Report No.9
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Japan Entrepreneur Report No. 9 July 2003
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- Japan's mobile business continues to amaze
- 3G Family: The High-Tech Touch
- Band-Aids for over-stressed, underserved society?
- "Why business is like cow drool"
- Bit and byte
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Japan's mobile business continues to amaze
Japan's mobile telephone business continues to amaze--and amuse. What's
the latest? Well, it won't be long before you can watch TV on your
celly.
Earlier this month NEC showed the world's first prototype cellular
handset that enables subscribers to watch digital television broadcasts.
The new phone is grabbing attention not only for its technological
wizardry, but because the digital broadcast television sector still
isn't attracting significant advertising revenue. That's making
advocates of "cell TV" enthusiastic about the success of fee-for-content
offerings and advertising models on i-mode and other mobile online
services. (For an alternate view on the success of cell advertising,
see <http://www.japanentrepreneur.com/200304.html#2>.)
Regardless of whether cell TV can be effectively integrated with
advertising or otherwise become a viable, earnings-generating business,
you can bet your socks that this service will become available in Japan
sooner rather than later.
One huge hurdle the coming "cell TV" market will need to overcome: short
battery life. Today NEC's prototype allows less than an hour of
continuous television viewing before it needs recharging. That's
probably insufficient for people serious enough about TV viewing to buy
a dedicated television-enabled "cellset." Maybe it'll be called a CV?
On the subject of mobile telephones, a few months ago I wrote an article
about Japan's "computer refuseniks"
(<http://www.japanmediareview.com/wireless/1047257047.php>), the central
theme of which is that the cellular handset has replaced the personal
computer as the default e-mail terminal of choice among most Japanese
consumers under the age of 21 (and a good portion of older consumers as
well).
Now comes a feature article in the July 14 issue of Nikkei Business
declaring that "digital audio-visual" or "digital AV" products--digital
cameras, DVD recorders, camera-equipped mobile telephones and the like--
have replaced the personal computer as both the object of consumer
interest and the engine of growth in Japan's consumer electronics
industry. Nikkei makes a good case that the release of Windows 95
represented the peak of the PC boom, and that the PC industry has been
declining since. Now, says Nikkei, the spotlight has been overtaken by
digital AV offerings.
Before reading that article, it had occurred to me that the 12-key
cellular handset keypad might eventually replace the traditional QWERTY
keyboard as the input mechanism of choice for <all> text-capable devices
in Japan. After all, the cellular telephone stands unchallenged as the
single most important, nearly ubiquitous digital AV device in Japan, and
it would make sense that the input mechanism for this device become the
standard for all digital AV equipment.
More important, most teenagers in Japan today learn to touch-type by
thumb, single-handedly, on a cellular keypad before learning to use a
traditional PC keyboard. Many are lightning-fast thumb typists. I
wouldn't be surprised if some of these kids type consistently at speeds
equivalent to 80 or 90 words per minute or more.
Just as I was bemused with the idea that the cellular keypad might
replace the PC keyboard, up pops a company called Mevael
(<www.mevael.co.jp>) offering a gizmo called the "Keiboard" designed to
do exactly that. Mevael displayed its Keiboard at the recent 2003 Tokyo
Business Show with the idea that consumers who can already touch-type by
thumb on cellular keypads--meaning 90 percent of all 15-year-olds and a
healthy portion of the over-15 crowd--can easily make the transition to
PCs, PDAs and other data devices without having to learn more complex
QWERTY keyboard skills.
Now NEC has announced a new super-thin, palmtop "Micro PC" with a
pistol-grip handle featuring-- you guessed it--a 12-key array identical
to those used on cell phones (it's also noteworthy that the device uses
a type of fuel cell battery that enables continuous operating time of
five hours, a number that NEC says it will boost to 40 hours by mid-
2005).
So say goodbye to personal computers and hello to digital AV devices,
led by advanced mobile handsets. And read on for an inside look at the
key driver behind the surprisingly low-tech "killer app" of one of
Japan's astonishing third-generation digital cellular telephone systems.
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3G Family: The High-Tech Touch
In her white jeans and multicolored T-shirt emblazoned with the single
word "Grapefruit," Keiko Miura, a cheerful 43-year-old Tokyo housewife,
somehow doesn't fit the image of an early adopter of third-generation
(3G) digital cellular technology.
But when her digital handset chirps and she unfolds it to reveal her
husband Hideo--talking onscreen in brilliant, full-motion, real-time
color video--she's suddenly a one-woman showcase for eye-popping, world-
leading, bleeding-edge technology.
Hideo Miura is videoconferencing with his wife from inside a train
speeding between Tokyo and Osaka. He's calling to enjoy some face-to-
face time, virtual though it may be, with Reina, the couple's five-year-
old daughter. "He's very conscientious," notes Mrs. Miura. "He calls as
many as ten times a day."
Mr. Miura, an entrepreneur who owns and operates a small television
program production company, explained that he often gets home after his
daughter is already in bed. "My work keeps me away from home a lot, and
that limits my time with Reina. With the videophone, I can see and talk
to her every day," he says.
Digital cognoscenti elsewhere in the world would no doubt envy the Dick
Tracy lifestyle enjoyed by the Miuras, who between them carry a pair of
NTT DoCoMo digital FOMA handsets capable of full-motion, full-color
audio/videoconferencing at 384Kbps between nearly any two locations in
Japan.
And mobile technology aficionados in the West might well imagine the
Miuras experimenting with a host of cutting-edge applications, such as
capturing full-motion video footage and zapping it through the ether to
friends or business partners, or snapping digital photos of breaking
news and uploading the images to blogs with commentary attached.
But the truth is much more prosaic. In a country where it isn't
uncommon for fathers to go for days without seeing their children, it
often seems the role of technology is to compensate for an over-stressed
society short on time--and unskilled in vocalizing emotion.
"Keeping in close touch with my family is by far the most important
reason for having this phone," Mr. Miura says. "I feel I can be with my
daughter even though we aren't physically together. 3G cell phone
ownership has nothing to do with my work; I rarely talk with friends or
non-family members via videophone. The key application for me is seeing
and speaking with my family."
Even pioneering 3G developer NTT DoCoMo didn't initially foresee how
consumers in Japan would actually use FOMA videophones. A year and a
half ago DoCoMo placed full-page advertisements
(<http://www.jir.net/jir12_01.html#1>) in the Asahi Shimbun, Japan's
second-largest newspaper, suggesting consumers might like to capture and
transmit videos of their pets.
Recently in the same newspaper, DoCoMo's full-page FOMA ads showed four
cute babies parading behind a dancing dog, indicating the mobile
telephone giant now figures that consumers are more interested in humans
as subjects of communication.
If the Miuras' usage pattern is any indication, DoCoMo's new direction
is right on target.
"Being able to see each other while we talk takes the communication
beyond words," Mrs. Miura says. "But the real drive behind buying the
phones was my husband wanting to see and talk to our daughter at the
same time. You know how people carry pictures of their kids in their
wallets? Well, having a videophone is like carrying living pictures."
"This videophone is truly remarkable," adds her husband. "It's still
hard to believe that I'm actually using such a device every day. It
represents something that was inconceivable to all of us only a few
short years ago."
Mr. Miura has always been curious about new technology, and is generally
eager to try out the latest electronic gadgets, says his wife. In the
business arena, he feels the videophone has the potential to eventually
eliminate much of the time differential in international communications
since users tend to carry their handsets with them late into the evening
and can talk on the spur of the moment with little preparation.
What does Mr. Miura think about blogging and other business-oriented
videophone applications?
"That stuff is for newspaper and television reporters," says Mr. Miura
with a dismissive air. "Seeing images captured by professional
television camera operators is completely different from viewing amateur
videos." But he lets it slip that he knows what the real killer
application for 3G videophones will be.
"Pornography," he asserts. "That's a timeless application: messaging
services, bulletin boards, plus the full-motion 3G aspects you can
imagine. I don't think it's available yet, but it's coming soon, no
doubt about it."
Considering the wild popularity of "dating" services available now via
i-mode and other second-generation (2G) predecessors to FOMA, and the
hundreds of millions of sex-related spam messages inundating Japan's
cellular network daily, Mr. Miura's prognostication seems a safe, if sad,
bet.
Calling his wife so that a reporter can snap a photo of the handset
screen, Mr. Miura explains that what's compelling to him about FOMA is
the emotional impact of seeing his family in real time. Yet no
technology can overcome the need for close person-to-person contact.
"It's a little disappointing that he wants to see and talk to our
daughter rather than me," Mrs. Miura jokes over the phone, with a touch
of wistfulness in her voice.
Her comment prompts a question: Does Mr. Miura use the videophone to
tell his wife he loves her?
"Well, I can't actually speak the words 'I love you'," he admits. "When
I want to tell her I love her, I do it by e-mail."
(This article appeared first at
<www.japanmediareview.com/wireless/1057185409.php>)
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Band-Aids for over-stressed, underserved society?
After interviewing the Miuras last month for the article above, and now
while vacationing on the West Coast of the U.S., a hypothesis occurred
to me. Compared to the United States, does consumer technology in Japan
serve less to empower individuals and more as a "Band-Aid" to reduce
stress and smooth over potholes in the social infrastructure?
Some observations seem to support the theory. Videophones are used to
"spend time" with children when parents cannot. Cell phone e-mail is
enormously popular in Japan: is that because cellular voice calls are
more expensive compared to the U.S.? Or in part because consumers are
less practiced in vocalizing emotion and more comfortable conducting
intimate communications through written messages?
Take another enormously popular consumer technology in Japan: car
navigation systems. Driving the week before last in Portland, Oregon,
where streets are organized in grids and follow logical alphanumeric
sequences (19th NW, 20th NW, Flanders, Glisan, Harrison, etc.), my wife
commented that few people in the United States really need car
navigation systems, simply because it is relatively easy to navigate
from Point A to Point to B, even without a map. In contrast, in Japan
such systems are genuinely useful, helping drivers deal with an almost
complete lack of street signage, narrow and crowded streets, lack of
grids, insufficient parking and other roadway inadequacies.
Japan's much-touted electronic toll collection (ETC) system is designed
to enable drivers to pass through highway toll booths without stopping.
But ETC, which has yet to catch on with the public, seems to be a "Band-
Aid" that no one wants--a poor substitute for both toll-free highways
and roadways wide enough to readily accommodate actual traffic volumes.
(Meanwhile, in much of the U.S., where roadways seem dominated by gas-
guzzling SUVs, the handful of subways and rapid transit systems appear
to be mere "Band-Aids" covering a generally inadequate public
transportation infrastructure.)
Turning to the home, electric carpets and high-tech space heaters
substitute for adequate installation and energy-efficient double-paned,
gas-filled windows. Robotic dogs enable consumers who lack yards or are
subject to condominium restrictions on pet ownership to enjoy "pets" of
a sort--and at low expense considering the lifetime cost of real pet
ownership.
Some years ago, the term "social infrastructure" became popular in Japan.
It refers to public resources shared by all consumers, ranging from
schools to medical facilities to roadways, park space, sewers and
recreation areas. Much of this social infrastructure is difficult to
renovate or re-create in consumer-friendly ways. Perhaps this has
created the need for technological "Band-Aids" to make the consumer
experience of public resources more pleasant.
I'm not sure my hypothesis is correct, but it may be useful for
entrepreneurs in Japan to consider the opportunities presented by the
need for more and better "Band-Aids" that reduce stress and improve the
quality of life in social infrastructure areas such as health, education
and recreation.
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"Why business is like cow drool"
Like me, you've probably spent many pleasant hours watching cows drool
and pondering what bovine slaver can teach us all about entrepreneurship.
(Warning: don't read the rest of this Quote of the Month over lunch or
coffee break.)
Consider cow drool. It hangs, sometimes for hours, from a cow's mouth,
before finally separating and dripping onto the grass. Watching
transfixed, you've probably thought to yourself, as I have, "Dang! I
wish that drool would quit hangin' there and just hit the ground."
Cow drool has two critical qualities, of which slow separation is only
one. The second is that bovine slaver consists of one long, continuous,
unbroken stream of saliva, not little droplets that piddle-plop
separately onto the pasture.
So let this old Japanese business chestnut be your guide when you
imagine the implications for business and entrepreneurship: "Akinai wa
ushi no yodare" ("Business is like the drool of a cow").
Cow drool provides instructive metaphors for business. First, it
reminds us that developing a business takes time; it doesn't happen
overnight. Second, it teaches us the importance of an unbroken stream
of activity, reminding us that patience and unceasing effort are
essential to success. Kind of like another Japanese business cliche:
"Keizoku wa chikara nari," or "perseverance is power," an old saw akin
to "slow and steady wins the race" in English.
Finally, cow drool reminds us that frantic attempts to cash in quickly
are almost always doomed to flop. You've got to let that slaver hang
for a long time before you can harvest it. So until next month, keep
your eyes on those cows...
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Bit and byte
"Surviving and Succeeding in Japan" will be the theme of the next
Entrepreneur Association of Tokyo meeting Monday evening August 4.
Terrie Lloyd (<www.terrie.com>), one of Japan's most prolific and
prominent serial entrepreneurs, will be the featured speaker. Mark your
calendar and plan to be at the City Club of Tokyo, located inside the
Canadian Embassy Complex (see <www.ea-tokyo.com> for details).
Readers with keen interests in Japan will want to check out Japan Media
Review, an online publication featuring stories by digital luminaries
such as Howard Rheingold and Joichi Ito--as well as lesser lights like
me. Sign up for the no-obligation, no spam JMR e-mail update alert at
<www.japanmediareview.com/subscribe/index.php>.
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Tim Clark
Senior Fellow
SunBridge Corp.
Voice 813.5459.0765
Fax 813.5459.0629
clark@sunbridge.com
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Copyright 2002-2003 Tim Clark
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