My opinion this week(41):
Winners take all forever
As newspaper and TV stations reported, the U.S. Department of Justice
appealed to the court on October 20th that Microsoft Company is
infringing the Antitrust Law concerning the sales of Internet browsing
soft by their company. Microsoft Company has decided to dispute overall
with the Department of Justice on this issue and the trial at the court
will start soon.
We are not sure about the outcome of the trial but I personally expect
that the Department of Justice will win in the trial. As every
participants of Internet knows, there are two major browsing soft to
see WWW service of Internet today. They are Netscape Navigator (NN) of
Netscape company and Internet Explorer (IE) of Microsoft Company. Two
of them has just announced the latest version of the soft which install
various very advanced features in them.
However, in these days , the late comer, IE is surpassing NN in the
market. This is because while the latter is being sold as an independent
PC application software, the former is provided free to all Window95
users which is integrated into a part of PC operating system. Microsoft
intended to strengthen the integrated features of the browser and OS in
the latest version of IE and tries to monopolize the browser's market
by this action.
From user's point of view, there is no objection for the integration
of browser and OS itself. When we use the latest version of IE, we see
some of those good advantages. In the Window98 which will be sold in
1998, such features of integration will further be strengthened. That
will be fine.
But is that all right that one or other good quality browser will
be eliminated from the market place as a result of such monopolistic
action by Microsoft? Any computer application software have some
advantages as well as disadvantages in specifications. That is true
with browsing soft as well.
I have not compared the latest version of two browsing soft yet,
so I have no ideas on the specific features of those two. But as to
the old version's products, I used to use one after another depending
on the situations considering advantages of each soft in various
cases. The same thing can be said with other application software
such as word processor, spread sheet, and communication.
Except operating system software, we had better to have several
competitive software in the market as far as application software
are concerned. As a result of competition, each software will be
improved in specs and in pricing in the competitive situation. I would
like to repeat that it is fine for Microsoft Company to try to integrate
some application software including browser with operating system. But
it is no good when they try to monopolize the browsing market using
such measures as a strategy. As one of a user of PC, such strategy to
monopolize the market cannot be overlooked.
I show here one other unfavorable facts about their sales tactics. I
am an official user of Office95 of professional version. Recently I
have received a letter from the company announcing the version-up from
Office95 to Office97. I checked the price offered for version-up. I was
quite disappointed with the fact that the price which I checked at PC
shops and the price which is offered for the user of competitive
products are even quite competitive with those presented to the official
users like myself.
They might think that those users who once purchased Microsoft
products would be obliged to buy their products at any rate. I wonder
if they forget providing the merits to their official customers and try
to expand market shares by providing even better service to those who use
competitive products at the moment.
As I write the above, it is obvious that any monopolistic position is
no good for consumers. The Antitrust Law itself is a kind of paradox to
the principle of free competition. The Law should never try to limit
free competition. However, I doubt if the strategy taken by Microsoft
Company really follow the principle of free competition. Some hard
makers said that they were forced to buy browsing soft together with
Operating System to be installed into the hardware. Once they succeeded
in monopolizing browsing soft market, they may try to monopolize another
application software next. Once this happened, Microsoft will try to
monopolize all software market in the future. Then, winners will take
all not for a while, but forever in the long run.
No constructive and favorable growth of PC market can be expected if
that happened in the market.
1997/11/1
Tadashi HAYASE
My opinion this week(42):
Dispute on a hundred meters
Nagano Winter Olympic Games is coming in 100 days. Many topics
are now reported everyday but the most important of all is the
dispute between Game sponsor, the Nagano Prefecture and Interna-
tional Ski Federation (FIS) concerning the starting point of down-
hill event of ski games.
While the Nagano Prefecture insists to keep the conventional
starting point for downhill game, FIS insisted that starting point
is to be placed higher by a hundred meter or so, so that downhill
game will be more exiting and competitive for skiers require
more advanced technical skills to win.
Any such higher starting points have not been admitted in any down-
hill@games in the past for the area of higher starting point is
designated to the special area for environment protection by the
country. Although general public skiers are allowed to ski in such
are, no game events have ever been allowed in the past.
Nagano Prefecture tried to limit off all general skiers from such
area if FIS tries to place the starting point at that area based on
the fact that general skiers are allowed to ski in such area. The
President of FIS, who visited to Nagano to discuss the issue got angry
about such move and expressed that FIS would refrain from all skiing
games from the Olympic if that happened saying that that action is a
big challenge to all skiers in the world.
Needless to say, the president of FIS is just trying to give some
pressure on Nagano Prefecture to change their policy itself. But the
Prefecture cannot accept the request of FIS so easily for the
protection of nature and environment is a big cause itself. At this
point, nobody in the country could say no to such cause if they are
told that any destruction of environment cannot be allowed just to
make such sport events more exiting.
As far as I observe the situation, I see that Nagano Prefecture
may accept the request of FIS so that the Olympic Game itself will
be successful. But their stance is that they are forced to accept such
request very reluctantly although that is not what they intended. This
is the way which Japanese bureaucrats and bureaucratic organization
follow in various situations like this. I regret to see such stance.
My opinion on this issue is a kind of clear. I am not personally
concerned too much on Olympic Games itself. However , I certainly think
that Nagano Olympic should be successful in any respects once it is
held in here Japan.
In order to see the success, I believe that the sponsor, Nagano
Prefecture should listen to the request of FIS as soon as possible.
When they tried to invite Winter Olympic to Nagano, they took all
such factors into consideration including the protection of natural
environment in along with the assurance of international level for
all events in the games. If that is not the case, the sponsor, the
Nagano prefecture is responsible for it. Furthermore, it seems that
the issue is not so critical and difficult to solve.
What FIS demands does not seem to be quite unreasonable. It is too
late for Nagano Prefecture to say that the starting points requested
by FIS is the area protected by the country. They should apologize
to the party and the people who are against to the decision based
on such cause. Then they should accept the request from FIS.
Certainly it is their job to make several reconstructive work on the
place if necessary and set a new rule that any skiing is not allowed
in that area any more. I believe people in the country will generally
agree with such decision at this time.
1997/11/8
Tadashi HAYASE
My opinion this week(43):
Resale price maintenance law
Presently at the deregulation committee set by the Government, the
public hearing on whether or not the newspapers' resale price mainte-
nance system should be abolished is going on.
At this hearing, the federation of newspaper firms insisted that
the newspaper companies will not be able to keep the good quality
of papers if such system is abolished, because retail shops will
face to keen competition and go bankrupt due to such severe competition
in the market. As a result, the newspaper firms will provide a big
loss to their customers i.e. consumers. That is the reason why they
wish to keep such resale price maintenance system.
On the other hands, various consumer unions including Japan House
Wife association insists to abolish such system saying that various
strong selling approach and hazardous sales promotion by retail shops
are providing a lot of troubles to consumers today.
My first impression on this issue when I hear about the hearing is
that why there still exists such old fashioned system as resale price
maintenance in this free market. Why is that? Why are the subscription
fee of newspapers, selling price of books and CD-ROM provided by
Japanese firms are higher than those provided by foreign firms? The
reason is obvious. The existence of such resale price maintenance laws
in Japan for such kind of items put up selling price higher.
Who will suffer the loss if such laws is abolished? The federation
of newspaper firms said that the quality of papers will be deteriorated
due to the excessive competition in the market once such system is
abolished. What a strange logic it is !
In these days a number of criticism are being provided by newspaper
firms toward the slowness of administrative reform conducted by the
government. That is fine. We generally support what they insist in
their paper. But it is quite a contradiction for them insisting to
keep such system which I understand is very old fashioned in any
sense.
Whatever they are commodities, services, software and publications
such as newspapers or books, the selling price of which should be
decided by the relationship between supply and demand in the market
place. It is the basic principle of market economy. I wish to say
definitely that such resale maintenance law itself is out-of-date in
every sense. The idea that suppliers set the price and force the
retailers to maintain that price for consumer is a kind of anachronism.
As one of consumers, I have a great doubt on the fact that newspaper
firms which should be most aggressive to proceed overall reforms
on the social system are trying to stick to such old system. They
are making fool of consumers by saying that quality of papers will
be lost once the price is settled in the free market. What a word it
is!
97/11/15
Tadashi HAYASE
My opinion this week(44)
Tax Week
Last week was designated as Tax Week. The week is set so that people
have a good knowledge about tax and become more cooperative to pay tax
as Japanese citizens. At all over the cities in the country, tax offices
appointed some famous entertainers or sports men to the superintendent
of the tax office of the day and made several promotional activities
in the streets. And it was this time when about 10 professional baseball
players were prosecuted by the authority for their evasion of taxes.
I don't know what to say about that whether it is good timing or
bad. From the side which holds tax week events, such accident is a
kind of good example to stress the importance of right tax payment as
taxpayers.
From the stand point of salaried workers like ours , any such tax
evasion accident scarcely happens for salaried workers for tax
are automatically collected not like baseball players. This is because
all taxes including income tax and inhabitant tax are collected at
the source of income every months.
So when it comes to salaried workers like ours, the motto of the
tax week and the tax week itself do not sound so interesting at all.
Most salaried workers have no chance to contact directly with tax
offices because tax collection is done automatically every months
at employers offices including some adjustment works at the end of
year concerning the payment of insurance fees and some additional
income of dependent families.
It is said that Japanese people in general lack the sense of right
as tax payers. There must be several reasons for that. But one major
reason for that derives from the fact that much of tax collections
are made at the source of income.
Japanese economy is now in serious recession. Stock market is down
and yen continues to get cheaper. The background for the recession
obviously due to the delay in performing administrative reforms and
various deregulation measures to activate market economy. In other
words, that is the reflection of the evaluation from the interna-
tional society for he slow advancement to improve Japanese social
and economic structures governed by bureaucratic system.
However, that is also the reflection of low level of people's
sense of right to improve the present status quo of society. That
is the reflection of the shortage of sense of right as tax payers.
The tax week is fine. It is natural that people are asked to remind
how important it is to be good tax payers. But at the same time, it
is more important to recognize basic rights as tax payers. Every tax
payers are requested to know how those taxes are utilized efficiently
by our government and for our social life.
I do insist that such tax collection system at the source should be
abolished to improve the sense of right as tax payers. All tax payers
should calculate his tax and go to tax offices by themselves in order
to become more sensitive in tax payment. I know the strong opposition
for the change with the reason that such change will require more
number of tax officers to process the work, which are against the
administrative reforms now underway.
I want to ask which is more important namely more cost or higher
interest of people concerning tax payment? Needless to say, the
higher interest of tax payers concerning tax payment is much more
important than the higher cost of tax collection work at the tax
offices.
1997/11/22
Tadashi HAYASE
My opinion this week(45)
Dissolution of Convoy
Yamaichi Securities Co. decided to close down their securities
business voluntarily. During three consecutive holidays, newspapers
and TV stations reported a lot of this news. All people, especially of
salaried people who work for business firms might have thought that
such serious matter would possibly happen to themselves in the future.
I did not really understand what it meant by the voluntary shutdown
of business. I understood that 100% later on after I watched TV news
and read newspapers on this news with the actual announcement by the
top management of the firm. Yamaich Securities Co. is obliged to
go bankrupt carrying a great amount of bad debt. This is true with
any firms which go bankrupt.
But usually whenever any firms face bankruptcy, they usually applies
for Company Rehabilitation Law and may be able to come back as a
rehabilitated firm. When Sanyo Securities Co. went bankrupt three
weeks ago, they selected this alternatives. They may be able to come
back by themselves or may be merged by some other firms. Although not
all employees will be employed, but most may be able to continue to
work in the firm as in the past. But in the case of Yamaichi, their
business will be shut down completely. About ten thousand employees
including subsidiaries of the firm will loose their jobs by this
action. Even the way to apply for the rehabilitation is shut by the
Ministry of Finance.
In order to avoid the turmoil in the financial market, the Ministry
of Finance seemed to take all necessary actions even considering
possible introduction of public fund. That is fine.
But they are not concerned with any of such employment issues. All
of other securities firms and firms in other industries reacted very
coldly against the President Nozawa's sincere request concerning this
employment issue. All firms must protect by themselves in this severe
business recession. They may face the same situation which will happen
to them tommorrow. What a miserable story it is!
When I heard this news, I imagined a big devaluation of yen would
follow in the foreign exchange market. Yen was surely down in the
following days in the international market, but not quite much. This
is because overseas economist and market analyst might have thought
that the further information disclosure of Japanese financial market
will be realized due to this case so that Japanese financial market
will be more healthy in their structure in the future.
So far, all Japanese banks, securities firms and insurance firms
have been protected as a convoy led by the central ship,the Ministry
of Finance. Such cooperative convoy ship system do not work any more.
Yamaichi Securities Co. have been discarded and cut out from such
protection. Once this happened, there will be second and third firms
which will be discarded from such protection. That means more banks
and securities companies will go bankrupt sooner or later. But nobody
can stop this move any more for the time being. And no other way but
this will stop the Ship of Japan sinking to the bottom of the sea.
However, it must be added that the responsibility of this convoy
leader i.e. the Ministry of Finance should be called for strictly
while such convoy system is being destructed to the fullest extent.
1997/11/29
Tadashi HAYASE
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