Negotiating with Japanese companies is beginning to seem normal to me (!). I should be sent away for psychiatric evaluation, or forbidden from going to Japan for a year. I am now in the midst of a 4-way negotiation in Japan, don’t ask me how I got involved in this… It is quite fun and exciting, but I am reminded of one thing - one of the big advantages that Japanese execs have in negotiation is that they do it very thoroughly, spending a lot of time discussing and rationalizing their own position, and having lots of people involved in the process. And if they don’t get a reasonable offer, they don’t give in or give up, they just keep coming back (or, as in some companies, simply say no and break it off). They just wear you down. Not only is this a conscious tactic, but it is a logical result of a group consensus approach, a belief in careful preparation, and a social value on precision and detail.

On our side, we usually spend an hour or so at best batting around different scenarios, throwing out some numbers, and setting a position that may or may not be based on careful and thorough analysis. We negotiate on the implicit expectation that there will and SHOULD be crises in the negotiation, which will push each side to the edge of its position, and then after the crisis hits we will change our position.

I would estimate that the Japanese executives spend at least 10 times more man-hours in negotiating than most Westerners do, including the preparation phase. I think the practical implication of this is clear – prepare to negotiate! BTW the Harvard Negotiation Project found out years ago that preparing to negotiate is one of the most critical success factors in achieving a satisfactory outcome.

Good luck!

Dan

***ISRAEL-JAPAN NEWS***

+RIKEI CORP. TO RESELL RIVERHEAD PRODUCTS

Riverhead Networks, a provider of distributed denial-of-service (DDoS), announced that it had signed a distribution agreement for Japan with Rikei Corp. According to terms of the agreement, Rikei Corp. will sell and support Riverhead's DDoS detection and mitigation solutions.

+MAGINK RAISES $5 MILLION FROM JAPANESE INVESTORS

Magink Display Technologies, a developer of full-color, digital-ink billboards for the outdoor advertising industry, has raised $5 million in Series B financing. New investor Japan Asia Investment Co. led the round, which included participation from Marubeni, also a new investor.

***BUSINESS NEWS***

+ JAPAN'S BROADBAND CONTRACTS MORE THAN DOUBLE IN FY 2002

Japan's Internet access providers had a combined 9,397,426 broadband subscribers as of the end of March, more than double the 3,861,195 figure of a year ago, according to the telecom ministry. The surge was caused by aggressive promotional campaigns. Most of the contracts – 7.02 million - are for ADSL service (2.38 the year before), followed by cable at 2.07 million (1.46 million a year before), and FTTH at 305,387 (26,400 a year before).

+JAPAN LEADER IN NANO-TECHNOLOGY SPENDING

According to Businessweek magazine, Japan was the world leader in government spending on nano-technology in 2002. The Japanese government spent approximately $1 billion on nano-technology, almost twice as much as the U.S., which ranked second with $550 million. The E.U.’s spending totaled $450 million in 2002.

+ WIRELESS BROADBAND MARKET TO GROW TO $790 BILLION IN 10 YEARS

The market for wireless broadband communications services in Japan is projected to reach $790 billion in 2013, according to recent estimates by an advisory panel to the telecom minister. The overall market value for wireless communications services, including production of communications hardware, is projected to hit almost $2 trillion in 2013, of which 40% is estimated to be revenues from communications services.

+ DEREGULATION TO OPEN DOOR FOR UWB, 5GHZ OUTDOOR WIRELESS LAN SYSTEMS

Japan's telecom ministry will start looking at widespread deregulation of the way outdoor radio wavebands are utilized, with a view toward implementing changes to relevant laws in 2004. These de-regulations are expected to enable 5GHz outdoor WLANs and to clear the way for ultra wide-band services capable of transferring data at over 100Mbps.

+SEMICONDUCTOR SALES STILL STRONG IN JAPAN

The Semiconductor Industry Association (SIA) announced that worldwide semiconductor sales climbed to US$12.1 billion in March 2003, a 2.6% monthly increase. Sales in Japan, who has a 23% of total chip consumption, rose by 33.5% year-on-year, while the Asia-Pacific market, the world's largest, was up 17.2%. Europe, the 3rd-largest market, rose by 11.3%, while sales in the Americas fell by 8%, reflecting the migration of the electronic equipment market to Asia.

***GENERAL TECHNOLOGY NEWS***

+NTT EYES PROVIDING FIBER-OPTIC IP TELEPHONY SERVICES

NTT Corp. plans to start offering IP telephony services through fiber-optic networks, according to the company's three-year business plan. NTT plans to build a new IP communications network by spring 2005 using fiber-optic lines. Before that, the firm will start offering such services as fiber-optic IP telephony and videophones via existing networks.

+ DOCOMO TO DIRECT $360 MILLION TO FOMA CELL PHONE DEVELOPERS

NTT DoCoMo said it would funnel a combined $360 million into five makers that have developed the carrier's FOMA mobile phones to help the five innovate their third-generation FOMA handsets and cut prices. The planned disbursements are designed to help improve the handsets and bolster their popularity.

+ USE OF IPV6 BECOMING MORE WIDESPREAD IN DEVICES OTHER THAN PCS

Internet Protocol version 6 (IPv6) has begun to be adopted for use in devices such as intelligent home appliances, rather than just in straightforward computers. The increasing popularity of home servers is driving the trend, and major manufacturers like Sony and Matsushita Electric Industrial Co. are reportedly hurrying to develop IPv6-compatible devices.

+ J-PHONE TO OFFER NEW ANTI-SPAM FUNCTION

Japan's J-Phone mobile service provider plans to introduce a new 'e-mail header information viewer function' as part of its efforts to combat spam. With the new viewer function, J-Phone says its customers can check e-mail header information on a PC, making it easier to determine the source and routing of spam.

+ 'MOBILE TV' TO START MPEG-4 ALTERNATIVE IN 2005

Japan Broadcasting Corp. (NHK) and commercial TV broadcasting companies have started to study video codec alternatives to MPEG-4 for their "Mobile TV" project set to launch in 2005, due to difficulty with the MPEG-4 royalty system. Candidates include the H.264, MPEG-1 and others.

+ DOCOMO SELLING MOBILE PHONE WATCH

Japanese mobile telecoms giant NTT DoCoMo has started selling a mobile phone that doubles as a wristwatch. The 113-gram "Wristomo" silver-bodied watch-phone pops off the wrist at the push of two buttons, allowing it to be used like a normal cellphone.