Paul and ALL: Article...A look at PC sales in Japan...
nando.net
U.S. PC firms gearing up to boost presence in Japan
Copyright c 1997 Nando.net
Copyright c 1997 Reuter Information Service
TOKYO (September 22, 1997 11:27 a.m. EDT) - U.S. personal computer makers are gearing up to boost their presence in Japan's PC market, which is at a major turning point after three years of spectacular growth.
The world's two PC giants, Compaq Computer Co. and Dell Computer Corp., have launched their offensive by announcing price cuts and introducing new low-cost PCs.
Japan's biggest maker, NEC Corp., has said it will start producing international-standard PCs by the end of the year.
The move is seen as an attempt by NEC, which currently boasts a nearly 40 percent share of Japan's PC market with its proprietary standard PCs, to protect its dominance.
Compaq considers NEC's shift in strategy as an opportunity.
"NEC has enjoyed a special status in Japan with its proprietary format. But the decision (to abandon this format) will be an advantage for us," Compaq Japan K.K.'s president Kuniaki Fujimoto told reporters on Monday. "NEC will find it hard to maintain the lion's share," he said.
A full array of new PC and server products will be on display at the "World PC Fair," which kicks off Wednesday in Makuhari, near Tokyo, and runs until Saturday.
About 580 leading PC manufacturers and makers of peripheral equipment will show their products to an estimated 250,000 customers, making it Asia's largest PC fair.
After three years of dramatic growth, Japan's PC sales slowed in the April-June quarter of 1997. Sales of desktop PCs sagged 11 percent to one million units, the first year-on-year decline in five years, according to a Japanese PC makers' trade group.
Individual users, shunning high prices, stayed away from the PC market, which weighed on overall sales, it said.
However, the trade group said demand for corporate-use models was still strong, with sales of portable PCs growing 42 percent year-on-year in the April-June quarter. Demand for corporate-use servers also grew sharply, it said.
Dell began selling its server products in Japan last week.
"In the server market in Japan, we would like to obtain a 10 to 15 percent market share within two to three years," Hiroshi Fukino, chairman of Dell Computer's Japanese unit, told reporters last week.
"The key to our overall growth is Japan," said Michael Lambert, a senior vice president at Dell.
Meanwhile, Compaq said it would start shipping low-cost stripped-down PCs in Japan for firms trying to cut maintenance costs at the end of September.
The NetPCs will be compatible with Microsoft Corp.'s Windows operating system, but do not have drives for CD-ROMs or floppy disks.
Compaq also said it had cut prices of its Deskpro series personal computers in Japan by up to 24 percent.
Compaq said it would be in an advantageous position when NEC starts producing international standard PCs and the Japanese market becomes less dominated by its proprietary PCs.
NEC had an 80 percent share of Japan's PC market in the 1980s, but has been losing its share amid aggressive sales by makers of international-standard PCs.
NEC's hardware upgrade is aimed at making PCs suitable for Windows 98, the next-generation operating software Microsoft plans to start shipping in April-June of 1998.
Most Japanese PC makers expect the Japanese PC market to grow by only 10 to 20 percent in the year to March 31, 1998, due in part to a delay in shipments of Windows 98. Microsoft originally planned to start sales at the end of 1997.
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Could be better, but overral not too bad.
Michael |
