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National pride obscures harsh truth about Sharp deal

by

Special To The Japan Times

An object of pride for Japanese consumers during the 2000s was the so-called Kameyama flat-screen television set manufactured by Sharp. Named after the factory in Mie Prefecture where it was assembled, the LCD-TV came with a sticker attesting to its provenance, and many people who bought the model never removed it. The brand was so iconic as a symbol of Japanese high-tech superiority that it was referred to it as “sekai no Kameyama,” or “the world-famous Kameyama.”

Except that it wasn’t. As Atsushi Osanai, an associate professor of management strategy at Waseda University and former Sony employee, pointed out during a recent TBS Radio discussion of Sharp’s current situation, the Kameyama TV only enjoyed popularity in Japan. And even while the plant was pumping out product, it was seriously in debt due to competition from other TV manufacturers, including overseas home electronics companies. Sekai no Kameyama was nothing more than a comforting myth.

The blinkered world view that gave rise to the myth is at the heart of Japan’s reluctance to let Sharp be sold to a foreign company, namely Hon Hai Precision Industry Co. of Taiwan. Osanai says this reluctance is fed by media and government entities that despair over the loss of industry know-how, which is considered a precious national resource. The anxiety comes from a deep feeling that denies the ascendance of Taiwan, China and South Korea in realms where Japan once reigned. Domestic media never seriously discuss the fact that companies such as Samsung and Haier now dominate the global home electronics field. By the same token, they don’t even mention it when K-pop bands continually sell out Japan’s domed stadiums.

A few pundits and journalists have made the case that not only does Sharp’s likely sale to Hon Hai not signal the end of the world, but that it could turn out to be a good thing for Japan. During the TBS Radio discussion, listeners sent in questions betraying their nervousness over the deal, and Osanai, along with finance journalist Tetsu Machida, kept talking about the “reality of the world we live in,” which is quite different from the world inhabited by the listeners — or, for that matter, from that of the program’s announcer, who admitted that she still hasn’t removed the “Made in Kameyama” label from her TV either.

One listener remarked that if Hon Hai buys the ailing company, Sharp will merely become a “maker of goods.” Osanai assured him that, in fact, Hon Hai was buying Sharp because it admires the company’s knack for new ideas. Hon Hai, also known as Foxconn, famously assembles the world’s iPhones, so it is already an experienced maker of goods, but the company possesses no capabilities for coming up with new goods and systems on its own.

Osanai and Machida emphasize that under Hon Hai, the company will be able to continue doing what it does best without having to give up facilities and personnel in Japan. Moreover, the Taiwan company will help promote Sharp’s products overseas, a proposition that may confuse many Japanese. Despite the “sekai no Kameyama” image, Sharp does not have much of a profile outside Japan due to its lack of initiative.

This laziness is endemic among Japan’s home electronics firms, according to Machida. In the previous decade, when many countries were making the changeover from analog TV to digital, Japan’s communications ministry worked hard to persuade governments in Latin America to adopt Japan’s broadcast standard rather than Europe’s or China’s, and they succeeded. Thirty countries now use the Japanese standard, but Japanese electronics makers didn’t follow up on this success, saying the region was “too risky.” In contrast, South Korea’s Samsung lobbied its own government to adopt the U.S. broadcast standard so that it would be easier for it to make equipment suitable for the American market, and now they are ascendant in that market. Sony and Panasonic, once prestige brands in the U.S., have become also-rans because they took their reputation for granted.

Japanese electronics makers “have never had an overseas strategy,” according to Osanai, unlike Japanese car makers. Hon Hai will give Sharp that chance, something the Innovation Network Corporation of Japan, which had been vying with Hon Hai for Sharp, would not have been able to do.

But that’s not the only reason Osanai and Machida are glad INCJ lost out. INCJ is the government funding arm that helped set up Japan Display by bringing together the liquid crystal display divisions of Toshiba, Hitachi and Sony in order to prevent low-price competition from wiping out the industry. Ostensibly, INCJ claimed it wanted to save jobs, but Osanai says that the only jobs the funding entity is protecting is its own. As with many bureaucratic entities, INCJ’s whole purpose is to justify its existence, and with taxpayer money.

Hon Hai’s purchase of Sharp costs Japan nothing, and except for the battery division, the Taiwan firm says it will not sell off any part of Sharp, though that could change once the financing dust has settled. Japanese media say that Hon Hai wants Sharp for its display technology, but there is nothing special about Sharp’s LCDs, which have become a commodity. Price is the only consideration. As financial writer Yasuyuki Onishi said in Nikkei Business, Hon Hai is not so stupid that it would spend ¥700 billion just for LCDs. In truth, it wants to get into the IOT (Internet of things) business, by producing home appliances that can connect to the Web, and for that it needs Sharp’s know-how. Hon Hai’s rival, Haier, bought General Electric’s appliance business for the same reason.

Softbank’s popular robot, Pepper, is manufactured by Hon Hai, another fact the media rarely mentions but one that is central to the issue of Sharp’s worth to the company. “Hon Hai is just like Pepper,” said Osanai. “You can tell it what to do, but it won’t come up with ideas on its own.”

  • Steve Jackman

    Japanese companies have been losing global competitiveness and market share for a long time now as Sharp’s situation and the recent accounting scandals to hide massive losses at companies like Olympus and Toshiba shows. The Japanese seem to be the last ones to realize that “Made in Japan” long ago stopped meaning cutting edge, high quality and good value, and that instead these days it is more likely to stand for overpriced poorly designed products which are often behind the technology curve.

    It is no wonder that this change has coincided with Japan becoming more nationalistic, inward looking, xenophobic and insular. The humility, curiosity and open mindedness which built Japan into a technological powerhouse after WWII is just a distant memory now having been replaced by extreme arrogance and hubris, and we all know where hubris leads to.

    • tisho

      Curiosity and open mindedness did not built Japan into a technological powerhouse, Japan has always been insular and inward looking. Free access to the US market and relatively open and free economy is what built Japan. Their success model was and still is for that matter – copy others – repeat. In an age where there is little competition this model was successful, however today it proves to be unproductive anymore as more and more countries are becoming developed and entering the global market, without innovation and creative work you’re not just competitive anymore.

      • Steve Jackman

        I largely agree with you, but I do think that there was a brief period after the War when the Japanese wanted to learn from the West, as evidenced by Japanese students studying in the U.S., and some Japanese travelling and wanting to learn English to live and work abroad, etc. Of course, it’s all relative since we are still talking about a highly insular and xenophobic society. And, it’s just getting worse.

      • Pink Floyd

        Getting worse is right, but this is just the tip of the iceberg, after Abe goes the next PM will make Abe look like a boy scout… Japan already has Apartheid and its not gonna get any better for a few generations ..

      • Steven Mike1127

        Really?? and how do you even know that??Can you see a future or something like that??

        I am sorry but i have to disagree with you.

        if you look a little bit harder. There are some kind of change happening now. For example there are more and more japanese that currently support immigration.

        {Delete the ***}

        http://ajw.asahi.***com/article/behind_news/social_affairs/AJ201504180035

        Not only that. Shigeru Ishiba, if you dont know who that guy is, he is the current member of LDP and the strongest challenger of Shinzo Abe inside the party. And he has a pretty huge chance of becoming the next president of LDP and thus also has a pretty huge chances of become japan next PM. Anyway he is also one of LDP politician that support the open immigration policy.

        {delete the ***}

        http://www.japantimes.c***o.j***p/news/2015/11/25/national/politics-diplomacy/japans-immigration-policy-rift-widens-population-decline-forces-need-foreign-workers/#.Vtxl-5x97IU

        And last is this. Another headline about opening up the immigration

        [delete the ***]

        http://www.channelnewsasia.***com/news/asiapacific/japan-ruling-party-to-tac/2568620.html

        If you think that those stuff only make Japan worse. Then you clearly dont know what is going on in Japan.

      • Steven Mike1127

        HAHAHAHAHAHA. Cant argue back on my earlier comment thats why you got my comment removed??? Now you are just plain COWARD. So here we go again i will post it again for you until you replay this

        HAHAHAHAHA, using PPP as a measure? Seriously dude how idiot can you be. If that is the case then China is the largest economy in the world then?? overtaking the US?? Which i am pretty sure NO ONE would agree to that.

        Even if you are using the PPP as a measure. BASED ON THE DATA that you just gave me. Japan gdp per capita is still higher than south korea. And this is what you SAID

        {{Why would a Korean or Taiwanese go to Japan to look for work, when both Korea and Taiwan have higher gdp per capita and higher wages than Japan? For China, sure, for now, only some really desperate chinese would go to Japan. Vietnamese? Sure, why not. Remind yourself that the number of Japanese workers in China is growing every year}}

        There you are clearly SAID that south korea gdp per capita is higher than japan. And you just contradicting yourself. Now i am really sure that you are indeed an idiot. Making a comment only to contradict your own earlier comment.

        {{{There are more Chinese tourists going to South Korea than to Japan}}}????? FALSE FALSE FALSE BIG FALSE

        [Delete the ***]

        http://www***.forbes.co***m/pictures/eglg45hhhhg/no-2-japan/

        http://www***.forbes.co***m/pictures/eglg45hhhhg/no-5-south-korea/

        Didnt i just told you to please get the fact straight first before you comment, Oh my god. You just keep and keep your idiocy running high.

        {{{Overall South Korea has more tourists than Japan}}}?? yeah, maybe right in 2014 but not anymore. In 2015 japan overtake south korea in tourism with a total almost 20 million tourist came to japan.

        {{{Japanese culture is a copy-cat of China, there’s nothing new you can find in Japan}}}????

        Copy cat?? You mean like those CHEAP CHINESE JUNK that CHINA clearly copy from the US and Japan product. Is that what you meant??? I think everybody know who is the copycat here.. you are clearly delusional to think otherwise. So here we go again same old same old strategy. You cant argue with a TRUE FACT and always resort to a FALSE FACT. And no matter what. The fact will always come out and you will be looked again and again like an idiot.

        I never came to japan??? How would you know?? are you a psychic??? FYI i have been in Japan, infact i am currently living here and been here for a total of 4 YEARS. And guess what, i like it here. The people are nice, polite and very honest. The crime rate are also very very low in here. I dont need to be afraid of getting robbed in the middle of the night.

        I think it is YOU that never came to japan.

        A clueless Japan hater who have twisted view of the country with basically have NO REAL LIFE beside bad mouthing japan mostly with FALSE FACT just like what you did with me. Yap thats right i just called you HAVE NO LIFE. I mean seriously dude. I saw your disqus profile. Those hundreds and hundreds of comment dedicated ONLY to bad mouthing japan. WOW just WOW, you sir are really need to get a LIFE.

        HAHAHAHAHAHA PEACE OUT

      • Pink Floyd

        oh dear , i thought you right wingers were in bed at this time of night.. oh and judging by your grammar you are Japanese so don’t try and pass yourself off as a foreigner here.

      • Steven Mike1127

        Look what only did is proving a point. That dude Tisho is just keep spreading false fact. Which i am always proving. I honestly dont mind people give their opinion and all but giving an opinion based on the false fact. That is what i called wrong.

      • tisho

        I’ve already replied to you, what more do you want from me? You are economically illiterate, uninformed and not receptive to new information, why would i wanna waste my time with you?

        Purchasing power parity is the only accurate measurement economists use to measure wealth, because it a measurement adjusted to local inflation, not overall sum. Yes, China IS the largest economy in the world measured adjusted to local inflation, measured by PPP. The Japanese GDP per capita may be slightly higher than South Korea’s, but if you take into account the standard of living which is higher in Korea, the inflation rates of both countries, the real wage growth of both countries and GDP per capita growth both countries, you would see that South Korea overall is much better off than Japan and has a much brighter future too, given the fact that Korean wages are rising, Japanese wages are not. The standard of living in Korea is higher than in Japan, things cost less, HDI is higher, the Korean economy is freer, they have much higher social mobility than Japan, those are things you just don’t understand, you’re not an economist and you’re not interested enough either, you just have an agenda to prove yourself right, that’s why i see no point in talking to you. I didn’t contract myself, i said the standards of living in Korea and Taiwan are much higher than in Japan, which is true, so therefore why would a Korean wanna go to Japan? It makes no sense, and the facts prove me right, those statistics include Koreans who were born there, that’s not an immigrant, yet it’s counted as one. You are the one contradicting yourself, i said Japanese culture is a copy cat of China, you start talking about cheap manufacturing, and even in this topic you are again uninformed. Every nation goes through the same process of development, you begin by producing cheap stuff, then you move on to high tech manufacturing, innovation, consumer and domestic driven growth. Japan went through the same process. Ask anybody in the US older than 50, he will tell you that in the 80 and 90s, Japan was known as the cheap copy cat manufacturing hub, producing cheap crap would break the next day you buy them, it takes accumulation of capital and skills to move through high paying, high tech jobs, China is already moving through that process, but you’re not informed enough to know anything about this, so i wouldn’t waste my time trying to explain it to you. No, you’re the psychic bro, shouting and cursing at me incoherent stuff you don’t even understand. You don’t know anything about Japan, but that’s ok, because i couldn’t care less about you. There, i replied, now piss off, and don’t bother me again.

      • Steven Mike1127

        My only problem with you is that. You like to include LIES, LOTS OF IT with the only purposes of bad mouthing Japan. Thats what i dont like. If you want to bad mouthing something or anything then please at least use some kind of REAL FACT. In which there are none of it in your opinion. None whatsoever.

        YOUR LIES=
        South Korea GDP Per capita is higher than Japan. LIES
        There are more chinese tourist go to South Korea than Japan. LIES (See those link i gave you at Forbes)
        There are more tourist came to South Korea than Japan. More LIES. Because in 2015 Japan overtake South Korea in tourism
        Once i have even seen in your comment that you said Japan is the worst country for women to live in. SERIOUSLY DUDE?? Have you even look at the statistic? Japan is considered one of the country with the lowest crime rate in the whole word. Not only that, Japan also ranked 8 in the world as the most peaceful country in the world by global peace index. If you called Japan as the worst country for women to live in then what do you call Saudi Arabia(Women cant drive in this country and they are worth half as man based on their sharia law), then how about india or pakistan(where women got raped on a daily basis).

        I seriously have no idea what kind of problem you have with Japan. I mean those pile up of hatred of yours. But again i told you. If you want to bad mouthing Japan then please use some kind of fact. NOT LIES like what you did all the time. And another thing. Please dont call me that i dont know anything about Japan because i know Japan way way more than you do. I mean, have you even came in Japan. I am pretty sure you are just those kind of foreigner that think he or she is an expert about Japan just by reading news or media outlet. Oh and the last thing i want to tell you is that I will keep bothering you if you keep spreading LIES. You can mark my word on that.

      • tisho

        Dude, you are a fanatic, which i think is a good thing, but use your obsessive fanaticism to research your material before you form an opinion. Everything i said is factually true, everything you say is factually untrue.
        1. I said South Korea has higher standards of living than Japan = true.
        2. Wages in South Korea are higher than Japan’s, which is what the GDP per capita PPP measures. (orbes . com / sites/ timworstall/2015/02/14/korean-wages-are-now-higher-than-japanese-wages-perhaps-for-the-first-time-in-3000-years/#7016e431684e)
        3. I said South Korea has more Chinese tourists than Japan = true. The link you gave me is about Chinese tourists going to Japan, it does not compare the number vs South Korea. (travelchinaguide . com / tourism/2015statistics/outbound.htm)
        4. South Korea is safer than Japan, Global peace index does not measure crime rates, it measure international relations, being next to North Korea will obviously put South Korea in a lower position, still, South Korea is safer than Japan (gogotsu . com / archives/15967)
        5. Japan ranks at the bottom of gender equality, women in Saudi Arabia have more rights than women in Japan (japantimes . co . jp / news/2014/10/29/national/japan-remains-near-bottom-of-gender-gap-ranking/)

        There, now move on with your next obsession, and PLEASE don’t bother me again. I have no time for uninformed psycho weebs who don’t know the first thing about Japan.

      • Steven Mike1127

        FIRST THING FIRST

        Have i ever said ANYTHING ABOUT standard of living or wages?? Dude, take a look at my reply to you. I NEVER said ANYTHING ABOUT WAGES OR STANDARD OF LIVING. i ONLY SAID about GDP PER CAPITA. Which you clearly said that SOUTH KOREA GDP PER CAPITA IS HIGHER than JAPAN( WHICH IS A LIE).

        GDP per capita IS NOT wages and also NOT standard of living. They are DIFFERENT.

        {{{3. I said South Korea has more Chinese tourists than Japan = true. The link you gave me is about Chinese tourists going to Japan, it does not compare the number vs South Korea. (travelchinaguide . com / tourism/2015statistics/outbound.htm)}}}

        hahahahaha. Dude you are funny. It looks like you dont even read those content on the link that you just gave me CAREFULLY. Those link is actually PROVING MY POINT even more. THANK YOU

        ANYWAY in the link that you just gave me. Yeah sure, in the “””First Half of 2015″”” there are more chinese tourist in South Korea than in Japan(I wont argue with it). But please do read again THE PARAGRAPH just below the ***Outbound Tourism Destinations***. Read from the first row until the third row of that PARAGRAPH.

        In that Paragraph(From the link you just gave me). And i quote

        {{{Analyzing from travel destinations, Asia still dominated China’s outbound tourism market. From January to May 2015, South Korea still ranked as the No.1 destination country. Nevertheless, the situation changed after MERS broke out on May 20th, which meant Japan moved into first place.}}}

        There, it clearly said(On the link you just gave me). “””which meant Japan moved into first place”””.

        hehehehehehe, i seriously laugh really hard after i read that. This is what i called clumsiness at a highest level. And this is also why i called you INCONSISTENT. Presenting a very evidence that instead proving your point it actually PROVING YOU WRONG. hehehehehehehe. You sir just made my day. THANK YOU

        AND AGAIN AND AGAIN. Have i ever said ANYTHING about JAPAN is SAFER than SOUTH KOREA? Please do take a look AGAIN at my REPLY to YOU. Can you please be on topic. This is what i said

        {{{Japan is considered one of the country with the lowest crime rate in the whole word. Not only that, Japan also ranked 8 in the world as the most peaceful country in the world by global peace index}}}

        I never said anything about JAPAN IS SAFER THAN SOUTH KOREA
        And also based on the link that you just gave me Japan still ranked 3 as the safest country in the world. Those mean that Japan is one of the safest country in the world right??or what, Do you want to argue that Japan is not a safe country? is that what you meant?

        {{{5. Japan ranks at the bottom of gender equality, women in Saudi Arabia have more rights than women in Japan (japantimes . co . jp / news/2014/10/29/national/japan-remains-near-bottom-of-gender-gap-ranking/)}}}

        Yeah regarding the gender issue in Japan. It is indeed true that there are many problem about it. But if you said that women in Saudi Arabia have more right than women in Japan. I am sorry dude but you are FLAT OUT WRONG

        http : // hdr.undp. org /en/composite/GII

        And again i told you. If you want me to stop bothering you then stop spreading LIES. Which based on on your latest reply to me. You clearly hasnt learned anything. Thats why i will keep bothering you. What are you gonna do about it anyway?

      • Steven Mike1127

        My only problem with you is that. You like to include LIES, LOTS OF IT with the only purposes of bad mouthing Japan. Thats what i dont like. If you want to bad mouthing something or anything then please at least use some kind of REAL FACT. In which there are none of it in your opinion. None whatsoever.

        YOUR LIES=
        South Korea GDP Per capita is higher than Japan. LIES
        There are more chinese tourist go to South Korea than Japan. LIES (See those link i gave you at Forbes)
        There are more tourist came to South Korea than Japan. More LIES. Because in 2015 Japan overtake South Korea in tourism
        Once i have even seen in your comment that you said Japan is the worst country for women to live in. SERIOUSLY DUDE?? Have you even look at the statistic? Japan is considered one of the country with the lowest crime rate in the whole word. Not only that, Japan also ranked 8 in the world as the most peaceful country in the world by global peace index. If you called Japan as the worst country for women to live in then what do you call Saudi Arabia(Women cant drive in this country and they are worth half as man based on their sharia law), then how about india or pakistan(where women got raped on a daily basis).

        I seriously have no idea what kind of problem you have with Japan. I mean those pile up of hatred of yours. But again i told you. If you want to bad mouthing Japan then please use some kind of fact. NOT LIES like what you did all the time. And another thing. Please dont call me that i dont know anything about Japan because i know Japan way way more than you do. I mean, have you even came in Japan. I am pretty sure you are just those kind of foreigner that think he or she is an expert about Japan just by reading news or media outlet. Oh and the last thing i want to tell you is that I will keep bothering you if you keep spreading LIES. You can mark my word on that.

      • Steven Mike1127

        HAHAHAHAHAHA. Cant argue back on my earlier comment thats why you got my comment removed??? Now you are just plain COWARD. So here we go again i will post it again for you until you replay this

        HAHAHAHAHA, using PPP as a measure? Seriously dude how idiot can you be. If that is the case then China is the largest economy in the world then?? overtaking the US?? Which i am pretty sure NO ONE would agree to that.

        Even if you are using the PPP as a measure. BASED ON THE DATA that you just gave me. Japan gdp per capita is still higher than south korea. And this is what you SAID

        {{Why would a Korean or Taiwanese go to Japan to look for work, when both Korea and Taiwan have higher gdp per capita and higher wages than Japan? For China, sure, for now, only some really desperate chinese would go to Japan. Vietnamese? Sure, why not. Remind yourself that the number of Japanese workers in China is growing every year}}

        There you are clearly SAID that south korea gdp per capita is higher than japan. And you just contradicting yourself. Now i am really sure that you are indeed an idiot. Making a comment only to contradict your own earlier comment.

        {{{There are more Chinese tourists going to South Korea than to Japan}}}????? FALSE FALSE FALSE BIG FALSE

        [Delete the ***]

        http://www***.forbes.co***m/pictures/eglg45hhhhg/no-2-japan/

        http://www***.forbes.co***m/pictures/eglg45hhhhg/no-5-south-korea/

        Didnt i just told you to please get the fact straight first before you comment, Oh my god. You just keep and keep your idiocy running high.

        {{{Overall South Korea has more tourists than Japan}}}?? yeah, maybe right in 2014 but not anymore. In 2015 japan overtake south korea in tourism with a total almost 20 million tourist came to japan.

        {{{Japanese culture is a copy-cat of China, there’s nothing new you can find in Japan}}}????

        Copy cat?? You mean like those CHEAP CHINESE JUNK that CHINA clearly copy from the US and Japan product. Is that what you meant??? I think everybody know who is the copycat here.. you are clearly delusional to think otherwise. So here we go again same old same old strategy. You cant argue with a TRUE FACT and always resort to a FALSE FACT. And no matter what. The fact will always come out and you will be looked again and again like an idiot.

        I never came to japan??? How would you know?? are you a psychic??? FYI i have been in Japan, infact i am currently living here and been here for a total of 4 YEARS. And guess what, i like it here. The people are nice, polite and very honest. The crime rate are also very very low in here. I dont need to be afraid of getting robbed in the middle of the night.

        I think it is YOU that never came to japan.

        A clueless Japan hater who have twisted view of the country with basically have NO REAL LIFE beside bad mouthing japan mostly with FALSE FACT just like what you did with me. Yap thats right i just called you HAVE NO LIFE. I mean seriously dude. I saw your disqus profile. Those hundreds and hundreds of comment dedicated ONLY to bad mouthing japan. WOW just WOW, you sir are really need to get a LIFE.

        HAHAHAHAHAHA PEACE OUT

  • Blair

    I must have missed all the hoopla. I have a Hitachi

  • GBR48

    Sharp had been run into the ground by executive incompetence to the point where it has the debts of a small and very badly governed nation state. Other Japanese corporates will follow if they do not reform. Even their own government want them to.

    You cannot operate in a fast-changing, dynamic global environment if you are culturally allergic to change.

    Too much of Japan Inc. is filled with people who do not have the ability to do the jobs that they have obtained through means other than merit. There is far too much corruption, internally or from external sources.

    Getting caught is not ‘increased transparency’: Olympus, Toshiba (accounting), Olympus (again-seriously, they should just add -gumi or -kai to their name), Kaketsuken (decades of falsification of blood products, which is just frightening) and Takata (safety devices killing people) are just the big names.

    Japan Inc. is refusing to reform and slowly killing itself by multiple means. This will have catastrophic consequences for the Japanese economy.

    Sharp is a well-known and well-respected international brand with good R&D. Foxconn can use that to expand. ‘Sharp’ is actually worth more to Foxconn than to Sharp itself, as it stands. They have competency and can better utilise Sharp’s various component parts. As it was, Sharp began losing money when the first employee walked in the door in the morning and turned on the lights. How much asset-stripping takes place will depend on the real state of the company. Sharp had so much debt attached to it that even its research and useful elements made it a fairly risky purchase, and Japanese companies are good at hiding things they do not want people to see.

    Endless bail-outs and INCJ-style nationalisation (which went out of fashion in the West in the 1970s, because it rarely worked) are a bad idea. It’s just using other people’s money – often public money – to shuffle all the problems, failures and dirty secrets under the tatami and paper over the cracks.

    If Japan wants to hold on to its innovation, then it needs to reform the corporate structures that apply that innovation in the marketplace. In a few cases it is happening. There is a bit of googlisation at Sony and other large companies are buying up start-ups and supplying them with venture capital to develop. Some big names are refusing to reform, covering up their failings using cash reserves to buy up more dynamic foreign companies that can bring in better revenue. The former is a better plan than the latter.

    Too many of Japan Inc.’s boardrooms are run like absolute monarchies. That just doesn’t work in a 21st century commercial environment.

  • Ron Lane

    Excellent article and equally excellent comments.

  • Ken Gai

    Sadly, either way it plays out, the negative media spin will tout either failed company or protectionist Japan. This ‘contribution’ tries to do both, starting with the title, while the jury is still out.

    Despite the boards recommendation to sell 67% of the company to Hon Hai, ultimately final approval (pending latest hiccup) will be up to it’s shareholders; read – based on financials – Not, as asserted in 3rd paragraph, “The blinkered world view.. Japan’s reluctance to let Sharp be sold”.

    This oped is so full of holes I don’t even know where to begin.. then maybe not so surprising (still disappointing) based on a quick skim of the source bios.

  • DutchCynic

    The Sharp-saga reminds me of the era when bloated US/European electronics makers were obliterated by their Japanese rivals in the 80s. Philips had a treasure trove full of patents and was at the technological forefront in consumer electronics, but could not deal with cheaper and often more sophisticated products from Japan. Consumer electronics for the most part filling up (often black) plastic boxes. Japanese have been beaten at their own game by the Koreans, Taiwanese and Chinese, who managed to develop better/cheaper sourcing networks than their Japanese rivals, who clung to the notion too long that their products needed to be made in Japan to be any good.
    If the secenario of Philips is be repeated in Japan, things do not look good for Sharp, it basically has withdrawn from consumer electronics (and lightbulbs) to focus on medical technologies. Guess for Sharp and most likely other electronics’ giants finding a renewed focus will be up ahead in the coming years.

    • Steve Jackman

      Yes, Japan should have known that other Asian countries will beat it at its own game, unless it moves up the value chain. However, Japanese businesses are so conservative and lacking in new ideas that they prefer to keep doing the same thing. There is no concept of creative destruction in Japan and it’s now paying the price for this.

  • DutchCynic

    The Sharp-saga reminds me of the era when bloated US/European electronics makers were obliterated by their Japanese rivals in the 80s. Philips had a treasure trove full of patents and was at the technological forefront in consumer electronics, but could not deal with cheaper and often more sophisticated products from Japan. Consumer electronics for the most part filling up (often black) plastic boxes. Japanese have been beaten at their own game by the Koreans, Taiwanese and Chinese, who managed to develop better/cheaper sourcing networks than their Japanese rivals, who clung to the notion too long that their products needed to be made in Japan to be any good.
    If the secenario of Philips is be repeated in Japan, things do not look good for Sharp, it basically has withdrawn from consumer electronics (and lightbulbs) to focus on medical technologies. Guess for Sharp and most likely other electronics’ giants finding a renewed focus will be up ahead in the coming years.

  • tisho

    if you look at the way NHK reported on this deal, you would think that Sharp is the one buying a bankrupted foreign company, the way they report on it is like Sharp is doing Foxconn a favor. Anyway, collectivist societies are backward, you can’t feel pride for something you’ve never done, and you can’t take credit for other people’s hard work.

    • Steve Jackman

      The Japanese media did the same thing when Renault rescued a then bankrupt Nissan, by painting it as a merger of equals, whereas, in reality it was anything but.

    • Steve Jackman

      The Japanese media did the same thing when Renault rescued a then bankrupt Nissan, by painting it as a merger of equals, whereas, in reality it was anything but.

      • Steven Mike1127

        Yea thats right. Only it turns out after the rescue. Nissan and renault become one of the most successful alliance ever exist in auto history. With Nissan now worth way way more than renault, the very company that rescue it. Nissan also got a huge advantage from that alliances.

        So, if we are looking it at a different point of view. In a sense this alliances is equal right?? Nissan is the one near bankruptcy after all not renault