July 11th, 2008
08:18 AM GMT
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TOKYO, Japan – The scene is uniquely Japan: Techno-freaks dressed up like cartoon characters, young women dressed like maids and superheroes, and even a dancing storm trooper.

Me interviewing our stormtrooper.
Me interviewing our stormtrooper.

They'd gathered early this Friday morning for the latest tech event: The release of the new Apple iPhone 3G in Japan.

Some 1,500 people camped out overnight through a hot and humid Tokyo summer, but that's hardly a sacrifice, to finally get their hands on the iPhone.

But here's what's unique about this latest tech gathering: The device is American. Made in Japan? Where did that familiar stamp on the back of your electronics go?

While these techies lost one night of sleep camping out for the device that promises portable device nirvana, Tokyo's corporate executives have been losing sleep for months wondering why they didn't invent it first.

In a recent lunch with the Ministry of Foreign Affairs, a good source moaned to me about the state of Japan's electronics market and how it was falling behind.

Why? Items like the iPhone represent, in many ways to the Japanese boardroom, the symbol of the new era of doing business.

Apple and Google are taking not small steps, but leaps and bounds in innovative technology. Japan, once the unchallenged ruler of the world's consumer electronics market, now watches as the Western world schools the East. Remember Sony's Walkman? Neither does anyone who wants an iPhone.

The debate is raging in Japan's government halls and in its corporate pikes. Bloggers are suggesting a coup of Tokyo's grey haired boardrooms so Japan can break from its rigid business rules. Others suggest that slow and steady, like Toyota's model of "kaizen," incremental improvements, wins the game.

There are no such debates on the streets outside of the virgin sales of the new iPhone in Tokyo.These weirdly dressed consumers are merely punching the air with joy, pronouncing a new digital era has finally arrived in their hands. The excitement here is being repeated all over the globe and celebrated in an American company. It's a party Japanese companies know all about. They're just not leading this one.

soundoff (19 Responses)
  1. Shawn Barva

    I live in Japan and have tried to get an iphone today. Most of the stores that are allowed to have them did not. They have not been shipped to the stores outside of Tokyo and Osaka. The only thing released to these stores has been the marketing displays. On top of that if you want to buy the phone up front it will cost closer to $600 not the $200 Apple has been proudly displaying since the 3Gs unveiling. You have to pay for it over two years to get the discount and the $200 price. The whole thing is starting to smell like a scam.

    July 11, 2008 at 9:41 am |
  2. Anonymous

    Seems like a sweeping generalization from observing relatively few fanatics on the first day of sale. 1500 camping out in a city of 20million shows mania? I disagree. The fact is that iPod sales have been not so good outside of US. Many people find use of iPod very cumbersome. Apple products are highly touted in US because it is THE only innovative gadget in the market. Not so in Japan or Korea. iphone is a novelty item and i do not believe it would quite take over the mkt. Google has no foothold in many major countries in the world. The reporter should do some more homework. i know this is just a blog but if it's going to be published on CNN then please include more facts.

    July 11, 2008 at 9:49 am |
  3. F. Huber

    It seems companies from several other "new kids" on the block have pushed Japanese companies down the list of the top global giants.
    This will be especially true of China in future imo, with the advantage of its gigantic domestic market. And India as well. Possibly Japan is finding that globalization is a very challenging environment.

    Anyway, in one Global Ranking List in Europe, Toyota was no. 7 last year, it's no. 22 this year.
    Mitsubishi UJF Financial dropped from 38 to 67 and NTT dropped from 81st place to 95th place. NTT's DoCoMo dropped from slot 77 to slot 92. However, Nintendo moved up from 200 to slot 90.

    Is Japan still the 2nd largest economy in the world?

    July 11, 2008 at 9:51 am |
  4. Darwin

    Who would have said ten years ago that Japan would become the largest auto maker in the world? No one. Least of all General Motors or Ford. Everything has it's cycle; don't be overly surprised if Bangladesh one day becomes the finanacial hub of asia (in say two to three thousand years time). The competitive edge which lies in every underdog ensures that new thoughts and products prevail sooner or later. History demonstrates this quite beautifully – the Babylonians, the Greeks, the Romans – they all had their moment of glory in history. It is this history which also teaches us today what went wrong for these 'super races'. Perhaps one word will best describe the scenario – complaicency. That coupled with over zealous greed and corruption bakes the perfect layered cake which we shall call, Black Forest Fiasco.

    The Japanese will get over their little upset, i'm sure; the i-phone is probably just regurgitated existing technology that has a nice new package and the usual marketing hysteria surrounding it. Still, they didn't do it first and this is the point in question. I don't know why on this occasion they didn't and with the product in question, they won't lose any sleep over it, unlike the people who cued over night to buy one.

    The next step in the 'real' new product to hit us won't come for some time – brand new technology that bases itself in what already surrounds us but we don't understand, technology of a different dimension, the fifth perhaps. In the meantime we'll have to make do with repackaged gadgets which those clever marketing chappies present us with, ensuring us that it reaaly does make our lives a little easier – quite the contrary in some cases (I can't go to the loo unless I have my mobile in hand and you can imagine the panic if it rings whilst in 'mid stream').

    July 11, 2008 at 11:02 am |
  5. Oscar Muller

    In Mexico the phone company telcel only gives you 200 megs a month. That is about 10-12 videos without county the amount of megs that entering a web page uses or sending an email. Now for every extra web page that you visit they charge us aproximately $4 usd, $17 usd for a MP3 and $160 USD for streaming a damn video. You do the math. NO wonder Carlos SLim is one of the richest people on the world.

    July 11, 2008 at 1:38 pm |
  6. James Pollack

    I've lived in Tokyo for years, and this is rubbish. Japanese cell phones (and technology in general)) have always been light years ahead of Western products. Most Japanese people I know don't terribly care about the iPhone because their existing keitai is better already, and has been for some time.

    "The Western world schools the East"?? Hardly. I can't help but wonder how much time this author has spent in the country and how many people she knows here. 95% of all consumer electronics goods sold here are strictly Japanese. Perhaps she should visit Akihabara on her next 24 hour stay here and see for herself, or is the urge to write provocative stories more important than the facts?

    July 11, 2008 at 3:44 pm |
  7. Mr. T


    sorry to hear that you could not get one today, but Softbank (carrier of iphone in japan) has been clear on the 2 year contract (to get the discounted price), and it actually is a standard cell phone practice in Japan (for any other cells). What's happening around the globe over the iphone may be crazy, but this little device is really fun to use. The AppStore and Itunes icons are way too easy for the users to spend $$$!

    July 11, 2008 at 8:35 pm |
  8. SweetLion/Tokyo

    I had to chuckle when I read this "article":
    "Japan, once the unchallenged ruler of the world’s consumer electronics market, now watches as the Western world schools the East."...Sh'yeah, RIGHT! We had 3G phones way before the U.S. caught on to the trend.

    The phones DoCoMo and AU/KDDI produce are LIGHT YEARS ahead of anything the U.S. can come up with! The iPhone has a 'pretty' UI, yes, but in terms of technological innovativation? Don't make me laugh...

    July 12, 2008 at 2:44 am |
  9. Jerry T

    In response to Shawn, I also live in Japan, and I'd like to take exception to his comment that the iPhone has not been shipped to stores outside of Tokyo or Osaka. I live in little Toyama prefecture, on the west coast, and it's considered a very rural area with only 1.2 million people. I went to a local Softbank shop, and not only was there no one in line waiting to get the phone, but they had 8 gig models on hand (but no 16 gig ones). I sat down at the counter with my wife to get one, then was shocked when we discovered the price- about ¥8,000 yen per month, and we'd have to get a new phone number (we were current Softbank customers). We decided that about $75/month just so we could fiddle around on the Internet was too steep a price. We decided to wait; perhaps in a year or so the price will come down. In the mean time, that iPod Touch is suddenly looking mighty sweet, but even there we will wait a few more months until the line is refreshed.

    Anyway, that's my big iPhone story- no lines, no hassle in our little local Softbank shop here in the countryside of Japan.

    July 12, 2008 at 7:43 am |
  10. gatkin09

    What a lot of western (U.S) biased reporting rubbish! As others have pointed out Japan is way ahead in terms of mobile handset technology.

    The U.S loves to rubbish Japan whenever possible but the fact is that for a country with few natural resources, Japan is still a major force. I wonder what ever happened to made in the USA?

    Okay, so some people queued up for iPhones in Tokyo, big deal. They also queue up for Ramen and Hello Kitty games as well.

    Japan watches the western world in regards to technology development...give me a break.

    Cheers from sunny and hot Japan!

    July 19, 2008 at 1:01 pm |
  11. desijadoo

    I haven't lived in Japan but I have been to Japan couple of times and I agree that Japan is way ahead of the west in consumer technologies. 3G, live TV, integration with Yahoo IM etc.., games, texting, video conf. , push to talk, etc are way of life there and is now catching on in the US.
    Japan's phone consumer market is geared toward personal entertainment and not towards business needs. Their phones are media rich and lack mundane business appointment, document handling etc... Work hard at office, play hard with your gadgets.

    The author really needs to make a leap out of the well she is living in and experience the world outside.

    July 28, 2008 at 8:53 am |
  12. f van karssen

    We in the United States are often forced to read about success stories to help us feel better - mostly by putting down others. As usual these days, our focus is wrong. For example we whine about having to find more oil at home to solve our problems instead of looking at Japan who builds its vast economy without having major oil reserves herself. How are they managing such an economy? We should follow such a model first and then focus perhaps on how we feed that new economic engine even better.

    August 6, 2008 at 12:02 pm |
  13. L Garza

    What the reporter of this article (and sadly, many others as well) have failed to "remember" is that many modern electronic devices, including the VCR, computers, etc., were originally invented in the US, not Japan... What the Japanese were able to do, however, was shrink production costs and the products themselves, making them viable to consumers the world over. I personally own lots of Sony products, so I'm not knocking the Japanese, rather just trying to give credit where it's due.

    August 11, 2008 at 2:00 am |
  14. Nicholas Folkes

    Japan is in major trouble; the world's largest Govt. debt, fastest greying population in world, biggest food importer in world and the worst economic growth in the developed world.

    America hollowed out in manufacturing in the 70's and lost the hart of its nation and this is now happening to Japan. Globalisation has hurt America over the past 30 years and will now help destroy Japan's industries too.

    August 19, 2008 at 12:01 pm |
  15. Nicholas Folkes

    I just found this article on 'Japan Times' website.

    One of Japan's top cell phone innovators says that for all his country's technological prowess, it could never have produced the iPhone.

    The progenitor: Takeshi Natsuno, who developed NTT DoCoMo's i-mode Internet browsing service for the cell phone, speaks in an interview Thursday at Dwango Co. in Tokyo, where he is an adviser.
    Japan's telecommunications industry stifles the kind of creativity that is so apparent in Apple Inc.'s Web-surfing phone, said Takeshi Natsuno, who developed Japan's first Internet-linking cell phone service, i-mode, in 1999, when such systems were still ground-breaking.
    "This is a great device," he said, affectionately fingering a black iPhone 3G during an interview Thursday. "This kind of device cannot be produced by Japanese manufacturers. NEVER."


    No doubt America is more technologically advanced than Japan. The Japanese seem to be better at capitalising on ideas by making devices in Japan but unfortunately America Inc. continue to manufacture their ideas offshore........what a shame!

    August 23, 2008 at 9:24 am |
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