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A monthly review of the latest developments in Japan’s IT, telecom, and life sciences sectors

March 2003 - Volume VI, Issue III

Triangle Technologies is the leading Japan Israel business development and investment advisory firm
www.triangletech.com

Dan's Desk

From Triangle's CEO

There will be no “Dan’s Desk” column for this month. Dan will be back next month with more on doing business in Japan. In the meantime, we suggest reading this very interesting Time Magazine story, about surviving the market slump by going global:

www.time.com/time/globalbusiness/article/0,9171,1101020923-351214,00.html

***TRIANGLE TECHNOLOGIES NEWS***

+CYOTA DELIVERS VERIFIED BY VISA TO UFJ

Cyota, a leading payment security company, has been selected by UFJ Card, the card division of UFJ Bank and one Japan’s 4th-largest card issuer with a 7 million card base, to provide the Verified by Visa Internet payment security technology for its Visa card members. Cyota SecureVbV is a Verified by Visa-compliant solution that reduces fraud by authenticating cardholders and producing online purchase receipts for their approval. UFJ’s service is provided through Intelligent Wave Inc. (IWI), Cyota’s partner in Japan. Triangle Technologies, which has helped form numerous strategic alliances in Japan for its clients, assisted in signing the distribution agreement between Cyota and Intelligent Wave Inc.

***ISRAEL-JAPAN NEWS***

+M-SYSTEMS, TOSHIBA UNVEIL MOBILE DISKONCHIP G3

M-Systems (Nasdaq:FLSH) and Toshiba America Electronic Components Inc. (TAEC), along with its parent company, Toshiba Corp. (OTC:TOSBF) (JP:6502) announced the upcoming availability of the Mobile DiskOnChip G3 flash disk. The Mobile DiskOnChip G3 is first internal memory product based on M-Systems' recently announced x2 technology and multi-level cell (MLC) NAND flash silicon.

+KAGOOR NETWORKS PARTNERS WITH JAPAN’S NTT-ME

Start-up Kagoor Networks, which provides solutions that control voice over IP (VoIP) technology, has signed a partnership agreement with Japanese telecom integrator NTT-ME. Under the terms of the agreement, NTT-ME will provide Kagoor's VoiceFlow series of VoIP border controllers to Japanese service providers and enterprises deploying VoIP and video over IP applications.

+IXI SOFTWARE ENABLING SEIKO, SANYO INNOVATIONS

Wireless software solutions provider IXI Mobile announced two new collaborations at the 3GSM World Congress in Cannes. Seiko Instruments Inc. (SII) is using IXI software to create a new variety of wireless watches and related services for the mobile market, while Sanyo Technology Center U.S.A., a division of Sanyo North America Corporation, is unveiling a series of conceptual models of new mobile devices codenamed "Alviss".

***BUSINESS NEWS***

+JAPAN BROADBAND PENETRATION CLOSE TO 17%

Japan's Ministry of Public Management, Home Affairs, Posts and Telecommunications reported that nearly 540,000 households in Japan signed up for broadband Internet service in January, bringing the country's total broadband subscribers to 8.344 million households. This implies a broadband penetration rate of around 17.2%. xDSL came out on top again with 88% of total growth in January, with FTTH and CATV trailing behind.

+3G SUBSCRIBERS TOP SIX MILLION IN JAPAN

A total of 621,600 people signed up for 3G mobile phone services in Japan in February, bringing the country’s 3G subscriber total to more than six million as of the end of the month, according to Japan’s Telecommunications Carriers Association (TCA). NTT DoCoMo enjoyed its highest monthly growth in subscribers, thanks to two new FOMA models launched last month, according to an earlier report from Dow Jones Newswires. Total mobile phone accounts stood at 74.368 million as of the end of February.

+ JAPAN CELLPHONE SHIPMENTS UP 17.2% Y-O-Y

Japan's domestic cellphone shipments grew at double-digit rates in January for a third month in a row, according to the the Japan Electronics and Information Technology Industries Association (JEITA). Handset shipments rose 17.2 percent from the same month a year earlier to 3.84 million units. Japan's three mobile phone have brought out a rapid succession of new camera-phone models in recent months, spurring users to replace their old phones and breathing new life into an increasingly saturated market.

+ONE OF FOUR MOBILE PHONE USERS HAS CAMERA-EQUIPPED PHONE

One out of four mobile phone users in Japan uses a mobile phone with a camera, and 70% of the camera-enabled phone owners send images taken by the camera to their friends' mobile phone, this according to IT research firm Ipse Marketing. Ipse Marketing's survey of mobile phone users was conducted through its Web site, gathering responses from 2,007 mobile phone or PHS users.

+DOCOMO CLOSE TO FOMA TARGET

NTT DoCoMo announced that it is much nearer to its goal of nationwide coverage for its FOMA 3G service than previously expected. DoCoMo believes that the offering of its services to 97% of the populated areas of the crucial Kanto Koshinetsu region will boost its national coverage to 89% of the Japanese population. This should bring DoCoMo closer to its stated goal of achieving 91% population coverage by the end of this month.

+DIGITAL INFO MARKET TO HIT $118B IN 2005

The size of Japan's digital information market is projected to expand from about $76 billion in fiscal 2002 to about $118 billion in fiscal 2005, according to Mitsubishi Research Institute (MRI).
MRI defined the digital information market as covering digital content such as images and music distributed via the digital network, communication networks and services as well as digital information terminals.

***TECHNOLOGY NEWS***

+DOCOMO TO START FLAT-FEE WIRELESS ACCESS

NTT DoCoMo has finally decided to launch a flat-rate charging system for users accessing the Internet via a PHS wireless modem. DoCoMo says the new service will start April 1st, and will cost JPY4,880/month ($41.16), a bit lower than the competition.

+DOCOMO ADDS FLASH

NTT DoCoMo has agreed to become the first phone carrier globally to build Flash capability right into its phones. DoCoMo's new 505 series phones, to be released later this year, will carry the player.

+IPV6 DEMONSTRATION STARTS AT SCHOOLS IN MITAKA, TOKYO

Mitaka City in Tokyo has recently started the "e!school” project, to establish gigabit class networks in elementary and junior high schools, public libraries and the city hall, in order to demonstrate an experiment of IPv6 multicast or high speed wireless LAN. This comes as part of the Japanese government's "e-Japan 2002 program”, and will continue until fiscal year 2004.