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| Japan Internet Report No. 18 August 1997 ********************************************************** In this month's issue: - The future called yesterday - Japan's Web content improving - Not entirely Internet related, but amazing nonetheless - Interview break - Industry news briefs - New subscribers ********************************************************** The future called yesterday Yesterday I got a telephone call from my buddy Ataru in Tokyo. Turns out he was calling via ATT JENS' new Internet telephone service (using an ordinary telephone, not a PC). What amazed us both was the excellent quality of the voice transmission. I wouldn't have known it was an Internet call until he told me. As we talked, we both noticed a tiny delay, but my guess is this would probably be undetected by the average user, especially for a Japan-to-U.S. call. If all the technical/bandwidth /regulatory issues involved in providing this type of service on a widespread basis can be overcome, and the kind of quality I experienced yesterday is consistently achievable, we're in for fixed-rate, low-cost worldwide telephone service real soon. ********************************************************** Japan's Web content improving Over the last year and a half, JIR has made sport of much of the silly, vapid and just plain boring content that is all too common on Japanese Web sites. But recently there are signs of real utility. Some examples: - Cosmo Pro has started a free Web service whereby visitors can search by location, price and other variables for land that is scheduled to be auctioned off by regional courthouses across Japan. I went online and tried this service, searching for parcels in the greater Kanto area priced at under three million yen. The search produced a number of listing, as did searches in other region. When I notified the Webmaster of one dead link in the site, the response was immediate, courteous and explained the reason for the mishap and an expected fix time. Until now, searching for this kind of information required reading local newspapers or magazines that are only available in the locale where property is to be auctioned. This impressed me as an innovative and progressive application. - MPT has set up a Web site for public housing properties and old post office sites that are no longer used and which the ministry wants to sell off. MPT plans to get rid of about 250 properties nationwide, totaling about 160,000 sq. meters in area. - The Ministry of Finance (MOF) says it will enable listed corporations to use the Internet to submit required notifications of intent to release securities. The MOF also plans to allow corporations to publicize their offerings over the Internet as well. The Ministry says it will start experimenting sometime after April of 1998 and hopes to implement the measures in fiscal 2000. The whole Japanese government, in fact, is starting to recognize the utility of the Internet and is coming up with all kinds of initiatives to create a ?paperless/electronic? government over the next five years. - Fujitsu is starting to localize U.S. content into Japanese and promote it domestically. The company has signed agreements with five U.S. firms with popular Web sites, including Computer Literacy, Weather Underground and United Artists (for the Dilbert comic strip). Look for more activities of this type as Japanese firms seek to bolster their content offerings and U.S. companies start to realize the purchasing power of the world's second largest Internet population. - Publisher Sanseido will start selling imported music CDs online under a membership system. The company already sells English language books over the Internet and says it is considering moving into imported miscellaneous merchandise, stationery and other goods. ********************************************************** Not entirely Internet-related, but amazing nonetheless Yokohama-based GATEWAY 2000 said that from late July it will startoutsourcing all of its PC delivery work to leading parcel carrier SAGAWA EXPRESS. SAGAWA employees will also set up PCs on behalf of consumer customers for a fee of 12,000 yen ($106), including delivery charges, and customers will be able to specify one of three time blocks within which they will have their computers delivered, according to GATEWAY 2000. The unusual new service will initially be available only in Tokyo's 23 wards and in Kawasaki and in Yokohama. GATEWAY 2000 previously focused on the so-called power user segment, but now will drive hard to win more customers among average consumers, according to a company executive. This is amazing - another delivery company found that the experience of convenience it is providing its customers could extend beyond parcel delivery. Remember a similar story about FedEx a few months back in JIR? While the new GATEWAY/SAGAWA partnership wasn't necessarily driven by Internet activity, it seems that widespread use of the Internet is making businesses more aware of functions that can be more effectively outsourced, and core competencies that can be extended beyond conventional operational boundaries. ********************************************************** This month we're giving our interview column a rest as we work to line up several speakers for the coming months. If you know someone who is a particularly good candidate, please send us a note.. ********************************************************** Industry news briefs Percent of Internet users with shopping experience soars, says study The percentage of Japanese Internet users who have shopped online has reached 35.4%, according to a Web-based NIKKEI BP survey. The figure represents a doubling from 17.8% a year earlier and a jump from 24.0% six months ago. The results also indicate that of those who have shopped online, three out of every four have done so twice ormore. One reason for the trend is that growing home use of the Internet has raised the percentage of women users online, according to NIKKEI BP The Internet user survey was conducted by the Nikkei Multimedia magazine from late May to early June and yielded 8,710 responses. Traditional retailers recognize power of Net Shopping Six major consumer electronics retailers including LAOX and JOSHIN DENKI will team up with NTT and SOFTBANK to sell CD-ROMs filled with game and educational software that can be tried out and then unlocked with "keys" purchased online with credit cards. The move isaimed at attracting shoppers to consumer electronics stores, given theincrease in the number of people who buy software directly over the Internet. The prices of the software that will be distributed this way will average less than 10,000 yen ($84). Japan's largest-ever card-based electronic money experiment to get underway Japan's largest-ever card-based electronic money experiment will get underway this fall with 430,000 student participants from 59 universities across Japan. The experiment will be undertaken by NTT DATA, a number of banks and the student version of SEIKATSU KYODOKUMIAI (SEIKYO), a grocery and sundries cooperative. Students will be provided with IC cards that contain an electronic money function andthat can be used as ordinary bank cards and credit cards as well. The experiment sponsors hope to raise awareness of electronic money among university students, who tend to be highly sensitive to the latest trends and fashions, and at the same time spark greater interest in electronic money systems among merchants and service providers doing business on and around college campuses. MATSUSHITA to release Internet TV MATSUSHITA ELECTRIC will put an Internet TV on the market September 1. The CyberMedia 32 features a 33.6Kbps modem and variousfunctions for enabling users to browse Web pages and use e-mail and electronic bulletin boards. Connected with WonderTown TV, MATSUSHITA's new homepage, the Internet TV allows the users to enjoy on-linekaraoke. Up to 12 pieces of music can be downloaded onto the TV's memory at a cost of 1,000 yen ($8.70). The price is set at 480,000yen ($4,174). The company plans to sell 2,000 units annually. Job opportunities for JIR readers? HITACHI will move its electronic commerce research facility to the U.S. in September. The company will transfer a number of its Japanese researchers to a Boston research group that is a unit of Oklahoma-based subsidiary HITACHI COMPUTER PRODUCTS AMERICA, and create a new research team there specializing in electronic business transaction technologies. HITACHI hopes to assemble a team of 30, including new local hires, by April 1998. By assembling its research team in the U.S., the world leader in electronic money and other electronic commerce-related sectors, HITACHI hopes to move quickly ahead with research and development efforts that are in line with international standards. Other Japanese firms are moving their Internet and electronic commerce-related research operations to the states in orderto be closer to the action, say industry watchers. RICOH to help WHISTLE into Japan market RICOH and Foster City-based high technology venture firm WHISTLE COMMUNICATIONS are cooperatively developing an all-in-one Internet connectivity device for the Japan market. WHISTLE produces InterJet, a toaster-sized device that combines a server, router, hub, modem, and software in a single package that sells for $2,000-$2,500 in the U.S. RICOH is developing a device with Japanese specifications that the two firms hope to release in early 1998 for around 400,000 yen ($3,448). The two firms see strong demand from small and midsizedcompanies for a compact, low-cost Internet connectivity solution. Meanwhile, RICOH wants to beef up its network-related operations in hopes of driving more sales of multifunction office machines. E-mail without typing? NTT and ASAHI KOKOKUSHA will on July 15 start experimenting with Anet Service, a new e-mail service using NTT technology that converts e-mail messages into audio messages that a subscriber can access from cellular or public telephones. The two firms will experiment for approximately nine months, then hope to start in April 1998 a free e-mail service whereby members are assigned addresses under the "Anet" domain. They will then be able to listen by telephone to messages sent to their Anet addresses. Each incoming message will also carry a signature sponsored by corporate advertisers. The two firms hope to experiment with 30,000 users by the time the service is commercialized. NTT shows true colors (again) NTT has shown its true colors as a government monopoly rather than an independent telecommunications service provider. The telephone giant finds itself in a quandary this time because dialup subscribers to its OCN Internet connectivity service are demanding personal Web space, which NTT doesn't provide due to concerns that subscribers will put licentious or other objectionable material on their Web sites. NTT considered recommending other providers for its dialup OCN subscribers who want to have personal Web sites, but that would mean extra charges that would make OCN more expensive compared to other ISPs, since most ISPs include Web space with their dialup accounts. If NTT was really a free market service provider, it would simply do what other providers do: Tell subscribers that their sites will be shut down if objectionable material is discovered. Yet another Internet telephone service... Tokyo-based CHIYODA CORP. will start an international Internet telephone service in August in step with the MPT's move to deregulate such services. Initially CHIYODA will offer services only between Japan and the U.S. and Japan and Korea, but plans by 1998 to expand the service to include Taiwan, mainland China, Hong Kong, the Philippines, Brazil and the U.K. It plans to set its initial Japan-to-U.S. rate at 75 yen (66 cents) per three minutes, 83% less than KDD's rates today, according to CHIYODA. Subscribers will call the nearest access point using ordinary telephones, then punch in a nine-digit personal ID, followed by the number they wish to call. The system will be usable from cellular and public telephones as well, and subscribers will be charged no setup or regular monthly fees. CHIYODA already has approximately 3,000 subscribers to an Internet telephone service linking Tokyo and Osaka. KDD to offer flat rate, nationwide domestic long distance telephone service KDD plans from late July to offer corporate customers domestic long-distance telephone service at a flat, nationwide rate of 54 yen (47 cents) per three minutes. The company will apply for MPT approval of the new service, then announce details of the new rate structure. The proposed rate of 18 yen (16 cents) per minute would be lower than any other carrier, including NTT, the NCCs and even type-2 discount providers. KDD plans to expand the new service to the consumer market next year, meaning lower rates from competitors in both the corporate and consumer markets are inevitable, say industry analysts. Why don't they just REALLY break up NTT? MPT has decided to make regional radio networks available to new common carriers (NCCs) and will ask the Telecommunications Technology Council to make recommendations. The move will pave the way for development of regional phone networks at low costs by NCCs, ending NTT's monopoly in the regional carrier market. The NCCs currently have to pay NTT for use of NTT's regional networks, which are directly connected with about 60 million phone subscribers in Japan. Thecouncil is expected to make recommendations by March 1998, and MPT plans to start allocating bandwidth to NCCs which plan to move into the regional carrier market. JAPAN TELECOM getting into dialup business big time JAPAN TELECOM plans by April 1998 to increase to more than 50,000 the number of dialup subscribers to its Open Data Network (ODN) service, up from 4,000 currently. Until this month, subscribers using ODN for dialup access had to pay a 10 yen ($0.09) per minute fee, but now the company has made possible direct access to ODN at a fee of 10 yen per three minutes. It plans to make ODN accessible to 70% of its regular telephone subscribers by next April, and win new subscribers through various PR campaigns, low-priced starter kits and other advertising. It's an Internet telephone service! Tokyo-based RIMNET, one of the nation's largest Internet connectivity service providers, in August plans to start offering Internet-based international telephone services. The company has teamed up with Virginia-based Internet telephone service firm GXC tocreate a system whereby subscribers dial a toll-free number, then punch in a security code prior to dialing the overseas number. RIMNET says it will offer call service to the U.S. for 90 yen (80 cents) per three minutes, approximately one-fifth KDD's current rates. The company says it will forge partnerships with other local providers to start similar service to the U.K., Australia and elsewhere. Cable-based phone services to start Cable television operator YOKOHAMA TELEVISION plans from April 1999 to start offering cable-based telephone and video-on-demand services. In preparation for the move, the company has set upinterconnections with TOKYO CABLE TELEVISION of Tokyo and JAPANNETWORK SERVICES of Yamanashi and later this year will start field trials using cable to provide telephone and PC communicationsservices. YOKOHAMA TELEVISION is already installing ATM switches and preparing a digital communications network and plans to experiment with about 500 households in cooperation with the other two firms. DDI striving to become NSP DDI will bolster its DION Internet connectivity service menu as it steps up its drive to shed its image as a communications carrier and recast itself as a network services provider (NSP). The company wants to establish itself as a top NSP by accelerating its penetration into both corporate and individual user markets for services provided through alliances with its mobile communications subsidiaries. DDI waslate in entering the Internet services market, but hopes to win a 5% market share by offering specialized services to PHS and cellular telephone users. The company's fiscal 1999 sales goal for DION services is 30 billion yen ($267.9 mil). ********************************************************** This month we welcome new JIR subscribers from WebTV, Fluke, Claris, Triumph International, and from Australia, Japan, the U.S.and elsewhere. JIR now has 768 readers. Tim Clark Editor Copyright 1997 by TKAI and Digitized Information, Inc. All rights reserved NOTE: Some JIR industry briefs appear later in Computing Japan magazine under modified titles. JIR is co-sponsored by Digitized Information, Inc. of Tokyo, a leader in providing daily English language coverage of electronics industry developments in Japan. For more information on monitoring electronics industry developments in Japan, or to receive a free e-mail sample of service offerings, please contact Digitized Information at diginfo@gol.com |
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