| C&C Operations | Computers and Industrial Electronic Systems |
| NEC is taking a number of steps to differentiate itself in today's increasingly competitive computer market in an open environment. NEC is leveraging its comprehensive C&C technology to develop leading-edge products and stay ahead of the competition. Furthermore, NEC, with its systems integration capabilities, is creating customer value by delivering increasingly high-value-added systems. NEC's alliance with Packard Bell NEC strengthens its position in world markets for PCs, the core products of the multimedia era. |
In fiscal 1997, sales of computers and industrial electronic systems rose 7 percent, to Y2,078.5 billion ($16,762 million), and accounted for 42 percent of net sales. Domestic sales increased 12 percent, principally owing to healthy expansion of PC sales, although the pace of growth lagged somewhat behind that of the previous period. NEC's broad product lineup and extensive service and support network fostered buoyant sales of PCs and PC servers. Systems integration services also contributed to domestic sales growth.
Overseas, sales decreased, primarily because NEC transferred a substantial portion of its overseas PC business to Packard Bell NEC, its affiliated company accounted for by the equity method.
To promote its PC strategy in world markets, NEC merged its PC operations outside Japan and China and its PC server operations in the United States and Europe with those of Packard Bell NEC, a major U.S. manufacturer of PCs. NEC will support Packard Bell NEC in such areas as the development of new notebook PCs and PC servers as well as in marketing and quality control.
Launched in April 1995, NEC's StarOffice software, an integrated groupware package that significantly enhances the efficiency of office operations, continues to enjoy strong support in the domestic marketplace. Intended for corporate users, in fiscal 1997 NEC unveiled its new StarEnterprise software, which supports the deployment of StarOffice and other existing software into Internet- and intranet-based applications. In addition, NEC established a subsidiary, NEC Systems Integration (China) Co., Ltd., to promote its systems integration business in China.
In November 1996, NEC added a very-large memory capacity model to its SX-4 series. This efficient shared-memory architecture machine has a main memory capacity of 32Gbytes, making it the world's largest of its kind. This user-friendly system allows simulations on a greater scale for research in such fields as nuclear fusion and cosmic plasma.
From small machines to superlarge-scale models, NEC markets a full lineup of its Parallel ACOS series mainframe computers, which incorporate complementary metal oxide semiconductor (CMOS) processors and offer enhanced connectivity with open systems. In December 1996, NEC began shipping competitively priced PX7900 large-scale mainframe computers, which were well received by the market.
Prompted by increased corporate demand for client-server PC networks, NEC's Express5800 series of servers enjoyed strong domestic sales in the period under review. With its broad product lineup, its early implementation of leading-edge de facto standard technologies, and its systems integration offerings that meet customer needs, NEC's reputation as a leader in the PC server market continues to grow.
NEC's Express5800 series was Japan's top-selling line of PC servers in 1996, and the continued strength of the domestic PC network market should lead to further sales growth. Also, NEC is intensifying its marketing efforts for the Express5800 series in Southeast Asia and Oceania.
The domestic PC market recorded solid growth in fiscal 1997. This was due to expanding development of PC-based core corporate information systems, including intranet-based systems, and leaps in consumer Internet usage.
From the standpoint of the pursuit of customer value, NEC fortified its customer service and support offerings. Among NEC's initiatives were its introduction at 21 locations nationwide of the NEC PC Clean Spot, a total PC support facility, and NEC's institution of 38 PC College education centers across Japan.
NEC also worked to increase
customer satisfaction by introducing its "best PC" product development initiative, which seeks to create products that are optimized to meet users' various needs. In January 1997, NEC launched the CEREB, a PC with a 28-inch wide-screen TV and digital versatile disk (DVD) player. Intended for use in the living room, the CEREB proposes a new lifestyle for the entire family.
NEC's high-resolution MultiSync display monitors have received high marks and enjoy brisk sales overseas.
NEC's 98NOTE Aile is the industry's lightest and thinnest among notebook PCs built with Intel Corporation's Pentium(R) processor with MMX(TM) technology. It measures only 29 millimeters thick and weighs just two kilograms when detached from its base station, which contains built-in CD-ROM and floppy disk drives.
NEC received an order from the New Tokyo International Airport Authority for a large-scale information system for passenger terminal one. As part of the work involved with this effort, NEC will supply TFT color LCDs for use in the large main departure board.
NEC developed and delivered five of its new mail processing systems for trial use by the Ministry of Posts and Telecommunications of Japan. The new systems are capable of reading the full mailing addresses and new postal codes, which will be introduced in February 1998, as well as converting this information to barcodes for printing on the mail. These systems will then sort mail in the correct order for delivery.
NEC merged its PC-VAN consumer-oriented value-added network information service, the "mesh" Internet connecting service for individuals, and The Cyber Plaza content service to form BIGLOBE, one of Japan's largest multimedia services. In dismantling the barriers between PC-VAN and the Internet, NEC has created a user-friendly interface adopting the latest multimedia technology.
