Great article in the most recent Forbes. Many (most?) of the gadgets mentioned in the last sentence will contain flash from SNDK.
forbes.com
A Digital Counterattack
By Benjamin Fulford
SONY, MATSUSHITA AND other Japan-based electronics makers were the undisputed rulers of the analog universe as the 1990s began. Then the digital revolution erupted around them, and they largely missed out on wireless phones, PCs, handheld computers and the Web. The Palm-Pilot came from a U.S. fledgling; Japan's big manufacturers have produced nothing truly revolutionary since the VCRs and compact disc players and Walkmans of the 1980s.
Now Japan's titans are waging a comeback. After spending tens of billions of dollars on research the past few years, they are preparing a new generation of cool gadgets that will be cheap, portable, powerful and Web-savvy, with near-perfect audio and visual capabilities. The first peek at the next wave comes in early October at the Japan Electronics Show.
The penalty for failure will be huge. Japan's production of TV sets, VCRs, stereo systems and the like peaked in 1991 and has been slowly declining as lower-cost, lower-tech Asian countries have gained. The next generation of high-tech products is all that can prevent the slow death of Japan's consumer electronics industry.
Sony Corp., with its well-oiled publicity machine, grabs headlines with its PlayStation videogame player and Vaio computers. But the one to watch in this counterattack is Sony's archrival, Matsushita Electric Industrial Co. with its Panasonic brand. Matsushita has annual revenues of $72 billion and huge ambitions. "Almost everything that is connected to a network will be made in Japan," predicts Yoshitomi Nagaoka, vice president of Matsushita's electronics arm.
Prototypes recently previewed for FORBES, and destined for markets by 2001, include portable devices able to handle electronic mail, Internet access, speech recognition, high-resolution video, wireless phone calls and more. They are so feature-rich that true success will require breakthroughs in a decidedly low-tech area: the battery.
Also being contemplated is a "smart panel" that will allow people to manipulate video clips, text, pictures and more as if they were arranging pieces of paper on a desk. No keyboard required. "As long as people have to use a keyboard, there will be no multimedia democracy," says Akira Kanda, head of Matsushita's end-user lab, the Multimedia Life Creation Center. With some of the new devices, he says, "Anyone, including children and old people, will be able to create their own Web pages."
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Sony's PlayStation is hot now, but watch out for Matsushita's sleek portables.
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Matsushita's developers aim to turn Kanazawa, a city of 457,000, into a gigantic lab. Together with Nippon Telegraph & Telephone, they will wire homes and businesses in the city with fiber-optic lines and supply assorted networking devices at nominal charge. In exchange, they will watch how nongeeks work and play with the new toys. In some cases Matsushita goes so far as to monitor their pulse and breathing.
Sony thrives thanks to a single product, the PlayStation, which accounted for 40% of its profits last year. Matsushita's winner is cell phones (sold mostly in Japan), which with other telecom gear provided 27% of earnings last year. More than 2 million Japanese who have never owned a computer have started e-mail and Web access this year using mobile devices, many under the Panasonic name.
The company is placing its biggest bets on digital broadcasting, and for good reason. The world's gradual transition to digital TV could create hardware sales of $380 billion over the next decade. One vital battleground is the format fight over recordable digital videodiscs due soon--and Sony looks likely to lose. It lost the VHS-Beta video war by failing to line up enough allies, and in DVD Matsushita has signed up 46 companies to embrace its standard; Sony has just 5.
At the Japan Electronics Show, Matsushita will unveil the world's first DVD recorders for TV sets. DVD recorders won't need rewinding, will let viewers instantly access any scene they want (or zip past a commercial in an eyeblink), and offer picture and sound rivaling that of a movie theater. The new product, expected about 2001, will also link to computers for editing and downloading of content. And it will be cheap.
"They are semiconductor [chip-based] devices, so they will ultimately be a lot cheaper to manufacture than VCRs," says Yoshiaki Kushiki, director of Matsushita's Multimedia R&D Center. In three years or so most households will be able to afford high-definition, 50-inch screens to accompany their DVD recorders, he says.
The next step will be large screens that mimic the human eye by letting viewers focus on particular parts of a picture, much as your eye focuses sharply on the person speaking to you. Three-dimensional TVs that don't require special glasses also are in the works, a Panasonic official says.
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Up next: 3D televisions that don't require special glasses.
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Matsushita also is testing two TV set-top boxes as home servers. One is a jukebox that uses 50 DVD/RAM discs to store up to 100 hours or 4 days of programming. The other uses hard drives to record the same amount. In the next generation, the total will reach 600 hours or 25 days of programming. Using an electronic program guide, you can select programs or types of programs. You can return from two weeks of vacation to catch up on all the Braves games you missed.
In March the company will begin selling a key building block for the portable future: the SD (smart digital) memory card. It's a square about the size of a postage stamp that will be able to hold an hour of music. MP3 lovers beware: It will offer copyright protection. People will be able to download an hour of tunes from a music publisher in just five seconds. You could then listen to it by sticking the card into your mobile phone or a tiny player that can be hung over the ear.
By 2002 the little chips will be able to hold 1 gigabyte of information, enough to hold thousands of digital pictures or to allow the creation of video cameras no bigger than a cigarette box. Matsushita predicts that by 2005 there will be an $80 billion market for SD memories and devices that use them.
Sony, pushing a rival "memory stick," has produced a fascinating array of still mainly conceptual products based on it. Walkman-like devices the size of a movie ticket, tiny viewers that can display hundreds of digital pictures and stereo gear are in the works. A memory-stick Walkman will hit the market early next year, a Sony official says.
Here again, however, Matsushita has trumped Sony by lining up more allies. Its SD memories are backed by a consortium (Matsushita, San Disk and Toshiba) that already controls more than 90% of the global market for flash memory cards. So far, only Sony sells its memory sticks, though the company hints that other companies may soon follow.
In Japan, Sony now sells Vaio computers that can record and edit up to 12 hours of television on their hard disks. Programs are selected using a program guide on the Web. But Sony has decided against selling the machines in the U.S. because Americans might balk at the $3,000-plus price.
Yet Sony could be in trouble unless it manages to leapfrog ahead with another winner like the PlayStation. Not counting the PlayStation, Sony's operating profits fell 93% last year as rivals like Matsushita squeezed it in most markets. Even the PlayStation could be threatened in two years by the Dolphin, a game player under development by IBM, Nintendo and Matsushita. In the fiscal first quarter ended June 30, Sony's net, including PlayStation, fell 55% and Matsushita's slid 14%.
Regardless of which powerhouse prevails, the fierce rivalry between Matsushita and Sony will yield one clear result: new gadgets galore for American consumers. |
