US media: This Olympics tells us that Japanese technology is no longer powerful

On July 22, Bloomberg reported that when the 1964 Olympics were held in Tokyo, Japan showcased a bullet train with a speed of up to 210 kilometers per hour, heralding the arrival of Japan's technological era.

In the following 15 years, Sony, Toshiba, and Space Invaders brought amazing products, Japan became a technological hegemon, and many people were talking about: "Japan will surpass the United States to become the largest economy."

Today, everything seems like a dream.

Soon the Olympics will open in Tokyo, but Japan is in a technological panic. It once determined the speed of evolution of televisions, video equipment, and computers, but now it is unable to keep up. Although the Walkman won glory for Japan, Apple's iPhone defeated it. In the field of smartphones and memory chips, rivals such as Samsung have surpassed it.

This experience not only erodes Japan's national pride, it is also a reflection of corporate difficulties and economic responsibility. Now that technology data standards are determined by the United States and China, Japan is likely to fall behind.

Japanese Prime Minister Yoshihide Suga has decided to fight back by making the chip industry a national project, as important as food and energy security, but industry executives and government officials believe that Japan must change its business model.

What does that mean? Kazumi Nishikawa, an official at Japan's Ministry of Economy, Trade and Industry, explained that Japan should remove some barriers to recruit foreign chip talent and completely abandon its insistence on "Japan-centrism." He said: "The self-reliance approach of Japan's manufacturing industry has not been successful, and we cannot repeat the same mistake this time."

Japan may lure TSMC to help rebuild its chip industry. Last week, TSMC CEO and co-chairman CC Wei told investors that he was doing "due diligence" on building a factory in Japan. The United States has invested $52 billion to support the semiconductor industry, South Korea has pledged to invest $450 billion over the next 10 years, and TSMC is preparing to invest $100 billion in the next three years. Japanese official Akira Amari said: "Some countries and regions provide different levels of support, making it difficult for Japan to compete." However, he also said that Yoshihide Suga is good at execution and will now focus on digitalization and carbon neutrality, both of which are related to semiconductors.

Japan is full of talent in the fields of robotics and supercomputing, and its internet speed is one of the best in the world. Tetsuro Higashi, honorary chairman of TEPCO, believes that solving the problem of Japan's technological decline is not as simple as rebuilding an industry. He talked about Japan's semiconductor advantages, such as Kioxia, which manufactures memory, and Sony, which manufactures image sensors, which are both strong, as well as components, energy-consuming chip manufacturing, and chip manufacturing equipment. He believes that Japan should combine these components to succeed.

Tetsuro Higashi said with concern: "Japan has a more fundamental fear. People are worried that if things get bad, the entire Japanese economy will be affected."

In 1990, Japan accounted for 50% of the global chip market, but now it only accounts for 6%. Japan used to produce memory mainly for large computers, which had high quality requirements and a warranty period of up to 25 years. When personal computers became popular, Japan seemed a little slow, and Samsung seized the opportunity to provide memory at a lower price with a warranty period of 3 years. In the digital age, many things are disposable, but Japan has suffered from "high quality disease".

Japan's semiconductor industry tends to create "domestic champions" and is reluctant to cooperate with foreign companies. In 1999, Tokyo merged the memory businesses of NEC and NEC and named it Elpida, but it filed for bankruptcy in 2012 with debts of $5.5 billion and was subsequently acquired by Micron Technology of the United States.

"We tried various methods to turn the tide, such as national projects, consortiums, and joint ventures, but all failed. The chip industry has not recovered," said Takashi Yunogami, an independent consultant. However, in the field of chip equipment and raw materials, Takashi Yunogami sees some hope. He believes that Japan's best option is to focus on a few successes and make them stronger.

Another reason for Japan's semiconductor failure is the "trade war" with the United States. 40 years ago, the United States launched a trade war against Japan, requiring it to purchase a certain proportion of American chips, otherwise it would impose tariff sanctions.

Amari said: "The United States saw Japan's rise, saw us as a threat and fought back." Japanese companies focused on the domestic market and did not expand globally, resulting in missed opportunities. For example, Docomo was the first to launch an Internet-connected phone, but lost to Apple and Samsung. Amari also said that now that national security is linked to technology, the government is facing a "once-in-a-century change" and Japan must meet the challenge or it will fall behind.

Amari believes: "Japan is good at going from 0 to 1, but not so good at going from 1 to 10. Japan often wins in technology but loses in business." (Xiaodao)