active-matrix TFT display. Its companion, the Satellite 2665XDVD, lists for $2,400. This machine has the same memory and storage capacities as well as the identical integrated V.90/K56flex modem and one-touch Internet access button, but it provides the performance of a 466- MHz mobile Celeron and the easier viewing experience of a 14.1-inch active-matrix TFT display. TAIS also released Satellite models for more budget-conscious small businesses, students and families. The Satellite 1555CDS costs as little as $1,200 for a 380-MHz AMD mobile K6-2 processor and 32 MB of SDRAM. For more demanding computing requirements, the Satellite 2100/2105CDS notebooks use a 400-MHz AMD mobile K6-2 chip. The Satellite 2100CDS, which has 32 MB of internal memory, costs $1,300, while the Satellite 2105CDS with 64 MB of system memory goes for $100 more. A 12.1-inch Color Bright display, an all-in-one 4.3-GB hard drive/diskette drive/24X CD-ROM drive, an integrated V.90/K56flex modem and easy Internet access are common to all three of these models. For people willing to spend $1,700, the Satellite 2100CDT delivers a 400-MHz AMD mobile K6-2 processor, 64 MB of synchronous memory and a 12.1-inch active- matrix TFT display.
Giving mobile professionals desktop performance on the go is how SONY ELECTRONICS, INC. introduced the VAIO F Series of high-performance notebooks. The five-model line is headed by the VAIO PCG-F390, a $3,700 or so system that features a 500-MHz mobile Pentium III processor, 128 MB of SDRAM (expandable to 256 MB), a 12-GB hard drive and a 15-inch XGA active-matrix TFT display. Like its F Series counterparts, this notebook also has an all-in-one design that includes a fixed floppy drive, hard drive and CD-ROM or DVD-ROM drive built in, dual battery capability, an iLINK digital interface, a complete suite of Sony digital video software and its PictureGear software for enhanced management of digital content. .....With some trade-offs, the high-end features of the stylish VAIO F Series are available in a sleek package that measures just 1.75 inches thick and weighs six pounds. SONY ELECTRONICS, INC.'s VAIO PCG-XG9 combines a 500-MHz mobile Pentium III processor with 128 MB of SDRAM, an 18.1-GB hard drive and a 13.3-inch XGA active-matrix TFT display. Its estimated selling price is $3,500.
The "new" FUJITSU PC CORP. marked its arrival with two new product lines in the LifeBook family of notebook computers, major redesigns of two others and a refreshment of a fifth. Its desktop replacement candidate is the new LifeBook X Series. Powered by a 500-MHz mobile Pentium III processor, these products can be configured with as much as 256 MB of system memory and up to 12 GB of hard-drive storage. Standard features are a 15.1-inch XGA active-matrix TFT display, 8 MB of video memory, a built-in floppy disk or SuperDisk 120 drive and a flexible bay that supports hot-swapping of CD-ROM, DVD or CD-Rewritable drives. Pricing of the LifeBook X Series starts at $3,400. The other new line is the thin, lightweight LifeBook S Series. A skinny 1.25 inches high and an easy-to- carry 3.74 pounds, these models run off a 400-MHz mobile Pentium III processor. They offer a choice of 64 MB or 128 MB of RAM and either a 6-GB or a 9-GB hard drive, plus a 12.1-inch active-matrix TFT display with a SVGA (super video graphics array) resolution of 800 x 600 pixels and an internal flexible bay for as little as $2,300.
FUJITSU PC CORP. also reengineered the LifeBook B Series to give business buyers even more configuration choices. The processor can be a 450-MHz or a 500-MHz mobile Pentium III, a 433-MHz Pentium II or a 433-MHz Celeron. Systems are available with either a 13.3-inch or a 14.1-inch XGA active-matrix TFT display, up to 256 MB of RAM, a 6.4-GB or a 10-GB removable hard drive and a modular CD-ROM, DVD or CD-RW drive. LifeBook E Series pricing starts at $1,700. The LifeBook E Series of mininotebooks also got a makeover with the addition of a larger 10.4-inch SVGA TFT display with touch screen and a bigger keyboard. The line, which currently runs off a 400-MHz mobile Celeron processor, offers as much as 192 MB of system memory and a 6-GB hard drive. A built-in 56K2 V.90 modem and integrated 10/100Base-T Ethernet local area network capabilities are included in the starting price of $1,800. Finally, Fujitsu PC brought the power of the 450- MHz and the 500-MHz mobile Pentium III processors to its line of multimedia notebooks, the LifeBook C Series. An AMD mobile K6-2 running at 450 MHz also is an option on these systems.
The line of ruggedized Windows-based notebooks from PANASONIC PERSONAL COMPUTER CO. has been shrunk to an ultraportable 3.8 pounds. The new, 1.7-inches- high Toughbook 17 and Toughbook 34 also are the first models to sport integrated wireless communications capabilities. Both use a 300-MHz mobile Celeron processor and offer 64 MB of RAM and a shock-insulated 4.3-GB hard drive. The screen is an 8.4-inch SVGA active-matrix TFT color display with touch capability and antireflective treatment. The two models, which lists for $3,240 and $3,190, respectively, differ only in the design of their magnesium case.
The first 10,000-rotations-per-second drives from HITACHI, LTD. for high-end workstation and server products and for storage systems will ship in the spring of 2000 after sampling in the first quarter. The 3.5-inch family includes a 1.6-inch-high drive providing 73.9 GB of storage, plus a pair of 1-inch packages with capacities of 36.9 GB and 18.4 GB. These boosts result from the application of high ariel density technologies that Hitachi incorporated in its 2.5-inch drives. All three drives are available with either a 100-MB-per-second Fibre Channel interface for storage area network and server farm installations or a 160-MB-per- second Ultra 160 SCSI (small computer system interface) data storage system interface.
FUJITSU, LTD., reportedly the world's fifth-largest supplier of hard drives, signed a cross- licensing agreement with its bigger rival, QUANTUM CORP. By giving each other access to its patented know-how, the two hope to remain competitive at a time when continuously falling PC prices are putting constant pressure on drive manufacturers.
To capitalize on the convergence of printers and scanners with such previously stand-alone products as copiers and facsimiles that digital technology is fostering, TOSHIBA CORP. created TOSHIBA AMERICA BUSINESS SOLUTIONS, INC. Irvine, California-head- quartered TABS, which has annual sales in excess of $500 million, combines three divisions that were parts of TOSHIBA AMERICA INFORMATION SYSTEMS, INC. These are the Electronic Imaging Division, which makes plain paper copiers and fax machines in Irvine and distributes these and imported products; the Toner Products Division, a producer/distributor of toner products with a plant in Mitchell, South Dakota; and the Document Solutions Engineering Division, a digital controller R&D organization. Also coming under TABS is a wholly owned subsidiary that runs a network of U.S. copier/fax dealers.
To extend its market share in the graphic arts, print and imaging fields, especially the print- on-demand part of the business, MINOLTA CO., LTD.'s Ramsey, New Jersey subsidiary signed LONDON LITHO to distribute, integrate and support its digital color printer/copier and printer products. Minolta's first value-added reseller for the POD market, the Lincolnwood, Illinois company will handle the Minolta MicroPress Cluster Printing System, a midvolume, short-run, on-demand, digital system for printing both black and white and color documents. Other products covered by the contract are the CF Series of color products, including the networkable CF910 digital color printer/copier and the CF911P and the CF911PE full-color laser printers.
The combination of MINOLTA CO., LTD.'s laser imaging technology and IMATION CORP.'s patented color management software has yielded what the partners calls a breakthrough digital color proofing system for creative and design professionals. The Minolta-Imation Matchprint Color Laser System, which should be available in the first quarter of 2000, will include Minolta's CF910 digital color printer/copier or CF911P networkable color laser printer, new Matchprint Color Laser Software from Oakdale, Minnesota-based Imation and 12 x 18-inch cobranded Minolta-Imation Matchprint Color Laser Paper. The software is expected to cost less than $2,500. Pricing of the paper will be decided later.
Mount Laurel, New Jersey-based OKI DATA AMERICAS, INC. introduced the OKICOLOR 8 Series to meet the stand-alone and workgroup color printing needs of small and midsize businesses. The line's two machines, which include a network-ready product, print eight color pages per minute. This speed is due in large part to the incorporation of OKI Single Pass Color technology, which features arrays of light-emitting diodes rather than lasers and four individual print stations. The paper moves along a straight path, picking up all four colors in a single pass instead of making four trips around the drum. The OKICOLOR 8 has a suggested price of $3,300, while the OKICOLOR 8/n lists for $3,800.
Small businesses can buy a six-ppm color or seven-ppm black text ink-jet printer for as little as $200 with a mail-in rebate. That is the price of SEIKO EPSON CORP.'s EPSON Stylus Color 760. Also priced to move at $270 is the new EPSON Stylus Color 860, which produces up to 7 ppm of color output and 9.5 ppm of black text. Both printers deliver a resolution of 1440 dots per inch, what is said to be the smallest droplet size in their classes and the company's Micro Piezo print technology. They also are equipped with built-in USB and parallel ports for compatibility with APPLE COMPUTER, INC.'s iMac and Power Macintosh G3 machines as well as Windows PCs. .....SEIKO EPSON CORP.'s Long Beach, California marketing unit also introduced the first laser printer designed to work with the iMac. The EPSON EPL-5700i, which costs $350 after a mail-in rebate, prints up to eight ppm with a resolution of 1200 dpi. Another major selling feature, Epson believes, is a low-cost, 6,000-page toner cartridge.
KYOCERA ELECTRONICS, INC., the Duluth, Georgia marketer of the Ecosys page printers, launched a family of products for printing checks, money orders, bank drafts and other financial documents. The three initial magnetic ink character recognition printers in the line incorporate a number of features to ensure the security of sensitive financial information. The entry-level model, which is designed for such applications as automatic teller machines with its 14-ppm speed, is priced at $2,000. The $4,500 top-of-the-line model outputs 28 ppm, making it suitable for high-volume check printing and MICR printing in a networked environment.
Ten months of development work by SHARP CORP. and OPENLCR.COM, INC. of Fort Collins, Colorado have yielded the first fax machines that automatically select the least- expensive carrier for each call, depending on the day of the week, the time of day and the area called. That capability is the result of openLCR technology, which also updates the long-distance carrier rate table embedded in Sharp openLCR-Ready fax machines every quarter. The first such products released by the company's Mahwah, New Jersey sales and marketing arm will be for personal and SOHO (small office/home office) use.
Volume shipments have begun of an input system for both PCs and Macintoshes that pairs a cordless scrolling mouse with a cordless pressure-sensitive pen. The $100 Graphire is manufactured by WACOM CO., LTD., the world's leading maker of computer graphics tablets and electronic pens, and marketed by its Vancouver, Washington subsidiary. The system is designed not only for more natural drawing and writing but also to add signatures to computer documents.
An exchange rate of ¥106=$1.00 was used in this report.
The Ihilani Resort and Spa on Oahu, Hawaii, one of the crown jewels of JAPAN AIRLINES CO., LTD.'s once far-flung real estate empire, will be sold to a Hawaiian company as part of the restructuring of the airline's investment portfolio. The nearby Ko Olina Golf Club also is part of the deal. The price of the transaction was not disclosed, but industry sources place it somewhere around $94.3 million. The resort and its 387-room luxury hotel opened in 1993. A JAL HOTELS CO., LTD. affiliate currently manages the properties, but that job will be handed over to MARRIOTT INTERNATIONAL, INC. when the sale is finalized.
An exchange rate of ¥106=$1.00 was used in this report.
NITTO DENKO CORP. is scouting sites in Ohio and California for a R&D facility that it hopes will help put the company on the cutting edge of the electronics materials field. The Osaka prefecture firm currently makes such related products as LCD display polarizing sheets and flexible printed circuit boards. The facility, which will have a start-up staff of 10 and equipment to do prototype production, could be operational within a year. Among Nitto Denko's varied U.S. operations are HYDRANAUTICS, INC., a San Diego, California maker of reverse osmosis membrane elements, ultrafiltration elements and systems, and GRAPHIC TECHNOLOGY, INC., which makes bar-code labels and systems in New Century, Kansas.
In an alliance aimed at delivering integrated process control solutions to their respective customers, YOKOGAWA ELECTRIC CORP. has teamed with DRESSER EQUIPMENT GROUP, INC. to develop and market products, systems and management tools that comply with the international Foundation field-bus data-transmission standard. New products will include industrial automation systems, measurement devices and control valve systems. Initially, the partners will cooperate on technology and systems integration for a Foundation field-bus positioner. They bring complementary strengths to this task. YEW provides a wide variety of process field instruments, test and measurement equipment, distributed control systems, systems integration, software and services to customers worldwide, while Dallas-based Dresser, a HALLIBURTON CO. unit, is a global leader in equipment and services for the energy industry, including valves, instruments, engines, fuel dispensers and gas meters. Sources in Japan say that Yokogawa Electric pursued the alliance to keep pace with such rivals as YAMATAKE CORP.
The combination of a manufacturing license from MATSUSHITA ELECTRIC INDUSTRIAL CO., LTD. and its own expertise enabled CMK CORP. to commercialize an ALIVH (any-layer interstitial via hole) printed circuit board for digital cameras. It already is delivering this product to EASTMAN KODAK CO. for its DC215 digital camera. MEI's ALIVH is an advanced substrate technology that specifically targets the design challenges created by shrinking vias, the pathways that carry a signal from one PCB layer to another. CMK initially applied this fix for high-density PCBs to cellular telephones before moving on to digital cameras; handheld electronic devices are a third target market. About 10 percent of its ALIVH PCB output now goes to Kodak.
DAISHINKU CORP., Japan's leading maker of crystal resonators, relocated one of its U.S. marketing subsidiaries to Marietta, Georgia from Overland Park, Kansas to better serve East Coast customers. A warehouse also was built at the new site to cut one or two days off delivery times. The Hyogo prefecture manufacturer also reorganized the distribution channels of its Costa Mesa, California subsidiary.
Four Japanese companies are among the members of a San Francisco organization formed to promote a common global infrastructure for smart-card implementation across multiple industries. GLOBALPLATFORM, INC.'s efforts should be aided by VISA INTERNATIONAL INC.'s decision to transfer its Open Platform card specifications and terminal framework to the group. This technology, now used by the financial services and telecommunications industries, can be implemented with the Java Card platform from SUN MICROSYSTEMS, INC. and Microsoft Windows for Smart Cards. GlobalPlatform's Japanese participants are JCB CO., LTD., the number-one credit-card issuer in Japan, NIPPON TELEGRAPH AND TELEPHONE CORP., NEC CORP. and TOSHIBA CORP.
VICTOR CO. OF JAPAN, LTD. is working with PHOENIX TECHNOLOGIES LTD., the San Jose, California supplier of the BIOS software found in today's PCs, to develop a new audio/visual intellectual property technology standard for networking consumer electronics products and Internet appliances. AVIP will be designed to facilitate quick and easy connectivity to a network without a PC or PC-related equipment for directly downloading digital movies, digital music and the like. It also will provide automated configuration of the products and appliances. In addition, AVIP's security features will ensure the protection of copyrighted materials. By drawing on Phoenix's expertise in linking computing and communications technologies through its system-enabling technology, the partners hope within a year to develop AVIP and then win its acceptance as the international standard for connected devices.
A Pennsylvania state government program that has the dual objectives of fostering the development of next-generation technologies in such areas as digital networks and mobile communications and making Pittsburgh a technology center will have at least one Japanese participant. CASIO COMPUTER CO., LTD. signed on to the Pittsburgh Digital Greenhouse project, which brings together businesses, academic institutions and the government. The company will contribute $100,000 to the effort. Casio executives will be on the program's advisory board and also will help select proposals for funding.
Still fine-tuning the organization of its U.S. businesses (see Japan-U.S. Business Report No. 359, August 1999, p. 13), CASIO COMPUTER CO., LTD. gave CASIO COMMUNICATIONS INC. responsibility for sales and marketing of its audio products in North America. These include CD boom boxes, personal CD and cassette players, and travel clock radios. Over the next year, the line will be expanded to MD (minidisc) players, MP3-related products, DVD equipment and karaoke products. Torrance, California-based Casio Communications now markets telephone products for home and small business users.
An exchange rate of ¥106=$1.00 was used in this report.
One of the largest independent power producers in the world, which doubles as a major U.S. electricity wholesaler, is for sale. Closely held SITHE ENERGIES INC. hired GOLDMAN, SACHS & CO. to find a buyer after first majority owner (60 percent) VIVENDI of France and then minority owner (30 percent) MARUBENI CORP. indicated that they wanted out. Neither investor gave a reason for its decision. Trader Marubeni paid $250 million for its stake in March 1996 and committed money to finance the construction or the purchase of electricity-generating plants. New York City Sithe has more than 28,000 megawatts of capacity in operation, under construction or in active development in the United States and elsewhere.
An exchange rate of ¥106=$1.00 was used in this report.
SUMITOMO LIFE INSURANCE CO.'s strategy to get the asset-management expertise to succeed in the pension and mutual fund management fields at home includes buying into foreign investment-man-agement "boutiques." Last spring, it acquired what became FARRELL-SL INVESTMENT MANAGEMENT, INC. (see Japan-U.S. Business Report No. 355, April 1999, p. 6). Now, Sumitomo Life has bought a 20 percent stake in SPRINGFIELD & CO., L.L.C. The Chicago firm, which managed assets $1.5 billion worth as of September 1999, exposes the big life insurer to a different set of investment skills: global fixed-income arbitrage.
Broker/investment banker NOMURA SECURITIES CO., LTD. has had its ups and downs in the United States recently. After pulling back from or out of certain activities, its NOMURA SECURITIES INTERNA-TIONAL, INC. unit has moved into the North American private equity market. Following the lead of its London sibling, Nomura Securities International's Manhattan unit formed the Principal Capital Group, also based in New York City. Its mandate is to acquire mature companies in the basic services field that are low technology but asset-intensive. The target purchase price is between $1 billion and $3 billion. The group is selling itself as offering interested sellers quick finalization of the deal and the ability to commit large sums of capital. Since 1994, the London Principal Capital Group has acquired 11 businesses with a total value of $11.7 billion.
The Bellevue, Washington subsidiary of TRANS COSMOS INC. has emerged as a major source of funding for Internet-based start-ups in the United States, particularly those that want to extend their operations to Japan. It now has more money to expand its investment portfolio, having raised $100 million through a second round of private equity financing.
An exchange rate of ¥106=$1.00 was used in this report.
At a projected cost of $145 million, a partnership between MITSUI & CO., LTD. (30 percent) and LAND O'LAKES, INC. (70 percent) will build the world's biggest cheese and whey production facility in California's Central Valley. Located in Tulare, which is about halfway between Fresno and Bakersfield, the plant should be operational by early 2001. It will make mozzarella and cheddar cheese as well as dried whey and whey fractions. On start-up, the factory will have a capacity of 3 million pounds of milk per day. By 2003, the owners of the yet-to-be-named joint venture expect to double capacity. The plant's output will be marketed initially in the United States, but Land O'Lakes, an Arden Hills, Minnesota- based cooperative of 6,000 dairy producers, obviously hopes that the Mitsui connection will lead to sales in Asia. Through its majority ownership of VENTURA FOODS, LLC, a City of Industry, California-headquartered manufacturer of edible vegetable oils and related products, the trader already has a substantial presence in the U.S. food products market, including margarine (see Japan-U.S. Business Report No. 352, January 1999, p. 5).
PIETRO CO., LTD., a Fukuoka manufacturer of salad dressings and similar products, is looking into U.S. production. Through a Hawaiian subsidiary, the company has been selling about 12,000 bottles of salad dressing a month in the United States, mainly to Asian- oriented grocery stores. A newly formed subsidiary in Dallas is spearheading the project. Current plans call for the plant to be open next spring. Sales are forecast to total $4.7 million a year. Pietro also is exploring the possibility of opening a chain of restaurants on the mainland. It already has five offshore establishments, including one in Hawaii.
A Hawaiian company that farm-raises abalone has received a $2 million investment from Hokkaido fish processor IHARA & CO., LTD. By mixing deep-sea water with regular ocean water, BIG ISLAND ABALONE CORP. is able to raise the mollusk to maturity in two years instead of the normal three. Ihara sees a market for the abalone in Asia and Australia as well as on the West Coast. It is projecting annual sales of Big Island's output at $7.6 million in five years.
Since 1996, SUNTORY WATER GROUP, INC. has acquired 32 bottled water suppliers, making it the undisputed number two in the business with a 9 percent U.S. market share and customers in 40 states. The last two additions were made in the same month. First, the Marietta, Georgia company, which SUNTORY LTD. formed in 1985, bought AQUA- COOL/BREWED HOT COFFEE, INC. of Portland, Oregon. That long-established firm produces a full range of bottled water products for residential and commercial delivery as well as for retail sale in Oregon, Washington and Idaho. It also provides coffee break service and traditional office coffee service. Suntory Water Group then acquired CLEARIDGE, INC. of Nashville, Tennessee. It, too, supplies a complete line of bottled water products to residential and commercial customers. This purchase bolstered Suntory Water Group's presence in markets like Orlando and Tampa, Florida and Nashville while giving it entree to the Memphis, Tennessee market.
An exchange rate of ¥106=$1.00 was used in this report.
In an unusual move for a Japanese company, JAPAN ENERGY CORP. put its GOULD ELECTRONICS INC. subsidiary in charge of the company's worldwide printed circuit board materials businesses, including R&D, production and marketing. NIKKO MATERIALS CO., LTD., a wholly owned Japan Energy unit, and three of that firm's subsidiaries are being consolidated with Eastlake, Ohio-headquartered Gould Electronics. The combined organization makes copper foil, copper-aluminum-copper and adhesiveless flexible laminates for the PCB industry at 10 manufacturing facilities in North America, Europe and Asia. Its international copper foil capacity is estimated at close to 4,000 tons a month. The expanded Gould Electronics has some 1,300 people on its payroll and annual revenues on the order of $566 million.
An exchange rate of ¥106=$1.00 was used in this report.
In December, KITO MACHINE INDUSTRIAL CO., LTD. of Aichi prefecture will open its own plant in Lexington, Kentucky after leasing space from another company to turn out welding machines for the automotive industry as well as washing systems and assembly and leak-testing systems. The KITO U.S.A. CORP. factory is equipped with a machining center, various milling machines, a lathe, drill presses, band saws, a grinder, a shearer, a breaker and welding equipment to customize its products to buyers' specific requirements. It will make three varieties of multispot welding systems, plus an intelligent welding system for flexible body welding lines. Kito U.S.A.'s clients include TOYOTA MOTOR CORP.'s North American operations, but the company, which had sales of $2.3 million in the year through March 1999, hopes to win orders from other vehicle makers. It currently employs 12 people.
Another Aichi prefecture manufacturer is building a plant in the United States to better serve its primary customer, TOYOTA MOTOR CORP.'s affiliated forklift manufacturing operation. OKUNO INDUSTRY CO., LTD. has formed a wholly owned subsidiary in Huntington, West Virginia to produce hydraulic cylinders for the lifting mechanisms of TOYOTA INDUSTRIAL EQUIPMENT MANUFACTURING, INC.'s forklifts. Commercial production is scheduled to start in August 2000 at a rate of 2,500 cylinders a month. At that point, Okuno expects to have a work force of 15 people, but staffing could increase to 50 employees in three years. Columbus, Indiana-based TIEM, in which TO-YODA AUTOMATIC LOOM WORKS, LTD. has an 80 percent stake, has been in business since 1990. It encouraged Okuno to manufacture here as part of its drive to expand local sourcing.
MITSUBISHI HEAVY INDUSTRIES, LTD. is conducting a top-to-bottom review of its struggling machine tool, plastic injection molding and other industrial machinery operations at home and abroad. That examination could produce some major near-term changes in MHI's American business activities, executives acknowledge. At a minimum, the company will consolidate its three U.S. machine tool and injection molding marketing subsidiaries. However, closing MHI MACHINE TOOL U.S.A., INC., a Hopkinton, Kentucky manufacturer of machining centers and computer numerically controlled lathes, is a definite possibility. Set up in 1990, MMT had sales of $112 million in FY 1998, but it apparently is not as efficient as MHI's Japanese factories. Any changes in the company's U.S. presence will take place before the end of the current fiscal year.
Like other makers of earthmoving equipment, HI-TACHI CONSTRUCTION MACHINERY CO., LTD. sees an expanding market in North America for compact hydraulic excavators, especially those with a short-radius arm for working in confined spaces. Through its Houston marketing subsidiary, the company released its first such product, a 5-ton machine. That model will be followed in December by 3-ton and 3.9-ton excavators. Hitachi Construction Machinery also will supply these miniexcavators to DEERE & CO. on an original equipment manufacturer basis. The two are equal partners in 10-year-old DEERE-HITACHI CONSTRUCTION MACHINERY CORP., a Kernersville, North Carolina manufacturer of larger-capacity hydraulic excava-tors. Hitachi Construction Machinery is aiming for North American sales of 1,800 compact excavators in FY 2001, which, if achieved, could produce revenues of $66 million.
SUMITOMO (S.H.I.) CONSTRUCTION MACHINERY CO., LTD. is weighing a request from CASE CORP. for it to supply compact hydraulic excavators for North American sale through the Racine, Wisconsin construction equipment manufacturer's distribution channels. Case has marketed Sumitomo Construction Machinery excavators in the 12-ton to 50-ton segment in the United States and Canada since 1992. However, its inquiry presents a dilemma for the Japanese company. It does not make small excavators. The ones it sells in Japan are supplied by ISHIKAWAJIMA CONSTRUCTION MACHINERY CO., LTD., and their contract prohibits Sumitomo Construction Machinery from mar-keting these products in the United States and Europe. Sumitomo Construction Machinery reportedly will decide by yearend whether it will move into the compact end of the excavator market on its own. For the last year, Case has been an equal partner with Sumitomo Construction Machinery in LINK-BELT CONSTRUCTION EQUIPMENT CO. of Lexington, Kentucky, which makes medium and heavy-duty excavators designed by its Japanese parent as well crawler and truck cranes.
In quick succession, JUKI CORP. formed JUKI AUTOMATION SYSTEMS HOLDING, INC. in Raleigh, North Carolina to sell, service and support Juki-brand SMT (surface-mount technology) and semiconductor assembly systems in North America, South America and Europe and then turned around and bought ZEVATECH, INC. That Morrisville, North Carolina company had been selling Juki's PCB assembly systems in these three markets on an OEM basis since 1987 (see Japan-U.S. Business Report No. 353, February 1999, p. 8). The seller was Switzerland's ESEC HOLDING SA, which acquired Zevatech in 1996. Juki, the number three in the world in terms of installed SMT units, initiated the transfer because it did not believe that sales of its equipment in the Americas and Europe were as strong as they could be, particularly from the vantage point of the company's direct sales in Asia.
The March 1998 order that SUMITOMO HEAVY INDUSTRIES, LTD. received from big stainless steel manufacturer ACERINOX S.A. for a skinpass mill and a tension leveler has resulted in a contract for the same equipment from the Spanish corporation's NORTH AMERICAN STAINLESS subsidiary. The skinpass mill will be installed first at the Ghent, Kentucky supplier's hot strip and plate rolling mill, followed three years later by the tension leveler. Like other recent customers, North American Stainless apparently was sold on the SHI equipment in part because of its ability to produce an extremely bright, defect-free strip surface with excellent metal flatness. The mill's ease of operation and quick roll changeovers also were strong selling points.
Market newcomer MATSUSHIMA MACHINERY RESEARCH CO., LTD. gave WOODINGS INDUSTRIAL CORP. of Mars, Pennsylvania exclusive rights to sell its microwave leveling system and related blast and electrical furnace equipment to steel mills for five years. The Kitakyushu, Fukuoka prefecture manufacturer expects the tie-up to produce fast business results, with revenues projected at $943,400 by March 2000. Woodings has strong industry contacts since it is a leading supplier of tap hole drills, clay guns and a long list of other products that are integral to the production of steel and other metals.
In a major win, MITSUBISHI HEAVY INDUSTRIES, LTD. will be the primary equipment supplier for a pair of natural gas-fueled power plants that SITHE ENERGIES INC. plans to build in Massachusetts. MHI won the contract, valued at some $566 million, from RAYTHEON ENGINEERS & CONSTRUCTORS, INC., the turnkey contractor for a 1,600-MW plant at the Mystic Station in Everett and an 800-MW plant at the Fore River Station in Weymouth. Both plants will employ combined-cycle technology, with each of the three 800-MW blocks built consisting of two of MHI's extremely efficient M501G gas turbines, a like number of its heat-recovery steam generators and one MHI steam turbine generator. Work at both sites is expected to start in the first quarter of 2000 and to be completed in early 2002. Thanks in large part to MHI's technology, the new plants will be among the cleanest-burning generating facilities in New England.
Ironically, news of this contract award came right before TOKYO ELECTRIC POWER CO., INC. executives let it be known that the company had decided to buy a natural gas- fueled combined-cycle generating system from GENERAL ELECTRIC CO. for installation at its Futtsu, Chiba prefecture power station. GE claims a 52.8 percent efficiency rating for its state-of-the-art gas turbine versus 51 percent for MITSUBISHI HEAVY INDUSTRIES, LTD.'s competing gas turbine, which TEPCO is installing as part of a combined-cycle system at its Kawasaki, Kanagawa prefecture complex. Engineers at Japan's top electric utility calculate that every percentage point increase in thermal efficiency saves the company some $103.8 million in annual fuel expenses. That and other cost reductions will be key as greater deregulation comes to Japan's electricity market. The Futtsu plant is scheduled to go onstream in 2003, the same year the Kawasaki station is operational.
An exchange rate of ¥106=$1.00 was used in this report.
Switching positions, FERROTEC CORP., a Tokyo manufacturer of products based on ferrofluid (magnetic fluid) technology founded in part by FERROFLUIDICS CORP. in 1980, is buying its former Nashua, New Hampshire parent. The acquisition cost is around $36.2 million. Ferrotec, an independent company since 1987, had consolidated revenues of $53.3 million in the year through March 1999. Most of its business is in Asia. By buying Ferrofluidics, which reported sales of about $28 million for the year ending June 30, the Japanese company gains a worldwide distribution and marketing network as well as a broader range of products. Ferrofluidics manufactures all its ferrofluids and ferrofluid-based products in Nashua. It has sales and technical support facilities there as well as in Germany and the United Kingdom. Ferrotec's production facilities are located in Japan and China.
Water treatment system manufacturer MORIOKI INDUSTRY CO., LTD. is looking for a company to distribute its magnetic-field water treatment devices for plants and other industrial applications. Known in Japan as Mamoru-Kun, the system uses an electromagnetic field to coagulate and remove iron from water and to minimize concentrations of other impurities. It also prevents the buildup of scale and slime as well as rust. Beyond improving water quality, the system has several environmentally friendly benefits. It also is cost-effec-tive, the Tokyo supplier says. The device is expected to be priced from $12,300 in the United States.
As specified in their September 1998 tie-up agreement, CENTURY MEDICAL INC. has invested a total of $5 million in MICRO THERAPEUTICS, INC. The Irvine, California company manufactures minimally invasive devices for the diagnosis and treatment of vascular disease. Century Medical is its exclusive distributor in Japan (see Japan-U.S. Business Report No. 361, October 1999, p. 23).
An exchange rate of ¥106=$1.00 was used in this report.
Two affiliates of MITSUI HIGH-TEC, INC. invested a total of $2 million in GATEFIELD CORP., the developer of a flash-based, field-programmable gate array architecture and the resulting ProASIC (application-specific IC) family of high-gate-count, nonvolatile, reprogrammable products. Kitakyushu, Fukuoka prefecture-based Mitsui High-tec, a major supplier of lead frames and packages for the chip industry, is the third major investor in the Fremont, California company. It owns 4.5 percent of Gatefield's shares. Gatefield was spun off from ZYCAD CORP. in 1997.
Soaring demand for flash storage in such products as digital cameras and MP3 audio players has helped to turn two competitors in the flash-memory business into collaborators. Under a memorandum of understanding due to be finalized by January 2000, TOSHIBA CORP., the market leader in NAND-type flash memories, and fabless SANDISK CORP., a prime mover behind the NOR flash-memory architecture and the world's largest supplier of flash data-storage products, will partner to develop and make gigabit-scale flash memories. Their immediate challenge is to come up with 512-megabit and 1-gigabit chips, a costly and technically demanding job, and SD (secure digital) Memory Card controllers. Toshiba brings to this work its future 0.16-micron and 0.13-micron NAND flash-memory technology. Sunnyvale, California-based SanDisk will contribute its multilevel-cell flash technology and controller system integration know-how. The two also will form an equally owned company to share the huge investment required to manufacture the jointly developed flash memories. They initially will use Toshiba's wafer-fabrication facility in Yokkaichi, Mie prefecture. However, sometime in the first half of 2001, production will start at DOMINION SEMICONDUCTOR LLC in Manassas, Virginia. By then, that fab will be wholly owned by Toshiba (see Japan-U.S. Business Report No. 359, August 1999, pp. 8-9). By 2002, the pending partners estimate, their joint venture should be producing more than $1 billion worth of flash memories a year. The Toshiba-Sandisk collaboration also will strengthen their efforts with MATSUSHITA ELECTRIC INDUSTRIAL CO., LTD. to make the SD Memory Card the industry standard for secure memory cards (see Japan-U.S. Business Report No. 360, September 1999, p. 8).
An equally ambitious technology alliance has been forged by HITACHI, LTD. and LSI LOGIC CORP. The big manufacturer of memory products and the system-on-a-chip leader have combined forces to work on process technologies for 0.10-micron designs and beyond. This effort spans not only joint development of a 0.10-micron device architecture but also cooperation on next-generation lithography tools, including direct-write electron- beam technology, and interconnect know-how for 0.13-micron devices. The near-term goal of the collaboration, which already is underway, is a SOC product with an embedded DRAM core. To be available from LSI Logic as soon as mid-2000, the so-called eDRAM will be based on Hitachi's 0.20-micron process technology and the Milpitas, California company's CoreWare design methodology. The Japanese semiconductor maker will serve as LSI Logic's foundry on this and future eDRAM offerings.
Some of the first personal electronic devices to incorporate the radio frequency-enabled wireless communications technology known as Bluetooth could result from the tie-up between module manufacturer TAIYO YUDEN CO., LTD. and SILICON WAVE, INC., a supplier of RF-powered system-on-a-chip solutions. Under their development pact, the Tokyo company will build a line of small modules for cellular telephones, notebook computers and future consumer appliances around the San Diego, California company's small, energy-efficient RMC (radio modem controller) Bluetooth ICs. Sampling of the Taiyo Yuden-Silicon Wave modules could start next spring. HITACHI, LTD. also is working with Silicon Wave but on a Bluetooth chip solution (see Japan-U.S. Business Report No. 361, October 1999, p. 9).
FUJITSU, LTD. and SUN MICROSYSTEMS, INC. will work together to extend the capabilities of the high-end SPARC processor in the market for enterprise-class systems while at the same time enhancing the software compatibility of their respective implementations of the SPARC V9 64-bit architecture. Specifically, they will develop a common programmers' reference model for future generations of the performance-geared, scalar SPARC processor. That will ensure that software written for forthcoming versions of Sun's UltraSPARC processor will run on Fujitsu's new SPARC64 GP products and vice versa. The agreement does not include joint SPARC design work.
As part of its strategy to sell more value-added automotive-use products in the United States, SANKEN ELECTRIC CO., LTD. introduced through subsidiary ALLEGRO MICROSYSTEMS, INC. several high-performance, compact and lightweight Hall-Effect sensors. These include a gear-tooth engine sensor and airbag and antilock braking system sensors. Worcester, Massachusetts-based Allegro, which specializes in mixed-signal ICs, also hopes to commercialize an accelerator chip. Much of its business in the automotive field has been in the power and signal-processing fields.
Japan's largest supplier of recycled silicon wafers, used by semiconductor manufacturers to monitor and optimize their manufacturing processes, is moving into the American market. RASA INDUSTRIES, LTD. plans to set up a subsidiary in California staffed initially by transferred employees to market reclaimed wafers to U.S. chipmakers as well as to Japanese fabs in the United States. Rasa believes that this new business can generate annual sales of $9.4 million in three years. It will be going up against a KOBE STEEL, LTD. subsidiary in Hayward, California, which runs what is said to be the largest silicon wafer reclamation facility in North America (see Japan-U.S. Business Report No. 351, December 1998, pp. 7-8).
Full-scale operations have begun at TOKYO ELECTRON TEXAS, INC. in Austin. By the end of March, the company expects to turn out 15 resist-coating systems for such next- generation products as 1-gigabit DRAMs. For now, all of the parts are imported from owner TOKYO ELECTRON KYUSHU LTD. However, the Texas unit, which has 50 or so employees, is in talks with American manufacturers about outsourcing some components. TOKYO ELECTRON LTD., the parent of the Kyushu company and one of the world's largest makers of semiconductor production equipment, has manufacturing operations in Gilbert, Arizona and Hillsboro, Oregon.
An exchange rate of ¥106=$1.00 was used in this report.
The largest provider of services designed to help small businesses succeed on-line has won a $39 million vote of confidence from SOFTBANK CAPITAL PARTNERS LP. San Francisco's SMARTAGE.COM will use the money to build its brand, develop its infrastructure and continue its growth. The company's expansion plans include joint ventures in Japan, the United Kingdom and France as well as more U.S. business. SmartAge.com already is helping 700,000-plus small firms build Web sites, access free e-mail, promote and advertise their services, and track how often their sites are visited. Softbank Capital Partners, which raised $1.25 billion for late-stage, pre-initial public offering and post-IPO financing, has made at least four other major investments since it was formed in June.
Prior to filing for an IPO, EMBARK.COM raised $24 million in financing from a number of venture capital funds and companies, including ITOCHU CORP. and RECRUIT CO., LTD. The San Francisco firm's Web site targets the higher-education market. Students can research colleges and graduate schools and apply on-line. The site also helps guidance counselors provide better college and career advice. At the same time, academic institutions can use the Embark.com system to recruit students, handle inquiries and process applications from students around the world.
Some of the biggest American names in the Internet and communications fields participated in a $40 million round of financing for NUANCE COMMUNICATIONS. They were joined by NTT SOFTWARE CORP., OMRON CORP. and TRANS COSMOS INC. Menlo Park, California-based Nuance specializes in natural speech interface software for communications, enterprise and Web-based systems. Its newest product is the Voyager voice browser. Omron, a Nuance distributor, has deployed several speech-recognition systems in Japan based on the American company's technology (see Japan-U.S. Business Report No. 358, July 1999, p. 31).
ANDOR CO., LTD., an up-and-coming Kobe developer of computer-aided design and manufacturing systems, has now committed more than $5 million to APPLIED 3D SCIENCE, INC. The latest transaction included a $1.2 million investment in the Merrimack, New Hampshire venture, which is working on 3D design technology and products for the mechanical engineering marketplace. Andor also will pay nearly $1.4 million in licensing fees to Applied 3D Science. Its first commercially available OEM toolkit had a November release date. A suite of end-user 3D modeling tools will come out in the first quarter of 2000.
The development of cutting-edge computer-aided engineering technologies is the ambitious goal of a technical alliance between FUJITSU, LTD. and the huge Visteon Automotive Systems unit of FORD MOTOR CO. Using its computational analysis capabilities, the Japanese company will develop exclusive hardware and software applications for the world's second-biggest manufacturer of automotive parts to enable it to optimize the use of CAE modeling in the design process. That, in turn, should shorten development cycles. Visteon will employ Fujitsu hardware and software in two of its major simulation technologies: the unified parametric vehicle system and the interior climate comfort engineering system. UPV is used to optimize front-end airflow and to perform exterior aerodynamics analysis. ICCE allows engineers to design interior climate control systems that deliver the best in passenger comfort. In return for Fujitsu's help, Visteon will provide detailed feedback on the developed applications. It also will work with Fujitsu on simulation-based design systems for nonrelated automotive programs.
To help big corporations handle unpredictable surges in electronic-transaction volumes, HITACHI DATA SYSTEMS CORP. launched Hitachi iSuite. This set of integrated solutions is designed to optimize enterprise-class infrastructures in such areas as e- business, enterprise resource planning, availability management and server consolidation. The Santa Clara, California company will backstop Hitachi iSuite by offering four major services: e-business infrastructure optimization, high-availability continuum, enterprise server consolidation and software portfolio management.
The developer of the popular Dragon Quest series of role-playing video-game software is ready to try again to make a go of it in the big North American market. In December, ENIX CORP. will establish a wholly owned subsidiary in Seattle. That new company is expected to launch sales in April 2000 of seven titles for SONY COMPUTER, INC.'s PlayStation video-game console and NINTENDO CO., LTD.'s portable Game Boy machine. Enix moved into the North American market in 1989, but poor sales forced it out in 1995.
An exchange rate of ¥106=$1.00 was used in this report.
In a deal that was too good to pass up, NIPPON SHEET GLASS CO., LTD. agreed to sell EPITAXX, INC. to JDS UNIPHASE CORP. for $400 million payable in the San Jose, California firm's common stock. West Trenton, New Jersey-based Epitaxx supplies optical detectors and receivers for fiber-optic communications and cable television networks. Its products include long-wavelength detectors and receivers that have application in such much-in-demand products as DWDM (dense wavelength-division multiplexing) and SONET/SDH (synchronous optical network/synchronous digital hierarchy) transmission equipment. Nippon Sheet Glass bought Epitaxx in 1990 for roughly $10 million. The Japanese company already has ties to JDS Uniphase -- a maker of components for optical communications systems that has used acquisitions to fuel its rapid growth -- as a supplier of microlens products.
The restructuring plans that Japan's big, vertically integrated consumer and industrial electronics manufacturers have announced in recent months might be targeted mainly at businesses in Japan, but they also can impact operations in the United States. The latest example of this growing reality is the announcement by NEC AMERICA, INC. that it would sell its Hillsboro, Oregon production facility to a contract manufacturer. Opened in 1985, the plant currently makes a variety of NEC CORP. communications network products, including access network systems, integrated communications systems and SONET equipment. It also produces electronic systems for cars and trucks. Some 500 people work at the factory, which reportedly ships $200 million worth of products annually. Whatever contract manufacturer buys the plant will continue to make NEC-brand communications network equipment and automotive electronic systems, but it presumably will attempt to win business from other companies. NEC America's decision to make the Hillsboro factory a contract manufacturing facility is still rare for a Japanese-affiliated company. It is not unprecedented, though. In late 1998, MITSUBISHI CONSUMER ELECTRONICS AMERICA, INC. turned its Braselton, Georgia cellular telephone plant over to SOLECTRON CORP., the top contract manufacturer.
Two other announcements accompanied this news. First, NEC CORP. disclosed that it planned a "significant" expansion of its network integration and systems integration operations in the United States over the next three years. The buildup will include a roughly 50 percent increase in staffing to about 1,600 people. Although details were scarce, Irving, Texas-based NEC BUSINESS NETWORK SOLUTIONS, INC. apparently will be the primary vehicle for this growth (see Japan-U.S. Business Report No. 353, February 1999, p. 11). Second, NEC USA INC. revealed that it had established the Venture Development Center in San Jose, California to support its parent's strategic reorientation toward R&D and Internet solutions. The facility has the job of commercializing technological breakthroughs that are not necessarily part of NEC's mainstream businesses today and establishing ventures capable of bringing these new technologies to the market. The Venture Development Center will be staffed by R&D specialists from other NEC organizations around the world, including the USA Development Center opened in 1997 in Princeton, New Jersey, although outsiders are expected to be brought in.
These changes ironically are occurring against the backdrop of NEC CORP.'s increasing business with AT&T CORP. Earlier this year, the world's premier provider of voice and data communications started wide-scale deployment of the NEC ITS-2400A, an OC-48 (2.5 gigabits per second) SONET multiplexer. AT&T is using the system to carry all types of sub-OC-48 private line and switched traffic and for SONET ring restoration. The carrier also is using NEC's SpectralWave-32/64 system to help it meet the skyrocketing demand for greater speed and bandwidth. Like other members of the SpectralWave family, this equipment is designed to carry traditional SONET traffic as well as Internet Protocol and other data traffic. AT&T is expected to be a major customer for NEC's forthcoming compact, small-footprint SpectralWave-160, which incorporates the company's L-band (long wavelength) optical amplifiers to deliver high channel counts and large capacity. This system moves traffic at OC-48 and OC-192 (10-Gbps) rates.
Traffic is being carried at 10-Gbps on the coast-to-coast network layer of GLOBAL CROSSING LTD.'s North American Crossing network, thanks to HITACHI TELECOM (USA), INC.'s AMN 5192 OC-192 SONET system. This equipment was ordered before Global Crossing acquired the former Frontier Corp. (see Japan-U.S. Business Report No. 355, April 1999, p. 10). By installing the Hitachi Telecom equipment in its backbone, Global Crossing not only is able to increase its network capacity in large increments, but the four-fiber BLSR (bidirectional line switched ring) technology featured in the AMN 5192 ensures the network's reliability and survivability. The North American Crossing network connects more than 120 metropolitan areas around the United States.
For the first time, KDD SUBMARINE CABLE SYSTEMS INC. has gone outside its traditional group of Japanese suppliers to buy optical fibers for undersea cable systems. It has signed a multiyear contract with CORNING INC. for its Submarine LEAF and Submarine SMF-LS optical fibers. KDD-SCS first will deploy these products in the TAT- 14 transatlantic system, which is scheduled for completion in October 2000. Sources in Japan estimate that about 20 percent of the optical fibers KDD-SCS uses for this project will be purchased from Corning. They also say that the yen's appreciation and the technical sophistication of the Corning optical fibers were behind the contract. Corning's year-old Submarine LEAF optical fiber is designed to minimize the occurrence of nonlinear optical effects, which can degrade the performance of advanced undersea systems. Its Submarine SMF-LS optical fiber, which has been commercially available since 1997, reduces the impact of four-wave mixing, a nonlinear optical effect that can impact the transmission characteristics of multiwavelength systems.
NTT MOBILE COMMUNICATIONS NETWORK, INC. tapped the team of LOCKHEED MARTIN CORP. and ORBITAL SCIENCES CORP. to build and launch the N-STAR c geosynchronous communications satellite. Scheduled to be delivered into space in the first quarter of 2002, the satellite will provide S-band communications services to mobile users in Japan, augmented by a C-band feeder link. It will be designed to operate for 10 years, supplementing NTT DoCoMo's current pair of U.S.-built N-STAR satellites. Prime contractor Lockheed Martin Commercial Space Systems of Sunnyvale, California will supply the entire payload, which it will mate with Orbital's STAR bus. Dulles, Virginia-based Orbital also will be in charge of providing the ground system, securing a launch vehicle and conducting initial satellite operations. This is the first time that Lockheed Martin and Orbital have teamed up to bid for a satellite contract. On their own, both companies broke into the Japanese commercial satellite business last year, ending the hold that HUGHES SPACE AND COMMUNICATIONS CO. and SPACE SYSTEMS/LORAL INC. had on the market (see Japan-U.S. Business Report No. 351, December 1998, p. 9).
An exchange rate of ¥106=$1.00 was used in this report.
The California Fuel Cell Partnership, established this past April, has its first Japanese member. HONDA MOTOR CO., LTD. joins DAIMLERCHRYSLER AG, FORD MOTOR CO., VOLKSWAGEN AG, three oil suppliers, a Canadian maker of fuel cells and the California Air Resources Board and the California Energy Commission. The group was formed to demonstrate the future potential of fuel-cell vehicles, identify issues concerning possible fuels and fueling technologies and to raise public awareness of this alternative to gasoline engines. Honda plans to have a fuel-cell vehicle ready by 2003. Both hydrogen-fueled and methanol-fueled prototypes are under development. In December, U.S. sales will start of the Honda Insight, the first gasoline-electric hybrid model available in this country.
Filling in details of their spring agreement to cooperate over five years on the development of vehicles powered by fuel cells and other replacements for gasoline (see Japan-U.S. Business Report No. 356, May 1999, p. 11), TOYOTA MOTOR CORP. and GENERAL MOTORS CORP. announced that 15 teams are at work in at least four different areas. Each company is developing its own four-wheel-drive hybrid system. The best technologies from each eventually will be combined into a single system. The collaboration also extends to creation of a smaller inductive charging coupler for electric vehicles, research on fuel-cell vehicles and standardization of the hydrogen supply system for fuel-cell vehicles. Toyota and GM disclosed at the same time that a June 1998 project to develop a compact charging system for electric vehicles was nearing completion.
With output of stamped and welded chassis and suspension parts nearing capacity at CALSONIC YOROZU CORP. because of increasing orders from GENERAL MOTORS CORP. and other customers, majority owner YOROZU CORP. has committed $9.4 million for new equipment at the big Morrison, Tennessee company. Most of the money will go for a hydroforming press that should be operational by the start of 2001. The press not only is designed for precision handling of complexly shaped parts but also offers several other advantages. For one, it reduces time in process by eliminating the need to weld together several smaller parts. The press is said as well to cut the weight of parts by 10 percent and to slash production costs by 20 percent to 30 percent. CYC, which opened in 1988, now can turn out 35,000 stamped parts a month.
Beginning in July 2000, ARVIN SANGO, INC. will make exhaust manifolds for vehicles assembled at TO-YOTA MOTOR CORP.'s Georgetown, Kentucky complex. This part currently is imported from Japan. SANGO CO., LTD. and ARVIN INDUSTRIES, INC., the equal owners of the Madison, Indiana maker of exhaust systems, will spend roughly $4.7 million to add production of manifolds. Output is projected at 12,500 units a month, which is not high enough to completely displace imports but a volume that could boost the joint venture's revenues by $11.3 million a year. Arvin Sango has been in business since 1988.
By 2003, a fourth production line for compressors for automotive air-conditioning systems will be operational at MICHIGAN AUTOMOTIVE COMPRESSOR, INC.'s factory in Parma, Michigan. TOYODA AUTOMATIC LOOM WORKS, LTD., the majority (60 percent) owner of the 10-year-old factory, sees this expansion as integral to its goal of boosting its share of the world vehicle AC compressor market to 40 percent or so from 30 percent at present. Michigan Automotive Compressor, in which DENSO CORP. has a 40 percent stake, currently makes 2.5 million compressors a year for such customers as GENERAL MOTORS CORP. and DAIMLERCHRYSLER AG. The installation of the fourth line will lift annual capacity to 3.5 million units.
The strategic alliance that VALEO S.A. and ZEXEL CORP. tentatively have agreed to form in the areas of automotive climate control and engine cooling is mainly designed to strengthen both firms' operations in Asia. However, under the memorandum of understanding, the big French automotive parts manufacturer will buy the Japanese supplier's climate control businesses in North America and Europe. Zexel operates two vehicle air-conditioning component plants in the United States. Its Grand Prairie, Texas factory, acquired in 1984, manufactures evaporators, condensers and tube assemblies, while a facility in Decatur, Illinois that opened in 1988 produces evaporators and compressors. Together with marketing and sales people in North America and Europe, these operations have 550 employees. Zexel's combined AC parts sales in the two regions are about $245 million a year. The agreement with Valeo could be finalized as soon as the beginning of 2000. It has the support of Zexel's majority owner, ROBERT BOSCH GMBH.
The Plumley Division of DANA CORP. is shipping seven low-emission fuel tank hoses to NISSAN MOTOR CO., LTD.'s Smyrna, Tennessee complex for the 2000 Altima sedan. The Paris, Tennessee-based supplier expects to sell 1.5 million hose components under the new contract.
Big bearing manufacturer NTN CORP. and the NTN TECHNICAL CENTER (U.S.A.), INC. in Ann Arbor, Michigan have developed a new type of four-wheel-drive system for the high-end sport-utility vehicles that are increasingly popular in the United States. The Lock-On-Demand transfer case clutch system sends power to the front wheels when speed sensors detect slippage in the vehicle's rear wheels. Compared with the viscous couplings and multiple plate friction clutches typically used today in full-time four-wheel-drive systems, NTN says that the LOD delivers better fuel economy and improved drivability and traction, even under the severest of conditions. NTN has not yet decided where the LOD, which consists of a two-way roller clutch and an electronic control unit that actuates the clutch when tire slippage is detected, will be manufactured, but one of its various U.S. bearing factories would seem to be an obvious candidate.
All the money that New York City's Metropolitan Transportation Authority is spending to upgrade the subway system has meant big business for subway car maker KAWASAKI HEAVY INDUSTRIES, LTD. and its Yonkers, New York assembly subsidiary (see Japan-U.S. Business Report No. 354, March 1999, p. 12). However, SUMITOMO HEAVY INDUSTRIES, LTD. also has benefited. For the second time in two years, it has won through SUMITOMO CORP. a contract to supply high-performance, noiseless wheels for MTA's subway cars. The latest order covers 15,000 wheels. Shipments of these parts will start at the end of 1999.
An exchange rate of ¥106=$1.00 was used in this report.
Although it had built 55 precipitated calcium carbonate satellite plants for paper manufacturers everywhere else, SPECIALTY MINERALS INC. never had been able to break into the world's second-largest paper market. That finally has changed. The Bethlehem, Pennsylvania company's majority-owned SPECIALTY MINERALS FIMATEC LTD. venture has won a contract from a paper producer described only as a major player in the business to build a PCC satellite plant at one of its mills. Expected to be operational in the second quarter of 2000, the facility will provide both filling and coating- grade PCC for the paper company's fine printing and writing papers. The plant will have an annual capacity of between 50,000 tons and 70,000 tons of PCC, which is a specialty pigment used in place of more expensive wood fiber and other, equally high-cost pigments to fill and coat high-quality paper. Specialty Minerals Fimatec was formed in 1997 by the local subsidiary of Specialty Minerals' parent, MINERALS TECHNOLOGIES INC., and FIMATEC LTD., a supplier of ground calcium carbonate to the Japanese paper industry.
Competitive pressures are forcing FURUKAWA CO., LTD. to end production of rutile titanium dioxide and to import this product from E.I. DUPONT DE NEMOURS & CO., INC. for distribution in Japan. Shipments will start in January 2000, presumably at the rate of about 12,000 tons a year, which is the volume that Furukawa currently makes at its Osaka factory. The diversified Japanese company will use part of the freed-up capacity to increase output of anatase titanium dioxide, a white pigment.
FUTURA COATINGS, INC., a St. Louis-based maker of high-performance coatings, elastomers and structural resins made from such things as polyurethanes, polyureas, acrylics and epoxies, has moved into the Japanese market. It formed a subsidiary in Osaka, with most of the money supplied by CREATE CLUB CORP. Sales already have started of Futura's polyurethane-based ULTRATHANE RSM (reaction spray molding) Series. These materials are being marketed as an alternative to fiberglass-reinforced plastics, the use of which as a stiffening agent increasingly is restricted because of environmental considerations, particularly their role in producing dioxins when incinerated. Futura's products not only yield no toxic substances when burned but also are highly recyclable. Other advantages include fast cure and demolding rates and high-impact resistance.
PHARMACIA & UPJOHN, INC. gave SATO PHARMACEUTICAL CO., LTD. marketing rights to a topical acne treatment known in the United States as Cleocin T Gel (clindamycin phosphate) but sold elsewhere as Dalacin T Gel. Action on P&U's March application to the Ministry of Health and Welfare for marketing approval is pending. Sato Pharmaceutical believes that sales of the antibiotic, which has been available in America since 1987, could total $14.2 million a year.
The popularity in Japan of PHARMACIA & UPJOHN, INC.'s Rogaine (minoxidil) for treating hair loss (see Japan-U.S. Business Report No. 354, March 1999, p. 13) no doubt encouraged BANYU PHARMACEUTICAL CO., LTD. to file a new drug application with MHW for Propecia (finasteride). Discovered and commercialized by parent MERCK & CO., INC., the drug blocks the formation of a male hormone that has been implicated in the development of inherited male pattern hair loss. Propecia was released in the United States in 1998. It is the first FDA-approved pill to treat hair loss in men. Banyu Pharmaceutical could start clinical testing of Propecia as soon as 2000. Its goal is to have the drug on the market in 2003.
With the human genome analysis business growing rapidly in Japan, GENEFORMATICS, INC. decided that the time was right to move into the market. The San Diego, California company made RIKEI CORP. the exclusive channel for selling and marketing its products and services, which are designed to expedite the identification of biologically relevant targets from the vast amounts of sequence data produced by various genomics projects underway around the world. GeneFormatics also trained a number of Rikei scientists so that they can provide full technical support to customers. The Japanese company estimates that this new activity could produce revenues of $2.8 million in FY 2000.
A Japanese start-up has begun a DNA (deoxyribonucleic acid) paternity testing service with help from GENETIC PROFILES CORP. The San Diego, California firm does the actual testing of samples collected by GLOBAL I INC. from medical facilities. Testing two adults and a child costs about $1,400. Global I expects to handle about 300 tests in FY 2000.
An exchange rate of ¥106=$1.00 was used in this report.
Every move that SOFTBANK CORP. makes in the Internet-related field seems to pay off, often handsomely. However, this success has not extended to the world of PCs. Earlier in the year, Softbank announced plans to sell generic or no-name machines supplied by big electronics distributor INGRAM MICRO INC. of Santa Ana, California (see Japan-U.S. Business Report No. 354, March 1999, p. 16). What the firm never envisioned was that sellers of brand-name PCs, especially American vendors, would introduce well-equipped models for as little as $800 or so. Accordingly, Softbank is cutting its losses by ending its contract with Ingram Micro.
In what is being billed as the largest outsourcing agreement by a manufacturer in Japan, MAZDA MOTOR CORP. is handing over to IBM JAPAN LTD. responsibility for running most of its computer systems. The deal, which extends from December 1999 through March 2010, will cost the automotive maker an estimated $471.7 million, but the FORD MOTOR CO. subsidiary expects to save as much as $47.2 million of what it otherwise would have spent on information technology requirements. More importantly, the arrangement allows Mazda to focus on its core business. IBM Japan will be in charge of developing the vehicle builder's IT resources outside of the R&D area as well as operating and maintaining its current systems, which include a pair of supercomputers, three host computers and roughly 10,000 PCs, plus networking equipment. The computer maker will set up a wholly owned subsidiary in Hiroshima to service the contract. This company will be staffed initially by about 350 people, including employees of Mazda's soon-to-be- disbanded IT unit. IBM Japan has been quite successful in the last year or so in winning IT outsourcing contracts, but most of its business to date has come from firms in the financial sector.
IBM JAPAN LTD. has enlisted a key partner to support a related business thrust -- developing solutions for financial institutions that take advantage of the Internet. Before yearend, the computer giant expects to form a company with TOSHIBA CORP. to build systems around its RS/6000 Unix-based servers that will help merging banks achieve some of the promised efficiencies by handling back-office or administrative functions on-line. Toshiba, which will have a 51 percent stake in the joint venture, brings experience in this field to the partnership since it currently markets financial systems centered on SUN MICROSYSTEMS, INC. Unix servers. Both IBM Japan and Toshiba will transfer technical and sales personnel to the new company, which is projecting revenues as high as $47.2 million in the first year of operations.
In a marketing strategy aimed directly at price-sensitive buyers of computers for the home, GATEWAY 2000, INC.'s subsidiary is offering deep discounts to people who purchase its consumer desktop and portable machines if they sign up before yearend for two or three years of Gateway.net Internet access. The best deal is on the new-to-Japan Neo (Astro) PC, a low-price, easy-to-use, all-in-one system equipped with a 400-MHz Celeron processor, 64 MB of memory, a 4.3-GB hard drive, an integrated 40X CD-ROM drive and a 15-inch screen. It lists for $850, but buyers who purchase three years of Gateway.net service can get a Neo for just $375. Unlimited Internet access costs $28.30 per month.
A broader range of products soon will be available at COMPAQ COMPUTER CORP.'s on-line store in Japan. Compaq DirectPlus, opened in July, now carries an exclusive line of Prosignia servers, desktop systems and notebooks (see Japan-U.S. Business Report No. 359, August 1999, pp. 14-15). Certain models of the ProLiant PC server, Deskpro desktop, Armada corporate-use notebook and handheld Aero 8000 families will be added to this lineup, as will a wider variety of peripherals and software.
The latest UNISYS CORP. enterprise server designed for high-volume transaction processing is on the market at monthly lease rates of $157,600 and up. Like other members of this series, the ClearPath HMP IX6800 is what is called a heterogeneous multiprocessing system since it integrates system software for Unisys' 2200 mainframe platform with Intel-based servers running the Windows NT or the SCO UnixWare operating system. One innovation of the IX6800 is a new cache storage design that delivers a 60 percent performance improvement. Another is the use of 0.25-micron CMOS (complementary metal-oxide semiconductor) technology.
With the EV67 implementation of its 64-bit Alpha 21264 processor now shipping, COMPAQ COMPUTER CORP. is claiming application performance gains of 30 percent to 40 percent for its Unix-based AlphaServer GS Series of enterprise-class servers. This jump, the company says, is the result of a combination of speed improvement and a larger cache. The new engine powers the latest version of the entry-level AlphaServer GS60E, which now can be equipped with as many as eight processors rather than the six Alpha 21264 (EV6) chips that were the outside option when the machine was introduced in Japan in August. Pricing of the more powerful model starts at $153,800. The pumped-up Alpha processor also is at the heart of the new-to-Japan AlphaServer GS140 system. This server can be configured with as many as 14 Alpha 21264s, and it is expandable to 28 GB of 64-bit Very Large Memory. The base, two-way AlphaServer GS140 lists for $584,300.
By yearend, IBM JAPAN LTD. thinks that it can sell 1,000 of the new AS/400e Dedicated Server for Domino to small and midsize customers. As its name suggests, this system is designed specifically to run Domino groupware applications. Obviously, that is possible with almost any PC server configuration. The beauty of its alternative, IBM Japan says, is that it allows businesses to run all their Domino applications on one machine rather than on multiple Domino servers due to the partitioning capabilities of the AS/400e. This makes operations not only easier and more affordable but also more reliable and secure, according to the company. Three versions of the AS/400e Dedicated Server for Domino are available. The middle one lists for $32,900, plus $9,400 for a 100-user Domino license.
A new systems architecture engineered specifically to boost both systems throughput and performance in 2D/3D graphics applications is the source of INTERGRAPH CORP.'s claim that its Zx10 ViZual Workstation is the fastest Windows NT workstation available. According to the Huntsville, Alabama firm, its Wahoo Technology with Streaming Multiport Architecture outperforms Windows NT architectures based on the Intel i840 chipset and the Intel BX chipset by supporting the latest Pentium III and Pentium III Xeon processors with their 133-MHz front-side buses, considerably more memory and better operation of that SDRAM, and much higher I/O bandwidths. Shipments of the Zx10 ViZual Workstation will start in late December. In the United States, pricing will begin at about $7,200 for a 733- MHz Pentium III processor, 256 MB of memory, an 18-MB hard drive, Wildcat 4110 VIO 3D graphics and Windows NT Workstation.
The performance advantages of the 600-MHz Pentium III processor are available in more companies' product lines. For instance, this engine powers the top model in IBM JAPAN LTD.'s entry-level IntelliStation E Pro workstation as well as its midrange IntelliStation M Pro, which can use one or two such chips. Both models also feature IBM Fire GL1 for 3D graphics capabilities rather than the Matrox Millennium 2D package standard on other products in the two series. Each of the base units has 128 MB of ECC (error checking and correcting) SDRAM. The IntelliStation E Pro, which starts at $3,800, offers 9.1 GB of storage, while its M Pro mate has 13.5 GB.
IBM JAPAN LTD. also made the 600-MHz Pentium III the new high-end option for those members of its broad Netfinity server series that are powered by this chip. Pricing of the new models starts at $7,700. At the same time, the company introduced the 550-MHz Pentium III Xeon in the rest of the Netfinity server line, which includes uniprocessor, two- way, four-way and eight-way models. The base configuration costs $16,000.
DELL COMPUTER CORP.'s subsidiary is one cycle ahead of its rivals. In a worldwide release, the direct marketer announced the PowerEdge 2400 as the latest addition to its family of workgroup servers. This machine features the 667-MHz version of the Pentium III processor with its 133-MHz front-side bus. The Power-Edge 2400 also is the first Dell workgroup server to offer hot swappable/redundant power supplies for enhanced availability. Embedded RAID (redundant array of independent disks) technology and a 64- bit PCI bus for higher data bandwidth are other selling points. The system memory of the PowerEdge 2400 scales up to 2 GB of SDRAM, and it can support as much as 144 GB of internal storage. Entry-level prices start at $3,600.
The 600-MHz Pentium III also now represents the state of the art in processor technology for corporate desktop systems. It is the power behind the high-end model in IBM JAPAN LTD.'s PC 300GL line, which is targeted at commercial customers looking for a combination of price and performance. The 6564-SKJ model has an estimated street price of $2,800. For buyers that are even more budget conscious, IBM Japan is offering a PC 300GL model (6288) that uses a 466-MHz Celeron processor for as little as $1,200. Among the eight new PC 300 systems that include these two machines is an additional member of the Japan-only PC 300PL Slim line of space-saving PCs. Equipped with a 500-MHz Pentium III chip, the newcomer starts at $1,900.
Business users who want the performance of Pentium III technology at an affordable price are the target market for DELL COMPUTER CORP.'s new OptiPlex GX110. Less than $1,200 buys a system with a 450-MHz Pentium III chip, 64 MB of SDRAM and a 4.3-GB hard drive. That price also includes the new Intel 810e chipset, which provides a higher level of component integration, such as of graphics and audio, but it does not include a monitor.
COMPAQ COMPUTER CORP. continues to cater to corporate purchasing managers that give priority to value in buying desktop machines. Its subsidiary released 28 models in the Deskpro line that start at less than $1,400. These PCs feature Celeron processors running at 466 MHz or 500 MHz. They also include the 810e chipset for optimized price/performance.
The Japan-only Aptiva E line of desktop PCs for the home that IBM JAPAN LTD. introduced in June has proved to be a hot seller in the ¥100,000 and under market. The company hopes to extend the success of the Aptiva 20J family with the 11-model Aptiva 24J series, which uses the 450-MHz version of the AMD-K6-2 processor rather than the 400-MHz release of its predecessor. The entry-level model costs just $940, but that price covers more than ample memory and storage, plus a monitor, a modem, LAN capabilities and a long list of family-oriented software titles.
Also going after the home desktop PC market, COMPAQ COMPUTER CORP.'s sales unit unveiled the four-model Presario 3500 series. This line offers a choice of Celeron processors with clock speeds of 433 MHz to 500 MHz, hard drives with a storage capacity of 8.4 GB to 10 GB, and a 32X CD-ROM or a 10X DVD-ROM drive. Internal memory is a uniform 64 MB of SDRAM. A 56-kbps modem and one-button Internet and e-mail access are standard. The entry-level 3500 model, the 3560, has an estimated street price of $945 without a monitor.
For individuals who want the flexibility that a notebook PC offers at an affordable price, COMPAQ COMPUTER CORP.'s subsidiary added the Presario 1246 model to its Presario 1200 line. It offers a 400-MHz AMD-K6-2 processor, 32 MB of SRAM, a 4.3- GB hard drive, a 24X CD-ROM drive, a 56-kbps modem and one-button Internet access for roughly $1,500. People willing to pay for more performance in a thin, lightweight design with a detachable wedge have two new choices in the Presario 1900 series. The Presario 1928 and the Presario 1929 share a 400-MHz Celeron processor, 64 MB of SDRAM and a 6.4-GB hard drive. They differ in the inclusion of a 24X CD-ROM drive or a DVD-ROM drive.
The revolutionary iMac home and classroom computer breathed some much-needed life into APPLE COMPUTER, INC.'s business in Japan as well as in the United States after it was introduced just over a year ago. The company now hopes to build on that success with a three-model line of iMacs completely redesigned to be faster, sleeker, quieter and more Internet friendly. The basic iMac, which lists for $1,100, sports a 350-MHz PowerPC G3 processor, 64 MB of SDRAM (expandable to 512 MB), a 6-GB Ultra ATA hard drive, a "slot-load" 24X CD-ROM drive, high-end graphics acceleration, a built-in V.90/56K modem, 10/100Base-T Ethernet and dual USB ports. It is engineered to operate without a fan and supports Apple AirPort wireless networking for fast Internet access from anywhere in the home or the classroom. The new iMac DV, short for digital video, uses a 400-MHz version of the PowerPC G3 processor and provides 10 GB of storage. What really distinguishes this $1,400 model from the basic iMac, though, are a 4X slot-load DVD-ROM drive with DVD video playback, two 400-megabit-per-second FireWire (IEEE 1394) ports and Apple's new iMovie software for creating professional-quality home and classroom movies. Rounding out the series is the iMac DV Special Edition. It has the same configuration as its namesake but comes with 128 MB of SDRAM and a 13-GB Ultra ATA hard drive for roughly $1,700.
Twelve years after PINNACLE SYSTEMS, INC. started marketing its video broadcast and production editing tools in Japan, the Mountain View, California firm opened a wholly owned subsidiary in Tokyo. At the same time, Pinnacle gained a new marketing partner: HITACHI ELECTRONICS, LTD. That company had been designing video server systems for broadcasters around equipment from HEWLETT-PACKARD CO., but in August, Pinnacle bought this part of HP's business. Hitachi Electronics is especially excited about Pinnacle's high-capacity video servers, which can store 1,000 hours of material and even more.
The new class of Fibre Channel solutions that start-up TROIKA NETWORKS, INC. introduced in September will be distributed by NISSHO ELECTRONICS CORP. The Westlake Village, California firm's equipment addresses the storage demands that e- commerce and e-business have placed on corporate IT systems. It does this by adding server cluster and Internet Protocol communications to Fibre Channel-based storage area networks, thereby creating a system area network. The resulting multifunctional network, which Troika Networks dubs SAN2 or SAN squared, provides a single-wire, fully open network infrastructure for building reliable, scalable and manageable IT systems. The first product that Nissho Electronics will resell is Troika Networks' SAN2 Controller 2000, a PCI- to-Fibre Channel adapter that enables network managers to support and administer storage and/or system area networks with a single device.
Answering the call of Solaris users for more storage capacity, increased throughput and faster response time for data warehouse applications, SUN MICROSYSTEMS, INC.'s subsidiary released new versions of the Sun StorEdge A5100 and Sun StorEdge A5200 arrays. The revamped A5100 marks Sun's introduction of 36.4-GB drives operating at 10,000 rotations per second. Fourteen drives fit in an enclosure. Six of these can be linked together to provide 3 terabytes of capacity. As much as 2.4 TB of storage in a 132-drive configuration is available with the upgraded A5200. This model uses 9.1-GB or 18.2-GB drives also operating at 10,000 rpm. Each subsystem has room for 22 drives. Pricing of the latest Sun StorEdge arrays starts at $66,000.
Seemingly helping a competitor, HEWLETT-PACKARD JAPAN LTD. has agreed to provide components and peripheral equipment for large-format ink-jet printers to GRAPHTEC CORP. Japan's largest maker of plotters and recorders plans to improve the speed and the printing definition of the HP products and sell the equipment under the Graphtec name to graphics companies. Graphtec, which had been selling San Diego, California ENCAD, INC.'s large-format printers, expects the tie-up with HP Japan to boost its annual revenues by $14.2 million in two or three years.
High-quality digital photos can be printed directly from a wide range of digital cameras with HEWLETT-PACKARD JAPAN LTD.'s HP PhotoSmart P1000 and HP PhotoSmart P1100 ink-jet printers. A PC is not necessary because these machines accept input directly from CompactFlash cards and SmartMedia cards. Both also function as desktop machines for everyday printing. The HP PhotoSmart P1000, which lists for $565, outputs up to 11 ppm in black and white with a 600-dpi resolution and 8.5 ppm in color with a 2400 x 1200 resolution. The faster HP PhotoSmart P1100 printer delivers 12 ppm in black and 10 ppm in color. It is expected to sell for $660. .....At the same time, HEWLETT-PACK-ARD JAPAN LTD. complemented the recently introduced HP DeskJet 970Cxi Professional Series with the HP DeskJet 955C. It provides photo-quality reproduction at speeds of 11 ppm in black and 8.5 ppm in color for $450.
EASTMAN KODAK CO. and SANYO ELECTRIC CO., LTD. have codeveloped the world's first commercially viable full-color, active-matrix organic electroluminescent display. The 2.5-inch (diagonal) demonstration product has a 190,000-pixel count. The breakthrough, the result of a development alliance forged earlier this year (see Japan-U.S. Business Report No. 354, March 1999, p. 17), is significant because OEL displays are easier to view than today's LCDs, plus they are much thinner, weigh less and consume considerably less power. Those characteristics mean that information-rich, user-friendly displays can be built into even more electronics products.
Now that it has a marketing subsidiary (see Japan-U.S. Business Report No. 361, October 1999, p. 19), RARITAN COMPUTER, INC. is bolstering its line of switches that allow multiple computers to be controlled through a single keyboard, monitor and mouse. Its latest product is the SwitchMan, a plug-and-play desktop product for operating two to four PCs. Pricing is open, but in the United States, the SW2 (two-channel SwitchMan) is $170, while the SW4 (the four-channel unit) costs $250.
In what INTERGRAPH CORP.'s Intense 3D unit considers a critical design win, FUJITSU, LTD. selected the new Wildcat 4110 graphics accelerator as the graphics subsystem for its next-generation FMV-PRO Workstation, a product used by many engineers and designers in Japan. According to the Huntsville, Alabama supplier, Wildcat 4110 delivers the industry's fastest graphics on any platform. It has double the performance of previous Wildcat products, but the pricing has remained basically the same.
An exchange rate of ¥106=$1.00 was used in this report.
NCR JAPAN, LTD. has decided that there is little benefit to the company from owning its headquarters in the Akasaka area of Tokyo. Consequently, it has agreed to sell the 37- year-old building, which has 191,125 square feet of floor space and stands on a 22,400- square-foot piece of property, to the Nippon Foundation for $125.5 million. NCR Japan will use the proceeds to fund its pension plan and strengthen its core businesses; that could include acquisitions. The sale is slated to close in April 2000. NCR Japan executives and the company's marketing unit will move to a building in Tokyo's Chiyoda district. The sales and consulting divisions will be relocated to existing NCR Japan offices in the Shibuya section of Tokyo, Yokohama and Oiso, Kanagawa prefecture.
One of the first American companies to exploit the opportunities created by the plunge in commercial property prices in Japan's big metropolitan areas has brokered the sale of its sixth office building in 1999. KENNEDY-WILSON, INC. arranged the sale of an eight- year-old, 60,000-square-foot, seven-story office building in central Tokyo owned by a stumbling real estate company to a U.S. real estate fund for $15.1 million. According to Kennedy-Wilson, the real value of the property is $300 per square foot. The transaction brought the firm's year-to-date sales in Tokyo alone to more than $150 million.
An exchange rate of ¥106=$1.00 was used in this report.
The market in Japan for uninterruptible power supplies is expanding at about 20 percent a year. The demand for scalable, redundant power protection for data centers and centralized servers is particularly strong. That has prompted big UPS supplier AMERICAN POWER CONVERSION CORP. to introduce its first enterprise-level system, the Symmetra Power Array. Priced from $17,900, this unit has a modular architecture that enables data centers and server farms to ensure nearly continuous power availability in a range of capacities as they expand.
VICOR CORP.'s subsidiary is projecting first-year sales of $7.6 million for a new line of Japan-only AC/DC and DC/DC switching power supplies. The MultiPack Family 600- Watt Series and the MultiPack Family 800-Watt Series feature modules that slide into a chassis to provide the output voltage and the power required. Both series of power supplies, which range in price from $830 to $925, are field-configurable so that industrial users easily can add or replace modules on-site to meet changing requirements.
Roughly 80 percent of the world output of lithium-ion batteries, which provide the power to portable devices like notebook computers and cellular telephones, comes from Japan. That makes this market a prime target for a novel safety switch developed by THERM-O- DISC, INC. that protects high-energy-density lithium-ion batteries from thermal runaway. The part does this by using a shape memory alloy as a temperature/current sensor. The sensor returns to its "remembered" high-temperature shape on transformation, resulting in an open circuit before reaching thermal-runaway temperatures. Beginning in December, the Mansfield, Ohio manufacturer, an EMERSON ELECTRIC CO. business, will make 1.5 million shape-memory-metal battery protectors a month specifically for the Japanese market. Emerson's Tokyo subsidiary will handle sales. The device will cost between 19 cents and 28 cents.
From December, start-up SOFT SERVO SYSTEMS, INC. will ship to Japan what it says is the first direct PC-based motion controller. The Waltham, Massachusetts firm's SoftServo performs all time-critical control computations using a single, powerful central processor unit that runs on such operating systems as Windows NT and Linux and that is integrated with low-cost FPGA (field-programmable gate array) interface boards and a software library.
An exchange rate of ¥106=$1.00 was used in this report.
The late September nuclear fission chain reaction at a nuclear fuel processing plant in Tokaimura, Ibaraki prefecture has forced sourcing changes at JAPAN NUCLEAR FUEL CO., LTD. The company, a supplier of nuclear fuel rods that is owned by GENERAL ELECTRIC CO., HITACHI, LTD. and TOSHIBA CORP., now buys about half of its powdered uranium dioxide requirements from JCO CO., LTD., but the operator of the Tokaimura plant will be shut down in the wake of Japan's worst nuclear accident. As an interim step, JNF will increase imports of uranium dioxide from GE while it searches abroad for other suppliers of this critical input. Despite the disruption, GE, Hitachi and Toshiba are moving ahead with their plan to form a company in January 2000 to take over their respective nuclear fuel businesses on both sides of the Pacific (see Japan-U.S. Business Report No. 356, May 1999, p. 5). The new firm will have two subsidiaries, one based on JNF and the other encompassing GE's Wilmington, North Carolina nuclear fuel operations. The American partner will own 60 percent of the holding company.
The freedom that independent power producers will have starting in April 2000 to sell electricity directly to industrial users has lured a heavyweight into the market. ENRON CORP., the top wholesaler of electricity and natural gas in the United States, has formed a subsidiary in Tokyo and is scouting out both partners for its proposed business and potential customers. The diversified Houston-based multinational has not disclosed, however, whether it plans to build its own power-generating facilities or buy existing plants. TEXACO INC. also is exploring the opportunities emerging in Japan's IPP market (see Japan-U.S. Business Report No. 360, September 1999, p. 17).
An exchange rate of ¥106=$1.00 was used in this report.
WIT CAPITAL JAPAN, INC. has raised $30.2 million in a second round of financing. With a total of $40 million at is disposal, the venture is closer to its goal of becoming the country's first Internet investment bank and, in the process, transforming how capital is raised in Japan. Wit Capital Japan was established by New York City's WIT CAPITAL GROUP, INC., MITSUBISHI CORP. and TRANS COSMOS INC. (see Japan-U.S. Business Report No. 359, August 1999, p. 19). Participating in the latest fund-raising were ENCOMPASS GROUP INC., HIKARI TSUSHIN, INC., a HONDA MOTOR CO., LTD. unit, NIKKO SECURITIES CO., LTD., an ORIX CORP. company, four brokerage houses affiliated with SANWA BANK, LTD. as well as Mitsubishi and Trans Cosmos. These Japanese investors now own 70 percent of Wit Capital Japan, but the American parent has the option to increase its stake to 40 percent from 30 percent within the next six months. Once Wit Capital Japan receives a securities license, it will offer a variety of investment banking services to Japanese Internet and Internet-centric companies. It also will develop electronic brokerage services that will give individual investors the chance to invest in public offerings and venture capital funds.
The opportunities available in Japan's underdeveloped investment banking field also have caught the eye of LEHMAN BROTHERS INC. It is in talks with BANK OF TOKYO- MITSUBISHI, LTD. about formally teaming up in this area as soon as the spring of 2000. Such an alliance would enable the New York City broker/investment banker to exploit the ties that Japan's top commercial bank has to corporate Japan while giving BTM access to Lehman's investment banking expertise. One particular initiative reportedly being explored is the establishment of a Lehman-managed private equity fund that would buy struggling or failed companies, turn them around and then sell them. The tentative partners also apparently are discussing the possibility of moving into the mergers and acquisitions business, another area where the demand for knowledgeable advice and guidance is growing.
The idea of setting up private equity funds to invest in underperforming or even bankrupt companies seems to have fairly widespread appeal to American investment banks and more adventuresome Japanese financial services providers. For instance, Manhattan's ROTHSCHILD INC. and DAIWA SECURITIES SB CAPITAL MARKETS CO., LTD. planned to form an investment fund in November that in time could have $471.7 million with which to work. The pending partners already have identified their first candidate -- NIKKO ELECTRIC INDUSTRY CO., LTD. The automotive parts manufacturer is operating under bankruptcy protection. Rothschild and Daiwa SBCM will inject $14.2 million into the Tokyo company. They expect to make money by taking Nikko Electric public once it is healthy or selling their shares.
The hottest investment scene in Japan, however, is the venture capital part of the market, particularly the provision of start-up capital for promising Internet entrepreneurs. For instance, San Francisco's WALDEN INTERNATIONAL INVESTMENT GROUP, which has invested in more than 200 companies in the Asian Pacific region and in the United States since 1987, and NIKKO SECURITIES CO., LTD.'s investment arm are managing the $30 million WIIG Nikko IT Fund. FUJI-TSU, LTD. is committed to putting up one-third of the financing, hoping that the fund managers will find companies that can help it expand its Internet-related business.
For its part, J.H. WHITNEY & CO., the first organized private equity firm in the United States, has invested a total of $28.3 million in four Japanese companies, including Internet content supplier LINK MEDIA INC. The company, which opened a Tokyo office in February, plans to invest an additional $94.3 million over the coming year. J.H. Whitney's areas of industry expertise and focus go beyond the Internet and include communications, health care, "transforming" industries and the consumer market.
No decisions have been finalized, but the NATIONAL ASSOCIATION OF SECURITIES DEALERS, INC. and SOFTBANK CORP., its equal partner in bringing the NASDAQ automated quotation system to Japan, could have the Osaka Securities Exchange manage the envisioned over-the-counter market rather than create an independent market structure, the original plan (see Japan-U.S. Business Report No. 358, July 1999, p. 18). The three parties confirm that talks are underway but have said nothing else. Analysts, however, see definite advantages to such a strategy, especially since the NASD-Softbank team reportedly is having trouble enlisting securities firms as market makers. An alliance with the OSE also could accelerate the debut of NASDAQ Japan, initially targeted for the fourth quarter of 2000.
The presumed elephant in Japan's on-line securities market, CHARLES SCHWAB TOKIO MARINE SECURITIES CO., LTD., will start operations December 1. The joint venture between CHARLES SCHWAB & CO., INC., which is the top on-line trading company in the United States as well as the number-one discount broker, and a group of Japanese investors headed by TOKIO MARINE & FIRE INSURANCE CO., LTD. initially will offer trading in U.S. stocks and investment trusts (Japanese-style mutual funds) (see Japan-U.S. Business Report No. 358, July 1999, p. 18). Trading in Japanese shares will start sometime in the spring of 2000. The biggest news, however, is that CSTM will follow the lead of MERRILL LYNCH & CO., INC. and set up a full-service retail brokerage network. At present, the company is talking about opening six to 10 offices over the next three to four years. By the end of that period, the joint venture hopes to have some 500,000 customers through its on-line operations, call center and branches.
CITIGROUP INC. has found another channel through which it can market its banking and investment products to individuals in Japan. The world's biggest financial services provider will acquire a 19 percent stake in on-line broker NIKKO BEANS INC. from founder NIKKO SECURITIES CO., LTD. Operational since October 1, Nikko Beans offers brokerage, investment trust and insurance products to customers through the Internet as well as a call center. CITIBANK N.A.'s financial products and services now are available at its own Web site in addition to its branch network and call center. MITSUI TRUST & BANKING CO., LTD. and NIPPON LIFE INSURANCE CO. also have minority interests in Nikko Beans.
This deal is only the second one between CITIGROUP INC. and NIKKO SECURITIES CO., LTD. on the retail side of the financial services business since the American multinational acquired a 9.5 percent share in the big broker in 1998 and the two tied up in the investment banking field earlier this year (see Japan-U.S. Business Report No. 354, March 1999, p. 19). However, other alliances are under discussion. One possibility, Citigroup and Nikko Securities say, is the establishment as soon as spring 2000 of a joint Web site that would offer an array of financial services broader than either company provides on its own.
FIDELITY INVESTMENTS JAPAN LTD. managed an estimated $967 million worth of investment trust assets as of September 30, 1999. FIDELITY BROKERAGE SERVICES (JAPAN) LLC expects a boost in that total when it begins sales over the Internet of the