Production of polypropylene resin will begin early in January 2000 at ARCO POLYPROPYLENE, LLC's state-of-the-art, 220,000-ton-a-year facility in Carson, California. ITOCHU CORP. (one-third) and ATLANTIC RICHFIELD CO.'s ARCO PRODUCTS CO. affiliate (two-thirds) announced the joint venture in September 1998. The $200 million factory is located next to an ARCO refinery that will provide all of the required feedstocks. In anticipation of the start of production, Itochu, the world's largest polypropylene marketer, formed CIPLAS AMERICA, INC. in Long Beach, California. This company will handle international sales, particularly in Asia, as well as marketing in the United States outside of the West Coast. That region will be covered by ARCO Products.
Cutting its losses, surfactant manufacturer NICCA CHEMICAL CO., LTD. ended production of specialty chemical products at its Fountain Inn, South Carolina subsidiary. The plant will continue its profitable specialty textile chemicals business, its initial focus on start- up in 1990. A major source of the favorable results in that area is an agent that repels soil on nylon fabric. In 1996, NICCA U.S.A., INC. diversified, opening a factory to make biphenol-S, which is used in developers for chemicals and papers. That was a bad move, the Fukui prefecture company now acknowledges. Nicca U.S.A.'s sales in 1999 are projected to fall about 10 percent short of the $18.1 million generated in 1998.
Interested in expanding its already significant agrichemicals division, particularly the range of products it sells for organic farming, SUMITOMO CHEMICAL CO., LTD. agreed to buy the agricultural products business of ABBOTT LABORATORIES. The deal includes research and development, sales, marketing and support operations for Abbott's naturally occurring biopesticides, plant growth regulators and other products for agriculture, public health and forestry. Abbott, however, will retain manufacturing rights to the bulk active ingredients for these products. This part of the health-care company's business, which employs some 165 people, had sales of $103 million in 1998. The transaction is expected to close in January 2000. At that time, Sumitomo Chemical will establish VALENT BIOSCIENCES CORP. in Libertyville, Illinois to run the acquired business. This globally focused company will function as an independent subsidiary of VALENT U.S.A. CORP. of Walnut Creek, California, which distributes herbicides and other agrichemicals.
Even second-tier pharmaceutical manufacturers believe that they need a R&D presence in the United States to succeed internationally. The latest company to make this move is SUMITOMO PHARMACEUTICALS CO., LTD. (see Japan-U.S. Business Report No. 358, July 1999, p. 2). It formed a wholly owned subsidiary in Fort Lee, New Jersey to oversee clinical testing of commercially promising treatments by contract research organizations as well as to track developments in the American pharmaceutical industry and to explore tie-ups. SUMITOMO PHARMACEUTICALS AMERICA, LTD. will begin operations in March 2000 with a staff of six or seven people. At that time, Sumitomo Pharmaceuticals' liaison office in New York City will close. The Osaka company sees two products under development as candidates for U.S. clinical trials. One is droxidopa for Parkinson's disease; the other, SM-13496, is a schizophrenia treatment.
Fellow midsize drug company MITSUI PHARMACEUTICALS, INC. thinks that its MS- 275, a synthetic benzamide derivative, has sufficient potential as a chemotherapeutic treatment for cancers insensitive to traditional antitumor agents to launch clinical testing in the United States. The firm already has asked specialists at the National Institutes of Health to evaluate the studies completed to date on MS-275, which works by inhibiting histone deacetylase. If those results are verified, Mitsui Pharmaceuticals could contract with a CRO to begin clinical trials as early as 2000. The company recently pulled out of the pesticide business and ended production of bulk ingredients for drugs to concentrate its resources on the more promising field of drug discovery, development and commercialization.
Japan's second-largest pharmaceutical house, SANKYO CO., LTD., has not been shy about its intention to remain a player in the rapidly consolidating world drug industry. Soon after announcing that CS-866 (olmesartan medoxil), an oral antihypertensive angiotensin-II receptor, would be the first product for which it would file an independent new drug application with the Food and Drug Administration (see Japan-U.S. Business Report No. 362, November 1999, p. 2), Sankyo identified three other drugs as strong possibilities for U.S. clinical testing. One is CS-011, an oral antidiabetic agent for Type II, or adult-onset, diabetes. This second-generation glitazone is considered a follow-on to Rezulin (troglitazone), which already is on the American market. Phase I testing of CS-011 is scheduled to start shortly, with FDA marketing approval eyed for 2003. U.S. clinical trials of CS-780, an oral anti-anginal nitrate donor, also could begin in the next few months. The third prospect is CS-502. As with CS-780, Sankyo plans simultaneous development of this oral analgesic and anti-inflammatory COX-II inhibitor in the United States, Europe and Japan.
SANKYO CO., LTD. readily acknowledges that to achieve its goal of selling products commercialized in-house on its own in the United States, it must develop its marketing and distribution capabilities. That was a primary reason the company was interested in obtaining exclusive rights from GELTEX PHARMACEUTI-CALS, INC. to market the Waltham, Massachusetts firm's Cholestagel (colesevelam hydrochloride) in the United States. This drug, expected to receive FDA marketing approval in mid-2000, is a treatment for hypercholesterolemia, which is characterized by undesirably high blood cholesterol levels. Cholestagel will be marketed by SANKYO PARKE-DAVIS CO., a Parsippany, New Jersey joint venture with WARNER-LAMBERT CO. Sankyo will pay GelTex up-front licensing and option fees of $13 million, plus make a $20 million milestone payment once the FDA clears Cholestagel for sale. As part of the agreement, Japan's number-two pharmaceutical company also gains an option to global rights to GelTex's second- generation cholesterol-lowering product, GT102-270, which is in Phase II clinical trials. The exercise of that option will generate additional payments.
A February 1997 partnership between SANKYO CO., LTD. and OSI PHARMACEUTICALS, INC. of Uniondale, New York to discover and develop small molecule compounds to treat influenza has been renewed for two more years. Several active compounds have been identified in the program. They now will be the focus of research to develop drug candidates for clinical testing. Sankyo is covering all the R&D costs as well as making milestone payments. In return, it will have exclusive worldwide commercialization rights to all products resulting from the collaboration. .....Mean-while, a project that SANKYO CO., LTD. began in 1995 with the medical school at the University of Alabama in Birmingham to develop gene therapy-based drugs for collagen-induced arthritis will be extended through 2002 rather than end in 1999 as originally planned. Over the next three years, the pharmaceutical company will provide $5 million-plus in funding to the university to support the ongoing research.
Caspases — a family of 11 structurally related human enzymes known to play specific roles in apoptosis or programmed cell death — will be the focus of a collaboration between TAISHO PHARMACEUTICAL CO., LTD. and VERTEX PHARMACEUTICALS INC. Their goal is to discover, develop and commercialize caspase inhibitors for the treatment of cerebrovascular (stroke, for example), cardiovascular and neurodegenerative diseases. Cambridge, Massachusetts-headquar-tered Vertex already has developed considerable expertise around one inflammation target in the caspase gene family. This work will be leveraged to other caspase targets. Taisho Pharmaceutical will make a $4 million initial payment to its partner as well as provide research funding and milestone fees. It also will cover up to a third of the cost of developing compounds that emerge from the caspase research program. For this money, the company will have the option to obtain marketing rights to any products in Japan and certain other Asian markets.
Bolstering its efforts to discover novel lead compounds, OTSUKA PHARMACEUTICAL CO., LTD. contracted to use the lead discovery services of PHARMACOPEIA, INC. These services start with high-throughput screening of the Princeton, New Jersey firm's multimillion-compound internal sample collection against an unspecified Otsuka Pharmaceutical target. They also include assay development and assay validation. In addition to fees for these services, Pharma-copeia is entitled to payments for successful achievement of milestones and royalties on marketed products resulting from its work.
An exchange rate of ¥105=$1.00 was used in this report.
For months, even longer, industry analysts have been saying that it was just a matter of time before NEC CORP. pulled the plug on persistently money-losing PACKARD BELL NEC, INC. That time has arrived. The Sacramento, California manufacturer of personal computers for the consumer or home market, once the number one in that segment but now fifth or sixth in the United States, basically is being reorganized out of existence. Only 500 or so of Packard Bell NEC's current North American and European work force of 2,600 will have jobs when this process is completed. Production of the PCs made in Sacramento will be outsourced, and operations there essentially will be closed. A call center in Magna, Utah is expected to be sold. Most notably perhaps, the Packard Bell brand name will disappear from the U.S. retail market. The commercial division of Packard Bell NEC — the NEC Computer Systems Division, which markets Express5800 servers, PowerMate desktop computers, Versa notebook computers and MobilePro handheld PCs to the corporate, government and educational markets under the NEC brand name — will remain in business. It will become NEC COMPUTERS, INC. effective January 1, 2000, part of NEC COMPUTERS INTERNATIONAL B.V., which will be in charge of all of NEC's personal computer operations outside of Japan and the People's Republic of China. Since 1995, when Packard Bell NEC's problems began, then new investor NEC and minority (12 percent now) partner GROUPE BULL pumped in excess of $2 billion into the company. The PC manufacturer's losses narrowed to a projected $150 million for 1999, but with NEC itself having problems and announcing a restructuring plan in September, executives decided that the electronics giant no longer could afford to keep Packard Bell NEC afloat.
Mainframe systems marketer AMDAHL CORP. of San Jose, California, a wholly owned FUJITSU, LTD. company, is taking over the U.S. sales and marketing operations of SIEMENS INFORMATION AND COMMUNICATION PRODUCTS LLC. The arrangement is an outgrowth of the global distribution agreement that Fujitsu and SIEMENS AG signed earlier this year. The Siemens computer systems product portfolio consists of Intel-based Primergy servers and Unix-based Reliant servers.
The next generation of the wildly popular PALM COMPUTING, INC. handheld platform will be codeveloped with SONY CORP. The starting point for the collaboration is Sony's decision to license the Palm OS operating system and the commitment by Palm Computing, a 3COM CORP. company, to support Sony's flash memory-based Memory Stick technology as part of the Palm Computing platform. The Japanese electronics powerhouse plans to use the Palm Computing platform to develop an entirely new line of information appliances — in short, mobile wireless electronics products that include not only today's electronic organizer functions but also audio-video capabilities. On paper at least, these devices will be able to access a broad range of wireless-based network services and content. At the same time, Sony and Palm Computing will work together to develop a version of Palm OS that supports the Memory Stick technology — a portable, rerecordable device about the size of a stick of chewing gum that can store digital data, audio, video and music — as well as other Sony AV technologies. Palm Computing will be able to license the bulked-up Palm OS to third parties.
The last products released by PACKARD BELL NEC, INC.'s NEC CSD were three additions to the Versa notebook line targeted at different groups of users. The Versa LXi is aimed at people looking for a desktop replacement at prices starting at $3,000. Running off a 500-MHz mobile Pentium III processor, it incorporates such features as a built-in floppy drive, modular VersaBay III technology and a 15-inch TFT (thin-film-transistor) LCD (liquid crystal display) screen with a XGA (extended graphics array) resolution of 1024 x 768 pixels. The Versa VX notebooks deliver convenience and ease of use in a package that weighs 6.4 pounds and measures 1.6 inches thick. They offer a choice of processors, whether Pentium IIIs with a clock speed of up to 500 MHz or 400-MHz and 433-MHz Celeron processors. The same goes for the display: a 12.1-inch TFT screen with a SVGA (super video graphics array) resolution of 800 x 600 or a 14.1-inch XGA TFT display. Hard-drive storage capacity runs from 6 gigabytes to 12 GB. A port replicator for easy connections to peripherals and local area networks also is included in the prices of the Versa VX, which range from $1,700 to $3,600. Finally, for highly mobile users, NEC CSD has the Versa FX, which weighs just 3.5 pounds and has a profile of less than an inch. Inside this slim form is a 400-MHz mobile Pentium III processor, a 12-GB hard drive, a 12.1-inch TFT display and extended battery capability. The price of $2,500 and up also includes external CD-ROM (compact disc-read-only memory) and floppy disk drives.
The next generation of the ePlate handheld PC from HITACHI AMERICA, LTD. will debut in the first quarter of 2000. Among other innovations, the HPW-630ETR incorporates an 8.2-inch color transflective LCD display that allows use of the device in all conditions, including direct sunlight. It also features a ruggedized case and a cradle option. Wireless LAN connectivity is built in. The new ePlate runs off the latest version of HITACHI, LTD.'s SuperH SH-4 RISC (reduced instruction-set computing) processor operating at 128 MHz. This engine was developed specifically for portable appliances like handheld PCs. The operating system is Windows CE Handheld PC Professional Edition Version 3.0.
MITSUBISHI CHEMICAL CORP. will develop the media for MAXOPTIX CORP.'s next-generation Optical Super Density high-capacity, removable, magneto-optical storage devices. The new OSD drives, which combine near-hard drive data-transfer rates and direct overwrite capabilities, will provide storage of 20 gigabytes per side and a growth path to 200 GB per cartridge. The OSD drives and media are designed so that today's MO jukeboxes can be upgraded to the new technology for an almost 800 percent increase in capacity without any changes in the jukebox robotics. Fremont, California-based Maxoptix plans to ship the new OSD drives and media by the fourth quarter of 2000.
In their second tie-up, KENWOOD CORP. and ZEN RESEARCH INC. have codeveloped a CD-ROM drive with an industry-leading read speed of 72X. Like their earlier 52X drive (see Japan-U.S. Business Report No. 355, April 1999, p. 4), the new one is based on the Cupertino, California company's TrueX technology. A Kenwood affiliate was scheduled to start shipping the drive on an original equipment manufacturer basis in late November. Samples were priced around $240 each.
Hard drive OEM customers of FUJITSU COMPUTER PRODUCTS OF AMERICA, INC. will have two new families of enterprise products available by the end of the first quarter of 2000 as well as the San Jose, California firm's next generation of entry-level desktop drives in December. The Enterprise 36LP Series is designed for the most demanding server and workstation applications. Available in capacities of 9.1 GB, 18.2 GB and 36.4 GB, this line features a spindle speed of 10,000 rotations per second, what is said to be the industry's fastest maximum internal data-transfer rate — up to 62.5 MB per second — and an improved average seek time of 4.7 milliseconds. It is available with either a Fibre Channel or an Ultra3 SCSI (small computer system interface) interface. For the cost- sensitive entry-level server and workstation market, the FUJITSU, LTD. unit has the Enterprise 18LP Series. Compared with their predecessors, these 9.1-GB and 18.2-GB drives, which have a 7,200-RPM spindle speed, deliver a 65 percent improvement in maximum internal data transfer and a 17 percent boost in average seek time. To meet the needs of today's low-cost consumer PC devices, Fujitsu Computer Products rolled out the XV10 family. This line comprises a single-platter 10.2-GB, 5,400-RPM drive and multiplatter 15.3-GB and 20.4-GB, 5,400-RPM drives. According to the company, the industry-leading transfer rate of up to 37.8 MB per second of these products as well as an access time of 9.5 milliseconds and a beefed-up arial density allow the high-speed access to large files that current data-intensive consumer and business applications require.
HITACHI, LTD. intends to be a major player in the market for digital video disc-random access memory drives, which, given their high speed, large storage capacity and rewritability, it sees as the medium of choice in the multimedia world of the future. For now, though, the company is focusing on DVD-RAM drives for PC applications. Its second- generation such product, the GF-2000, will begin sampling in January 2000. With single- sided storage of 4.7 GB, the forthcoming DVD-RAM drive offers some 1.8 times the capacity of its April 1998 predecessor. Moreover, during writing operations, it transfers data twice as fast. .....In the meantime, HITACHI, LTD.'s Brisbane, California marketing unit is shipping a fifth-generation DVD-ROM drive to computer OEMs and multimedia PC upgrade kit suppliers. The GD-5000 can read data from all standard removable optical discs, including both DVD-RAM and DVD-Recordable as well as the full range of CD technologies. It provides a data-transfer rate as high as 11.08 MB per second for DVD- ROM media and 6 MB per second (40X maximum) for CD-ROMs, plus enhanced data- access times for all types of media.
The main promoter of combination drives, RICOH CO., LTD., has moved up the release of its latest product, a four-in-one, CD-Recordable/CD-ReWritable/DVD-ROM drive, in response to strong initial business and consumer interest. The MP9060A drive, part of the MediaMaster line, will allow users to read DVD-ROM and CD-ROM, write to CD-R and rewrite to CD-RW media. Expected to cost less than $400, the drive will have a 6X CD- Recording speed, a 4X CD-ReWriting speed, a 24X CD-ROM reading time and a 4X DVD-ROM reading time.
Small businesses and workgroups never again will have trouble locating an electronic or a paper document. That is the promise made by RICOH SILICON VALLEY, INC. for its novel eCabinet information-management solution. With eCabinet plugged into the office network, all workflow information is routed through it and automatically captured with optical character reading and indexing technologies. Once documents are stored, they then can be searched and retrieved using eCabinet's Web-user interface. Cupertino, California-based Ricoh Silicon Valley, a wholly owned RICOH CO., LTD. subsidiary, specializes in networked office products that harness the powers of the Internet and thin-server hardware/software technologies.
KYOCERA ELECTRONICS, INC.'s strategy for making headway in the extremely competitive U.S. market for laser printers is to emphasize the low cost of ownership of its products just as much as their performance and quality. The latest printer to get this sendoff from the Duluth, Georgia company is the FS-1200, which outputs 12 pages per minute of black text. Based on a suggested price of $650, a long-lasting drum and toner cartridge and low consumable costs, Kyocera Electronics claims that the FS-1200 has the lowest total cost of ownership of any product in its class.
Rounding out its coverage of the ink-jet printer market, SEIKO EPSON CORP.'s Long Beach, California marketing unit introduced a wide-format business graphics printer. The EPSON Stylus Color 1160 prints up to 9.5 pages per minute of black text and 7 ppm of color material with a photo-quality resolution of 1440 dots per inch. It can handle paper sizes ranging from 3.5 x 3.5 inches up to 13 x 44 inches. Compatible with both Windows and Macintosh machines, the EPSON Stylus Color 1160 features built-in USB (universal serial bus) and PC parallel interfaces. It also can be connected to an optional Ethernet print server to serve network requirements. After a $50 mail-in rebate, the printer costs an estimated $400.
Multifunction peripherals have proved to be a tough sale for suppliers, in part because they do not necessarily improve productivity. SHARP CORP. has taken on this complaint in its FO-3800M multifunction digital laser fax/copier/printer/scanner. A true multitasking device, the system simultaneously performs two functions — for example, sending or receiving faxes at the same time that printing or copying is going on. The FO-3800M prints or copies at a rate of 8 ppm. .....In a related move, SHARP CORP.'s American marketing unit introduced a multifunction device with one-touch scan to electronic mail for less expensive Internet faxing. The UX-4000M, which will be available in the first quarter of 2000 at an estimated price of $500, also features fax forwarding. In addition to scanning and Internet faxing, the system functions as a digital copier and an 8-ppm laser printer as well as a regular fax machine.
SONY ELECTRONICS, INC. continues to push the envelope on flat-panel displays. The 15-inch Multiscan N50 XGA TFT active-matrix LCD panel showcases the company's latest engineering efforts. The sleek black design measures just a half-inch at the edge and weighs less than 6 pounds. It also incorporates SONY CORP.'s single interface cable, which allows all the circuitry to be designed into a separate module that can be placed out of sight. Other Multiscan N50 innovations are a user sensor that powers the display down or up depending on where the user is and a light sensor that adjusts the monitor's brightness to the ambient light in the room. The Multiscan N50 will be available in January at an estimated price of $1,500. Currently shipping for $1,300 is Sony Electronics' Multiscan M151, a 15.1-inch XGA TFT active-matrix LCD panel. Although measuring 8.2 inches deep and weighing 11.2 pounds, this monitor occupies half the desk space of a conventional 17-inch cathode-ray tube display while weighing 25 percent less.
Although touting its flat-panel display expertise, SONY ELECTRONICS, INC. continues to advance its lineup of CRT computer displays, all of which now have been converted to the company's "virtually flat" FD Trinitron technology. Marking the switchover are three Multiscan E Series FD Trinitron displays: the Multiscan E100 15-inch (14-inch viewable image size), Multiscan E200 17-inch (16 inches) and Multiscan E400 19-inch (18 inches) monitors. These products are priced at roughly $230, $380 and $650, respectively.
Low-temperature polysilicon TFT LCDs have an edge on amorphous silicon TFT LCDs in terms of both resolution and brightness for new generations of mobile personal devices, TOSHIBA CORP. maintains. Its latest effort in this field is the world's first 6.3-inch display with XGA resolution. That capability makes the display suitable for such products as electronic books or personal digital picture viewers. The new LCD will be available in the spring of 2000. The sample price will be about $1,000. Toshiba's lineup of low- temperature polysilicon TFT LCDs already includes a 4-inch product with VGA resolution (640 x 480 pixels), an 8.4-inch SVGA model and a 10.4-inch XGA display.
An exchange rate of ¥105=$1.00 was used in this report.
For the last 13 years, TIFFANY & CO. has leased its flagship store at Fifth Avenue and 57th Street in Manhattan from DAIICHI REAL ESTATE CO., LTD. Now, the 10-story, 124,000-square-foot building, which was designed and built specifically for the luxury jeweler in 1940, is back in Tiffany hands. The company paid $96 million in cash for the property. The former Japanese owner said that it decided to sell to improve its financial position. Although the price Daiichi Real Estate paid for the building in October 1986 was not disclosed, executives indicated that it was about the same as the selling price. That makes the company fortunate compared with many other Japanese investors. In general, American commercial properties bought in the late 1980s and early 1990s have been sold at a loss.
Beating out two other bidders, including another Japanese team, SUMITOMO CORP. and partner MI-TSUBISHI HEAVY INDUSTRIES, LTD. won a $109 million contract to build an automated people mover system at AMERICAN AIRLINES INC.'s new North Terminal at the Miami International Airport. The project, scheduled for completion in 2004, includes design, engineering, construction, vehicles and a closed-circuit television monitoring system. Featuring MHI's unmanned train technology, the 0.8-mile-long system will have four station stops and will carry as many as 74,000 people a day between AA's 47 North Terminal gates, ticketing and baggage areas. Sumitomo and MHI initially will deliver 11 trains with two rubber-wheeled cars each. Up to 20 trains could be in operation if demand requires. The partners will be working with eight Miami-area companies.
An exchange rate of ¥105=$1.00 was used in this report.
Santa Clara, California is the location of YASKAWA ELECTRIC CORP.'s U.S. mechatronics marketing unit (see Japan-U.S. Business Report No. 361, October 1999, p. 6). The staff of 10 or so is working to develop customers among semiconductor makers in Silicon Valley for Yaskawa Electric's compact servos, machine controllers and other motion control products, its wide range of drives and its robotics equipment, particularly clean-room robots. In time, the office, which is run by YASKAWA ELECTRIC AMERICA, INC. of Northbrook, Illinois, is expected to help advance the company's technology in the mechatronics field.
By yearend, SMK CORP., a big maker of connectors, switches and other mechanical components for computer, communications and consumer electronics products, planned to open an office to market connectors and other parts for cellular telephones to North American suppliers of this equipment. The site selection process has not been completed, but the Chicago area reportedly is a leading candidate for the new facility. In the United States, SMK plans to target sales to U.S. manufacturers, while its Mexican marketing effort will be directed at Japanese companies producing there. The company already has a distribution subsidiary in Placentia, California. It also makes remote controls for audio and video equipment there.
NICHICON CORP., Japan's top producer of aluminum capacitors and a major maker of tantalum capacitors, and VISHAY INTERTECHNOLOGY, INC. have agreed to combine R&D efforts to advance the state of the art in tantalum capacitors as well as in related materials and production equipment. The Malvern, Pennsylvania company has expertise in this area through its Sprague division. A primary focus of the work will be to lower the ESR (equivalent series resistance) of tantalum capacitors to meet the increasingly demanding requirements of desktop and notebook computer makers and communications equipment suppliers. As a result of the collaboration, Vishay expects to introduce shortly an organic polymer tantalum capacitor with an extremely low ESR. NEC CORP. and KEMET ELECTRONICS CORP. have a similar tie-up (see Japan-U.S. Business Report No. 358, July 1999, p. 6).
Even after all these years, SONY CORP.'s technical prowess still can wow people. The latest demonstration is the VAIO Music Clip. Called a personal network player, this sleek, cigar-size device stores and plays secure digital music content downloaded from the Internet or transferred from an audio CD. The VAIO Music Clip, which has 64 MB of flash memory, holds up to 120 minutes of music files stored using Sony's ATRAC3 audio compression technology. It plugs into the USB port of almost any VAIO desktop or portable PC and downloads an hour of music in about three minutes. On-the-go users can get approximately five hours of continuous playback from a single AA alkaline battery. The VAIO Music Clip will be available in January 2000 at a suggested price of $300.
An exchange rate of ¥105=$1.00 was used in this report.
The progressive deregulation of Japan's power-generation market has a number of domestic firms scrambling to gain the expertise to take advantage of the business opportunities emerging. For MITSUBISHI CORP. and TOKYO ELECTRIC POWER CO., INC., one means to this end is to become shareholders in independent power producer ORION POWER HOLDINGS, INC. Through recently formed DIAMOND GENERATING CORP. of Los Angeles, the trader invested $120 million in the Baltimore- based company, which was established in March 1998 by CONSTELLATION ENERGY GROUP, the parent of BALTIMORE GAS AND ELECTRIC CO., and investment banker GOLDMAN, SACHS & CO. to acquire electric generating plants across the United States and Canada. TEPCO, Japan's top electricity supplier, put $80 million into Orion. By mid- 2000, Orion expects to have spent more than $2.7 billion to buy in excess of 5,200 megawatts of generating capacity in the Northeast and Upper Midwest. Pending is a $1.7 billion deal to purchase seven plants in Pennsylvania and Ohio from DUQUESNE LIGHT CO. that have a combined generating capacity of 2,600 MW. Orion sells the electricity it produces to local utilities.
An exchange rate of ¥105=$1.00 was used in this report.
In a further diversification of its U.S. agricultural operations, ITOCHU CORP. has introduced in California a feed additive developed by CALPIS CO., LTD. Calsporin is a beneficial bacterial product that is said to lower the incidence of salmonella in poultry. It also reportedly reduces the presence of other harmful bacteria found in the intestines of livestock. Itochu subsidiary QUALITY TRADERS INC. is handling sales, which it plans to extend nationwide. The Cincinnati, Ohio company believes that Calsporin can develop into a $19 million to $28.6 million business in the United States in three or four years.
An exchange rate of ¥105=$1.00 was used in this report.
At a cost of roughly $47.6 million, AICHI STEEL CORP. is buying the 80 percent of LOUISVILLE FORGE AND GEAR WORKS, LLC that it does not own already. The manufacturer of specialty steel and forged products bought into the Georgetown, Kentucky company in August 1997, paying some $10 million for its initial stake. Louisville Forge makes such forged products as crankshafts, gears, knuckles, camshafts and connecting rods for the automotive and off-road equipment industries. Its primary customer is TOYOTA MOTOR CORP.'s main North American assembly complex, which also is located in Georgetown. However, Aichi Steel, which does a considerable amount of business with Toyota at home, hopes that Louisville Forge can win contracts from other companies. Such an expansion would help boost sales above the current annual total of about $76.2 million.
STRAWBERRY CORP. is moving into the American market for microhinges used in such products as cellular phones and PCs. Although only three years old, the Kawagoe, Saitama prefecture manufacturer claims to be the world's leading supplier of precision hinges for cell phones. Executives attribute this success not only to cutting-edge design and production capabilities but also to the company's ability to quickly engineer products to customers' requirements. That responsiveness, in turn, is the result of what Strawberry says is the largest number of computer-aided design and manufacturing systems in the hinge industry.
Virtually unnoticed outside the business, SONY CORP.'s main U.S. subsidiary sold MATERIALS RESEARCH CORP. to industrial gases giant PRAXAIR, INC. Sony's 1989 purchase of Orangeburg, New York-headquartered MRC, then a manufacturer of chemical vapor deposition and physical vapor deposition equipment for semiconductor producers as well as of thin-film deposition materials, became a political issue in the United States because of worries that Japanese competitors not only would dominate the chip market but also take over the semiconductor manufacturing equipment end of the industry. Those fears have evaporated. In the meantime, Sony sold MRC's equipment division to TOKYO ELECTRON LTD. The operations acquired by Praxair of Danbury, Connecticut consist of deposition materials, mainly sputtering targets for semiconductor production.
An exchange rate of ¥105=$1.00 was used in this report.
During the mid-1980s, HOSOKAWA MICRON CORP.'s New York City subsidiary used acquisitions to build what it calls product recovery products — industrial filter media, filter bags and cloths, for example — into one of its four major businesses. However, those operations, which span North America, Europe, Australia and South Africa, have become a drag on profits. To sharpen its focus on its other activities, particularly powder and particle processing equipment, HOSOKAWA MICRON INTERNATIONAL, INC. has agreed to sell its global product recovery product line to BEACON INDUSTRIAL GROUP LLC of Charlotte, North Carolina for an undisclosed price. The transaction, which is expected to close in January 2000, covers products and services marketed under the MikroPul, Menardi-Criswell, Filtex and Filter Media brand names.
Although operations began only about a year ago, an expansion is underway at bellows manufacturer NABELL CORP.'s plant in New London, North Carolina. A cutting and sewing line has been set up, and a welding machine is scheduled for installation in advance of the start of production of advanced folding bellows. The Nabell subsidiary already has an order for AF bellows from the U.S. affiliate of a Japanese linear motion guide maker. It also has had feelers from a number of semiconductor and medical equipment makers. Those inquiries have convinced Nabell that its U.S. sales could reach $1.3 million in 2000.
Production of KUBOTA CORP.'s new BX-Series of subcompact tractors has started at the company's 11-year-old plant in Gainesville, Georgia. The two models in the line — the BX 1800, which features an 18-horse-power version of Kubota's three-cylinder, liquid-cooled E-TVCS diesel engine, and the 22-hp BX 2200 — were designed specifically for the American and European markets. They are targeted at commercial operations that require more than a lawn and garden tractor but something smaller and more efficient than the company's mainstream compact tractors. Both are equipped with four-wheel drive and a heavy-duty, two-speed hydrostatic transmission. The BX 1800 is priced at $11,000, and the BX 2200 lists at $11,500. KUBOTA MANUFACTURING OF AMERICA CORP. expects to produce 4,000 BX-Series tractors for the U.S. market in 2000 and 1,000 for European sale.
KOMATSU UTILITY CORP. hopes to ride the strong demand in the United States for compact excavators and sell 2,000 units in 2001 versus 500 or so in 1998. Key to the Vernon Hills, Illinois company's ambitious goal are three models in KOMATSU LTD.'s new MRx compact excavator family. These products, which have lifting capacities of 740 pounds (the 4,829-lb. PC20MRx), 925 pounds (the 7,056-lb. PC30MRx) and 1,145 pounds (the 9,900-lb. PC40MRx), can work in tight areas without sacrificing power or performance thanks to their small tail swing radius. The MRx compact excavators also feature the HydrauMind hydraulic control system found in Komatsu's full-size excavators as well as proportional pressure-controlled joysticks and swing booms. Of course, Komatsu is not alone in hoping to boost sales of compact excavators. YANMAR DIESEL ENGINE CO., LTD.'s Buffalo Grove, Illinois subsidiary expects to double sales in FY 2000 from the 500 units projected to be sold in FY 1999. KOBE STEEL, LTD.'s Stafford, Texas construction machinery operation also is eyeing a 100 percent jump in compact excavator sales. However, both of these competitors plan to achieve their targets with their existing product lines.
An exchange rate of ¥105=$1.00 was used in this report.
Taking aim at XEROX CORP.'s near-stranglehold on digital machines for print-on-demand establishments and centralized corporate production centers, CANON INC.'s Lake Success, New York subsidiary introduced its first high-volume digital printer/copier product. The imageRUNNER 110, which will be available in the first quarter of 2000, prints 110 pages of black text per minute with a resolution of 600 dots per inch. Interestingly, the machine will be made by the German printing press manufacturer that earlier this year bought EASTMAN KODAK CO.'s high-end copier business. Canon did not release any pricing information, but industry sources estimate that the imageRUNNER 110 will cost in the low $200,000 range. Xerox's DocuTech production printing line, which spans machines printing 65 ppm to 180 ppm, is priced between $100,000 and nearly $500,000. Over the last year or so, Canon has moved aggressively into the market for digital copiers/printers, unveiling imageRUNNER products for both low end and midrange copying requirements.
An exchange rate of ¥105=$1.00 was used in this report.
Within the next two years, FURUKAWA ELECTRIC CO., LTD. expects to be one of the three biggest optoelectronics suppliers in North America. To this end, it formed FITEL TECHNOLOGIES, INC. in Clinton, New Jersey to run all existing FEC optoelectronics operations in North America. FITEL Technologies is backed by new design and product development centers in Clinton and in Marlborough, Massachusetts. It also can draw on the resources of FEC's existing marketing and sales offices in Peachtree City, Georgia and Santa Clara, California. Beyond a new organizational form, the company's strategy for ascending the ranks of optoelectronics suppliers is to maintain its current leadership position in power pump lasers while providing integrated, custom passive devices for DWDM (dense wavelength-division multiplexing) optical networking systems and optical amplifiers.
SUMITOMO ELECTRIC INDUSTRIES, LTD. is working with CIDRA CORP. to advance the capabilities of the Wallingford, Connecticut firm's distributed fiber-optic sensing systems. Oil companies use these imaging and monitoring systems to locate, manage and control hydrocarbon resources. The partners' immediate goal is to develop distributed sensors. These are required, CiDRA says, because as wells become deeper, hotter and more complicated, the current alternative technology, single-point electronic sensors, no longer are effective. SEI, which is CiDRA's fiber-optic cable supplier, invested $1 million in its collaborator as part of the tie-up.
Marketing will start in spring 2000 of a tissue preparation system developed by the Torrance, California subsidiary of histology and cytology equipment manufacturer SAKURA FINE TECHNICAL CO., LTD. The Tissue-Tek Paraform Sectionable Cassette System is designed to streamline the now time-consuming job of embedding tissue in a cassette and removing the processed tissue and placing it in an embedding mold while, at the same time, making the process more exact. For greater efficiency, SAKURA FINETEK U.S.A., INC. is working on an automated version of the Paraform cassette system. A prototype should be available in the fall of 2000. Sakura Fine Technical plans to market both products in Europe and Japan.
The team of TOTOKU CORP. and Westminster, Colorado-based DATA-RAY CORP. has developed what is said to be the world's first perfectly flat CRT monitor for PACS (picture archive and communication systems) medical imaging. This profile eliminates the distortion typically associated with a CRT's curved screen. The DR96 Digital also employs automatic luminance stability circuitry. By continuously compensating for beam current degradation, this technology ensures that brightness levels remain stable both over time and among monitors. Shipments of the DR96 are scheduled to start in January 2000. Data- Ray, a designer and manufacturer of high-performance monitors for medical, industrial and scientific imaging applications, is owned by NIPPON CHEMI-CON CORP.
An exchange rate of ¥105=$1.00 was used in this report.
To support its push into the international market for set-top boxes and other digital television broadcast equipment, MITSUBISHI ELECTRIC CORP. invested $5 million in TERALOGIC, INC. The fabless Mountain View, California start-up, in which MELCO has a 4.3 percent stake, has made a name for itself as a developer of low-cost, high-performance graphics and video processing chipsets for digital TV set-top boxes. Satellite-beamed digital TV broadcasting will begin in Japan toward the end of 2000, followed by terrestrial broadcasting in 2003. By then, ground-based digital TV broadcasting should have started in Europe and Australia. It already is available on a limited scale in the United States. Like other consumer electronics manufacturers, MELCO sees in that rollout a surge in demand for digital TV set-top boxes. TeraLogic's chips have been available in Japan since the spring of 1998.
By the spring of 2000, NEC CORP. expects to be selling 1 million virtual channel memories a month. Within a year, it believes that it can jump the monthly total to 5 million units. A volume order from PC supplier MICRON ELECTRONICS, INC. of Nampa, Idaho is one key to this confidence. The chipmaker's VCM is a new, open-standard DRAM (dynamic RAM) core architecture that addresses the demands that today's multimedia PCs place on their system memories. It does this by increasing memory bus efficiency and performance.
Management of R&D activities for all CANON INC. operations in the Americas has been assigned to CANON U.S.A., INC.'s new Canon Research and Development Group. This organization is headquartered in a recently opened, 163,500-square-foot facility in San Jose, California. Nearly half of the building is occupied by Canon U.S.A.'s Semiconductor Equipment Division. It has space for sales, marketing, customer support and training, including a large clean room where Canon's wafer steppers and scanners can be demonstrated and evaluated. The facility also houses Canon U.S.A.'s software development and publishing unit. That proximity is expected to facilitate timely development of new stepper and scanner software. The center will be used to service and refurbish the company's microlithography tools, work that until now has been performed in Japan. Located in the center as well is the sales and support staff for Canon U.S.A.'s camera, components and computer peripherals divisions.
SHIN-ETSU CHEMICAL CO., LTD.'s Phoenix, Arizona subsidiary is working with wafer stepper manufacturer ULTRATECH STEPPER, INC. to develop processes for thick-film and specialty photoresist applications using the San Jose, California company's 1x and reduction line of microlithography tools. The partners will use Ultratech Stepper's latest equipment to evaluate SHIN-ETSU MICROSI, INC.'s I-line, G-line and broadband resist materials (see Japan-U.S. Business Report No. 354, March 1999, p. 8). They also will examine the use of these products in a variety of applications, including thin-film heads, micromachining and bump processing.
Semiconductor production equipment manufacturer DSI K.K. has given AMTECH SYSTEMS, INC. of Tempe, Arizona exclusive rights for three years to market its high vacuum-type vertical furnace system for annealing in the United States, Europe and China. In South Korea and Taiwan, the Kawasaki, Kanagawa prefecture company and its marketing partner, which also makes semiconductor production equipment, will collaborate on sales. DSI's SA-200HV features a unique double-wall process tube system that provides a high vacuum with a very low oxygen concentration. For precise temperature control, it has a touch panel controller. The SA-200HV can transfer as many as 25 200-millime-ter (8-inch) wafers at a time. Through its alliance with Amtech Systems, DSI hopes to sell 10 SA- 200HV furnaces outside Japan in 2000 for revenues of $3.8 million and $9.5 million worth in 2003.
ADVANCED MICRO DEVICES, INC. selected the Unity DRM oxide etcher from TOKYO ELECTRON LTD. to perform the critical local interconnect application involving cobalt silicide at its Fab 25 microprocessor front end. AMD migrated to CoSi from titanium silicide when it switched to 0.25-micron processing tech-nology for its new generation of speedy chips. The firm said that it chose the Unity DRM oxide etcher because of its suitability for high-volume manufacturing, the tool's superior critical dimension control, and its highly selective process and precise chamber matching. TEL is the world's leading supplier of oxide etching systems.
In January, the Austin, Texas subsidiary of TOKYO ELECTRON LTD. will begin marketing a fully automatic prober for 300-mm (12-inch) wafers. The mechanical architecture of the second-generation Model P-12XL is designed to sustain high loads while maintaining accuracy. This combination, TEL says, accommodates optimal test conditions for high-pin- count advanced logic and memory devices as well as the precision needed for on-axis alignment of narrow-pitch, small-pad devices across wide temperature ranges. The system comes standard with capabilities for inspecting probe tips and probe marks, a semi- automatic probe card changer for changing larger probe cards and temperature control systems. The Model P-12XL is software-compatible with TEL's 200-mm wafer prober, the P-8 Series Model.
The Methuen, Massachusetts marketing unit of ULVAC JAPAN, LTD. has introduced a pair of sputtering systems. The small, cluster-type Model SME-200 sputtering system for compound semiconductor and SAW (surface acoustic wave) devices responds to manufacturers' interest in depositing thinner films for more compact parts. It can be used with wafers that measure up to 200 mm. Another selling point is the configurability of the SME- 200 with one of three process chambers: a sputtering chamber, a plasma chamber or a heating chamber. The other new sputtering system, the Model SRH-820, is designed for processing CSP (chip-scale packaging) parts. This high-throughput system also can accommodate wafers up to 200 mm. It offers the flexibility of seven process modules, including heating, etching and sputtering.
Generation six of KOMATSU LTD.'s krypton excimer laser light source for high numerical aperture steppers and scanners is available from the company's Santa Clara, California sales office (see Japan-U.S. Business Report No. 359, August 1999, p. 9). The G21K is the world's first deep ultraviolet excimer laser for 0.13-micron processing. It builds on the 248-nanometer, KrF 20-kilohertz G20K excimer laser light source, which is targeted at the 0.15-micron node. To enable steppers and scanners to expose finer line geometries, Komatsu narrowed the laser's bandwidth. It also improved the G21K's energy dose stability.
An exchange rate of ¥105=$1.00 was used in this report.
Within weeks of opening its doors, the Internet Incubator at PANASONIC TECHNOLOGIES, INC.'s Panasonic Digital Concepts Center in Cupertino, California was home to five early-stage, rapidly growing Internet and electronic commerce start-ups (see Japan-U.S. Business Report No. 359, August 1999, p. 9). The companies that passed the PDCC test are: 2ROAM, INC., which provides translation solutions to deliver Web- based content, commerce and services to handheld wireless devices; DYNAPTICS CORP., a developer of on-line impulse buying software; EMENTORING. COM, INC., an on-line learning source for global business skills; FORT NOCS, INC., an Internet applications development and hosting company; and MAGIC-BEANSTALK.COM, INC., which is a meeting place for participants in the dot-com revolution. At this stage, PDCC's Internet Incubator has room for 10 more entrepreneurial ventures.
American Internet start-ups that need money to get off the ground or to expand continue to find willing investors among the handful of Japanese companies that have tied their future to this medium. For example, year-old PRESENTER.COM, INC., which describes itself as the Web's first on-line exchange and forum for presenters and consumers of expert- knowledge content, raised $6.5 million in initial venture-capital funding from SOFTBANK CORP., TRANS COSMOS INC. and a former chief executive of APPLE COMPUTER, INC. The San Jose, California company will use the money to expand operations and staffing, implement an international marketing campaign and develop additional applications for its expert-based information exchange system. Presenter.com, which plans an initial public offering in 2001, uses proprietary encoding technology to transform videotaped events into iPresentations — a new media form that combines streaming audio synchronized with transitional video or still slides and fully indexed presentations of experts from around the world discussing a variety of business-relevant subjects.
SOFTBANK CORP.'s Mountain View, California-based SOFTBANK VENTURE CAPITAL unit, which manages venture-capital funds focused mainly on early-stage Internet companies, hopes to bolster its reputation as the driving force behind some of the most successful Internet start-ups in the United States by leading a $7.5 million round of follow- up financing for DR- DREW.COM, INC. This Pasadena, California company just launched a health and life-style Web site and community aimed at young adults. It takes its name from Dr. Drew Pinsky, who is called the favorite television and radio doctor of the Internet generation. The site is designed to give hard-to-reach 14-to-34-year-olds a forum for exploring a wide range of physical, mental and emotional health topics.
In another test of its ability to pick winners, SOFTBANK VENTURE CAPITAL joined two other American venture-capital funds in putting up money for SPIN MEDIA NETWORK, INC. Established in 1998, the Palo Alto, California company runs Spinway.com, which offers businesses free cobranded or private-label dial-up Internet access to drive traffic and broaden their brand identity. It does this by allowing companies to offer personalized content, rewards programs, instant messaging, full-featured electronic mail and parental- control software. Spinway.com also is said to be the only site that features full-motion video at dial-up.
Softbank Group companies have been the leading source of funding for American Internet start-ups, but HIKARI TSUSHIN, INC., Japan's biggest distributor of cellular telephones, also is making a name for itself. Among other recent initiatives, the company spearheaded a round of venture-capital financing that raised $20 million for INTRANETS.COM, INC. The Woburn, Massachusetts business, which launched its Web site less than three months ago, provides free intranet portals for small and midsize businesses and organizations, including Web hosting and custom URLs. More than 55,000 entities already have registered for the services. Intranets.com, a product of the idealab! Internet incubator, will use the new funding mainly to finance a major marketing campaign.
Another Internet venture that has caught HIKARI TSUSHIN, INC.'s eye is MEDSITE.COM, INC. The four-year-old, Manhattan-based business, which calls itself the physician's home on the Internet, generated $36 million in follow-on financing through the sale of preferred stock to a number of venture-capital funds or firms as well as to the Japanese company and a big U.S. health-care operation. Medsite.com offers a broad selection of medical books, software, journals and supplies, plus such services as medical news, electronic physician credentialing and continuing education.
XSIDES CORP. (formerly The Pixel Co.) also received a vote of confidence from HIKARI TSUSHIN, INC. The Japanese business joined other investors in providing $15 million in second-round financing for the Seattle operation, which is developing technology that brings Internet applications and services to PCs independent of and outside the machine's operating system. Through partnerships with other companies, xSides delivers such content as customized e-mail, news and weather via a permanent miniature portal window on the desktop.
In an investment right down its alley, HIKARI TSUSHIN, INC. joined four other companies, including 3COM CORP., to provide $14 million in second-round financing for PARAGON SOFTWARE INC. The Santa Clara, California firm's FoneSync software technology is the de facto platform for synchronizing personal information between the desktop and the Internet and mobile phones. Some of Japan's biggest manufacturers of cellular phone handsets have worked with Paragon to develop its software.
TRANS COSMOS INC. and its Bellevue, Washington subsidiary also have built up an enviable portfolio of dot-com investments. One of the latest additions is TRANZ-SEND BROADCASTING NETWORK, INC., into which the American affiliate put more than $3 million. Some of this money will be used to launch the San Francisco firm's ClickMovie.com site, which electronically delivers movies to TV sets using a PC as the set-top box. Tranz- Send's ultimate goal, though, is to use the Internet to make all types of high-quality video available on demand. .....TRANS COSMOS INC.'s U.S. unit also participated in raising $2 million in seed funding for BRAND3 INC. Founded last spring, the Los Angeles developer of Internet-based relationship-building programs for branded organizations will use the money to launch its first offerings in early 2000. Its mission is to enable merchants to extend their brand and marketing message beyond banner ads and limited portal plays. The means is Brand3's GluOn software. It allows an organization to permanently put its logo on the desktops of customers who have signed on or who have requested the free Internet access, e-mail or chat services that participating retailers can provide thanks to their tie-ups with Brand3.
Japan's trading companies also have emerged as a source of funding for Internet and information technology ventures. For instance, ITOCHU CORP. led a group of venture- capital funds and private investors that put up $2.4 million in first-round financing for ZIPLIP. COM, INC. The Mountain View, California business, which launched its Web site in July, specializes in secure messaging and collaborative services. ZipLip was the first company to offer free, totally private e-mail and file transfer over the Web. Its fee-based services include secure document delivery, file-sharing, storage, bulletin board and other collaboration tools. With more money in hand, ZipLip will scale up operations, broaden its product lines and expand marketing.
For their part, MITSUBISHI CORP. and it primary U.S. subsidiary acquired a reported 25 percent in ERGONOMIC TECHNOLOGIES CORP. for an undisclosed amount. The six- year-old Oyster Bay, New York ergonomic consulting technology company will use the investment in part to complete the development of its ergonomic enterprise work-force planning software for Fortune 500 businesses. ETC also will earmark some of the money to begin an Internet-based workplace risk assessment service. .....At the same time, MC CAPITAL INC., the New York City venture-capital arm of MI-TSUBISHI CORP., joined SOFTBANK TECHNOLOGY VENTURES L.P. and a long list of other investors, including many big names, in providing $35 million in mezzanine financing for RECIPROCAL, INC. The Buffalo, New York-headquartered company is in the digital rights management business, enabling content owners to secure their material for distribution and sale over the Internet. Its highly scalable Digital Clearing Service, which just started, is compatible with a variety of platforms, vendors and content types and can handle millions of transactions a day.
Forthcoming SONY CORP. audio products featuring the consumer electronics innovator's OpenMG and MagicGate copyright management technologies will be able to play music content protected by INTERNATIONAL BUSINESS MACHINES CORP.'s Electronic Music Management System — a comprehensive electronic-business solution for the sale and secure downloading of music. This interoperability is the result of an agreement the two reached last spring (see Japan-U.S. Business Report No. 356, May 1999, pp. 9-10). Sony's Memory Stick Walkman and VAIO Music Clip personal audio players, which will be packaged with OpenMG software, will be the first products to feature IBM's EMMS solution. The next step in the collaboration is a wireless music distribution field trial in Japan with NTT MOBILE COMMUNICATIONS NETWORK, INC. This test, expected to start in the first half of 2000, will enable consumers to receive and play EMMS-secured music content over NTT DoCoMo's personal handyphone system data-communications network using Sony's Memory Stick as the recording media in portable devices.
In an arrangement also designed to promote digital music downloads to personal audio players and PCs while protecting the intellectual property of artists, music labels and other rights holders, SONY CORP. agreed to make OpenMG interoperable with MICROSOFT CORP.'s Windows Media digital rights management format. As with the IBM collaboration, the end result here will be that content protected by Microsoft's DRM system can be securely supported on the Memory Stick Walkman, the VAIO Music Clip and other OpenMG-compliant devices. In conjunction with this announcement, Sony said that it would support the Windows Media Audio audio-compression technology on the VAIO Music Clip in addition to its proprietary ATRAC3 technology. In a trade-off of sorts, INTERNATIONAL BUSINESS MACHINES CORP. agreed as part of its expanding electronic-music alliance with Sony to back the ATRAC3 sound-compression know-how.
Last January's agreement between SONY CORP. and SUN MICROSYSTEMS, INC. to bridge the Sony-backed HAVi (home audio-visual interoperability) standard for AV equipment and Sun's Jini (Java infrastructure initiative) platform, which is aimed at information appliances (see Japan-U.S. Business Report No. 354, March 1999, pp. 24-25), has evolved. The pair now plan to work on technologies to directly link digital consumer devices and Internet-based content and services. Their initial focus is the development of home- gateway software that will run on such appliances as set-top boxes and digital TV sets and bring the Internet to consumers without using PCs. Network server technologies are the other thrust of the expanded tie-up.
FUJITSU, LTD. and TIVOLI SYSTEMS INC. have signed a wide-ranging cooperation agreement designed to help their mutual customers worldwide more efficiently leverage their IT resources. For starters, the diversified electronics company will bundle Tivoli Management Agent with storage systems currently under development. This pairing, the new partners said, will help Fujitsu customers reduce the complexity of implementing Tivoli Enterprise technology management software. Second, Fujitsu will offer Tivoli Storage Manager 3.7 as part of its SystemWalker suite of network management products for enterprise customers. It also will integrate several other main SystemWalker components with Tivoli Enterprise. Finally, Fujitsu will join the Austin, Texas company's Team Tivoli partner program. In conjunction with this worldwide arrangement, Tivoli's Japanese subsidiary will offer its customers several SystemWalker management products and Tivoli Ready SystemWalker applications.
Hoping to win more business from big financial services providers and communications companies in need of mission-critical integration solutions, the Waltham, Massachusetts- based Software Solutions Division of HITACHI COMPUTER PRODUCTS (AMERICA), INC. joined forces with TOTAL TRANSACTION MANAGEMENT. The alliance will draw on the HITACHI, LTD. organization's expertise in large-scale infrastructure software and San Diego, California-headquar-tered TTM's experience in the integration of Web-based and legacy systems with scalable and robust middleware systems. Hitachi's infrastructure software includes the Hitachi Enterprise Application Manager distributed application middleware, which allows direct measurement and management of large distributed applications. Another product is Hitachi TPBroker for Java and C++. This custom application development platform provides the infrastructure for communications and CORBA (common object request broker architecture)-based transactions. TPBroker also has several add-ons.
A wider range of scientific and technical applications soon will be available for COMPAQ COMPUTER CORP.'s powerful 64-bit Unix AlphaServers, thanks to an agreement that the big computer supplier signed with FUJITSU, LTD. Under it, the two initially will port the Japanese company's MOPAC 2000 calculation system, which is used to obtain molecular orbitals from macromolecular structures, to the Compaq high-per- formance computing platform. Later, they plan to optimize Fujitsu's molecular dynamics software, MASPHYS, its VisLink network visualization tool and other science and technology applications to run on the Compaq system. These products will be jointly marketed in the United States, Europe and Japan.
Attempting to ride the constantly building Linux wave in the United States, FUJITSU SOFTWARE CORP. will release in the first quarter of 2000 a version of TeamWARE Office 5.3 that supports the open-source operating system. This suite of groupware applications includes e-mail, time and resource scheduling, discussion forums, and document management and retrieval functions. The forthcoming package will work with Caldera Open Linux, Red Hat Linux and Turbo Linux. In the future, San Jose, California- based Fujitsu Software plans to offer other TeamWARE products that support the Linux platform.
To ensure the continued penetration of the IMAGER line of digital document systems into corporate offices, the Sharp Document & Network Systems of America Division of SHARP CORP.'s main U.S. subsidiary soon will release a pair of document management applications. Both were developed by SHARP LABORATORIES OF AMERICA, INC. in Camas, Washington. One of the products is SharpDesk, which links hard copy and digital images to application software. That integration gives users the ability to manage and merge documents from various sources, edit and manipulate them, and then produce finished documents locally or send them electronically anywhere in the world. The other SLA-developed product is the Sharp Printer Administration Utility. It allows remote configuration and monitoring of Sharp and other companies' printers.
CASIO SOFT, INC., the San Jose, California mobile productivity software development subsidiary of CASIO COMPUTER CO., LTD., announced Casio Soft Project 2.0. This program lets users import and export Microsoft Project-compatible project schedules directly from and to handheld or palm-size PCs, including Casio's line of Windows CE- operating Cassiopeia products.
In a deal valued at $16 million, NAMCO LTD., one of Japan's three largest makers of arcade-type video game equipment, has agreed to buy VIRTUAL MUSIC ENTERTAINMENT INC. The Andover, Massachusetts company specializes in music- based video games. It has developed games for the Sony PlayStation and other platforms. VME also codeveloped a karaoke sing-along game with PIONEER CORP.
In a coup for home video game content developer KONAMI CO., LTD., the company is teaming with the Disney Interactive unit of WALT DISNEY CO.'s Disney Consumer Products Division and ESPN, INC. of Bristol, Connecticut to produce a full line of ESPN sports titles for video game consoles and PCs. Approximately 10 titles are planned for launch in 2000 for such interactive game platforms as the Sega Dreamcast and the Sony PlayStation. The initial titles will be based on officially licensed league sports, but later ones will draw on exclusive ESPN programming.
An exchange rate of ¥105=$1.00 was used in this report.
With a near-term investment of $1.2 billion, trader MARUBENI CORP. hopes to develop high-speed, high-bandwidth global data communications services into one of its core businesses. The company already has committed most of this money. Marubeni is a partner along with GLOBAL CROSSING LTD. and others in Pacific Crossing-1, the first privately owned and operated transpacific undersea fiber-optic cable network. Marubeni also owns 51 percent of GLOBAL ACCESS LTD., a joint venture with Global Crossing that is building a state-of-the-art terrestrial fiber-optic network to link the two PC-1 cable stations in Japan to Tokyo, Nagoya and Osaka (see Japan-U.S. Business Report No. 352, January 1999, p. 26). Both the subsea system and the terrestrial network are nearing completion. In addition, the trader is participating along with such companies as BELL ATLANTIC CORP. in laying the FLAG undersea fiber-optic cable network between the United States and Great Britain. This link is scheduled for completion in 2001. With the international infrastructure almost in place, including a Japan-Great Britain connection, Ma- rubeni founded GLOBAL BANDWIDTH SOLUTIONS, INC. This New York City- headquartered subsidiary, which the trader is planning to take public on the NASDAQ over- the-counter market in the summer of 2000, will be in charge of selling data communications capacity to multinationals around the world.
KYOCERA CORP. is likely to become the second source of supply of iDEN (integrated digital enhanced network) handsets to wireless services provider NEXTEL COMMUNICATIONS, INC. The two have signed a memorandum of understanding. To finalize the deal, Kyocera must arrange to license the iDEN technology from MOTOROLA INC., the developer of this know-how — which combines digital cellular service with text/numeric paging and digital two-way radio — and currently the Reston, Virginia company's only handset manufacturer. Nextel indicated that it felt that it had to diversify suppliers because of the recently rapid growth in its subscriber numbers. The Kyocera- made handsets should be available in late 2000.
Already the producer of modems for METRICOM, INC.'s current-generation Ricochet mobile communications service, ALPS ELECTRIC (U.S.A.), INC. will make the modems for the Los Gatos, California firm's forthcoming 128-kilobit-per-second service. The new devices, which will begin shipping in the second quarter of 2000 in anticipation of a summer launch of the Ricochet 128-kbps service, will work with both serial and USB ports on portable computers. Ricochet uses small antennas on the customer's equipment that exchange data with microcell radios mounted on city streetlight and utility poles. These radios communicate with each other and with local wired access points that, in turn, are connected to a wired local network and the national Internet backbone. San Jose, California- headquartered Alps Electric (U.S.A.) primarily is a manufacturer of computer peripherals.
CBS CORP. is using production equipment manufactured by SONY CORP. to create digital high-defini-tion programming for its morning news shows. The contract, which industry sources estimate was worth somewhere between $4.8 million and $5.7 million, includes nine studio cameras and companion control units, plus 39 plasma display monitors that measure 42 inches diagonally. CBS already has some Sony digital broadcast equipment in its studios. It also has digital production systems from Sony archrival MATSUSHITA ELECTRIC INDUSTRIAL CO., LTD. The network's directly owned affiliates are installing MEI equipment for their own digital broadcasting.
An exchange rate of ¥105=$1.00 was used in this report.
Operations in Japan will bear the brunt of the restructuring plan that NISSAN MOTOR CO., LTD. announced in mid-October, but the number-two Japanese automotive maker's North American business will not be exempt from this cost-cutting, efficiency-boosting initiative. For starters, 1,000 jobs will be cut by April 2001, primarily by eliminating overlapping positions in NISSAN NORTH AMERICA, INC.'s various units. In fact, however, more than half of the reduction already has been completed, in part through attrition but mainly because Nissan outsourced all of its information technology activities in the United States and Canada to INTERNATIONAL BUSINESS MACHINES CORP. (see Japan-U.S. Business Report No. 362, November 1999, p. 3). The remaining cuts will come from Nissan North America's regional sales offices and financing unit as well as from among the roughly 1,200 white-collar workers at NISSAN MOTOR MANUFACTURING CORP. U.S.A. in Smyrna, Tennessee. The downsizing will not affect the 4,800 or so people who work on the factory floor making the Altima sedan, the Frontier pickup and the Xterra sport- utility vehicle. As part of the restructuring, though, Nissan Motor Manufacturing will cease to be a stand-alone company effective April 1, 2000, becoming instead part of Gardena, California-based Nissan North America.
TOYOTA MOTOR CORP. and GENERAL MOTORS CORP. have codeveloped an inductive charging system for electric vehicles that is based on the American partner's Magne-Charge inductive-charge technology. This breakthrough is the result of a June 1998 agreement. Unlike the conductive charging systems tried until now, this one has the advantages of being small and lightweight. Perhaps most importantly, it does not need to be installed in the electric vehicle. Toyota is using the new charging system in the electric- powered version of its RAV4 sport-utility vehicle, which just went on sale in Japan. Under a wide-ranging five-year arrangement announced last spring, Toyota and GM now are trying to prove technologies for vehicles powered by alternatives to gasoline (see Japan-U.S. Business Report No. 362, November 1999, p. 14).
With an order in hand from DAIMLERCHRYSLER AG for sintered camshafts for one of its light trucks, the Grand Haven, Michigan joint venture between NIPPON PISTON RING CO., LTD. (20 percent) and FEDERAL-MOGUL CORP. will double output of this component. Little additional money will have to be invested in equipment to reach this target. Starting in March 2000, the partners will have the capacity to make 100,000 sintered camshafts a month. The joint venture now known as FEDERAL-MOGUL ASSEMBLED CAMSHAFTS, INC. was formed in late 1996 when NPR tied up with the U.S. subsidiary of a British automotive parts manufacturer that later was acquired by Southfield, Michigan- headquartered Federal-Mogul.
Three-year-old F.T. PRECISION INC., a supplier of parts to HONDA MOTOR CO., LTD.'s engine factory in Anna, Ohio, is undergoing a $13.3 million expansion. The Fredericktown, Ohio joint venture between Honda and bearing manufacturer TANAKA PRECISION INDUSTRY CO., LTD. (65 percent) already has used part of this money to launch production of outboard retainers at the rate of nearly 1.1 million units a year. The rest will be used to start making a specialized roller bearing. Production of that component will begin in March 2000, heading toward an annual volume of almost 3.2 million units.
At a cost of roughly $9.5 million, TOKAI RIKA CO., LTD. will add a facility to make steering locks at its TAC MANUFACTURING, INC. subsidiary in Jackson, Michigan. Production is scheduled to begin in June 2001. The new plant will have the capacity to turn out 45,000 steering locks a month. These products, which will be made from lighter-weight magnesium rather than the traditional zinc, will be shipped to TOYOTA MOTOR CORP.'s Georgetown, Kentucky complex and to Fremont, California-based NEW UNITED MOTOR MANUFACTURING INC., Toyota's equally owned venture with GENERAL MOTORS CORP. In 2005, Tokai Rika projects, output of steering locks will total $23.8 million. In operation since 1992, TAC now makes steering wheels, airbag assemblies and shift levers.
TOYO RADIATOR CO., LTD.'s decision earlier this year to gamble $10 million on a plant to make radiators and oil coolers for cars and light trucks (see Japan-U.S. Business Report No. 355, April 1999, p. 11) even though it had no customers lined up has paid off. GENERAL MOTORS CORP. has awarded a contract to Toyo Radiator subsidiary COPAR INC. of Hopkinsville, Kentucky for radiators and oil coolers for some GM minivans. Shipments will start in the summer of 2000. The new Copar plant initially will have the annual capacity to build parts for 300,000 vehicles.
Going out ahead of its bigger domestic rivals, JAPAN AIR SYSTEM CO., LTD. awarded Pratt & Whitney Engine Services a 10-year, nearly $150 million contract to provide overhaul work and maintenance for its fleet of JT8D-200-powered MD-80 aircraft. The deal covers 63 Pratt & Whitney-built engines. All of the service will be performed at the UNITED TECHNOLOGIES CORP. company's Columbus Engine Center in Georgia, which is dedicated to the very large population of JT8D engines installed on commercial aircraft. The same team of people at the center will work on all the JAS engines. Pratt & Whitney also will assign staff to the number-three Japanese airline's base in Tokyo.
An exchange rate of ¥105=$1.00 was used in this report.
What is claimed to be the first chemical admixture to reduce the drying shrinkage of concrete and the potential for subsequent cracking is available exclusively in North America from Cleveland's MASTER BUILDERS, INC. The low-viscosity, water-soluble liquid admixture, TETRAGUARD AS20, was developed by one of the companies that merged to form TAIHEIYO CEMENT CORP. In use in Japan and elsewhere in Asia for nearly 15 years, TETRAGUARD AS20 has a proven track record of reducing concrete shrinkage by as much as 80 percent at 28 days and up to 50 percent at a year and beyond. Taiheiyo Cement believes that North American sales of TETRAGUARD AS20 could equal those in Japan in 2002, or about 550 tons a year. Japan's largest cement producer hopes to expand its admixture business in the United States through the tie-up with Master Builders, which specializes in construction chemicals.
ITOCHU CORP. has a 10-year contract to ship 330,600 tons of steel slag annually to American cement producers. They will mix this substitute for limestone with cement for use in such bulkhead projects as dams and ports. Steel slag, a by-product of the steelmaking process, has two major advantages over limestone. First, it is environmentally friendly. Limestone emits carbon dioxide when heated at the extremely high temperatures required for mixing with cement. Second, steel slag costs about half of what limestone does. The steel slag that Itochu exports to the United States will come from NIPPON STEEL CORP. mills.
The 15-year North American marketing arrangement between FUJIMI INC., a major supplier of abrasives and slurries (polishing liquids), and SPEEDFAM-IPEC, INC., a Chandler, Arizona maker of chemical mechanical planarization systems for the semiconductor industry, has ended. SpeedFam-IPEC sold its half interest in abrasive and slurry distributor FUJIMI CORP. of Elmhurst, Illinois to its partner for $9.8 million. The ownership change was engineered to help Fujimi and SpeedFam-IPEC alike focus on their core businesses.
Although it is the largest cosmetics manufacturer in Japan and fourth in the world, SHISEIDO CO., LTD. still is trying to find the right formula for ending its status as an also-ran to such industry giants as ESTEE LAUDER COS. INC. and France's L'OREAL S.A. in the American market. Availability is not the main problem since Shiseido products are sold in some 850 department stores and specialty shops in the United States. Inadequate brand recognition is a far bigger marketing obstacle. In an effort to overcome that stumbling block, Shiseido is experimenting with beauty "service centers." These Shiseido Studios offer customers free makeup. The first American one will be located in New York City's Soho neighborhood. As a complement to this strategy, Shiseido soon will introduce a line of upscale skin-care products called Cie de Peau Beaute. It also is weighing the sale of another skin-care line, Qiora. Both of these lines are sold in Japan.
The company that bills itself as Japan's largest mail-order cosmetics and health-food manufacturer and marketer has introduced its first two products to the American market. Through its Irvine, California subsidiary, FANCL COSMETICS is marketing a line of skin- care products that is completely free of additives and preservatives. Adding to their appeal, the Yokohama firm's cosmetics are packaged in small, hermetically sealed, freshness-dated bottles that contain a two- to three-week supply. Fancl's 28-month-old marketing unit also is offering a powdered green tea in single-serve packets. Both product lines are sold exclusively by mail order or at the company's Web site.
Already the largest single-brand advertising agency anywhere, DENTSU INC. is poised to become the top shareholder in a soon-to-be-formed global advertising and diversified marketing services company that will rank as one of the biggest in the world. This firm, to be headquartered in Chicago, will result from the merger of The Leo Group, which includes among its holdings LEO BURNETT CO., and The MacManus Group, the New York City- based holding company for a number of equally well-known ad agencies. The new holding company will have annual revenues in excess of $1.7 billion, 500 operating units in 90 countries and 16,000 employees. Billings are expected to be split evenly between the United States and other markets and between advertising and diversified marketing services. After the merger, Dentsu will take a stake of approximately 20 percent in the new company, which will be the Japanese firm's major partner in serving clients outside of Asia. Dentsu's involvement is an outgrowth of negotiations it initiated late in 1998 with Burnett about an alliance that would help to build business in the United States and Europe.
An exchange rate of ¥105=$1.00 was used in this report.
In a sign that regulatory reform slowly is changing the competitive landscape for big American pharmaceutical companies, BRISTOL-MYERS SQUIBB CO. will close its research facility in Aikawa, Kanagawa prefecture by the end of 1999. The center, which employs 40 people, conducts early-phase clinical testing and compiles other information for products that BMS hopes to develop for introduction in Japan. However, now that the Ministry of Health and Welfare is more willing to accept the results of clinical trials generated overseas when companies submit new drug applications, the BMS facility has become superfluous. Should the pharmaceutical company need in-country clinical data in the future, it will outsource this work. Most of the staff at the research institute will be transferred to BMS's headquarters in Tokyo.
In another indication that the U.S. pharmaceutical industry believes that Japan's market environment is changing, ELAN PHARMACEUTICALS, INC. of South San Francisco, California has outlined plans to launch sales there. The firm, the drug division of Ireland's ELAN CORP., PLC, a big drug-delivery company, already has established a subsidiary in Tokyo and is in negotiations with prospective domestic partners. Elan has two candidates for clinical development in Japan. One is ziconotide, a novel N-type neuronal calcium channel blocker. Administered directly into the spinal cord, it has shown promise in clinical studies of significantly reducing chronic, intractable pain in patients for whom morphine-type therapies have failed. The other product is NeuroBloc, a botulinum toxin type B injectable solution for the treatment of the painful neurological condition known as cervical dystonia, which generally affects the muscles of the neck and the shoulders.
AFFYMETRIX, INC. — the developer of the GeneChip system for acquiring, analyzing and managing complex genetic information to enhance the diagnosis and the treatment of disease — has given SANKYO CO., LTD. a broad license to its technology. The subsidiary of AMERSHAM PHARMACIA BIOTECH CORP., the Santa Clara, California company's distribution partner, arranged the deal. Sankyo is the first Japanese drug firm to be able to tap on a widespread, preferential basis Affymetrix's standard and custom GeneChip arrays, instrumentation and software to monitor gene expression. Last summer, TAKEDA CHEMICAL INDUSTRIES, LTD. gained more limited access to the GeneChip platform (see Japan-U.S. Business Report No. 358, July 1999, p. 13).
Japanese and other multinational pharmaceutical and biotechnology companies interested in outsourcing their international product development work to a full-service contract research organization have a new option. FAMILY HEALTH INTERNATIONAL, a not-for-profit clinical research and technical assistance organization, and E.P.S. CO., LTD., which also is in the clinical research services business, have tied up. After establishing common operating procedures and sharing technologies to maximize service and clinical data quality, the Research Triangle Park, North Carolina FHI and its Tokyo-based partner will start comarketing their service. E.P.S. will conduct all clinical studies in Japan, while FHI will handle all trials in North America and elsewhere outside Japan. Midsize trader KASHO CO., LTD. of Tokyo will help to coordinate activities between the two companies.
Broadening its push into Japan, nutritional supplement supplier REXALL SUNDOWN, INC. has formed a development and marketing alliance with SNOW BRAND MILK PRODUCTS CO., LTD. Under it, the Sundown Vitamins Division of the Boca Raton, Florida company will work with Japan's largest maker of dairy products to come up with vitamins and other supplements for the local market. These will be sold through Snow Brand's extensive distribution system. The first product could be on the market as soon as March 2000. Rexall Sundown previously teamed up with ROHTO PHARMACEUTICAL CO., LTD. (see Japan-U.S. Business Report No. 355, April 1999, p. 13).
NUTRITION FOR LIFE INTERNATIONAL, INC., a direct seller of nutritional supplements and other consumer goods, opened a support subsidiary in preparation for launching sales of its products through a network of independent distributors. The Houston company will ship merchandise directly to its distributors, who will be linked to headquarters through a state-of-the-art computer system.
An exchange rate of ¥105=$1.00 was used in this report.
In what they say is a win-win deal for themselves and for major Japanese corporations, COMPUTER SCIENCES CORP. and HITACHI, LTD. have formed an alliance to offer current and future customers of the diversified electronics company cutting-edge information technology systems and services in Japan. The goal of the new partners is to help Japanese businesses compete more effectively internationally by globalizing their IT systems. They expect to work most closely with the big financial services providers that result from the wave of mergers announced in recent months. Hitachi executives said that the firm, which has considerable systems integration expertise and has invested heavily in the development of state-of-the-art hardware and software technologies, decided to collaborate with El Segundo, California-based CSC, the number-three computer services company in the United States, in order to provide its customers more advanced IT services faster. CSC already operates in Japan. Its main clients reportedly are Japanese insurers.
Like other American computer companies, APPLE COMPUTER, INC. has been experimenting with different marketing approaches. Its latest initiative is the Apple Store in Store concept. In cooperation with 11 electronics volume retailers, the recently high-flying Apple will foot the cost of opening areas in 34 of their stores that will carry an array of Apple computers, peripherals and software. Among the merchandisers participating in the Apple Store in Store plan are DEODEO CORP. and SOFMAP CO., LTD.
Buttressing its retail channel strategy and DirectPlus on-line and telephone sales network (see Japan-U.S. Business Report No. 359, August 1999, pp. 14-15), COMPAQ COMPUTER CORP.'s subsidiary began a commission-based sales agent system. Under the DirectPlus Agent program, the company hopes to line up roughly 100 agents from the ranks of systems integrators, software vendors and other IT businesses to represent Compaq products. The big computer maker handles marketing and order fulfillment directly.
GATEWAY, INC.'s sales operation hopes to tap into the expanding SOHO (small office/home office) market by offering hardware leases tailored to the requirements of these businesses. In cooperation with equipment leasing and rental affiliates of BANK OF TOKYO-MITSUBISHI, LTD., the company has streamlined the application and approval processes to make leasing more attractive to this customer base. Gateway expects approximately 80 percent of the contracts to be valued at less than $47,600.
A new generation of the Compaq AlphaServer SC Series Supercomputer will ship to scientific, industrial and commercial users in Japan in the first quarter of 2000. COMPAQ COMPUTER CORP. claims for the line, which is built around the latest iteration of the powerful Alpha 21264 64-bit RISC (reduced instruction-set computing) chip, an unprecedented combination of power, scalability and affordability. A system configured with 16 processors, 16 symmetric multiprocessing nodes and 16 MB of internal memory will lease for $65,700 a month. The AlphaServer SC Series Supercomputer runs Compaq's Tru64 Unix operating system and comes with its cluster file system software.
Before then, COMPAQ COMPUTER CORP.'s subsidiary will ship the entry-level Compaq AlphaServer DS20E. The space-saving single- or dual-processor system, targeted at such customers as Internet services providers and communications companies, initially will sport a 500-MHz Alpha 21264 chip, but the 667-MHz version of this engine will be available in early 2000. Compaq claims that the AlphaServer DS20E outperforms anything in its class, thanks to the marriage of the latest in high-bandwidth memory know- how and the Alpha processor, 64-bit very large memory and advanced clustering technology. It also notes that despite a starting price of just $21,400, the system offers features typically found on larger systems, including hot-swap drives, fans and power supplies and remote system management. The AlphaServer DS20E supports the Tru64 Unix, Compaq OpenVMS and Linux operating systems.
The "carrier-grade" computer systems required by communications services providers, ISPs and network equipment providers are one recent market focus of SUN MICROSYSTEMS, INC. Its Netra t servers are the vehicles for bridging the communications and computing worlds. In Japan, Sun is marketing the Netra t 1400. On the computing side, the system supports up to four UltraSPARC-II processors and delivers high-speed memory, PCI (peripheral component interconnect) connectivity, Ultra SCSI disk and high-speed interconnects. At the same time, the Netra t 1400 fits into standard 19- inch communications racks. It also provides communications alarms, lights-out management capabilities and optional AC/DC power supplies. Pricing begins at $36,600.
SUN MICROSYSTEMS, INC.'s subsidiary also is fortifying its position in the market for Unix workgroup servers with the release of the small-footprint Sun Enterprise 220R and 420R. Both products deliver multiprocessing power, Ultra SCSI disks and PCI connectivity in a highly modular, four-rack-unit design. The Sun Enterprise 220R, which lists for $25,200 and up, supports one or two 450-MHz UltraSPARC-II processors and provides 2 GB of memory, while the $30,500-plus Sun Enterprise 420R can handle up to four 450-MHz Ultra SPARC-II chips and comes standard with 4 GB of memory.
The line of Unix workstations from SUN MICROSYSTEMS, INC. has a new high end, one able to handle the most demanding graphics applications. The Ultra 80 also is the company's only such product available in uniprocessor, dual-processor and quad- processor configurations. Among other touted features is the highest memory bandwidth of any Sun workstation hardware. The Ultra 80 ranges in price from $3,800 for a system with a single 450-MHz UltraSPARC-II chip to $64,800 for a workstation that harnesses the power of four of these processors.
Seeing opportunities in the growth of Windows NT-based digital video production, which includes companies creating content for commercials, TV programs, live broadcasts, interactive multimedia and the Web, INTERGRAPH CORP.'s subsidiary released a fully integrated turnkey desktop video system. At the heart of the video editing and finishing system is the Huntsville, Alabama company's TDZ 2000 GT1 ViZual Workstation, which taps the power of a pair of 550-MHz Pentium III processors and provides the throughput for high-bandwidth video applications as well as the memory needed for both off-line and on-line work. To this platform, Intergraph added edit* plus 5.0 nonlinear editing software from AUTODESK, INC.'s Discreet affiliate and MATROX ELECTRONIC SYSTEMS, LTD.'s DigiSuite real-time video hardware and software tools. For an introductory period, Intergraph priced its system at $37,900, or about 30 percent less than the cost of competing turnkey video systems.
The SP750 Professional Workstation is better able than ever to handle jobs like simulation, design and analysis, and modeling and virtual prototyping that previously were assigned to Unix workstations, COMPAQ COMPUTER CORP. argues. This minitower system now can draw on the power of dual 733-MHz Pentium III Xeon processors. At the same time, potential bandwidth constraints are addressed through the Intel 840 chipset with its 133- MHz front-side bus, dual memory channels, dual-peer PCI buses and 64-bit PCI connectivity. The SP750 also provides power graphics users with anywhere from 128 MB to 2 GB of extremely fast ECC DRAM memory and a choice of a high-performance 9.1- GB or 18.2-GB Ultra3 SCSI hard drive operating at 10,000 RPM. Included as well in the base price of $8,900 is any one of a long list of graphics controllers. .....For companies that do not require all the firepower of the SP750, COMPAQ COMPUTER CORP.'s subsidiary has new versions of the AP240 Deskpro Workstation. These machines use a single 600EB-MHz, 700-MHz or 733-MHz Pentium III processor with a 133-MHz front- side bus. They also feature the new Intel i820 chipset to maximize the high-speed system memory, which is expandable from 128 MB to 512 MB. Storage on the AP240 now takes the form of a 9-GB Wide Ultra2 SCSI hard drive with 10,000-RPM capability. The graphics controller is either the Matrox Millennium G400 or the ELSA Synergy II. With AP standing for affordable performance, Compaq priced the base configurations from under $3,500 (the 600EB-MHz model) to $4,400 for a system employing a 733-MHz chip.
COMPAQ COMPUTER CORP.'s latest data center-targeted product is the ProLiant 6400R server. The rack-mountable system is designed to address the space constraints of these environments while giving customers the computing power and performance they need to run demanding business applications, implement clustering solutions or host active intranet, Internet and e-commerce sites. The ProLiant 6400R can support up to four Pentium III Xeon processors and provides as much as 2 GB of memory and 72.8 GB of internal storage. Pricing begins at $14,800.
New as well to the Japanese market from COMPAQ COMPUTER CORP. is what the company calls the easiest and most affordable clustering solution. Suited for such needs as remote systems requiring unattended high availability or branch office industry applications, the ProLiant CL1850 consists of two Compaq server nodes and shared storage prepackaged in a space-efficient cabinet. Each of the servers can support one or two 550- MHz Pentium III processors. As much as 16 GB of system-enhancing memory per server is available, as is a maximum of 252 GB of high-perform-ance storage. The basic configuration of the ProLiant CL1850 costs $21,000.
The era of the 700-MHz Pentium III processor has arrived in the PC server market and, once again, DELL COMPUTER CORP.'s subsidiary was ahead of its rivals in introducing the latest in processor technology. Its vehicle was the PowerEdge 4300 server for networked midsize and large businesses. Able to support two of the fast Pentium IIIs, the PowerEdge 4300 features redundant, hot pluggable components to provide uninterrupted operations. High availability is ensured as well by anywhere from 128 MB to 2 GB of ECC SDRAM memory and support for RAID (redundant array of independent disks) controllers. The PowerEdge 4300 also provides ample storage through 9-GB, 18-GB and 36-GB Ultra2/LVD SCSI hard drives spinning at 7,200 RPM or 10,000 RPM. Dell's marketing unit priced the base configuration of the new PowerEdge 4300 at $4,800.
DELL COMPUTER CORP. also beefed up the power and the system bandwidth of its OptiPlex GX110 line of networked desktop machines for midsize and bigger companies by reengineering them to support Pentium III processors with 133-MHz front-side buses running at 533 MHz, 600 MHz, 667 MHz or 733 MHz. The aggressively priced family starts at $1,400 for a PC with a 533-MHz Pentium III or at $2,300 for one with a 733-MHz part. Those lists include 64 MB of SDRAM memory, expandable to 512 MB, plus a 6.4- GB hard drive. Other storage options are 13.6-GB or 15-GB 5,400-RPM drives or 10-GB or 20-GB 7,200-RPM drives.
The IBM PC 300PL, IBM JAPAN LTD.'s desktop series for the mainstream corporate market, is the first PC to feature a built-in security chip. That extra appears on the model 6565. It is powered by a 667-MHz Pentium III processor with a 133-MHz front-side bus and comes with 64 MB of ECC SDRAM memory and a 13.5-GB hard drive. The only option on the well-equipped model 6565 is the operating system. One running Windows 98 Second Edition costs $3,300, while the Windows NT 4.0-based version lists for $3,500.
Slim and trim all-in-one desktop designs are a major PC market trend in Japan, where space-constrained offices and homes are the norm. Catering to this demand, GATEWAY, INC.'s marketing unit released the second-generation Profile 2. Both of the line's models, which have no desktop or tower case, have a tiltable 15.1-inch XGA active-matrix TFT color display, 64 MB of system memory, Intel three-dimensional graphics and four USB ports for peripherals. Other specifications differ, though. The $1,900 LE model uses a 433-MHz Celeron processor and has a 6.8-GB hard drive and a 24X CD-ROM drive. About $2,400 buys the XL model with its 500-MHz Celeron chip, 20-GB hard drive and 6X DVD-ROM drive.
The jump in memory prices last fall forced DELL COMPUTER CORP.'s subsidiary to abandon the under ¥100,000 PC market. However, lower prices for Celeron processors enabled the company to get its Japan-only Dimension J400C back under this price point. Aimed at price-sensitive SOHO buyers, this system uses a 400-MHz Celeron processor and provides 64 MB of SDRAM and 4.3 GB of storage. Without a monitor, it lists for $825. Adding a 15-inch CRT display as well as a sound card and a modem raises the price to $950.
In an otherwise off month for the release of new notebook computers, DELL COMPUTER CORP.'s local operation added three models to its business-use Latitude line, all of which include both a touch pad and a track stick for greater convenience. The Latitude CPxH500GT, targeted at true road warriors, features a 500-MHz mobile Pentium III processor and a 14.1-inch active-matrix TFT color display. It starts at $3,000-plus. The base configuration of the Latitude CPtV400ST with its 400-MHz Celeron processor and 12.1-inch active-matrix TFT color screen goes for about $1,000 less.
Japan historically has been a tough place for outside suppliers of handheld computers because of the entrenched position of SHARP CORP.'s Zaurus in the market for personal digital assistants or personal organizers. That has not dissuaded HEWLETT-PACKARD JAPAN LTD. from introducing several of its parent's Jornada products. The latest machine, however, is more like a mininotebook than a PDA. The Windows CE-operating HP Jornada 690 not only uses a 133-MHz version of the 32-bit Hitachi SH3 processor and provides 32 MB of SDRAM memory, but it also has a 6.5-inch color display with touch- screen capabilities and a three-fourths-size keyboard. Equally distinguishing, the 1.1-pound system sports a high-performance internal modem and three ports plus two card slots.
In the near term, IBM JAPAN LTD. and OLYMPUS OPTICAL CO., LTD. will begin testing at customer sites a "wearable" computer that they codeveloped under a September 1998 agreement. Despite its tiny size — the device is only slightly bigger than a Walkman — the partners envision it as a stand-alone Windows 95 or Window 98 computer rather than a PDA. The system runs off a Pentium MMX processor and includes 64 MB of internal memory, audio and graphics capabilities, and a USB port. Even more notable, it incorporates INTERNATIONAL BUSINESS MACHINES CORP.'s matchbook-size 340-MB microdrive and a head-mounted color display developed by Olympus that is said to provide a resolution similar to viewing a 10-inch PC monitor from about a foot away. Despite the field trials, the partners have not yet decided whether to commercialize the device.
At the same time that it released its Netra t carrier-grade servers, SUN MICROSYSTEMS, INC.'s subsidiary introduced a low-profile storage unit for these systems as well as for any other rack-mounted server running the Solaris operating system. Designed to allow services providers to add storage incrementally in their usually cramped quarters, the Netra st D130 houses up to three hot-swappable 10,000-RPM disk drives with a total storage capacity of 54 GB in an enclosure only one rack-unit high. Moreover, the drives can be connected directly to the Ultra SCSI port that is standard on all Sun servers. The company priced the Netra st D130 at $11,200.
The challenge of network file storage increases virtually every day for big corporations. UNISYS CORP.'s subsidiary sees in this problem a sales opportunity for its FS1006 file server series. Not unlike marketers of competing network file servers, Unisys maintains that its dedicated products provide the failure-proof access to data that big businesses demand. Equally important, the FS1006 line meets their requirements for scalability up to 1.1 terabytes. Moreover, it supports mixed Windows NT and Unix environments. Another key attribute of the FS1006, which lists for $123,800 and up, is that access to the file server and the storage is over a network, including Gigabit Ethernet.
Market newcomer GENROCO, INC. believes that corporate Japan soon will need a next- generation storage area network solution in the form of its Gigabyte System Network product family. This line includes an eight-port, full bridging switch, a Gigabit Ethernet network router, a storage array controller and software based on a new, very-high- bandwidth network protocol known as Schedule Transfer. The Slinger, Wisconsin company boldly says that its GSN products are the foundation for the highest-bandwidth, lowest- latency storage and networking topology available today. More importantly, it adds, they enable highly scalable SANs across numerous disparate network technologies. TOKYO ELECTRON LTD. has the job of translating GENROCO's claims into sales.
According to DELL COMPUTER CORP.'s subsidiary, the latest additions to its PowerVault family will allow storage area networks to be constructed at about half the cost as before. The PowerVault 51F Fibre Channel switch can be configured with as many as eight universal ports for connecting servers and tape drives to the SAN fabric. Together with the simultaneously released PowerVault QLA2200F/2000 host bus adapter, midsize and big companies can build SANs with as much as 8.4 terabytes of capacity. The switch is priced from $11,000, while the adapter starts at $1,400.
HEWLETT-PACKARD JAPAN LTD. penciled in first-year sales of 400 HP SureStore 125ex jukeboxes. This target is based in part on the fact that the latest addition to this HEWLETT-PACKARD CO. storage family, which uses 5.2-GB rewritable magneto- optical media cartridges, gives smaller organizations 50 percent more capacity than the 80ex model for the same price. The HP SureStore 125ex comes with 24 slots and, therefore, offers a total capacity of 124.8 GB of data. HP Japan priced the new jukebox at $13,400 for a single 5.2-GB cartridge and at $18,800 for two.
Because their gear is complementary, the subsidiaries of COMPAQ COMPUTER CORP. and STORAGE TECHNOLOGY CORP. have decided to cooperate in the field of storage products in order to boost the sales of both. The marketing arm of Louisville, Colorado-based Storage Technology will include among its offerings Compaq's disk array subsystems. Conversely, the computer company will handle the big network storage manufacturer's open-enterprise tape library systems.
PC manufacturers in Japan are testing a new line of extremely high-density, high- performance 3.5-inch hard drives from QUANTUM CORP. The Ultra SCSI Atlas V features a disk rotational speed of 7,200 RPM rather than the 5,400 RPM more typically found in desktop machines and provides a minimum of 9 GB of storage for as little as $400. Quantum's subsidiary plans to begin commercial shipments in the spring of 2000.
EXABYTE CORP. lined up additional supplies of AVE (advanced metal evaporated) media tapes for its MammothTape backup tape drives. The Boulder, Colorado company contracted with TDK CORP. to make seven-micron 170-meter, 125-meter and 45-meter AME media tapes for its Mammoth, Mammoth-LT and recently announced Mammoth-2 tape drives as well as for Exabyte's autoloaders and tape libraries. AVE technology is said to give media higher capacity and superior signal strength while reducing the chance of read/write errors.
Continuing to push the resolution boundaries of color TFT LCD displays, IBM JAPAN LTD. introduced a 20.8-inch module with nearly 3.15 million pixels, arrayed as 2048 x 1536 pixels. That is the new QXGA (quadruple XGA) graphics specification. The ITQX20, which is housed in a compact package and features a viewing angle as wide as 170 degrees, is aimed at such applications as document creation and processing, image processing and medical imagery. Volume production of the extremely high-resolution panel will start in the first half of 2000 at one of affiliate DISPLAY TECHNOLOGIES INC.'s plants. It will be fabricated alongside a very high-resolution 15-inch panel that IBM Japan also helped to develop (see Japan-U.S. Business Report No. 361, October 1999, p. 19).
COMPAQ COMPUTER CORP. also sees an expanding market in Japan for high- resolution, space-sav-ing TFT LCD monitors. Its subsidiary has launched sales of the $4,400 TFT7000 color flat-panel display. With a diagonal viewing area of 17 inches, the display provides a super XGA resolution of 1280 x 1024 pixels and a 160-degree viewing angle.
A fourth Japanese company has acquired a license for EASTMAN KODAK CO.'s organic electroluminescence know-how. NIPPON SEIKI CO., LTD. will use the new type of flat- panel display technology for motor vehicle instrumentation applications. Kodak claims a number of advantages for its OEL technology over today's LCD technology, including lower power consumption, a faster response time, higher brightness levels in a variety of lighting conditions, an unlimited viewing angle and a thinner design. Nippon Seiki, which now is planning to start production of OEL-based displays for instrument panels in mid-2002, has the right under the agreement to buy OEL materials from Kodak. The company's other Japanese licensees are PIONEER CORP., SANYO ELECTRIC CO., LTD. and TDK CORP. Kodak and Sanyo, which also is a development partner, recently announced the first commercially viable OEL display (see Japan-U.S. Business Report No. 362, November 1999, p. 18).
Flight simulation game enthusiasts have two new joysticks from Fremont, California's LOGITECH, INC. that offer improved operability. The $75 WingMan Extreme Digital 3D is designed for advanced players, while the WingMan Attack, which is priced around $40, is targeted at beginners or occasional players.
HITACHI, LTD. has chosen the Peerless ImageWorks controller for its next generation of SL color printer engines. Developer PEERLESS SYSTEMS CORP. of El Segundo, California notes that its design is scalable and flexible as well as easy to customize to support families of printing products. A number of OEMs have adopted Hitachi's current SL-1 color printer engine for their office color printers.
New Versa FX notebook computers from NEC CORP. will incorporate graphics subsystems from SILICON MOTION, INC.'s Lynx family. The model for the Japanese and European markets, which sports a 333-MHz Celeron processor, will use the LynxEM, while the Pentium III-equipped Versa FX for American business users will integrate the LynxEM4. The two controllers provide the same functionality, but the LynxEM4 has more internal memory for faster, higher-bandwidth graphics applications. San Jose, California- based Silicon Motion says that a major selling point of its controllers is their pin compatibility, which facilitates integration into multiple designs for different markets.
At the same time, NEC CORP. is bundling its Japan-only DV Editor, which consists of an IEEE 1394 board or card and software for digital video processing, with SONIC SOLUTIONS' DVDit! LE DVD authoring software. The result, the Novato, California supplier says, is a complete, easy-to-use and affordable digital video production and DVD authoring system for PC users.
The first company to employ SPATIALIZER AUDIO LABORATORIES, INC.'s new 3D stereo technology, represented by the AN7399 chip, is MITSUBISHI ELECTRIC CORP. Its product is a high-resolution, 15-inch color TFT LCD monitor/television that is only slightly more than an inch thick. This deal marks the first time that MELCO has licensed Spatializer's audio technology, although the Woodland Hills, California company counts most of Japan's other big-name electronics manufacturers among its licensees.
An exchange rate of ¥105=$1.00 was used in this report.
By April 2000 at the latest, TYCO INTERNATIONAL LTD. will consolidate the management side of the Japanese operations of leading connector manufacturer AMP INC. of Harrisburg, Pennsylvania and Menlo Park, California-based RAYCHEM CORP., a major maker of fuses. The conglomerate acquired both of these companies earlier in 1999. Along with the subsidiary of relay producer ORIGINAL ELECTROMECHANICAL CO., they will be part of the Tyco Electronics Group and will go under that name. Together, the three companies have annual sales in Japan of some $952.4 million. Among the activities that will be consolidated to improve efficiency are administration, information systems, finance, distribution and materials procurement. The new Tyco Electronics subsidiary will be located in Kawasaki, Kanagawa prefecture, where the local units of AMP and Raychem are based.
The latest addition to the line of high-density power components marketed by VICOR CORP.'s subsidiary is a second-generation series of DC/DC converter modules with a 300-volt input. Like the Andover, Massachusetts manufacturer's other converter families, these products are available in micro, mini and maxi packages. Those three sizes span 24 models and output voltages ranging from 2 volts to 48 volts. Pricing of the new converter modules runs from $140 to $295.
Extending their relationship, ENERGY CONVERSION DEVICES, INC. and subsidiary OVONIC BATTERY CO. awarded TOSHIBA BATTERY CO., LTD. a nonexclusive license to their cylindrically wound nickel metal hydride battery technology for use in hybrid electric vehicles. The deal, which requires various lump sum payments to Troy, Michigan- based OBC as well as royalties on sales of licensed products, gives Toshiba Battery the right to manufacture cylindrically wound NiMH batteries in Japan and to sell them worldwide subject to certain restrictions. While hybrid electric vehicles — which use batteries for electrically driven propulsion along with an internal combustion engine, a fuel cell or some other source of power — are expected to be the main application for the licensed technology, Toshiba Battery can employ it in such special-purpose, battery-driven vehicles as motorized wheelchairs and golf carts. Several Japanese companies have licensed Ovonic Battery's NiMH battery know-how and taken a minority position in the firm, including HONDA MOTOR CO., LTD., SANOH INDUSTRIAL CO., LTD. and SANYO ELECTRIC CO., LTD.
An exchange rate of ¥105=$1.00 was used in this report.
Any number of examples can be marshaled to demonstrate the proposition that American financial services providers believe that there is money to be made in Japan. One of the latest is a rash of investment funds, set up both to bankroll start-ups and to finance mergers and acquisitions against the backdrop of corporate restructuring. The latter possibility has attracted the attention of GE CAPITAL CORP., which already has a big, diversified portfolio of Japanese financial services companies. Along with DAIWA SECURITIES SB CAPITAL MARKETS CO., LTD. and trader SUMITOMO CORP., the world's largest nonbank financial institution is talking about setting up a nearly $2.9 billion M&A fund. About one-third of this amount would be raised from foreign and domestic institutional investors. The balance would be borrowed against the assets of the acquired companies. The prospective Japanese partners would be in charge of scouting out M&A candidates, while GE Capital would supply its extensive M&A expertise. Both sides would tap their sources to raise the money. .....MORGAN STANLEY DEAN WITTER & CO. also is said to be weighing the possibility of moving into Japan's M&A business, backed mainly by American investors. Tentative plans call for the investment bank/brokerage house to spread upward of $95.2 million among two or three good-size companies by the end of March 2001 and in excess of $9.5 million on small firms with favorable growth prospects.
Japanese businesses looking for buyers or seeking advice on restructuring and other financial initiatives have a new source of help. New York City's LAZARD FRERE & CO. and DAIWA SECURITIES SB CAPITAL MARKETS CO., LTD. have teamed up to provide a full array of financial advisory services as well as to handle M&As. The two investment banks also stand ready to assist non-Japanese clients with any Japan-related transactions.
SOFTBANK CORP. has built a reputation as the savviest Japanese investor in Internet- related start-ups, committing funds to dozens of such American companies and partnering with many of them to bring their expertise to Japan. It now has decided that the time soon will be right to make money off of two of its financial services joint ventures. In the second quarter of 2000, MORNINGSTAR JAPAN K.K., a source of independent information on the performance of mutual funds, will go public on Japan's over-the-counter market, followed the next quarter by on-line broker E*TRADE JAPAN K.K.'s initial public offering. DAIWA SECURITIES GROUP INC. will be the lead manager for the Morningstar Japan IPO, while NOMURA SECURITIES CO., LTD. will perform this function for E*TRADE Japan. Morningstar Japan was formed in the summer of 1998 by MORNINGSTAR, INC. (45 percent) and Softbank (55 percent). The Japanese company recently made a sizable investment in the Chicago firm (see Japan-U.S. Business Report No. 359, August 1999, p. 9). E*TRADE Japan, which just launched its financial services Web site (see Japan-U.S. Business Report No. 361, October 1999, p. 21), was set up at the same time. It is 42 percent owned by E*TRADE GROUP, INC. of Menlo Park, California.
Another SOFTBANK CORP.-affiliated on-line financial services company, E+ADVISOR CO., LTD., will soon add ANDERSEN CONSULTING LLP as a minority investor. E+Advisor was established last June by Softbank's consumer finance subsidiary (67 percent), Hartford, Connecticut-based DIRECTADVICE.COM CORP. (22 percent) and a group