Japanese may launch computer offensive in US by year's end
The cover of Apple Computer's new 1983 annual report looks like a blackboard. It shows IBM and Apple with big chalk arrows pointing up, for continued strong growth. But off to the side, there's another arrow with a flag - a Japanese flag - and the year 1986 scrawled nearby.
American computermakers are not naive. They don't expect Japan to leave the small-computer stone unturned in this country. But it's anybody's guess when and how the Japanese will enter the market in any serious way.
''The earliest major push will be around next Christmas,'' says Jeanne Dietsch, president of Talmis Inc., a computer-research firm. A few other analysts also think Christmas sounds reasonable.
But not Aaron Goldberg. ''The Japanese a force by next Christmas? That's laughable,'' harrumphs this regional manager for the Pacific branch of the research company International Data Corporation. ''They don't have the products. They don't have the distribution, and they don't have the software,'' he says.
For now, that's certainly true. With only 2 percent of the US microcomputer market, the Japanese can hardly claim success here. But now that IBM has set a standard in business computers, the Japanese companies have a defined market ''to attack,'' as one Sanyo executive put it. And, with Texas Instruments out of the home-computer market and others floundering, some analysts believe that market could support a strong new entrant.
The Japanese haven't made a big splash so far for several reasons: For one thing, the American computer industry has been a moving target, difficult to hit. Computer companies come and go; products change monthly. ''In other industries, the Japanese have sat back and waited to see what the American consumer wanted,'' says Dr. Harold Kinne at Future Computing, a computer research firm. That's just what they are doing now, he says.
At the same time, ''the Japanese have been very concerned with their own internal market,'' Dr. Kinne explains. ''There's an unbelievable market for Japanese word processors. They've been concentrating on that, and the US has been on the back burner. When they decide to give the US priority, they will be a major factor.''
It looks like the Japanese companies, in the US at least, are just now trying to put new vigor into their offensive strategies. These firms - including Epson America, NEC Home Electronics, Panasonic, and Sanyo Business Systems - are mostly going for the business user who needs a desktop, or a portable, computer. They say their competitive advantage will be price and quality, which both come from automated manufacturing.
''The Japanese have been very successful at automation,'' says Apple spokeswoman Barbara Krause. ''We plan on making our manufacturing operations as state-of-the-art as possible.'' The computermaker will shortly open an automated manufacturing facility in Freemont, Calif.
Now that IBM has set the standard in business computing, the Japanese have something to shoot for. Some of these companies will concentrate on IBM look-alikes that run IBM software. (''Hogwash,'' says Goldberg, about the importance of the IBM standard. He thinks IBM is likely to become more proprietary with its small computers, leaving its dependents in the dust.)
''Apple set the standard, and IBM set the standard, and if these are the standards, now it makes sense for the Japanese to come in and become very strong ,'' states Thomas Priestly, general manager for NEC Home Electronics.
NEC and Epson say they have had good growth this year. They also say they are negotiating with major retailers to expand their already sizable distribution network. NEC and Epson have a lot going for them because they are big sellers of computer peripherals - like printers and video screens - and the market knows them. At the moment, NEC's kneetop, portable computer is a hot seller, and Epson's QX-10 personal computer has received good marks from analysts.
Companies like this, which have their foot in the door and already have a decent distribution system, stand a chance, say the experts. For a Japanese company that does not yet have its own American branch, it will be much more difficult.
''What can they bring to the table?'' asks Ronald Stegall, senior vice-president of marketing at Tandy (Radio Shack). ''How can they reduce costs significantly when the Americans already competitively play that game? And distribution - mail-order service won't work in the serious business-computer world. They are behind in repair, warranty, and service, and capability in software . . . . The Japanese are making an effort at the IBM-type, but that's pretty crowded right now.''
There is an uncrowded market just waiting for a steady-as-a-rock manufacturer , and that's the home market for computers under $300.
But while IBM established some degree of standardization in the upscale personal-computer market, no such standard exists in the home market. Different kinds of software must still be written for the individual machines, because they don't all share the same operating system. It's as if an RCA stereo could only play an RCA record.
There is a way the Japanese may get around this. Right now, 14 Japanese companies are working on their own set of standards, including an operating standard, called MSX. The computers with MSX would all be able to use the same software, just like a record player can play any record. The idea is that they will bring this new system (invented by an American company, but being developed in Japan) to the US and circumvent the whole standards problem by using MSX.
Again, analysts and industry executives are mixed on this one. ''MSX has the potential of being an important thing. It is not important yet,'' Dr. Kinne says.
''I'm not sure MSX will do it,'' hedges Chris Kirby, analyst at Sanford C. Bernstein & Co., a New York broker. ''It's a little late in the game for new operating systems to emerge.'' One US company, tiny Spectra Video, has taken the gamble and is coming out with an MSX machine of its own. ''I don't think MSX is up in the air,'' says Steven Weinstein, vice-president of marketing. He names three Japanese companies with plans to bring MSX to the US next year. And, he says, ''at least half a dozen (US) software houses are committed (to writing programs for it).''
Whether the Japanese come in 1984, or 1985 - whether they concentrate on the business or the home market - US companies are still taking them seriously.
''You never underestimate the Japanese,'' says Bruce Entin, an Atari spokesman.