Japanese cell phone makers return to U.S.

Published: Tuesday, January 14, 2003 at 6:01 a.m.
Last Modified: Monday, January 13, 2003 at 10:30 p.m.

LAS VEGAS - For American cell phone users, the past few years have been ones of deprivation.

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Japan's NEC Corp. says its model 515, which operates on the four GSM bands used in North America and Europe, is the first in a new line being readied for the U.S. market.

The Associated Press

While folks in Japan and Europe chatted on slick cell phones made by Sony, Panasonic, NEC and others, Americans had to make do with models that sported fewer features. Japanese makers had largely fled the American market because it was cluttered with competing networks.

But now, the Japanese handset makers are coming back _ a trend that figures to help keep prices down and speed the rollout of new cell phone applications.

Japan began its U.S. comeback in 2001, when Sony and Sweden's Ericsson started selling high-tech phones under a joint venture.

Panasonic and Sanyo sell a few models for AT&T Wireless and Sprint PCS, respectively. None makes a dent in the market domination of the top three: Finland's Nokia, Illinois-based Motorola and South Korea's Samsung.

But in October, Hitachi launched a camera phone that uses Sprint PCS's CDMA network. Hitachi and Sprint also plan to sell a personal digital assistant/phone in the spring that runs a Microsoft operating system.

NEC, another big vendor in Asia and Europe, hopes to tempt U.S. consumers this spring with its model 515 phone, a folding handset with a 2.2-inch color screen. It operates on the four GSM bands used in North America and Europe and is the first in a new line being readied for the U.S. market.

And Panasonic is bringing a high-end camera phone to the United States in the spring, having launched it in Europe in October. Its GU-87 will operate on AT&T Wireless' GSM network.

In a demonstration at the International Consumer Electronics Show, a Panasonic representative used the phone to connect to the Internet, then retrieve pictures from a wireless webcam perched on a pole inside the Las Vegas Convention Center. The camera could've been anywhere in the world, said Panasonic's Jim Reilly.

"If it's in your refrigerator, you can check it on your way home to see if you need milk," Reilly said.

Getting back into the U.S. market won't be easy, but Japanese manufacturers have a few advantages. First, the companies have already proven their technologies can sell in Japan, the world's most advanced market.

Second, Japanese manufacturers have long been the world's leaders in cramming goodies into tiny packages. In this case, the phones are loaded with cameras, fine color screens, Internet browsing and e-mail capabilities.

Third, the Japanese no longer have to manufacture separate phones just for the United States.

American carriers -- like many of their counterparts overseas _ have almost completely converged on two wireless standards, GSM and CDMA, and now agree where the country's future generation standards are headed.

With three carriers -- Cingular, AT&T Wireless and T-Mobile -- offering GSM in the United States, Panasonic and Sony Ericsson can simply sell their European phones here. Others, like NEC, plan U.S.-centric models that require little modification.

"Now that the U.S. consumer market is embracing new technologies, NEC is poised to bring our years of experience in the Japanese market to the U.S," said Noboru Sakata, general manager of NEC America's wireless division.

Hitachi also believes U.S. consumers and networks are finally ready for fancy Japanese phones. Both of its U.S. models handle e-mail, Web browsing and can take and send pictures like their Japanese counterparts.

"People want more features. They want a smaller package," said Gerard Corbett, vice president of Hitachi America.

What sells in Japan may not sell here, however.

Americans, who are more likely to have computers at home, may have less use for Internet, e-mail, games and cameras on their cell phones.

Japanese and Europeans also commute more on trains and buses -- where they can check e-mail or play games. American commuters, typically stuck behind the wheel, are more interested in just talking.

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