Tag: galapagos

  • Japan Galapagos Effect – How to capture global value for Japan? Keynote for the American Chamber of Commerce in Japan (ACCJ) by Gerhard Fasol

    Japan Galapagos Effect – How to capture global value for Japan? Keynote for the American Chamber of Commerce in Japan (ACCJ) by Gerhard Fasol

    Japan Galapagos Effect – how to capture global value for Japan. From the Journal of the American Chamber of Commerce in Japan (ACCJ), reproduced with permission.

    Dr. Gerhard Fasol dissects the history behind Japan’s unique international market separation

    By Hugh Ashton

    Originally posted by ACCJ Journal on January 15, 2011 in “Chamber Events”
    based on a talk given by Dr. Gerhard Fasol to the Members of the American Chamber of Commerce (ACCJ) on July 12, 2010, at the Westin Hotel, Tokyo.

    (c) 2011 Copyright by The American Chamber of Commerce in Japan (ACCJ).
    Reproduced with kind permission of ACCJ.

    Dr. Gerhard Fasol, the founder and CEO of Eurotechnology Japan KK, spoke to ACCJ members about Japan’s “Galapagos Effect” at the Westin Hotel in Tokyo. The “Galapagos Effect,” for those unfamiliar with the term, is used to describe Japan’s unique culture of technology that has not expanded beyond Japan’s borders, in the same way that the Galapagos Islands exemplify unique evolutionary developments in nature.

    Gerhard Fasol
    Gerhard Fasol

    Where Japan Leads

    Investment is a prime reason why such developments as Internet-related mobile communications are so advanced in Japan. As Fasol pointed out, Japan has seven times the number of 3G base stations as the United Kingdom. Many of the related technical developments in mobile handsets that are only just coming onto the market outside Japan have been standard for many years in this country—Fasol gave high-quality camera phones as an example.

    Quoting a Nokia spokesman, he claimed one reason for this leap was that Europe is conservative in regards to standards, which take a long time to develop and ratify in contrast to Japan. He amplified the Galapagos analogy by stating, “Japan is a Galapagos island, and doesn’t have to care about standards.”

    Fasol also claimed that Japan is 10 to 15 years ahead of other nations in its use of electronic money. He contrasted Europe’s fragmented and overly bureaucratic nature with Japan’s, where large decisions—such as
    i-Mode and Suica—can be made by a mere two or three people, which may come as a surprise to those who see Japan as a bureaucratic nightmare.

    The reverse side of the Galapagos effect, however, is that Japanese phones designed for the home market fail to find buyers outside Japan. Electronic money is another area where Japanese technology seems destined to remain within the borders of Japan, despite the fact it is now quite common and accounts for a relatively large proportion of currency in circulation at about two percent. Fasol claimed that the U.S. and Europe are not yet ready for the mass introduction of such a payment system like Japan. In the long term, he believes, non-Japanese global giants will probably win out over the Japanese innovators.

    Shedding Light on Genius

    Another area where Japan has led innovations in the commercialization of technology is the revolution in lighting, which is poised to offer new environmentally-friendly illumination options. Based on the invention of the blue LED by Shuji Nakamura, the new lighting systems are also wallet-friendly in that they offer a 6,000-fold advantage in terms of price for the same amount of light over kerosene-powered lighting, still a staple in many parts of the world.

    However, Nakamura was largely ignored by the Japanese business community; he is not even named on the website of the company that employed him (Nichia), and is now working at a university in California—Tokyo University claimed they wanted more “ordinary professors.” According to Fasol, the “Galapagos effect” means that there is no room or need for geniuses like Nakamura in Japan.

    Economy

    Up to 1995, Japan’s economy was growing, but is now static, a unique situation within the G8. Indeed, extrapolated from present trends, South Korea’s economy could overtake Japan’s in 2022.

    Japan has a huge electronics sector, from giants to smaller specialist makers with a $600 million market about the same as the Netherlands. However, the growth is almost zero compared with that of 10 years ago. The net income of the top 20 companies of the sector is actually less than that of a single U.S. company, GE or of Korean rival, Samsung. This has a disadvantageous effect on pension funds, who are the major shareholders of these companies, but the governance of Japanese corporate affairs by shareholders is much less than, say, in the U.S. Still, Japan enjoys a very large national market (unlike the UK, for
    example), which can help companies survive. On the other hand, this may have prevented companies from “going global” as their internal market has reached saturation. Fasol mentions rice cookers as an example of a
    consumer durable that is not purchased frequently, and accordingly has a relatively small and finite market footprint. Even so, every major electrical manufacturer designs and produces a range of rice cookers, with a very low profit margin of well under one percent, which may be part of the legacy of the zaibatsu (the large pre-war conglomerates). This legacy means that most present-day conglomerates feel the need to do everything—for instance, there are three global makers of trains, but ten in Japan.

    The Galapagos Study Group

    Fasol then went on to describe the 26-person interdisciplinary Galapagos Study Group—of which he was the only non-Japanese member—which met monthly for a year and concentrated on the mobile phone industry.

    The results of these meetings were summarized in three sets of recommendations to telecom carriers, electrical manufacturers, and content companies, with the second category receiving the recommendations that Fasol described as most radical.

    He surprised his listeners by saying, “I think it would be best for Japan if in five years or so there were no more Hitachi, or Fujitsu, or Toshiba.” This, of course, was not meant as a direct attack on these specific companies, but as an attack on their conglomerate nature. Instead of the current state, he suggested a move towards smaller companies, focused on profitable businesses, would be preferable and would restart growth.

    On the content side, Fasol claims that Japan is the only country in the world with the intellectual and creative resources to create characters that can stand up to Mickey Mouse and the Disney empire, but has not succeeded in creating global businesses based on Pikachu or Doraemon. Accordingly, the committee made a recommendation that platforms similar to Disney be created in order to create global businesses using such characters.

    Gerhard Fasol
    Gerhard Fasol

    Coming to Japan from the Outside

    On the subject of breaking into “the Galapagos market,” Fasol pointed out that good foreign companies can succeed in Japan if they know the market. As an example, he cites traffic lights, whose specifications in Japan are controlled by the police. Any company failing to recognize this kind of local quirk, no matter what its global standing, is doomed to failure when it comes to Japan. Examples of dramatic failures he cited were Nokia, Nasdaq, and Vodafone. To paraphrase the traditional real estate tag, Fasol claimed that the three biggest mistakes foreign companies coming to Japan make are “arrogance, arrogance and arrogance.” He claimed that this has nothing to do with Japan’s closed markets, quoting the iPhone’s success as an example.

    He pointed out that there are other reasons for the failure of foreign entrants. Apart from the failure to listen to customers and understand the market, reasons include partnership with the wrong joint venture partners, and the management of Japanese ventures by managers who fail to understand the country.

    However, the Japanese service lifestyle, allied with what he terms a “fashion society,” is a great opportunity for outsiders to break into the Galapagos market, and Fasol claimed that foreign companies can tap Japan’s creativity and use it to their advantage.

    He also claimed that the relative isolation of Japan from global standards and practices in some cases actually enriches the global experience. But at the same time this also introduces life-threatening issues for Japan and this isolation must be addressed through two-way dialog from inside and outside of Japan.

    (c) 2011 Copyright by The American Chamber of Commerce in Japan (ACCJ).
    Reproduced with kind permission of ACCJ.

    —–

    Gerhard Fasol’s Stanford University lecture “New opportunities vs old mistakes – foreign companies in Japan’s high-tech markets”

    (was transmitted by Stanford’s TV to 100s of Silicon Valley companies)

    Read more about Japan’s “Galapagos effect” here:

  • Japan technology companies – the future?

    Japan technology companies – how to move to the future?

    Gave a talk to a group of about 50 CEOs of the Japan subsidiaries of global companies on the topic “A future for Japan’s tech companies?”

    I talked about the same issues as at the TTI-Vanguard Forum about a year earlier, and started again with the conclusions:

    Japan technology companies – First to develop many technologies, but not good enough in capturing global value

    • Conclusions 1: Japan has invented and first brought to market many new technologies and business models in today’s hottest areas, and Japan is not good enough at capturing global value from this incredible creativity
    • Conclusions 2: why does it take at least 10 years to reinvent the wheel in London?
    • Conclusions 3: WHAT is holding Japan back to capture global value from fantastic inventions?
  • Paradigm change of the global mobile phone business and opportunities for Japanese mobile phone makers

    Presentation at the CEATEC Conference, talk NT-13, Meeting Room 302, International Conference Hall, Makuhari Messe, Friday October 3, 2008, 11:00-12:00.

    See the announcement here [in English] and in Japanese [世界の携帯電話市場のパラダイム変更と日本の携帯電話メーカーのチャンス]

    The emergence of iPhone, Android, open-sourcing of Symbian, and the growth of mobile data services are changing the paradigm of the global mobile phone business opening new opportunities for Japanese mobile phone makers. Japan’s mobile phone handset makers have missed most opportunities during the first wave of mobile phone opportunities. The developing paradigm change opens new opportunities for Japanese makers. The talk will explain the paradigm shifts and trends of the global mobile phone handset market, and resulting opportunities for Japanese mobile phone makers, and will indicate how these opportunities can actually be realized.

    Copyright 2013 Eurotechnology Japan KK All Rights Reserved

  • Will the iPhone trigger a turning point in Japan’s mobile phone industry?

    Will the iPhone trigger a turning point in Japan’s mobile phone industry?

    Tetsuzo Matsumoto (Senior Executive Vice-President and Board Member of SOFTBANK MOBILE Corporation),
    Gerhard Fasol (CEO, Eurotechnology Japan KK)
    and
    Dennis Normile (Japan Correspondent of SCIENCE Magazine, and FCCJ)
    discuss about the future of Japan’s mobile phone market.

    “Will the iPhone trigger a turning point in Japan’s mobile phone industry?”
    (Foreign Correspondents’ Club of Japan, Tokyo Wednesday, August 13, 2008, 12:00-14:00)
    (Photo: Copyright Foreign Correspondents’ Club of Japan, used with permission)

    Left to right: Gerhard Fasol (Eurotechnology Japan), Tetsuzo Matsumoto (VP SoftBank-Mobile) and Dennis Normile discuss the iPhone market entry to Japan
    Left to right: Gerhard Fasol (Eurotechnology Japan), Tetsuzo Matsumoto (VP SoftBank-Mobile) and Dennis Normile discuss the iPhone market entry to Japan

    Copyright 2013 Eurotechnology Japan KK All Rights Reserved

  • Japan’s Mobile Phone Industry and u-Japan (Talk announcement)

    • Title: “Japan’s Mobile Phone Industry and u-Japan”
    • Date and Time: Thursday, 12th October 2006, 17:00-19:00
    • Location: Main Conference Room 4F, EU-Japan Centre for Industrial Cooperation, Tokyo

    Agenda:

    Japan’s mobile phone and broad-band markets are about 3-6 years ahead of Europe: new services are typically invented or first brought to market in Japan, 3-6 years earlier than in Europe. Internet in Japan is generally much faster and much cheaper than in Europe. For this reason and because of it’s size, Japan’s telecom markets are full of opportunities for European companies with the right products and the right strategy, and for investors with the necessary knowledge.

    Japan’s mobile phone industry is notoriously difficult to understand for Europeans because it’s
    market logic is very different from Europe’s, and because the pace of innovation and structural change is much faster, and because of the language barriers.

    This talk will explain the driving forces behind recent dramatic changes in Japan’s mobile telecom sector, and will explain new changes that the “ubiquitous-Japan” (“u-Japan”) policy will bring in the near future.

    Do you need to know what Europe’s mobile phone and internet markets will look like in 2010 or 2015? – Come to this talk and you will get a good look into Europe’s IT future about 5 years ahead, as well as Japan’s telecom markets today.

    Background

    Following Vodafone’s decision to end business in Japan and the announcement of the sale of Vodafone-Japan to SoftBank, this author has been asked to brief the Technology Attaches of the 25 EU Embassies in Tokyo on Japan’s mobile phone and telecom sector.

    The EU Technology Attaches were particularly interested in the impact on Europe by the termination of by far the biggest ever European investment in Japan. Clearly it is also important to determine, what other European companies can learn from Vodafone’s experience.

    Eurotechnology Japan KK has been awarded a contract by the European Union to benchmark Japan’s telecom sector vs EU and make recommendations.

    More about Japan’s telecom sector

    Copyright 2013 Eurotechnology Japan KK All Rights Reserved

  • Why Japan is several years ahead of Europe in telecoms…

    Why Japan is several years ahead of Europe in telecoms…

    Briefing the EU Attaches at the EU Embassy in Tokyo about the reasons behind Vodafone’s departure from Japan

    The deeper reasons and background on why Vodafone failed in Japan

    Today (March 23, 2006) I was invited to brief the Technology Attaches of the Embassies of the 25 European Union countries here in Tokyo about Japan’s telecommunications sector (both fixed net and wireless) in a one hour presentation + discussion. I had offered several alternative topics and the conference of EU Technology Attaches selected the most provocative title I had offered:

    Why Japan is several years ahead of Europe in telecommunications and what Europe can do to catch up

    Vodafone KK’s Chairman and former NTT-DoCoMo Vice-President Tsuda, who had worked 34 years at NTT and DoCoMo (and who resigned from his Vodafone-Japan CEO position a few weeks after being head-hunted), said in a recent interview with Bloomberg that “Japan is way ahead in 3G”. – therefore, although this title is clearly provocative, it’s clearly worthwhile examining this question. With the sale of Vodafone KK to SoftBank last week, the timing of this briefing was particularly interesting. My presentation discussed the following questions:

    • Is Japan ahead of Europe in Telecommunications?
    • Why?
    • What is the impact?
    • Is this important?
    • What Europe can do to catch up

    Read our report on Japan’s telecom sector to understand more

    Copyright 1997-2019 Eurotechnology Japan KK All Rights Reserved

  • Why are keitai so hot in Japan?

    Why are keitai so hot in Japan?

    Seminar announcement

    The European Institute of Japanese Studies (EIJS Academy in Tokyo) of the Stockholm School of Economics will hold a seminar in Tokyo-Marunochi on Thursday, February 16, 2006:

    Topic: “Why are Mobile Phones (Keitai) so hot in Japan? – and How European companies in all sectors can profit from Keitai”

    Speaker: Gerhard Fasol

    Gerhard Fasol
    Gerhard Fasol

    Agenda:

    Japan created the most passionate and most advanced mobile communications (keitai) market in the world. Recently, almost all innovations in mobile communications have been developed or brought to market first in Japan. Fasol’s talk will explain why this is, and how European companies in all fields, from retail to publishing can profit by building keitais into their business models.

    Date: Thursday, February 16, 2006
    Time:

    6.15 – 7.00 p.m. Drink and Snack (served before the lecture)

    7.00 – 9.00 p.m. Lecture and Discussion

    Place:
    Marubiru Conference Square, Room 2 (Tel: 03-3217-7111)
    8th floor of Marubiru, 2-4-1 Marunouchi, Chiyoda-ku, Tokyo
    One-minute walk from JR Tokyo Station, Marunouchi South Exit

    Fee: JPY2,000 per person, payable at the door
    Free for students, please bring your student ID
    Free for those who are from sponsoring companies

    Advance registration required: Please sign up (via email) or fax to (FAX 03-3212-1530) for the attention of Ms. Futagawa (EIJS Tokyo Office.)

    Copyright·©2013 ·Eurotechnology Japan KK·All Rights Reserved·

  • New opportunities versus old mistakes in Japan

    Foreign companies in Japan’s high-tech markets

    Stanford University US-Japan Technology Management Center Autumn 1999 Seminar Series: ” The Transformation of R&D in East Asia and Japan”

    Thursday, October 28th, 1999: 16:15pm US-Japan Technology Management Center, (Skilling Lecture Theatre)

    (was transmitted by Stanford’s TV to 100s of Silicon Valley companies)

    Copyright 2013-2019 Eurotechnology Japan KK All Rights Reserved