WIRING JAPAN
A bitter culture clash that has reduced Japan
to a third-rate power in networking.
By Bob Johnstone
WIRING JAPAN
A bitter culture clash that has reduced Japan
to a third-rate power in networking.
By Bob Johnstone
------------------------------------------------------------------------
At precisely 8:00 on the evening of Friday, September 17, 1993, Japan's first commercial Internet packets flashed out of Tokyo and down Trans-Pacific Cable No. 4, bound for San Jose, California. A new era in Japanese networking had begun. As befits the birth of a new business, cheers went up and toasts were made. But not everybody was rejoicing in Tokyo that night - for Japan's first commercial Internet packets were sent by American engineers working for Japanese subsidiaries of the US corporations InterCon Systems and AT&T. InterCon's first customer was TWICS, Japan's first public access Internet provider, a small for-profit firm most of whose 400-odd subscribers are foreigners based in Japan.
Across town, a group of Japanese Internet pioneers were grinding their teeth in frustration. The company they had set up to provide commercial Internet services had been denied a license to operate by Japan's Ministry of Posts and Telecommunications. Holding up the locals while waving on the foreigners is not the way business is usually done in Japan. Something odd is going on.
That something, in essence, is the head-on collision of two cultures: The freewheeling, democratic style of the Internet has run smack into traditional Japan at its most authoritarian. On one side, you have the technology pioneers, young volunteers who built Japan's largest research network by their own efforts, without any support from the Japanese government. They are led by Jun Murai, the man some Americans (like Carl Malamud and Howard Rheingold) call the Internet samurai.
On the other, you have the officials charged with providing network services to the Japanese research community. They have tried to ram unpopular standards and technolo-gy down users' throats - and failed. Their leader is Hiroshi Inose, arguably Japan's most powerful technocrat.
The officials resent the pioneers' early successes and are waging a dirty-tricks campaign to try to regain the upper hand. Through their arrogant behavior, the pioneers have played into hands of their rivals, who are masters of the bureaucratic game.
Today, the situation has degenerated into a highly emotional conflict, with each side hurling accusations and insults at the other. Little TWICS has been caught in the crossfire. In mid November, the company's long-standing domestic e-mail connection via Tokyo University was suddenly cut off, apparently in retaliation for TWICS having opted to use a non-Japanese Internet link. Then the company received an intimidating phone call from a man claiming to represent the computer center at Tokyo University.
"Stop doing business in Japan!" the man shouted, "Shut down at once!" (TWICS has since been reconnected.) "It's one of the trickiest messes I've seen in years," comments Internet luminary David Farber, a University of Pennsylvania professor who tracks developments in Japan. It is also a mess that matters. For, as Farber points out, what the Japanese do affects the rest of us. And while Japan may be the world's second-largest economic power, the Japanese remain dangerously isolated. Networking has the power to change that by bringing Japan closer to the international community. But by the same token, failure to log on to the world's largest network could leave Japan more isolated than ever.
The massive proliferation of the Internet has left the Japanese far behind. As of June 1993, Japan had roughly five networks for every 100 in the United States. Outbound NSFNet traffic from Japan that month was 42,000 Mbytes, roughly the same as that from Taiwan, a country with one sixth Japan's population, and less than half that from Australia, the Pacific Rim's most aggressive network user.
Young Japanese have heard about the Internet and they are eager to get access to it. The irony is that the very people who should be encouraging them to log on are instead preventing them.
The best way to reach Jun Murai, associate professor at Keio University, is, surprisingly, not by e-mail. Instead, you ask one of his acolytes to track him down for you. Initial contact with Murai - via his car phone - is encouraging: "You want to do [the interview] over a beer, or dinner, or what?" he asks. On meeting Murai, you quickly realize why he is so popular with his Internet counterparts elsewhere. In a country where most academics still wear suits, Murai wears an ancient sports shirt, a beer gut tumbling over his black jeans. He looks a bit like a bear, an impression his deep, rumbling voice reinforces. And while vagueness is regarded as a virtue in Japan, Murai comes straight to the point.
Ten years ago, when Murai was just 28 years old, the Japanese research community was debating how to take advantage of deregulation to install communications networks. Discussion centered around which of the proposed Open Systems Interconnection architectures to adopt. To Murai, such meetings were a waste of time: "I was young, and that was boring," he says. "What I wanted was to have a network, to do actual operation and development, so that we could find out what the problems related to computers and communications were, then solve them."
So he and some friends rolled up their sleeves and started laying cable. Their first effort was the immodestly titled JUNET, a dial-up modem service offered over public phone lines. It proved immediately popular with Japanese academics starved for e-mail, especially after Murai made it possible for them to enter text using Japanese characters. Encouraged, Murai went on to launch a more ambitious project in 1987, the Widely Interconnected Distributed Environment, or WIDE. A backbone network, WIDE is based on leased lines that interconnect local area networks. Owning leased lines is very expensive in Japan, and to pay for them, Murai turned to commercial firms like Sony and Canon. Once again, the network proved popular - today, it connects some 30 research institutes and 40 companies. WIDE also has a link, via the University of Hawaii, to NASA's Ames Research Center, through which Japanese researchers can communicate with their US counterparts.
Indeed, WIDE became such a hit that Murai was forced to turn down requests for connections. A second headache was that companies were not necessarily confining their use of the network to research, as required under the Japanese government's extremely strict definition of appropriate use. An obvious solution to both problems was to set up a company to offer commercial Internet services. In December 1992, Murai and some of his students formed Internet Initiative Japan (IIJ). This is the company to which the Ministry of Posts and Telecommunications refuses to grant an operating license.
Jun Murai's success is a thorn in the flesh of Shoichiro Asano, a former Tokyo University professor who is in charge of day-to-day operations at Japan's National Center for Science Information Systems (NACSIS). This organization was formed to provide network information services for university researchers. As an official organization, supported by Japan's Ministry of Education, Science, and Culture, the Center naturally opted to use officially sanctioned technology, notably the Open Systems Interconnection protocols, which were first proposed in the early 1980s. Trouble was, it took a lot longer than originally anticipated for the committees in charge of developing these protocols to come up with the goods, and even when they did, many found them cumbersome and needlessly complex.
Meanwhile, back in the US, an ad hoc set of protocols known as TCP/IP was spreading like wildfire. Establishment engineers turned up their noses at these protocols, sniffing that they had been designed by young cowboys and were too sloppy for any self-respecting network to use. Maybe they were - and the protocol issue still divides the engineering com-munity with all the ferocity ofa religious schism - but by the beginning of this decade, TCP/IP had become the de facto standard for networking in most of the world. It now has an installed base three to five orders of magnitude larger than that of Open Systems Interconnection. In 1991, realizing that it had backed the wrong horse, NACSIS at last began to convert its network to support TCP/IP. By that time, however, WIDE was firmly established in the eyes of the Internet community as Japan's front-runner.
That a lowly assistant professor and his rag-tag band of graduate students should have attained such status seems to have embittered Asano, a disheveled and shifty-looking individual in his early 50s. Mention Murai to him and he becomes animated. "For five years, Jun Murai has done dirty things to [the Center]," he complains. Many of these "dirty things" concern Internet Initiative Japan. For example, Asano accuses Murai of being its "shadow leader." (Japanese academics are not supposed to sully their hands through contacts with business.) He also charges that IIJ has attempted to use American pressure in various forms to force the Ministry of Posts and Telecommunications to issue the group an operating license. None of this would matter much if it were just a case of sour grapes. Unfortunately, however, Asano has the backing of the director of NACSIS, Hiroshi Inose; that gives him the power to do Murai - and, by extension, the spread of Japanese networking - considerable harm.
In a society that reveres seniority, the 67-year-old Inose is about as senior as you can get. Back around 1957, as a young electrical engineer consulting at Bell Laboratories, Inose won a basic patent on time division multiplexing, a key technology for combining several calls on the same line, one which all modern telecommunications switching systems use. This reflects a caliber of achievement that few Japanese academics can match. In later life, Inose became dean of Tokyo University's prestigious engineering school, taking up his current position as director of NACSIS upon his retirement from the university. He is a member of the US National Academy of Sciences, an IEEE fellow, and has a string of other awards and prizes to his name. Prime among them is his designation by the Japanese government as a person of cultural merit, an honor carrying tremendous status in Japan. Today, Inose chairs many of the key policy committees at both the ministries of Trade and Industry, and Posts and Telecommunications. His former students hold senior positions at leading Japanese electronics firms. Indeed, it is scarcely an exaggeration to say that few Japanese involved in information technology are not beholden to Inose in some way.
Inose was not available to be interviewed for this article: His schedule was booked up for two months. But most people who have met him are struck by his charm and gentility. Hell, the man even writes poetry.
But inside the velvet glove is an iron fist. Many Japanese criticize Inose for throwing his weight around, but few dare to do so openly. One of the few is technology journalist Yukihiro Furuse. In the November issue of the monthly magazine Shincho 45, Furuse writes that "probably no one can criticize [Inose] because he has absolute power and he is senior to everybody." Furuse recognizes that networking is of crucial importance to Japan's future. And he is concerned that Inose's behind-the-scenes style is not the best way to promote its growth.
One specific charge made by Furuse and others against Inose is that he has used his influence with the Ministry of Posts and Telecommunications to prevent IIJ from getting an operating license. Another is that he leaned on the Ministry of Trade and Industry to prohibit a new computer research project it was supporting from using IIJ to provide network services. Why should Inose care about a bunch of young upstarts like Murai et al? "Professor Inose represents the old establishment," suggests one senior telecommunications executive, "and their idea is that government and national universities should always stay in the center, delivering and exchanging information." In the US, the acceptable-use policy for the Internet was designed to promote the growth of commercial Internet services. The Japanese acceptable-use policy seems by contrast aimed at preventing the growth of Internetworking beyond the ivory towers.
David Farber, who has known Inose for many years, insists that his friend is acting purely in the national interest and for the benefit of the education community. Farber says that Inose is worried about IIJ's claims that it can provide network services for Japan's university researchers at an affordable price. In addition to rendering NACSIS superfluous, this could also lead to the education ministry cutting off much-needed financial support for networks. An IIJ spokesperson confirms that the company had planned to offer an academic discount plan but were told by the Ministry of Posts and Telecommunications that licensed carriers would not be allowed to discriminate between different types of customers. IIJ is currently providing customers with domestic network service, which it can do without a special license.
"Inose believes that achieving a successful conclusion is a slow, careful process that keeps the support of the education ministry," Farber says. "He gets upset with the cowboy approach" taken by Jun Murai and his associates at IIJ. Inose is not the only one upset by IIJ's behavior. Some of the blame for the current conflict must also go to IIJ's manage-ment, and in particular, to the company's president and CEO, Hiroyuki Fukase. Fukase is an engineer by training, not a businessman. He has needlessly antagonized potential investors by asking for money, then neglecting to perform the follow-up visits that Japanese business etiquette demands. Worse, he has annoyed Hikaru Chono, director of the Ministry of Posts and Telecommunications' computer communications division and the official in charge of issuing the license IIJ needs to provide international Internet services.
In Japan, it pays to treat bureaucrats with respect. They form, after all, an elite, and have dedicated themselves to serving their country, working long hours in overcrowded conditions for low pay. The quid pro quo is power. Visit a Japanese government office and you will see a constant stream of supplicants who come to beg for official favor.
Chono is a prime example of the bureaucratic breed. A graduate of Tokyo University's law school, he has paid his dues - including a stint as Japan's representative at the CCITT (the international telephony committee) in Geneva, and a year as a postmaster in a remote part of northern Japan. He has been involved with telecommunications since 1975, and he is tired of it. In particular, he is fed up with Fukase. "IIJ is a very difficult company for me to understand," he sighs, "they've done lots of publicity and marketing, they've published their tariffs in journals and magazines, but they haven't finished the formalities."
What Chono needs is a letter of guarantee from a financial backer. "If they complete all the necessary documents," he says, the Ministry of Posts and Telecommunications will issue a license "within 15 days, maximum." Fukase claims to have found a backer, the Industrial Bank of Japan, but accuses Chono of having warned the bank not to deliver the letter of guarantee. Such accusations are typical of Fukase's bull-in-a-china-shop style. In early 1993, he upset the ministry by arranging for a letter from a friend in the US National Science Foundation in support of IIJ's license application to be delivered via the US Embassy in Tokyo. Asano accuses IIJ of urging US equipment manufacturers to criticize the Ministry of Posts and Telecommunications for preventing them from doing business in Japan. Such heavy-handed attempts to use US pressure to bully the ministry into granting a license have had an effect oppo-site to the one intended. The best thing that Fukase could do at this point would be to go see Chono and try to pour some oil on troubled waters.
But Fukase has not been to Chono's office in months, while Asano reportedly visits him regularly. "They're naive guys," comments one observer of IIJ. "They don't know how to play the game in their own country." Murai would like to wash his hands of the conflict and get on with his research. "I don't want to deal with any of this," he groans, adding in frustration, "What's wrong with me? I'm providing a better environment [than NACSIS], producing researchers and good results, and the com-panies [that support WIDE] are very happy. The problem is," he concludes, "I'm too young to deal with this kind of thing."
But much as he might like to, Murai cannot simply walk away from the mess that surrounds IIJ. Indeed, as Farber points out, much of the current problem stems from confusion over Murai's dual role as director of an academic research network and would-be godfather of a commercial Internet pro-vider. Carl Malamud, a friend of Murai and author of the technical travelog, Exploring the Internet, comments that "the real issue in Japan is the same as in the US. We're moving beyond the myth that the Internet is some academic research project."
What then is to be done to sort things out? Nobody in Japan seems to know. One less-than-optimum solution is simply to let time take its course. Inose is expected to retire in a couple of years. Following his master's departure, Asano says he will probably return to academic life. Well before then, IIJ will likely bring in new management to run its business, leaving Murai to get on with his research. For the moment, however, though a new era has begun, precious time is being lost. And it is time that Japan can ill afford to lose.
------------------------------------------------------------------------
Reasons for Japan's Late Start
•Dominance of centralized, mainframe-based computing
•Lack of LANs
•Proprietary protocols
•TCP/IP ignored while government and industry pursued OSI
•Lack of Japanese software and support for routers
•Over-regulation
•Difficulty of Japanese text entry
•Japan a small country dominated by Tokyo
•Overpriced leased linesWhat's Needed for Japan's Catch-Up
•More support, especially financial, from government and industry
•Better-educated bureaucrats
•More coordination between existing networks
•Elimination of barriers imposed by government between academics and industry
•More free-access systems
•More applications software
•Faster links
•Lower tariffs
•More researchers
•More links with other Asian countries------------------------------------------------------------------------
Turf Wars
The bureaucratic infighting behind Japan's failure to create its own coherent information infrastructure strategy is further discussed.
------------------------------------------------------------------------
Outside the station in the small Tokyo Bay town where I live are two of the most sophisticated public telephones in the world. Encased in cool gray plastic, the phones feature on-hook dialing, volume controls, and LCD screens that give instructions on how to make international calls -- in English as well as Japanese. Most beguiling of all are the two jacks near the bottom of the phones, which can accept both analog and digital input from a personal computer.
What I often wonder is, for whom are these phones intended? Almost the only people who ever use them are salarimen calling their wives to come and pick them up late at night. In the past year or so, Integrated Service Digital Network (ISDN) phones have sprung up all over the Tokyo area. The joke is that the only people who ever jack into them are visiting American engineers who cannot resist the opportunity to log onto the Net remotely from a public phone (and have their photo taken doing it). But even they only use the analog jack.
ISDN phones are symbolic of the way things are done in Japan. Government bureaucrats decided that the public needed digital phones, so we got digital phones, with little thought given to how we would use them. Positioned as an extension of the traditional phone system, Japan's narrowband (64Kbps over copper) ISDN has been a commercial flop, having attracted fewer than 200,000 subscribers in the six years since the service went into operation.
Today, the Japanese are debating the construction of a much more ambitious broadband digital network that is intended to lay optical fiber to every home and office in the country. But again, as commentator Kazuhisa Maeno of the Mainichi newspaper writes, "the issue of how the communications circuits should be used is being completely ignored."
Though nominally a Western-style democracy, Japan is actually run by bureaucrats, not politicians. Japanese bureaucrats are selected on merit from among graduates of top universities. These are the ultimate products of what is probably the most competitive education system in the world. They bring their razor-sharp competitive instincts to their new positions. But whom to compete against? Why, bureaucrats at other ministries, of course. "Young bureaucrats are like yakuza," comments one government source, referring to the Japanese mafia. "They develop muscles by fighting against each other -- that's the style of their society."
Japan's rulers inhabit a cluster of office buildings in Tokyo's central Kasumigaseki district, just down the hill from the Diet (parliament) building and across the moat from the Imperial Palace, where Emperor Akihito lives in splendid isolation. Dominating the cluster is a thirteen-story tower that houses the notorious MITI, the Ministry of International Trade and Industry. For ambitious young bureaucrats, International Trade and Industry used to be the ministry of choice. But the ministry's glory days -- when it had control over allocation of precious foreign exchange, hence the power to decide who could import what -- are long gone.
Today, pride of place goes to the bean counters at the Ministry of Finance, whose stronghold is the undistinguished squat gray building across the road. To MITI's right is its archrival, the Ministry of Posts and Telecommunications. Prominently displayed in the lobby of the Posts and Telecommunications building are demos of the various unsuccessful projects that the ministry has promoted over the past decade. In addition to narrowband ISDN, these include Captain, a teletext system that, unlike the French Minitel, never found a popular application; CATV, as cable television is called in Japan, which until very recently has been too tightly bound in red tape to grow; satellite TV, which has been hobbled by the high cost of transponders (Posts and Telecommunications permit required); and Hi-Vision, Japan's obsolete version of high-definition television, which sputters on in the form of eight-hour daily broadcasts on one channel that are unwatched by all but a tiny minority.
Over the way from the Ministry of Posts and Telecommunications is the Ministry of Education, Science, and Culture (Mombusho), which sets the national school curriculum and administers Japan's universities. Mombusho bureaucrats live in a brown brick doughnut of a building which, to judge by its art deco flourishes, was built before World War II. This is entirely appropriate, since the education ministry spends much of its time making decisions about how unsavory incidents involving the Imperial Japanese Army during World War II -- most notably the Rape of Nanking -- are presented, or not presented, in history textbooks. MITI may have its visionaries and radicals, but the Mombusho is dominated by conservatives who guard their prerogatives with particular zeal.
The education ministry discourages fraternization between its vassals -- university faculty, for example -- and researchers at institutes run by other ministries, let alone their corporate counterparts. The Mombusho has the power to punish those that disobey it by cutting off their funding. Its goal is to maintain as much control as possible over the university nodes of Japan's computer network. The funny thing is, the ministry's bureaucrats seem to have little idea what networks are used for. "Even when we explain it to them, they still don't understand," laments Haruhisa Ishida, of the University of Tokyo's Computer Centre, who is secretary of the Japanese branch of the Internet Society.
Nor is the situation any different at the other ministries which see networking as their business. Only one of the half-dozen bureaucrats interviewed for this article (a MITI man, naturally) had an e-mail address, and even that was at a research institute, not at the ministry itself.
Nonetheless, when Vice President Al Gore presented his National Information Infrastructure proposal to Congress, Japanese bureaucrats were quick to formulate a response. Their opportunity came in the form of a Yen1.3 trillion (US$13 billion) supplementary budget announced in mid-1993 by Japan's government. This money was intended to stimulate Japan's sluggish economy. Some 10 percent of it was earmarked for "new social infrastructure," a vague phrase that could be understood to mean information superhighways. Certainly, that was how MITI chose to interpret it, proposing the construction of a nationwide network of optical fiber to the home.
The gambit by MITI stung the Ministry of Posts and Telecommunications into rushing out a counterproposal. In the old days, the boundaries between the two ministries were well demarcated: MITI looked after computers, while the Ministry of Posts and Telecommunications took charge of communications. The arrangement worked well so long as computers were stand-alone devices, but the coming of networking has given MITI the perfect excuse to poach on Ministry of Posts and Telecommunications territory. (A second blow to the Ministry of Posts and Telecommunications was the loss of control over Nippon Telegraph and Telephone Corp. (NTT) following the partial privatization of the giant corporation in 1985.)
Posts and Telecommunications bureaucrats saw new social infrastructure as a chance to regain some lost ground. They argued that, since the US government was committed to providing fiber to the home, Japan should embark on a similar project in order not to be left behind. (This, as several Japanese commentators have pointed out, was "a deliberate misunderstanding," the Clinton-Gore administration's intention being to stimulate the construction of a nationwide network, not to lay the fiber itself.) The bureaucrats proposed that construction of the network should be entrusted to a new public corporation which would, of course, be managed by the Ministry of Posts and Telecommunications.
At this point, NTT threw its hat into the ring, announcing that it could handle building the network. Bringing fiber to every home would take twenty years and cost Yen41 trillion (US$400 billion), but the corporation could do it. Where would the money come from? From raising the price of local phone calls, the corporation answered, bringing up an increase for which it has long lobbied the Ministry of Posts and Telecommunications. The Ministry of Finance, the ultimate arbiter in the debate, is known to favor NTT's plan, not least because the Ministry of Finance wants the corporation's stock price to rise so it can sell off the 66 percent of NTT shares that the government still holds.
As it makes the difficult transition from public corporation to full- fledged private company, NTT has begun to slough off its old, bureaucratic ways. In the past, says Kaoru Kubo, vice president in charge of NTT's strategy planning office, NTT would present its customers with a network interface and tell them to adapt their systems accordingly. These days, Kubo says, "The world is changing. De facto standards like PC, video, and TCP/IP were not determined by network vendors." The lesson, he adds, is that "we have to change our attitude. These different guys tell us what they require, then it is up to us to try and accommodate them."
This customer-friendly attitude is coupled with a newfound aggressiveness in forming alliances with partners to develop multimedia services. In March, NTT announced that it would join Tokyo-based software publisher Softbank in a venture to provide video on demand over the telephone company's data communication lines. The same month, NTT president Masashi Kojima shocked local firms by appearing on the same platform with Microsoft Chairman Bill Gates to announce that the two firms would work together to develop multimedia-related services. Earlier in the year, the corporation had demonstrated its recognition of US superiority in communications software by joining the General Magic alliance.
What NTT would like to see most of all now is deregulation, especially in Japan's archaic tariff system. When the corporation wants to introduce a new service, it must figure out how much it would cost to implement the system nationwide, then charge accordingly. Not surprisingly, the result is high costs for everybody. This is particularly true in the case of leased lines, the sine qua non of networking, where costs range anywhere from five to eight times as much as in the US. But since Japan's new common carriers -- DDI Corp., Japan Telecom, and Teleway Japan, the local equivalents of Sprint and MCI -- depend on leased-line sales for much of their revenue, the Ministry of Posts and Telecommunications is reluctant to let NTT drop its prices too much.
At the same time, a challenge to NTT's assumption that it will have sole charge of creating Japan's information infrastructure has emerged in the shape of a heavyweight alliance called Tokyo Telecommunication Network Co. Among partners in this grouping is Tokyo Electric Power Co., which for several years has been quietly laying a fiber network alongside its power transmission lines. Though it has yet to begin trials of interactive services, Tokyo Telecommunication Network is already talking of hooking up with regional power companies and cable operators throughout Japan to form a nationwide network.
Meanwhile, back in Kasumigaseki, the turf war for control over construction of the next-generation network rages on. Thus far, all that has been agreed upon is the construction over the next three years, at a cost of Yen4.1 trillion to Yen5.2 trillion (US$40 million to $50 million), of a new, interministerial 6Mbps fiber network connecting 50 or 60 government research laboratories. Responsibility for running this network nominally belongs to the Science and Technology Agency. But the agency is a lesser player in Japan's great bureaucratic game, and has little practical experience with networks and few qualified personnel. Behind the scenes, the National Center for Science Information Systems, an institute belonging to the education ministry, is maneuvering to gain control.
But in the heat of battle, the bureaucrats appear to have lost sight of what matters most. That is, the creation of new services and the development of applications. "If you look at the US National Information Infrastructure initiative," NTT's Kubo says, "in addition to conduit, the government also gave budget for libraries, universities, and medical centers -- to promote the development of applications and to encourage the spread of online databases to give people easy access. But the Ministry of Posts and Telecommunications doesn't understand -- they ignore this kind of key issue."
The Japanese are acutely aware of the problems caused by an unaccountable bureaucracy that puts the short-term interests of individual ministries ahead of those of the nation. Bringing the bureaucrats back into line was a high priority of the reformist government led, until April, by Morihiro Hosokawa, though success ultimately eluded him. A major problem is that many of the government's new representatives are still wet behind the ears, and even senior coalition politicians have no previous government experience. So, paradoxically, the effect of the new government has been to strengthen the hand of the bureaucrats. Japanese politicians appear to know even less about networking than Japanese bureaucrats. There used to be one Diet member who used a computer bulletin board to communicate with his constituents. Unfortunately, he lost his seat in the last election. And it is doubtful whether even he jacked into an ISDN phone.
The Posts and Telecommunications Ministry admits defeat. Twice.
Everybody, including the Ministry of Posts and Telecommunications, knows that Hi-Vision -- Japan's hybrid analog HDTV standard -- is dead as a dodo. But when in late February Akimasa Egawa, director general of the ministry's broadcasting bureau, admitted as much, he sparked outrage from broadcasters and equipment makers alike.
Egawa said the Ministry of Posts and Telecommunications was considering shifting its support from Hi-Vision to an all-digital system like the one proposed in the US. In Japan, it is customary before announcing such a radical policy shift to make the rounds of concerned parties to explain your position. In this case, however, the announcement came out of the blue. The bureaucrats evidently concluded that shock treatment was the only way to deal with the recalcitrant firms.
Egawa's bluntness backfired on him. A storm of protest blew in from senior executives at Sony and other leading Japanese electronics companies. After all, they wanted to know, was it not under guidance from the ministry that they had adopted the standard in the first place? The hapless bureaucrat was forced to eat his own words. It now looks as if Hi-Vision will be allowed to limp on into obscurity.
A second Ministry of Posts and Telecommunications initiative, the deregulation of cable television, has been more favorably received. Not that the bureaucrats are in favor of deregulation in principle, mind you. Rather, the criticism blaming their restrictive policies for Japan's backwardness in advanced communications had grown too loud to ignore any longer. At the end of 1993, the ministry agreed to allow up to 33 percent foreign ownership in cable TV firms. Then in April, the Ministry of Posts and Telecommunications indicated that it would permit cable operators in different areas to connect to each other.
(Government restrictions on the size of the areas that cable companies can serve have been a major factor in preventing firms from achieving sufficient economies of scale to operate at a profit. Lack of capital has in turn prevented cable companies from expanding, with the result that today only about 3 percent of Japanese homes are wired for cable versus 63 percent in the US.)
Several powerful corporate groups are gearing up to get serious about providing cable to the Japanese domestic market. Typically, these cluster around a giant trading company, with a US partner providing operating expertise and programming and a Japanese affiliate supplying hardware. One such affiliate is Itochu, which has reportedly teamed up with Time Warner, US West, and Toshiba; others possibly involving US giant TCI, are in the works.
Still more deregulation is in the works. The Ministry of Posts and Telecommunications is currently conducting a sweeping review of laws and policies affecting communications and broadcasting. These are currently administered by separate fiefs within the ministry. But bowing to the march of digital technology, the bureaucrats are likely to recommend that in the future a single set of regulations will suffice for both.
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Bob Johnstone (bobjohnstone@twics.com)
wrote "Wiring Japan" for Wired 2.02.Copyright © 1996 HotWired, Inc. All rights reserved.
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