US High Tech Urged to Look Past Short Term, Ally with Japanese
 
Copyright (c) 1989, McGraw-Hill, Inc.
SAN FRANCISCO (Microbytes Daily News Service) --- American
high-tech companies need to form alliances with Japanese
companies and become less obsessed with "instant gratification"
and short-term profits, according to industry leaders addressing
the Alliance Japan seminar here.
 
American companies "have to get their act together" and overcome
their obsession with quarterly profits and "instant
gratification" to compete globally, warned Mitch Kapor, founder
of Lotus Development Corp.
 
American firms need to show the kind of financial discipline
that's characteristic of the Japanese and look to longer-term
investments and product development strategies, he said. Kapor
related Lotus' experience in developing its Japanese version of
1-2-3 (called 1-2-3J), which took 2 years to develop and overran
its budget by $5 million. Although Lotus underestimated the
"cultural incompatibility" between the U.S. and Japan and had to
make hundreds of modifications to 1-2-3 to make it suitable for
Japanese users, the results paid off, said Kapor. Lotus expects
to sell 250,000 copies of 1-2-3 this year, he said.
 
American and Japanese "preoccupation with national self" is
inconsistent with today's global economy, Kapor said. It is
time to discourage the "obsession with national destiny" and to
"de-escalate the rhetoric" contributing to the tensions between
the two countries, he said.
 
Vinod Khosla, a cofounder of Sun Microsystems and now a venture
capital consultant, exhorted American firms to strike marketing
and distribution alliances with Japanese companies. According
to Khosla, Zenith Data Systems' successful line of portable
computers was designed and manufactured by Mitsui in Japan and
marketed in the U.S. under the Zenith moniker. Khosla cited
NeXT's alliance with Canon as a key component in NeXT's future.
Khosla said that NeXT may be more successful in Japan than in
the States since the Japanese workstation market is in a much
earlier and less-competitive stage than in the U.S. Khosla also
pointed to some companies that should have struck marketing
alliances but didn't -- in particular, Sony with its NEWS
workstation, which has been very successful in Japan but has
been a flop here because Sony didn't understand the market, he
said.
 
Khosla predicted that the laptop market will produce fruitful
alliances between U.S. and  Japanese companies. He cited a
rumor that Apple and NEC are working together on a Macintosh
"ultralight" laptop. "NEC can clearly help Apple," said Khosla,
"particularly after the portable that Apple announced." NEC has
formed an alliance with a "small Silicon Valley company" with
the intention of entering the Atari/Nintendo game market in the
U.S., Khosla said.
 
Alliance Japan is a joint venture of several Japanese and U.S.
consulting and venture capital firms. Its advisory board
includes Phillippe Kahn of Borland and Akio Morita of Sony.
 
Contact: Alliance Japan, 2325 Third Street, Suite 325, San
Francisco, CA 94107; (415) 863-5074.
 
                              --- Nick Baran
 
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