HISTORY OF TELEVISION PRODUCTION IN JAPAN
cell phone fragrance system Sharp Corp. put the first domestically produced black-and-white TV set on the market in 1953, while Toshiba Corp. sold the first color TV set in 1960. When they first debuted, black-and-white TVs were well beyond the reach of ordinary households. Priced at around 175,000 yen, the TVs were about 30 times greater than the 5,400 yen average starting salary for high school graduates. [Source: Yomiuri Shimbun, May 19, 2012]
“TVs spread rapidly among ordinary households when Tokyo hosted the Olympic Games in 1964. Since then, TVs became a core product for the export industry, contributing to high economic growth. In 1968, Sony Corp. invented the first Trinitron color aperture grille CRT TV. Japanese TVs spread across the global market as a symbol of advanced technology.
“During the 1970s, there was a sharp increase in Japanese TV exports to the United States, causing friction in bilateral trade. In 1977, Japan set self-imposed restrictions on TV exports to the United States, limiting the number to 1.75 million units per year. Despite the self-imposed restrictions, Japan gained further momentum. Although there were more than 20 U.S. TV manufacturers in the early 1960s, most had fallen by the wayside.Meanwhile, Japanese CRT-based televisions dominated the global consumer electronics market.
“Japanese electronics companies dominated the global market for cathode ray tube televisions. However, the competitive landscape of the TV industry has significantly changed since early 2000s, when flat-screen liquid crystal and plasma display TVs began to replace CRT TVs as core products.
Japan is a leader in high-tech liquid-crystal display screens used on computers and cell phones. In 1996, Fujitsu and other Japanese electronic companies introduced the first flat screen televisions using plasma-technology panels. Early models sold for $10,000.After being heralded as the next big and sucking up $8.3 billion in research and start up costs, analog high definition television (HDTV) was obsolete before it even fully reached the market. It lost out to digital HDTV, which, with the help of an inexpensive "smart box," could combine the function of a television and a computer. Analog uses radio waves to transmit information while digital uses a computer style code that is cheaper to broadcast.
The market for flat-screen televisions is very competitive and getting more competitive and less profitable all the time as production increases and prices come down. Things will get even worse for electronics companies in 2012 when several flat-screen television factories in China come online and increase output six time what it was in 2009. On top of that several Chinese companies plan to enter the market, taking advantage of increased supply capabilities. Some analysts say when that occurs there will be a glut of flat-screen televisions and this will result in a realignment of the television industry and exit of some companies
The price of a 42-inch flat-screen television sold in the United States fell from $917 in 2008 to $634 in 2010. When all the Chinese factories come on line analysts predict the price of a 32-inch LCD panel will fall about 40 percent from the $200 range in 2010 to about $120 in 2012.
The sale of flat screens televisions increased 95.3 percent in 2010. Japanese electronics companies were hurt by price cuts and sluggish sales of flat-screen televisions in the U.S. in late 2010. In Japan things were better. Shipments of flat-panel televisions in Japan totaled a record 25.19 million units in 2010, up 84.5 percent from the previous year. Sales were supported by the government’s “eco-point” incentives. Blue-ray players and recorder-players also sold well.
Only two companies in Japan produce LCD panels: Sharp and Panasonic. Global LCD panel market: 1) Samsung (26 percent); 2) LG (25.9 percent); 3) AU Optronics, Taiwan (16.1 percent); 4) Chimei Innolux, Taiwan (14 percent); 5) Sharp (10.3 percent); 6) Other s (7.6 percent). [Source: U.S. DisplaySearch]
Global flat-screen television sales (market share in October -December 2010): 1) Samsung (21.4 percent); 2) Sony (14.2 percent); 3) LG. Flat screen television sales share in North America in 2009: 1) Samsung (26.9 percent); 2) Sony (14.3 percent); 3) Vizio (10.7 percent); 4) Panasonic (8.5 percent); 5) LG (8.3 percent); 6) Sharp (5.5 percent)
Decline of the Japanese TV Industry
Sharp flat-screen TVs In 2012, Toshiba and Hitachi announced they would end its domestic. This left only four electronics firms that produce TVs domestically remain: Sony Corp., Panasonic Corp., Sharp Corp. and Mitsubishi Electric Corp. In February 2011, Toshiba and Mitsubishi said they would stop making disc recorders that automatically skip commercials bowing to pressure from the National Association of Commercial Broadcasters in Japan.
“The "Big Three" electronics firms--Sony, Panasonic and Sharp--that made huge investments into building plants and facilities to produce liquid crystal displays, posted after-tax losses of 1.6 trillion yen ($20.3 billion) in their consolidated settlements of account for fiscal 2011, due primarily to slumps in their TV businesses. The TV businesses of the nation's electronics companies have been under increasing pressure due to price wars with their South Korean counterparts. Ironically, amid such fierce price competition, the more units the Japanese makers produced, the greater losses they suffered. [Source: Makoto Miyazaki and Ryosuke Yamauchi, Yomiuri Shimbun, May 19, 2012]
“The decline of Japan's TV businesses, one analyst said, is attributable to such factors as "errors at the management level that led to a failure to foresee the consequences of the rapid progress of technologies involved and changes in what consumers want."Panasonic, for instance, started operating in 2009 the Amagasaki No. 3 plant in Hyogo Prefecture--the latest type of factory for producing plasma TV panels--at a cost of about 200 billion yen. The company, however, had no choice but to halt production there in the business year that ended this March.
Japanese TV Makers Outperformed by South Korean Rivals
Japanese electronics companies are now overshadowed by South Korean manufacturers. Initially, Japanese manufacturers held an advantage over foreign producers in the flat-screen TV market. For example, flat-screen TVs produced at Sharp's Kameyama plant in Mie Prefecture--known as the "Kameyama model"--became synonymous for a high-quality TV. With this success, Sharp once held the largest global market share for flat-screen TVs. [Source: Yomiuri Shimbun, May 19, 2012]
“However, during the mid-2000s, South Korean manufacturers such as Samsung Electronics Co. began to catch up to Japanese manufacturers, making it difficult for them to differentiate themselves from their South Korean competitors in terms of technology. South Korean companies took the initiative and opened up markets by boosting production capacity and productivity through aggressive large-scale investments. Additionally, a weak won has helped South Korean companies increase their price competitiveness, while the strong yen has hurt Japanese companies' ability to compete.
“In 2005, the Japanese share of the global TV market was about 48 percent, far exceeding the 21 percent held by South Korean firms. In 2010, however, Japanese companies' share fell to 38 percent, while the share of South Korean rivals rose to 36 percent and now surpasses Japan. Japanese makers no longer lead in technology and find it difficult to keep up with South Korean companies making large capital investments. [Source: Etsuo Kono and Kiminori Kurihara, Yomiuri Shimbun, October 21, 2011]
In 2011, Samsung held the largest global market share for TVs at 23.8 percent, followed by LG Electronics Inc. at 13.7 percent. Japanese makers came far behind, with Sony at 10.6 percent; Panasonic Corp. at 7.8 percent; and Sharp at 6.9 percent.
Reuters reported: “Some analysts say the $100 billion LCD TV market peaked in 2010 and forecast it will shrink 3 to 4 percent annually, as consumers in advanced countries have already traded in their bulky cathode-ray tube TV sets for flat screens, while the LCD market has been in a glut since last summer. Global TV manufacturers are restructuring their businesses and outsourcing production as cut-throat competition and weak demand squeeze margins. Analysts have criticized Sony for failing to aggressively take on the competition in the TV market from South Korean rivals Samsung and LG Electronics Inc, the largest and second-largest players, respectively. [Source: Reiji Murai and Hyunjoo Jin, Reuters, December 26, 2011]
Blue-Ray Versus HD-DVD
blue ray player In the early 2000s a Betamax-VHS-like battle developed which format would be the standard in video disc player. Sony and Panasonic developed the Blue-Ray disc while an alliance of NEC and Toshiba developed the HD-DVD format. In 2005, Sony and Toshiba discussed a unified DVD format. But in the end decided to go their separate ways. By that time Samsung, Sharp, and Apple supported Blue-Ray.
The outcome of the battle depended a lot on which Hollywood companies would back which format. Disney, 20th Century Fox, and Sony supported the Blue-Ray DVDs while Warner Brothers, New Line Cinema, Paramount and Universal said they supported HD DVDs.
The Blue-Ray holds 50 gigabytes of data, five time more than HD-DVD. The picture quality is said to be six time better than that of standard DVDs. Comparing a Blue-Ray disc movie of “Cars” with a standard DVD, Jan Turnbow wrote in the New York Times, “A tractor in the background in the opening shot went from fuzzy to insignificant on DVD to sharp , vibrant, scenery on Blue-Ray. A smooth piece of canvas turned out to be richly textured fabric. Every pebble, every blade of grass, every hair on every rat’s back-it was all just stunning in comparison.”
Competition between Blue-Ray and HD-DVD formats made consumers wary and delayed delivery of either system. Machines that played both formats were introduced in mid 2006. They sold for about $1,200. Around the same time Warner Brothers announced that it developed discs, called “Total HD Discs”, that played both Blue-Ray and HD-DVD formats and played on both Blue-Ray and HD-DVD players. As of late 2007 about 1 million players using both of the formats had been sold.
In February 2008, Toshiba announced it was abandoning the HD-DVD discs, meaning that Blue-Ray would be the standard for the next generation high-definition of video recording.
With conventional 3D the television project different images to the viewer’s right and left eyes at high speed, and 3-D images are reconstructed in the brain. Using 3-D glasses a viewer cannot see an image intended for the right eye with the left eye and vices versa. The system creates stereoscopic images. In May 2010, the Economy, Trade and Industry Ministry set 3-D guidelines in part to standardize the industry and deal with problems such as eye strain and queasiness caused by the technology.
3-D televisions went on sale in Japan in April 2010. The first ones to go on sale were 50- and 54-inch plasma modes made by Panasonic that sold for $4,650 and $5,750. Toshiba, NEC and Fujitsu have all unveiled a 3-D desktop personal computer
Among the biggest attention-getters at the CEATEC technology and electronic trade show in October 2010 were the latest 3-D technologies, including a 3-D theater that simulated being in a futuristic city, Toshiba’s 3-D television that doesn’t require glasses.
Sony and Victor released 3-D video cameras in early 2011. The release was partly intended to help boost sluggish sales of 3-D televisions.
3-D televisions made up only 5 percent of sales in 2010. One reason for poor sales is the shortage of 3-D movies and TV programs.
See electronics, video games.
Toshiba’s Glasses-Free 3-D TV and the Woman Who Created It
Hiroko Tabuchi wrote in the New York Times, “It is the Achilles” heel of 3-D television: the clunky glasses that viewers must wear to see images pop out in 3-D. A 3-D Toshiba TV at the Consumer Electronics Show. Instead of using glasses, the screen directs images to the appropriate eye.” Toshiba started selling its glasses-free 3-D televisions in Japan in October 2010 and introduced them to North America and Europe in 2011. [Source: Hiroko Tabuchi, New York Times, January 17, 2011]
Rieko Fukushima, a researcher at Toshiba, developed a way to do away with the glasses of 3-D television. “I’d be lying if I said it wasn’t tough as a woman,” said Mrs. Fukushima, 39, who led Toshiba’s effort to develop the world’s first “naked eye” 3-D TV. The project began nine years ago, when she had just returned from maternity leave. “Sometimes, I’d se’e it in my colleagues expressions,” she said: “What? A woman? This age? In charge?” “
Mrs. Fukushima’s success, Tabuchi wrote, has therefore been welcomed as an inspirational tale of what can happen when things fall into place: a driven woman, a supportive family, and a company trying to diversify its work force. “As a researcher, her ideas are cutting edge,” Yuzo Hirayama, the head researcher at Toshiba’s TV research unit, told the New York Times. “Her communication and networking skills also never cease to astound me.”
“It was in 2002 that Mrs. Fukushima, after maternity leave for her first child, helped set up a new research and development team to explore the possibilities of 3-D displays,” Tabuchi wrote. At the time, there was skepticism at Toshiba over whether 3-D technology could be commercialized. Still, Mrs. Fukushima saw the potential in an early prototype. From the start, she was convinced that the viewing glasses that accompanied most 3-D technology would have to go.”
“In conventional 3-D TV technology that uses glasses, images for each eye are rapidly displayed one after the other. Filters in dedicated glasses flash on and off in sync with the TV, so that the right eye sees one image, then the left eye sees the next image, creating the illusion of 3-D. But Mrs. Fukushima proposed a new approach: developing an algorithm that draws on a Toshiba imaging processor called the Cell to display nine images for each frame. A sheet on the screen angles each image so that the right eye sees only images meant for the right eye, while the left eye sees only images meant for the left eye. The biggest challenge was making a TV that displays 3-D images even when viewed from wider angles. Toshiba has not entirely solved that problem: its TVs work best when viewed from within a 40-degree zone.”
“Designing a mass-production setup to keep costs down also posed difficulties, something Mrs. Fukushima tackled by building a network of experts from around the company. But pressure mounted as the project progressed. “When I was just a researcher, a setback would only reflect badly on myself. But now that I was leading a team, I had to make sure nobody lost faith,” she said. “I needed to think things through harder than anyone else,” she said. “I often felt overcome with worry, but I tried not to show that at meetings.”
Digital Cameras and Japan
Digital cameras are big sellers for Japanese electronic companies. As of 2006, Japanese companies produced 80 percent of the world’s digital cameras. Many manufacturers have suffered though as result of stiff competition and low prices.
The digital camera was invented in the 1970s by Steven Sasson, an electrical engineer at Eastman Kodak. Sasson later told the New York Times, “My prototype was big as a toaster but the technical people loved it, But it was filmless photography, so management’s reaction was, “that’s cute — but don’t tell anyone about it.”
In July 2008, a company called Plaza Create began selling a disposable digital camera with recyclable liquid crystal panels taken from old cell phones. The 27-exposure camera sell for about $12. A 50-exposure model, $14.
Cannon powershot digital cameras
Cell Phones in Japan
In the early 2000s, cell phones in Japan were arguably the most advanced found anywhere. They have high resolution screens that produce sharp images and third generation networkz that allow use to shift through pages quickly. The only problem is in many cases Japanese phones can not be used outside of Japan.
In 2000, cell phones showed rock concerts with no sound. Still images flashed quickly so they looked almost like a video. In 2001, Kyocera introduced mobile video phones with a small digital camera on the back that allowed people to send pictures of themselves to friends with the same kind of phone. Costing $335 when it was introduces, the phone was as small and compact as other cell phones. The images though were often jiggly.
Japanese initially didn't take to the Internet on personnel computers with same enthusiasm as Americans but they quickly took to the Internet on the cell phones in a big way. In 2000, there were more than 40,000 web sites specifically designed for cell phones.
In 2001, Japan introduced the "third generation" of cell phone technology with great clarity and the ability to transmit data and video on color screens. The 3G technology made cell phones into wallet-sized PCs and portable play stations and with that came ring that sounded like the roar of a Tyrannosaurus Rex, services that allowed users to check their Pachinko reaction times and security systems that allow them to eavesdrop on their pets or check their house for possible intruders.
In the mid 2000s, Sony-Ericsson introduced Walkman cell phones that were like a cross between a cell phone, an iPod and a high resolution digital camera. Casio introduced models that were shockproof and waterproof and could be worn in the shower or on a scuba dive. Models for children had GPS so parents could figure out where they were.
Increasingly cell phones were being used as credit cards or wallets with electronic money functions called osaifu-keitai that allow users to buy things from convenience stores and vending machines and pass through subway and train gates. As of 2005 about 9 million cell phones used had the money function and 28,0000 shops nationwide accepted them. Payments is done through scanners positioned next to the cashier.
The cell phone handset industry in Japan was very competitive in the 2000s. As of early 2008 there were about 10 handset manufacturers and the industry was ripe for a major shake up. Soon after the start of the year Mitsubishi Electric announced it was going to stop make handsets and Kyocera bought Sanyo’s handset division. Disney introduced handsets in Japan with great expectations, with special designs aimed at girls and young women and special buttons that can be pushed to gain access to shopping sights.
Domestic mobile sales in fiscal 2009: 1) Sharp (25.6 percent ); 2) NEC Casio (15.2 percent ); 3) Panasonic (15.1 percent); 4) Fujitsu (12.5 percent); 5) Apple (7.8 percent); 6) Sony Ericsson (7 percent ); 8) Kyocera (5.6 percent); 9) Toshiba (4.7 percent ); 10) Others (6.5 percent). [Source: BCN Inc.] Top cell phone makers in Japan in 2007: 1) NEC (17.1 percent); 2) Panasonic (14.1 percent); 3) Sharp (12.9 percent); 4) Sanyo (12.4 percent); 5) Fujitsu (10.9 percent); 6) Sony Ericsson (7.7 percent); 7) Toshiba (7.1 percent); 8) Mitsubishi (6.5 percent); 9) Casio (4.7 percent); 10) Kyocera (3.6 percent); 11) Others (2.7 percent).
See Cell Phones, Communications Under Culture and Media
Lack of Japanese Cell Phones Overseas
Japan's "Galapagos syndrome" is a phrase first coined to characterize the nation's highly evolved but globally incompatible cell phones. The term is now applied to other isolated industries, even to its people. In 2009, the global market share of Japanese cell phone makers combined was only three percent.
Hiroko Tabuchi wrote in the New York Times, “Because Japan’s phone industry remains highly fragmented, no company so far has been large or savvy enough to make a strong overseas push. Instead, handset makers have long been content to serve as suppliers to Japan’s three largest mobile networks, which command a market of more than 100 million users, most of them on advanced 3G networks.” [Source: Hiroko Tabuchi, New York Times, March 1, 2011]
“And in their hardware fixation, Japanese manufacturers have tended to bog down their handsets with clunky software platforms and fenced-in Web services that do not emphasize downloads of third-party applications. That has put them at odds with the trend in much of the rest of the world, where attention has swung to devices like the iPhone, which runs software much as an ordinary computer does and lets users download apps from independent developers.”
“Japanese companies have been so pioneering in many fields, but they have failed to build a global business” of handsets, Gerhard Fasol told the New York Times. He is chief executive of Eurotechnology, a Tokyo firm that advises companies on global mobile and telecommunications strategy. “What you need is a global infrastructure,” Mr. Fasol said, “and Japanese handset makers have nothing.” The handset makers “need to stop worrying about the carriers and start thinking more globally,” said Shuichi Iizuka, a telecommunications analyst at the ISB Institute, based just south of Tokyo.
With the domestic market shrinking Japanese cell phone manufacturers are beginning to gear up for more for markets abroad with smartphones with several firms including Panasonic , NEC, Casio and Sharp offering products in early 2011. Many of the Japanese producers will use the Google Android system and thus not handicapped by system that using a system that only works in Japan.
Smart Phones in Japan
Smartphone shipments in Japan in fiscal year 2010-2011 (market share) : 1) Apple (37.8 percent); 2) Sharp (24.3 percent); 3) Sony-Ericcson (9.8 percent); 4) Samsung (9 percent); 5) Fujitsu (8.8 percent); 6) NEC Casio (3.2) percent ); and Others (7.1 percent). [Source: MM Research Institute).
In the fall of 2010 NTT Docomo, KDDI and SoftBank all began aggressive drives to push their smartphones. They all had new models of phones and new services and aps and promised plans to introduce super-fast service. Docomo began pushing waterpoof phones with e-money functions. Their Galaxy S smartphones were made by Samsung. As of May 2011, KDDI had launched six Android smartphones, including Sharp-produced Inforbar A01 and the Sony-Ericsson-produced Xperia. Softbank’s profits have surged on the popularity of its exclusive deal marketing Apple’s iPhones. In May 2011. Docomo released a new line-up of smartphones, including new versions of the popular Samsung Galaxy, Harp introduced the Aquos phone, which allows users to see 3-D images without glasses and NEC-Casio launched the super-slim, waterproof Medias smartphone.
But for the most part Japan electronic companies have been largely absent from the smartphone phenomena. Hiroko Tabuchi wrote in the New York Times, “In fact, the success of the iPhone in Japan — together with Apple’s popular App Store, with hundreds of thousands of applications for download — has opened eyes.” [Source: Hiroko Tabuchi, New York Times, March 1, 2011]
Now they are hoping to make up for lost time. Tabuchi wrote in March 2011: “NEC introduced what it said was the world’s thinnest smartphone. At 8 millimeters thick, equivalent to about four stacked nickels, its Medias N-04C runs on Android and also comes with an electronic wallet function, digital terrestrial television and a five-megapixel camera. Although the phone is for sale only in Japan for now, NEC is planning an overseas push, focusing first on Mexico and Australia. Another Japanese manufacturer, Kyocera, is planning soon for the United States release of an Android-based smartphone that comes with two screens, capable of running separate apps at once.”
Most global operators are preparing to use advanced LTE networks, which could make it easier for the Japanese phones to work on networks anywhere. Shigeru Kobayashi, an executives working on Sharp’s new smartphones, told the New York Times. “We don’t plan to keep on building the same kind of phones that we used to. Sharp’s latest smartphones, like its IS03 model, a sleek device with a high-resolution touch screen, have caught the attention of overseas gadget bloggers. Hoping to get a piece of the iPad market, Sharp has introduced a lineup of tablet computers running a version of Android. For now, with Smartphones, Sharp is focusing its attention on the fast-growing Chinese market, although officials say they also intend to bring phones to North America.
Japanese Smartphones and Android
Japanese electronics companies are hoping by adopting Google’s Android mobile operating system they can make up for lost time. “We have the technology to compete in the United States,” said Naoki Shiraishi told the New York Times. He had led software development for a new line of Android smartphones from Sharp, the largest Japanese cellphone maker. “It’s finally time for Sharp phones to go play in the Major Leagues,” he said. Sony Ericsson, NEC and Kyocera are among the other Japanese handset makers also hoping to Android will open up international markets for them. [Source: Hiroko Tabuchi, New York Times, March 1, 2011]
Hiroko Tabuchi wrote in the New York Times, “While Android was initially overshadowed by the popular iPhone from Apple, its user numbers are now soaring. In 2010, global sales of Android phones reached 67.2 million units, ahead of iPhones, which sold 46 million units, according to the research company Gartner. Certainly the price is right: Google offers Android free to manufacturers. And Android has caught on since its introduction in 2007, as a growing community of software developers has written apps, sold via Google’s Android Market... Although Google earns no commission from any Android handsets sold, it takes a substantial cut — 30 percent — of the apps sold in the Android Store.”
“It took a while, but Japanese handset makers are now rushing to introduce Android devices, each married with cutting-edge technology,: Tabuchi wrote. “That includes Sony Ericsson, which dabbled with other platforms like Symbian and Windows Mobile for its high-end Xperia smartphones, but has used Android for its latest models. Google itself, meantime, has urged more handset makers to use Android. “Japan has great hardware, great R.& D., great engineers,” John Lagerling, director of Android Global Partnerships at Google, told the New York Times. “Now they can also get the best software.”
Besides helping Japanese phone makers reduce their software development costs, the globally recognized Android standard could also help them achieve worldwide economies of scale that could further reduce overall costs. But Fasol of Eurotechnology warns that even with good Android phones, Japanese companies could cede some of the most lucrative parts of the business, selling apps, to Google.”Android gives the Japanese an opportunity, that’s for sure, but it places them at a relatively low position,” Fasol told the New York Times. “It makes them one of many soldiers in the Google army, with Google as king.”
“Google, in addition to retaining nearly a third of the applications revenue, has recently introduced other revenue-enhancing measures, like letting software developers accept payments within apps,” Tabuch wrote. “But phone makers would receive none of this income. And even as Android is helping Japanese phone makers lay their overseas plans, it has also opened the Japanese market to foreign competitors. Samsung, of South Korea, for example, has made inroads in Japan with its slick Android-based Galaxy smartphone.”
“For the Japanese phone makers, cashing in on Android’s popularity will mean learning some new skills, like marketing, while unlearning some old habits, like paying too much attention to the hardware and too little to the software,” tabucho wrote. “Japan’s phone makers may need to become nimbler, too. Their love for continual fine-tuning of their hardware has meant they have had trouble keeping up with Google’s frequent Android updates. Many of the smartphones released this season, like the Sharp IS03, still run on Android version 2.1, which was announced more than a year — and two updates — ago. Google is soon expected to release Android version 2.4.”
“Working with Android has meant an overhaul of Sharp’s tightly controlled development process. In one big change, Sharp has invited outside developers to its labs to test prototypes and develop apps — a rare move for a Japanese manufacturer. In 2010, Sharp hosted two “hackathons” — programming jamborees — to encourage more developers to make apps optimized for its smartphones. At one of these sessions a group of about two dozen outside developers worked on apps at Sharp’s usually top-secret research lab near Hiroshima. And in an unprecedented move, Sharp last year released a phone that was deliberately “jailbroken” — letting programmers freely tweak some of the phone’s core software controls.”
Japanese Smartphone Parts
Japan electronics manufacturers provide many key parts for smartphones: Toshiba makes flash-memory devices; Elpida makes DRAM chips and Renesas makes chips, microprocessors and micorcontrollers for smartphones and other next-generation devices. All of the of these companies are putting their factories into overdrive to keep up with demand. South Korean and Taiwanese manufacturers also make many of the same parts. Recently Apple has been turning more and more to Japanese electronics companies for parts as it other main supplier — Samsung — is using many of its parts to make products that rival those of Apple.
Mitsui Mining & Smelting Co. controls about 90 percent of the global market for ultrathin copper foils used in smart phones.
Smartphones Put Pressure on Other Electronic Products
Yu Toda wrote in the Yomiuri Shimbun: “The rise of smartphones has brought both benefits and drawbacks for manufacturers. While domestic manufacturers of electronic parts are enjoying increased demand, thanks to the tremendous popularity of smartphones, companies manufacturing other digital items, such as digital cameras and portable games, have expressed concern the market will be taken over by makers of "multifunctional terminals." [Source: Yu Toda, Yomiuri Shimbun, October 15, 2011]
“According to the core private-sector machinery order survey, a key advance indicator of capital spending conducted by the Cabinet Office, machinery orders, excluding those for ships and electric utilities, jumped a seasonally adjusted 11 percent in August from the previous month for the first increase in two months. The figure is believed to be the result of investment demand in areas related to smartphones, such as semiconductors and liquid crystal displays. The electrical machinery sector jumped by 29.5 percent in August from July and in the information and communication electronics equipment sector by 74.6 percent.
“Toshiba Corp. constructed a new semiconductor production facility at its Yokkaichi plant in Mie Prefecture to increase the production capacity of flash memory chips. It began shipping from the facility in August. Murata Manufacturing Co., the world's No. 1 maker of capacitors for smartphones, plans to purchase Finnish electronic parts maker VTI Technologies for about 20 billion yen to strengthen its sensor business.
“However, the boom in smartphones has negatively affected other digital equipment manufacturers. The global market for compact digital cameras has shrunk by about 20 percent from last year. The quality of an iPhone 4S camera is comparable with high-end compact digital cameras and the new iPhone can take videos in full HD. In the portable gaming industry, Nintendo Co. slashed the price of its 3DS game device by 10,000 yen in August, following sluggish sales of the handheld console after its release in February. Meanwhile, the number of applications for the iPhone has increased to about 100,000. Manufacturers are also facing increasingly fierce competition over portable music players, car navigation systems, electronic dictionaries and IC recorders."More and more people think they don't need other gadgets as long as they have a smartphone," said Hideaki Yokota, head of MM Research.
Japanese Handset Companies
Internationally the shares of Japanese companies in the handset market is relatively low compared to Nokia of Finland, Motorola of the United States and Samsung of South Korea. Nokia and Motorola, the No. 1 and No. 2 cell phone makers in the world have a very small presence in Japan. Vodaphone tried, gave up, sold out and left. These companies have not succeeded in part because their products are not up to the quality of their Japanese counterparts. In 2008, Nokia announced it was withdrawing from Japan due to it inability to crack the market there.
Next-Generation, Energy-Saving Semiconductors
Etsuo Kono wrote in the Yomiuri Shimbun: “Major electronic IT manufacturers including Hitachi, Ltd., Fujitsu Ltd. and NEC Corp., plan to jointly develop next-generation semiconductors that will operate with one-tenth of the power consumed by present-day devices, it has been learned. Next-generation semiconductors will allow the transfer of greater amounts of data while at the same time enable a reduction in the size of IT-equipment and their power use. [Source: Etsuo Kono , Yomiuri Shimbun, January 3, 2012]
“The manufacturers hope to have the semiconductors available in fiscal 2019 and they anticipate the devices will be used widely at businesses including call centers that offer cloud computing services, as well as in products such as personal computers.These devices are expected to reduce the power consumption of servers at data centers by about 30 percent and should also minimize the power consumed by air-conditioning units as the semiconductors will suppress heat generation.
“The devices will use less power while providing extremely high data transfer speeds, enabling manufacturers to equip smartphones with the same central processing units typically found in personal computers. Experts say it will also be possible to create smartphones with battery lives that last twice as long as those available in the marketplace.
“Manufacturers are competing to make semiconductors smaller and more efficient. To reduce their size, the wiring of lines on the circuit boards of these devices must be narrowed. Experts agree that the width between these lines must be at least one millimeter. But a group of companies including Hitachi are attempting to reduce the width to 0.1 millimeter by replacing the circuit board lines with optical interconnectivity typically found in products such as digital cameras. Optical technology will enable manufacturers to produce semiconductors that are one hundred times smaller than their current size.
“Japan's power consumption from information technology products is expected to increase by about 5.2 times between 2006 and 2025 due to the expansion of cloud computing services through the Internet. Therefore, there is a growing need to develop next-generation semiconductors that will significantly reduce this power consumption. If next-generation semiconductors are developed, experts say they are expected to reduce power consumption by 130 billion kilowatts per hour in 2030. This is about 13 percent of the electricity generated by 10 Japanese power companies in fiscal 2009, which was about 1 trillion kilowatts per hour.
“There is increasing global competition between manufacturers developing optical technology as they believe it is key to producing next-generation semiconductors. IBM Corp. of the United States has announced it will have next-generation semiconductors in IT equipment in 2020.
Japanese companies such as Hitachi plan to produce trial products by completing the required technological developments by fiscal 2019. They aim to utilize optical technology to revive the Japanese semiconductor industry, which has been faring badly against South Korea's Samsung Electronics Co. To support domestic research and development, the Economy, Trade and Industry Ministry will offer subsidies of about 30 billion yen over 10 years starting in fiscal 2012.
Image Sources: 1) 2) Sony 3) NEC 4) 5) Fujitsu 6) Canon 7) xorsyst blog 8) Sharp 9) Panasonic 10) Sanyo
Text Sources: New York Times, Washington Post, Los Angeles Times, Daily Yomiuri, Times of London, Japan National Tourist Organization (JNTO), National Geographic, The New Yorker, Time, Newsweek, Reuters, AP, Lonely Planet Guides, Compton’s Encyclopedia and various books and other publications.
Last updated October 2012