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Global competition and technology standards: Japan's quest for techno-regionalism.

This article examines Japan's evolving commitments to technology development and technology diffusion in Asia. It explores Japan's technology strategies in three areas--Interact protocol, open source software, and horology--focusing on the importance of technology standards. The development and diffusion of technology standards has become one of the core elements in establishing industrial competitiveness. The importance of technology standards encouraged the Japanese government and firms to pursue a regional policy to develop and diffuse new technological ideas and standards in Asia. Japan's commitments were accepted by its neighbors because they could obtain various benefits from collaboration with Japan, such as technological exchanges, technology transfer, and financial aid.

KEYWORDS: Japan, Asia, technology policy, Internet protocol, open source software, horology


The Japanese economy and Japanese industry experienced a decade-long recession in the 1990s. The collapse of the bubble economy in the early 1990s led to a sharp decline in stock and land prices. Financial turmoil due to nonperforming loans impeded a return to growth, and bankruptcies and unemployment rose to historical levels. The keiretsu networks, which were regarded as the base of Japanese business strength, eroded over the course of the decade.

Given the gradual decline in economic performance and overall industrial competitiveness, the Japanese government and firms intensified a strategy to utilize core industrial competencies for the revitalization of the Japanese economy. Japanese industry retained a competitive edge in digital consumer products, car navigation systems, nanotechnology, and a number of other areas. A critical strategy in these and other sectors is to make the particular technology a standard in the market. While the Japanese economy experienced a serious setback in the 1990s, trade in goods, services, and technologies between Japan and Asia expanded steadily during that period. Japanese manufacturers continued to engage in foreign direct investment (FDI) in East Asia, which led to the formation of dense production networks in the region.

Close economic linkages with Asia and the growing importance of technology for industrial competition influenced the technology policies and strategies of both the Japanese government and Japanese firms. In this article, I examine Japan's evolving commitments to technology development and technology diffusion in Asia by examining the importance of technology standards. I advance three arguments in the discussion. First, the development and diffusion of technology standards have become one of the core elements in establishing industrial competitiveness and thus in shaping a state's technology policy. Second, the Japanese government and Japanese firms pursued a regional approach--promoting collaboration with Asian countries in developing and diffusing new technological ideas and standards. Third, Japan's neighboring countries accepted and supported Japanese technology standards largely because they hoped to secure greater opportunities for joint technology development and technology transfer.

I begin with the literature on the state's preferences for technological advance and the implications of technology standards. I then investigate the policies and strategies of the Japanese government and Japanese firms regarding the development of particular technologies and their diffusion in Asia. The empirical contribution of the piece focuses on three sectors: Internet protocol, open source software, and horology.

Industrial Competitiveness and Technology Standards

What kind of strategies does a government adopt to improve the technological base and increase the technological capabilities of its firms? When a state remains at an early stage of industrialization, an inward-looking technology policy seems to be appropriate. The state fosters the technologically important sectors by providing export subsidies and government procurement and by regulating the entry of foreign rival firms and products into the domestic market. In addition, major firms create collaborative relationships to achieve common technical goals, and the government sustains such corporate activities by organizing government-funded research consortia or providing tax breaks, generous subsidies, and loans. Through such strategies, the government seeks to raise its capabilities to learn and adopt standardized foreign technology for mass production.

However, a variety of forces have revealed limitations of the closed, inward-looking approach to technological development, especially for advanced states. First, changes in the global business environment make inward-looking technology policy less feasible. Firms need access to much larger markets and technological bases in order to finance the huge and rising costs of conducting research and development (R&D) for new innovation. The domestic market is often too small to secure sufficient economies of scale and financial and human resources. Collaboration with foreign firms has become increasingly important for securing access to the latest R&D and the funding for it. This is especially the case for firms from advanced states because of the need to establish a solid position in all major markets in the so-called triad of high-growth Asia, North America, and Europe.

Second, trends toward economic openness and market liberalization have gained momentum. States are pursuing deregulation and privatization measures, reducing the scope of government intervention in the market and creating more transparent business-government relations. Undue state intervention and tight relationships with the government might have been valuable in the past, but they can also impede innovation in the private sector.

Third, the development of multilateral trade institutions made it difficult to adopt a closed technology policy. Differing national technical standards have acted as substantial nontariff barriers to international trade. To rectify this situation, the World Trade Organization (WTO) system urges harmonized international or regional standards. For instance, the Agreement on Technical Barriers to Trade of the WTO stipulates that "where technical regulations are required and relevant international standards exist or their completion is imminent, Members shall use them, or the relevant parts of them, as a basis for their technical regulations." (1) Thus, the WTO urges member states to promote more open technology policy.

Importantly, the emergence of a new liberalized global economy does not straightforwardly undermine interstate competition for technological advance. To the contrary, increased globalization can magnify the potential costs and benefits that result from any one country's competitive advantage or disadvantage. (2) Moreover, intensive global competition has created a world dominated by new types of technology-driven monopolies and oligopolies that can distort the nature of competition in the marketplace. (3) If a state hopes to hold firms and sectors with the potential of challenging these monopolies and oligopolies, it has strong incentives to prop up these firms and sectors by enhancing their competitive edge.

In this context, there is a vital role to be played by technology standards. Technology standards are valuable in industrial sectors where network externalities matter. Where network externalities exist, the utility that users can derive from consumption of a given good or service increases with the growing number of the installed base of users. (4) These network externalities, however, require compatibility and interoperability in the exchange of data and products and raise the importance of the broader diffusion of standards that cover such interoperability and compatibility. Technology standards also provide substantial benefits for consumers by bolstering the credibility of technologies as well as by expanding features that are common across all brands. (5)

Thus, technology standards change the nature of corporate competition. Even if a firm invents an innovative technology, or a whole industry in a particular country produces a cluster of new technologies, that firm or industry cannot become a winner if it fails to make the technologies accepted in the regional or global market. Firms have to transit from their own to international standards. Government should have strong incentives to encourage firms to make efforts to diffuse technology standards in the marketplace.

Two questions arise regarding the development and dispersion of specific standards. The first is how the government and firms cooperate to establish and diffuse particular standards. The characteristics of standards themselves matter. It is difficult to sustain a bad standard if there is a competing product that is superior. At the same time, past competition over standardization suggests that a technology standard that holds advantages in such economic variables as price and quality alone does not always win in competition. (6) Governments and firms can make their standards win in the standarization game by strategically locking in such standards in the broader markets.

The second question is why the second-tier states agree to accept standards that the first-tier state develops and tries to advance, particularly given that they also have strong incentives to improve their own technological capabilities. Geographical proximity, overall economic linkages with the first-tier state, and the offer of various kinds of payoffs--including opportunities for joint research and technology transfer and exchanges--are all likely to affect the preferences and behavior of the second-tier countries.

I address those two questions by examining Japan's technology policy toward Asia. Japan was long regarded as a paradigmatic "techno-nationalist" state with strong domestic orientation. (7) Its government harnessed indigenous technological capacity by assisting corporate investment and allocating credit to targeted sectors with an eye to creating internationally competitive firms. In the development process, the government limited the entry of foreign capital stringently, although advanced foreign technology was aggressively absorbed. In the 1990s, the Japanese government attempted to rejuvenate the depressed domestic economy by carrying out a neoliberal reform program. While the government welcomed the entry of foreign firms into the Japanese market, it began to sponsor internationalized cooperative research programs.

However, the extent to which the Japanese government and Japanese business changed their philosophy of technological development has been the subject of controversy. Some scholars give credit to Japan's shift to a more open technology policy. For instance, Gregory Coming argues that Japan's R&D programs represented by the Human Frontier Science Program, Intelligent Manufacturing System Program, and Real World Computing Program invited participation of foreign firms in order to leverage complementary resources and capabilities. (8) Others are still skeptical about such changes toward a more open technology policy, asserting that Japan's core ideologies of national self-sufficiency and techno-nationalism have remained fundamentally unchanged. (9)

In examining Japan's technology policy toward Asia, it is necessary to consider the policy implications that derive from deepening economic linkages between Japan and Asia. Production and distribution networks that Japanese firms formed through FDI into Asia in the early 1990s created a sophisticated division of labor in the region. (10) Linkages through FDI contributed to the steady rise of East Asia as a group in Japan's overall trade. China, including Hong Kong, surpassed the United States as the primary trade partner in 2004. In accordance with the enhanced economic interdependence, the Japanese government has intensified its policy-oriented commitments to Asia, aiming at the diffusion of particular ideas about administrative guidance and financial architectures. (11)

These changes hint at the possibility that the Japanese government and Japanese firms have also shifted their technology policy toward Asia by intensifying their incentives to diffuse their own technological innovations and ideas. The necessity of diffusing technology standards induces the Japanese state to pursue a regionally oriented technology policy, in addition to a domestically oriented one, in order to make its firms compete against their foreign rivals that dominate the major markets in the world. The Japanese state seeks to build a "regional base" where it retains more political and economic leverage in strengthening its firms' position in the global technology game. The neighboring countries accept Japanese initiatives for technology development largely because they can secure access to opportunities for joint technology development and technology transfer.

Proceeding from these assumptions, I examine Japan's technology policies in three industrial segments: Internet protocol, open source software, and horology. The three cases are selected because of differences in the standardization process. The standardization process is normally classified in two categories. The first is the market-based model in which several competing standards are introduced into the market and the most broadly used one becomes the de facto standard. The second is the committee-based model in which the formal standardization authority formed by governments or international organizations decides on the de jure standard.

The horological case was selected as representative of the committee-based model. The standards for watches are discussed and decided on at the Horology Technical Committee of the International Organization for Standardization (ISO/TC114). The cases of Internet protocol and open source software are examples of the market-based model. However, there are nuanced differences between the two cases. In the case of open source software, the developer of open source software aims to challenge the existing dominant standard: Microsoft Windows. This is a competition within the same generation. In the Internet protocol case, companies seek to diffuse a newly developed, next-generation standard, and precommercial competition is fierce.

The Pursuit of New Internet Protocol Standards

Corporate Strategies and Government Policies

The technology that this section highlights is Internet protocol version six (IPv6). The Internet protocol is data-oriented protocol used for communicating data across a packet-switched Internetwork. The Internet protocol version four (IPv4) was the first version of protocol to be widely deployed. But IPv4, which uses 32-bit addresses, has the problem of a limited number of Internet addresses (4.3 billion). The next-generation protocol, IPv6, uses 128-bit addresses and can rectify this problem by offering a virtually infinite number of addresses. Even in early 2006, the live addresses in the publicly accessible Internet were still dominated by IPv4, and IPv6 accounted for a tiny share. However, quite a few firms and governments have been eager to deploy IPv6 and develop IPv6-related technologies and products.

Although quite a few Asian states, including China, India, and South Korea, set up a national strategy for IPv6, Japan was particularly serious in its development and diffusion. Japanese information technology (IT) firms did not establish a solid position in the Internet business due to a failure to enter the market in a timely fashion. For a long time, the routers that underpinned the PIv4 network were dominated by a single US firm, Cisco Systems. The company accounted for more than 70 percent of Internet addresses under the IPv4 network. Routers made by different firms could be used on the Internet on condition that they complied with the de facto standard set by Cisco Systems.

Japanese IT firms aimed to expand their business in the Internet age by spearheading the development and diffusion of IPv6. IPv6's merit of an infinite number of addresses was particularly important for Japanese IT firms that hoped to take the lead in creating a ubiquitous Internet society where various kinds of digital electronic products would be connected through the Internet. In particular, they aimed to establish international competitiveness by promoting collaboration between digital consumer appliances (hardware) and broadband (service).

In the new millennium, Japanese IT firms intensified their efforts to develop IPv6-related technologies. In October 2000, the IPv6 Promotion Council was established by eighteen firms and universities. The council aimed to assist in the development and diffusion of IPv6-based applications and to help ensure a smooth transition from IPv4 to IPv6. (12) The executive board members included all major Japanese IT firms, such as NEC, Fujitsu, Toshiba, Matsushita, Sony, and NTT Communications. The council set up four working groups and implemented trial tests for IPv6-compliant consumer electronic products.

In May 2003, Hitachi, Cisco Systems, NEC, Fujitsu, and Juniper Networks announced that they would jointly develop standard software for connecting networks for IPv6. The software would enable data to be transmitted freely across equipment by different companies running different software. The standard software was based on the result of the participation of five firms in the "Japan Gigabit Network Experiment" sustained by the Telecommunications Advancement Organisation of Japan, an organization affiliated with the Ministry of Internal Affairs and Communications (MIC). (13) The experiment connected thirty-seven routers from different manufacturers in a nationwide network transmitting data at 2.4 gigabits per second.

The Japanese government sought to support the development of IPv6 by incorporating this objective into Japan's overall IT strategy: e-Japan strategy. (14) The e-Japan strategy issued in January 2001 raised an objective of promoting "a shift to the Internet networks equipped with IPv6 that provides enough address space and stricter protection of privacy and network security, in anticipation of various Internet access devices and digital consumer electronics that will become popular and always be connected to the Internet." In August 2002, MIC received the Second Interim Report on Internet Policy Direction in the Twenty-first Century from the Telecommunications Council. The report, the most comprehensive plan for Internet policy, showed concrete measures for the introduction and distribution of IPv6 as well as guidelines for the transition of Internet infrastructures to IPv6-based ones. The primary objective was that Japan shall distribute the transitional model to other countries and thereby contribute to the worldwide development of IPv6.

The government has adopted several measures to sustain the development and diffusion of IPv6. The first was support for R&D and field experiments for IPv6 and content distribution. The IPv6 Development Field Trial was conducted with an annual budget of 2 billion yen in 2003-2005. This trial aimed to conduct demonstration experiments to realize a smooth transition of the whole infrastructure from IPv4 to IPv6. The second was favorable tax treatment for the use of IPv6-ready touters. Qualified firms that introduced IPv6-ready routers were entitled to write off 12 percent of installation expense, which exceeded the regular legal depreciation limit for calculating the corporate tax. The fixed property tax to be paid to the local government was also cut by 25 percent.

IPv6 and IT Cooperation with Asia

The diffusion of IPv6 was incorporated into Japan's overall IT strategy toward Asia. The main pillar for Japan's IT policy for Asia was the Asia Broadband Program (ABP), which the Japanese government formally launched in March 2003. (15) The program aimed to make Asia a global information hub in parallel to Europe and North America by 2010 through policies for preparing network infrastructures pertaining to broadband platforms and relevant policies for introducing and diffusing broadband platforms. Among seven goals for the program, a concrete one was to "facilitate the transition of IPv4 networks to IPv6-ready networks in Asia." (16) In order to achieve this goal, the program stipulated a number of concrete measures: to establish transition technologies and transition models, to establish IPv6-ready satellite technologies compatible with terrestrial systems through R&D, and to encourage the widespread use of the fruit of joint experiments in Asian countries.

In August 2004, the Japanese government presented the ABP at the first Association of Southeast Asian Nations Plus Three (ASEAN+3) Telecommunications and IT Ministers Meeting. At the meeting, the ministers deliberated on measures for promoting the preparation of broadband platforms and capacity building. They also reached a common recognition that cooperation between ASEAN and the three Northeast Asian countries should be further strengthened. Concrete programs to implement the ABP followed. In February 2004, MIC opened a website, Asia Broadband Program, which included an outline of the ABP, various programs, and future policy directions. (17) The following month, the Asia Broadband Symposium was held in Tokyo, where lectures by experts and a panel discussion by government officials from Asian countries were organized.

What benefits did Asian countries draw by collaborating with the ABP? Several Asian countries could secure official development assistance (ODA) funds through the ABP. For instance, Vietnam obtained loans of 19.4 billion yen in 2003 for the North-South Submarine Fibre Optic Cable Link project. In the same year, Japan provided Laos with a grant of 220 million yen for the Implementation of International Telephone Switching System project. (18) As for IPv6 development in the ABP, some Asian countries could implement joint projects and experiments with Japanese funds. Japan and Singapore implemented IPv6 large-scale multicast technology and IPv6 dynamic band allocation and management technology. Moreover, Japan and China undertook practical application test programs for an international communications system using IPv6 and for a joint international remote content development system. (19)

In addition to efforts to create wide recognition of IPv6 at the regional level, the Japanese government attempted to develop and diffuse IPv6 in the narrower Northeast Asian framework. In January 2002, MIC minister Toranosuke Katayama made a formal visit to Seoul and Beijing. At the meeting in Korea, Katayama and his Korean counterpart, Yang Seung-taik, agreed to promote cooperation in the development and standardization efforts for the fourth-generation (4G) mobile communications systems as well as in IT policies, including competition policies, broadband Internet policies, and e-commerce. At a ministerial meeting in China, Katayama and his Chinese counterpart, Wu Jichuan, signed a memorandum of understanding to promote collaborative efforts in next-generation Internet (IPv6) and third-generation (3G) mobile communications systems. Moreover, both ministers agreed to construct a Japan-China information and communications technology (ICT) partnership and to hold a Japan-China-Korea ICT ministers meeting. (20) Japan, China, and South Korea later intensified programs to promote ICT cooperation.

In September 2002, the first tripartite IT ministers meeting was held in Marrakech, Morocco. Government officials as well as representatives from the research institutes and private businesses attended the meeting, and the ministers agreed to coordinate telecom policy and jointly promote broadband platforms and R&D activities. At the second IT ministers meeting, in Cheju, South Korea, in September 2003, the ministers identified seven areas for cooperation. (21) The ministers agreed to establish a working group to promote substantial cooperation in each of the seven areas. At the third ministerial meeting, in Sapporo in July 2004, international cooperation on the radio frequency identification (RFID) sensor network was added as a new area of cooperation. This new theme aimed at realizing a ubiquitous network society through R&D and joint verification experiments on technologies concerning RFID and the sensor network, as well as joint research on the ubiquitous network. In the area of IPv6 cooperation, the three countries agreed to set up a Next Generation Internet (NGI) working group to promote the exchange of information and experts as well as joint R&D, standardization, and the development of IPv6 application services. At the second meeting of the NGI working group, in November 2004, the participants agreed to promote interoperability and interconnection of IPv6 products through the IPv6 Ready Logo Program.

Japan's interests in developing and diffusing IPv6 technologies and products are also seen in bilateral collaboration with China. The Japanese government implemented a number of joint IT experiments. In December 2003, MIC set up a high-speed, high-capacity international circuit between Japan and China and launched joint IT experiments with China on a variety of applications. A large number of universities and private corporations from both countries joined these experiments, which were designed to promote the diffusion of IPv6 and achieve compatibility within a multilingual environment. The Ministry of Economy, Trade and Industry (METI) has also implemented activities to promote the development and diffusion of IPv6 in China in close collaboration with the private sector. In February 2002, METI and the Chinese National Development and Reform Commission (NDRC) concluded the memorandum of cooperation. Four months later, METI and NDRC reached an agreement to conduct the IPv6 Collaboration Between Japan and China project, which lasted from June 2002 to March 2005. (22)

Why were Japan and China interested in promoting various joint projects? Japan's attempts to promote collaboration with China stemmed from a desire to establish ascendancy in the new Internet protocol technologies by penetrating the huge Chinese market. With continuous high economic growth and the willingness to introduce the latest technologies, China has built large-scale Internet and mobile phone networks. As of March 2003, China counted 60 million Internet users and more than 200 million mobile phone users. (23) The Chinese government intensified its commitments to the development of IPv6 largely because of the shortage of IPv4 addresses in the country. (24) Given these trends, the Japanese government and firms had a strong desire to diffuse its IPv6 technologies and products in China and establish the solid position in the next-generation Internet protocol standard.

China aimed to utilize Japan's sufficient financial resources for the development of IPv6 technologies and networks. For instance, METI undertook the IPv6 Japan-China project with the successive budgets of 650 million yen in 2002, 600 million yen in 2003, and 570 million yen in 2004. These amounts were quite large for one bilateral project. Moreover, China hoped to get the know-how of commercial services and expertise of various application developments. The introduction of IPv6 in the latest network facility required a test bed for R&D of application into various services integrating voice, data, and images. The Japanese government and firms had conducted various R&D activities, field trials, and commercial services in Japan.

In brief, the Japanese government and Japanese firms have attempted to establish institutional linkages for cooperation in the IT field through various regional frameworks, including through the ASEAN+3, in Northeast Asia and through bilateral cooperation. In this attempt, the development and diffusion of IPv6 technologies and products were given priority. This was because Japanese firms, which retained a weak competitive edge in the Internet business, would be able to establish a strong position by penetrating the broader market in Asia. Asian countries accepted Japan's efforts largely to secure financial assistance and technological expertise from Japan.

The Development of Open Source Software

Corporate Strategies and Government Policies

Japan's decade-long recession had negative impacts on its electronics sector, which had been the engine for Japan's economic growth. In the 1990s, the major Japanese electronics firms were forced to scale down their businesses and decrease investment in capital and R&D. In the new millennium, the firms could go back to a growth trend, largely because of the success of digital consumer electronics products. The huge popularity of digital cameras, digital versatile disk (DVD) recorders, and liquid crystal display televisions increased profits of major electronics firms.

However, the integration of consumer electronics and digital technology posed a new challenge for Japanese electronics firms. The integration meant that operating software is key to retaining the competitive edge in hardware products. Moreover, Japanese electronics firms needed to counter the advance of computer firms into the consumer electronics market. Japanese electronics firms were shocked by Apple's smashing success with the iPod in the audiovisual area where they had been the dominant players. Microsoft has also gradually shifted its business emphasis to the digital consumer electronics market. The leader of the computer industry sought to dominate overall software in the consumer electronics market with Windows-based technology just as it did in the personal computer (PC) market. Microsoft had a prospect that a PC would become the controller of all kinds of electronic equipment in the home, such as TVs, DVDs, mobile phones, and audio equipment.

Japanese electronics firms aimed to develop the TV as the main consumer electronic product in the home. They believed that while a PC would become a commodity with low profits, a TV would become a profitable product by maintaining high picture quality and permitting access to content through the Internet. For instance, Kunitake Ando, Sony's president, stated in his keynote speech at the 2003 International Consumer Electronics Show that television would play the leading role again in the future with the speeding up of Internet access. (25) Regardless of whether the PC or the TV becomes the key product in the home, the development of software was clearly a central strategy in competition in the Internet-connected consumer electronics market. To win this competition, Japanese electronics firms needed to develop their own operating software, independent of the dominance of Microsoft.

In the new millennium, the major Japanese electronics firms launched concrete projects to advance the development of their own operating software. In December 2002, Sony and Matsushita announced that they would study the functions and performance required for next-generation digital home appliances--like shorter start-up/response times and small memory consumption--and develop basic operating software on the basis of the Linux open source software (OSS). In June 2003, Sony and Matsushita established the Consumer Electronics Linux Forum (CELF) with six other companies: Hitachi, Toshiba, NEC, Royal Philips Electronics, Samsung Electronics, and Sharp. (26) The CELF aimed to discuss and formalize requirements for extensions to Linux to meet the needs of consumer electronic products such as audio and visual products and mobile phones. They agreed to disclose source codes to the forum members when they achieved some degree of success in resolving technology issues. In June 2004, the group released some source codes for the Linux version for digital consumer electronic products. Moreover, the packages included many functional expansions (patches) and tools developed by the worldwide development community, making it possible for even someone unfamiliar with Linux to get it up and running quickly.

In response to moves in the private sector, METI has implemented various policies for supporting the development of OSS technologies and communities for OSS. The ministry secured 1 billion yen in 2003, 0.9 billion yen in 2004, and 1.42 billion yen in 2005 to implement programs for supporting OSS development and deployment. METI conducted surveys on environments for the use of OSS. In March 2003, METI released a report concerning the security insurance of OSS. Five months later, METI published another report on the situation and problems regarding the use of OSS in Japan. The report covered licenses, guidelines to introduce OSS, and case studies. Moreover, METI conducted a pilot project regarding OSS at the National Institute for Advanced Industrial Science and Technology. This project aimed to examine issues and problems regarding OSS desktop environment. In January 2006, METI established an open source software center within the Information-Technology Promotion Agency (IPA), a METI-affiliated organization. The center, established jointly with NEC, Hitachi, Fujitsu, and NTT Data, aimed to collect and share technology information held by firms and to publicize it for developing new technology systems using OSS.

Indeed, the main areas in which OSS is used are desktops and servers. However, METI's commitment to OSS development was driven by the desire to maintain the international competitiveness of Japanese firms in the digital consumer electronics market. This stance was clearly shown in METI's reports and in the remarks of its officials. In September 2002, METI's Commerce and Information Policy Bureau organized the Strategic Study Group for e-Life. The group issued a report for e-Life initiative in April 2003. The first point in its seven-point action plan was "the promotion of common and standard technologies." The report proposed that open source software such as Linux and TRON would be a significant choice for a platform of digital consumer electronics products. (27) Hidetaka Fukuda, director of the IT Industry Division of the bureau, stated at the Open Source Way 2002 that Japan's competence would be harmed if digital consumer electronics products converged on the same operating software and applications that run on it. (28)

Japan's Commitments to 055 Development in Asia

In parallel to a commitment to the development of OSS in Japan, cooperation with Asian countries has become a critical policy agenda. Accordingly, METI took the lead in institutionalizing region-based cooperative programs for developing OSS. In October 2002, METI proposed holding an Asia Open Source Software Symposium at the eASEAN IT working group. The first Asia OSS Symposium, held in March 2003 at Phuket, Thailand, was attended by some 100 participants from fourteen countries in Southeast and Northeast Asia. (29) The symposium, sponsored by the Center of the International Cooperation for Computerization (CICC), a METI-affiliated organization, has been held biennially since then and has increased the number of participating countries with formulating a concrete agenda for cooperation. (30) At the second symposium in Singapore, the number of participating countries increased to eighteen when countries from South Asia joined on. At the fourth symposium, in Taipei, the participants agreed to set up five working groups: Asia repository, human resource, standards, localization, and business.

Committed to all of Asia, Japan wanted to create a forum where the participating countries would deepen the mutual recognition and understanding of particular technologies and technology standards. This approach was effective for Southeast Asian countries whose software industries were at a primitive stage. These countries could get updated information and opportunities for network formation at forums that were funded by the Japanese government.

In addition to such a forum-based approach, Japan has advanced joint research cooperation with countries that retained higher techno logical capabilities: China and South Korea. The origin of cooperation among Japan, China, and South Korea for OSS development dates back to November 2002. At the twentieth Asian-Oceanian Computing Industry Organization (ASOCIO) Symposium, the Japan Information Technology Services Industry Association (JISA), the Chinese Software Industry Association (CSIA), and the Federation of Korean Information Industries (FKII) confirmed common interest in developing OSS jointly. (31) The three associations decided to encourage their governments to exhibit positive commitments to the development of OSS and considered concrete initiatives to create tangible programs for this objective. (32) In November 2003, JISA, CSIA, and FKII held the China-Japan-Korea OSS Business Conference in Osaka, Japan. The conference brought together some 500 participants from the public and private sectors. The three associations agreed on four agenda items at the conference. (33) Each industry then set up a domestic OSS promotion body: the China OSS Promotion Union, the Japan OSS Promotion Forum, and the Korea OSS Promotion Forum. (34) Thus, the first initiative to promote OSS development among Japan, China, and South Korea was taken by the private sector.

In 2004, trilateral OSS cooperation involving both the public and private sectors evolved rapidly. In April, the first Northeast Asia OSS Promotion Forum met in Beijing. At the same time, a trilateral IT Directors-General Meeting was held. (35) In July, the second forum was held in Sapporo, Japan. Government officials and representatives of open source promotion groups reported on the situation regarding OSS and OSS promotion activities in each country. At the forum, the three countries agreed to set up three joint working groups: Technology Development and Assessment Working Group (WG1), Working Group on Human Resource Development (WG2), and Standardization and Certification Study Working Group (WG3). The third forum was held in Seoul in December 2004, followed by the fourth in Tianjin, China, in April 2006, and the fifth in Fukuoka, Japan, in November 2006. Although political relations between Japan and China and between Japan and South Korea deteriorated during 2004-2006 due to Japanese prime minister Koizumi's visit to Yasukuni Shrine, the institutionalization of collaborative initiatives evolved. While WG2 and WG3 drew up a charter to provide basic guidelines for tier activities, WG1 set up the server sub-working groups and the desktop sub-working group.

In August 2005, evidence of the first achievement from this trilateral collaboration appeared. Three software firms--Japan's Miracle Linux, China's Red Flag Software, and a Korean firm, Haansoft--announced that they had developed Asianux 2.0, a local Asian version of the Linux operating system. Asianux 2.0 had the same basic design as Linux but was compatible with Asian languages and scripts. (36) Although the launching of Asianux 2.0 resulted from the accumulation of activities at the business level, collaboration at the governmental level sustained such business activities.

Japan's motivations to promote trilateral cooperation in OSS development were slightly different from those for IPv6 diffusion. Japanese firms retained strength in "embedded" OSS used in consumer electronics products, digital cameras, and mobile phones. The Japanese government and firms hoped to expand the scope of business operations in these areas by activating studies and research on standardization for the embedded Linux in collaboration with China and South Korea. One of the major tasks of WG3 was to study existing international standardization activities for embedded Linux and identify requirements from the three countries.

At the same time, Japan hoped to mitigate moves toward the development of original standards in China. China had strong aspirations for the self-reliance of technology development. (37) Such aspirations were shown in the IT field and exemplified by TD-SCDMA (time division--synchronous code division multiple access) in 3G mobile communications, and WAPI (wireless LAN authentication and privacy infrastructure) in Wireless LAN. (38) China had a firm desire to develop indigenous OSS from the national security standpoint. The Chinese government has vigorously supported OSS development since the Ministry of Information Industry sponsored a promotion meeting, "China and Linux," in June 1999. The Chinese government extended intensive support for software firms such as Red Flag and other nongovernmental enterprises working on Linux operating software as a way to promote the software key project of the High-Tech Research and Development Program (the so-called 863 Program).

The Japanese government and Japanese firms were concerned that the Chinese government might develop OSS on its own standard base. Such a development would stymie the entry of Japanese firms and products into the Chinese market. A METI official who was involved in the IT policy explained an objective of cooperation with China as follows: "Through collaboration with China, we will prevent China from pursuing the original standards and making China build onto the international standards." (39)

Why, then, do South Korea and China promote collaboration with Japan? The Korean government has actively committed itself to developing IT technologies and investing in the establishment of an information superhighway infrastructure. South Korea became one of the most advanced broadband nations, and its leading IT firms--Samsung Electronics and LG Electronics--expanded their shares in the global mobile market with the quick adoption of CDMA (code division multiple access) technology. Seoul has striven to improve technology on CDMA mobile and broadband services and has expanded these services to Asia. For this objective, exchanges of technological expertise with Japan were indispensable. When Japanese and South Korean IT ministers held a meeting in January 2006, Korean officials introduced television services using Internet networks while Japanese officials demonstrated terrestrial digital TV broadcasting for mobile phones. (40) South Korea aimed to advance this kind of collaboration through the OSS initiative. Moreover, South Korea held the common perception with Japan that the development of an original OSS is a prerequisite for securing the sound development of the next generation of mobile phones and digital consumer electronic products with bright growth prospects. An official of the Korean government-affiliated Korea IT Industry Promotion Agency (KIPA) stated that "under the current system dominated by Microsoft's Windows, we are allowed to just develop low-end applications. Only with open-source systems like Linux can we lead the global market." (41)

China wanted to collaborate in OSS development primarily for national security reasons. As already explained, China had strong aspirations for developing indigenous OSS in order to avoid the situation where the core technology is controlled by a US company. Two additional factors should be mentioned. First, China wanted to reduce the payment of licensing fees for software developed by foreign firms and to enhance freedom of action by increasing the amount of software developed by domestic firms. Second, China hoped to demonstrate and utilize the expertise it had accumulated through past commitments. For instance, the Standardization and Certification Study Working Group (WG3) was established at China's strong request. (42) Beijing intended to utilize its desktop OSS capabilities, which led to the drafting of Linux standards. The collaboration with Japan and the utilization of Japanese technological expertise were valuable factors in achieving these objectives.

To summarize, Japanese electronics firms, which long retained competitiveness in the consumer electronics market, faced a challenge from computer producers due to the integration of consumer electronics and digital technology. The integration meant that operating software became key in determining the competitiveness of hardware products. Accordingly, the Japanese government and electronics firms tried to promote OSS development. Significantly, they considered close collaboration with Asian countries a critical pillar for developing open source. While the government has developed a forum for open source throughout Asia, the Japanese government and Japanese firms have promoted concrete R&D collaboration with China and South Korea.

Japan and the Diffusion of Horology

Japanese Watch Producers and Horological Standards

Watch production in the world is divided mainly between Europe and Asia. In Europe, Switzerland, France, Italy, and Germany are major watch manufacturers, while in Asia, Japan, China (including Hong Kong), India, and South Korea engage in the production of watches and specific watch components. According to an estimate by the Japan Watch and Clock Association (JWCA), Iota] watch production in the world was 1.25 billion units in 2005. Analogue quartz watches had an 82 percent (1.03 billion) market share, followed by digital quartz (200 million) and mechanical watches (20 million). Japan's production, including overseas, accounted for 58 percent of the world's total watch production, and 68 percent of total production of the analogue quartz watch. (43) While Japan is strong in producing mid- and low-priced quartz watches, European countries, represented by Switzerland, retain competitiveness in the production of higher-priced mechanical watches.

Standardization in watch production is a matter of interest to component manufacturers, to firms engaged in watch assembly, and to distributors and retailers. Existing watch production standards are relevant primarily in terms of health, safety, quality, and interchangeability. (44) An international body that is responsible for dealing with all standards relating to watches, miniature clocks, and clocks is the Horology Technical Committee of the International Organization for Standardization (ISO/TC114), which was established in 1965. Currently, there are nine participating members (P members) and sixteen observer members (O members). (45) Switzerland, Japan, and France have provided the chairmanship and secretariat of the ISO/TC114 and its subcommittees. (46)

When the ISO/TC114 was established, Switzerland was the most advanced nation in watch production. From the 1920s until the 1950s, the Swiss horological industry shared half of the world's total production and 80-90 percent of total exports. (47) In the 1970s, the Japanese horological industry showed remarkable growth--thanks to the innovation of quartz watches, which enabled Japanese manufacturers to mass-produce watches of high quality. This innovation reversed the position of Japan and Switzerland in watch production, making Japan the world's primary watch-manufacturing nation in 1980.

Through the 1980s and early 1990s, Japanese watch producers advanced horological technologies further to make accurate, irrefrangible, and functional watches. Despite such advancements, Japan faced difficulty in making its horological technologies accepted as international standards at the ISO/TC114. Deliberations at the committee did not exhibit notable changes. Switzerland forged close linkages with other European countries. The Federation of the Swiss Watch Industry (FH, Federation de l'Industrie Horlogere Suisse) encouraged its counterpart in France, Germany, the United Kingdom, and Italy to organize the Standing Committee on European Watchmaking Industry (CPHE, Comite Permanent de l'Horlogerie Europeenne). The horological association in each country has hosted a CPHE meeting biennially, and common issues, such as the European Union's directives and laws and European Committee for Standardization (CEN) matters, have been discussed at the meetings. Through these opportunities, the CPHE members have been able to coordinate their interests and positions regarding ISO/ TC114 activities.

For a long time, the P members of ISO/TC 114 were Switzerland, Japan, France, Russia, Germany, China, and the UK. Switzerland could lead deliberations at the committee by successfully drawing support from the European members for its positions. Japan tried to deepen discussions on technical issues at the committee's meetings, but Switzerland was disinclined to have such discussions and tried to settle differences on technical matters by putting them to a vote. The Japanese members were dissatisfied with the persistent lack of discussions on technical issues. (48)

In Switzerland, the horological industry is the third largest industry sector and a pillar of the country's domestic industry. The Swiss horological industry comprises small and medium-sized manufacturers of mechanical watches. Switzerland was reluctant to adopt high-level technology standards that were beyond these manufacturers' capabilities. Even standards that had sufficient technological validity were not accepted when they did not meet the conditions of the Swiss horological industry. (49) Accordingly, local standards in Switzerland were adopted as international standards through the ISO/TC 114. This situation was repeated for thirty years, until the ISO/TC 114 plenary meeting in Berlin in 1995. (50) At that meeting, Japan advanced several important proposals on technologies that reflected remarkable progress in its horological industry in the 1990s. However, most of them were not adopted. At the meeting, it was decided that the following plenary meeting would be held in Japan.

In brief, Japan could become the world's largest watch producer in the 1980s through innovation in quartz watches. However, it failed to make its technical standards accepted at the international standard-setting committee. Switzerland, the previous leading watch producer, controlled deliberations on technical issues at the ISO/TC114 by successfully utilizing close linkages with other European nations. The Japanese horological industry needed to set up strategies to raise the position of its technology ideas and standards at the deliberations of the ISO/TC 114 meetings.

Close Linkages with Watch-Producing Countries in Asia

For a long time, standardization was not a major target of industrial policy for the Japanese government. However, the government's stance began to change in the mid-1990s. In July 1996, METI strengthened the Standard Division of the Agency of Industrial Science and Technology. The new post of deputy director-general for Standard Affairs and two new sections--the International Standard Section and Control System Standard Division--were set up. (51) In December 1996, the government issued the Program for Reform and Creation of the Economic Structure. One of the goals of this program was "to promote the system to lead international standardisation activities in accordance with the rising importance of international standards."

In line with gradual changes in the government's posture toward standardization, the Japanese horological industry sought to make the 1997 ISO/TC114 meeting an opportunity to make Japanese technical proposals accepted as international standards. For this objective, the industry adopted two strategies. The first was the formation of close communications with watch-producing countries in Europe. The Japanese horological industry considered it difficult to have sufficient discussions at the plenary meeting only, because a few-hour discussion on each technical issue was too short. Accordingly, it hoped to have an opportunity for discussions before the plenary meeting where it could explain Japan's technological ideas and merits.

In February 1997, the Japanese horological industry dispatched a mission to Switzerland, France, and Germany. The mission members visited the secretariat of the ISO/TC114 and FH in Switzerland, the Centre Technique de 1'Industrie Horlogere (CETEHOR) in France, and the Deutsches Institut fur Normen (DIN) in Germany. They explained Japan's proposals and opinions on major technical issues and gained support for most of their proposals. Moreover, Japan and Switzerland agreed to hold a meeting outside the regular plenary meeting. (52)

The second and more critical strategy was to strengthen linkages with watch-producing countries in Asia. For a long time, Japan and China were the only two non-European members of the ISO/TC114. China, which became a P member in 1979, did not express its opinions at the plenary meetings, largely due to the language problem, and tended to support Swiss proposals at final voting. (53) Japan tried to change China's posture in the meetings by increasing the Chinese industry's technical knowledge and by helping it improve its technological level. From 1995 to 1997, the JWCA held a meeting with the Horological Association of China (HAC) three times and provided suggestions and guidance regarding specific horological technologies. Japan's support helped enhance the activities of the standardization research group within the HAC. (54)

Japan's weak position at the ISO/TC114 meetings derived largely from the small number of members from Asia. Switzerland could lead discussions about technical matters by gaining support from its neighboring countries. Given this situation, Japan made efforts to change the member imbalance by encouraging watch-manufacturing countries in Asia to participate in the ISO/TC114 meetings. India registered as a P member but did not attend the plenary meetings. In May 1997, the Japanese horological industry sent a mission to India to induce India's ISO/TC114's committee members to express opinions at the plenary meetings. Japan could confirm through the talks that India was not happy with the gap between the existing ISO standards and the situation in India and that India would support the idea that opinions from Asian countries should be reflected in international standards. Participation in the ISO/TC 114 would serve to achieve this objective. (55)

In June 1996, Japan also sent a mission to South Korea to solicit their support. The JCWA encouraged the Korea Watch and Clock Industry Cooperative to participate in the 1997 plenary meeting. Since the Korean horological industry was still young, the industrial members knew little about ISO standards and activities of the ISO/TC114. South Korea was not ready to be a P member of the ISO/TC114 but with Japan's encouragement agreed to attend the 1997 Tokyo meeting as an observer. (56)

The ISO/TC114 Tokyo meeting was held in May 1997 with participation from seven countries (Japan, Switzerland, France, China, India, the UK, and South Korea). Since India and South Korea attended the meeting, Asia's representation was almost equal to Europe's. The deliberations at the meeting proceeded smoothly, largely because Japan held prior consultation and set up opportunities for technical exchange. The Japanese horological industry succeeded in getting most of its proposals on technical issues accepted at the meeting. Moreover, a technical exchange session on allergies in the watchmaking industry was organized on Japan's recommendation. Japan hoped to have an opportunity for substantive discussions on technological matters before voting on technology standards. The participants also adopted a resolution to create a working group on allergenic materials. (57) Japan succeeded in having the allergenic material issue included on the committee's agenda.

After the 1997 Tokyo meeting, Japan continued its efforts to strengthen linkages with watch-manufacturing countries in Asia, especially with China. The JWCA set up institutional linkages with the HAC. In March 2002, the Japan-China Horological Association's Interchange was institutionalized, and its first executive meeting was held in Shanghai. (58) This linkage provided Japan with an opportunity to discuss a vital issue for the Japanese horological industry: the infringement of intellectual property rights. Japan and China agreed to establish a workshop on intellectual property rights to discuss the situation of property right infringements in China and to propose concrete countermeasures to deal with this problem. The interchange talks also encouraged technical exchanges between Japan and China. In accordance with an agreement at the talks, the first standardization workshop between the JWCA and HAC was held in Beijing in October 2002. (59) Through regular meetings for technical exchange, Japan could explain the technical background and rationale for Japanese standards, which helped generate support for Japanese proposals at the ISO/TC114 meetings.

Japan's efforts to strengthen communication and technical exchange led to positive support from China and India for Japanese proposals at the ISO/TC114 meetings. For instance, at the 1999 plenary meeting, (60) India and China gave strong support for Japanese proposals regarding precious metal coverings, antimagnetism, and watch glasses, which led to a confrontation between three European members and three Asian members. (61) Switzerland had successfully managed deliberations on technical matters at the previous meetings, but this was not the case at the 1999 meeting. With India and China's support, Japan's influence on technical issues rose considerably. In fact, at the end of the meeting, Switzerland proposed to Japan that the two countries hold consultations prior to the next plenary meeting. At the 2001 meeting in Zhuhai, China, and at the 2003 meeting in Neuchatel, Switzerland, Japan's influence increased further. While most of Japan's proposals and opinions were adopted, a Swiss proposal was defeated by the final vote. Moreover, revisions were made in the conduct of meetings to allow sufficient discussion before voting takes place. This was largely because Japan had organized prior consultation with Switzerland and France and had set up opportunities for technical exchange with China.

China and India benefited from Japan's commitment to improve communication at the executive level and to foster technical exchange. They could better understand the importance of standard setting at the international standards committee and could gain up-to-date information on horological technologies. This led to active involvement of China and India in the ISO/TC114 meetings. At the 1999 plenary meeting, India and China offered opinions and suggestions at various subcommittee and working group meetings. The two countries exhibited keen interest in the ISO/TCll4 activities. The 2001 meeting was supposed to be held in Switzerland, but China's strong proposal that the meeting be held in China was accepted. The enhanced presence of China and India at the meetings reflected their growing confidence and expertise in technical matters.

The horological case exhibits at least two critical implications in assessing Japan's commitment to technology standards. First, technology standards are important for a mature sector like horology in which the Japanese industry has strong technological capabilities. Unlike the cases of IPv6 and OSS, the Japanese industry had already established a strong position with high-level technologies. However, it was forced to assume serious business burdens because its technological ideas failed to be translated into international standards. Thus, even in a relatively mature sector, the diffusion of technology standards has become a vital issue in maintaining international competitiveness. Second, the formation of close linkages with Asian countries was a major factor in having Japanese horological standards accepted at the ISO/TC114 meetings. Japan's proposals and opinions received attention at the committee meetings largely due to backing from Asian members. Technical exchange and communications at the executive level contributed to Asian countries' increasing interest in the ISO/TC114 meetings and their support for Japan's proposals in the committee meetings.


My major goal in this article has been to elucidate the relationship between Japan and Asian countries as regards technology development and technology diffusion. Technology standards have become increasingly important in retaining international competitiveness, and Japan has adopted strategies to diffuse its own standards in Asia in three areas: Internet connection, open source software, and watch manufacturing.

Japanese firms have engaged in different degrees of competitiveness in the three areas. The Japanese horological industry has maintained a competitive edge by catching up with its Swiss rival. Japanese electronics firms, which had long maintained strong competitiveness, faced new dynamics caused by the integration of consumer electronics and digital technology. In the Internet business, Japanese firms failed to establish a competitive position largely because they were late entering the business. The common key factor in improving and retaining competitiveness in the three areas has been technology standards. The Japanese horological industry needed to have its own technologies and technological ideas accepted as international standards. Japanese electronics firms had to develop new operating software in order to win in the battle over the newly emerging digital consumer electronics market. Japanese IT firms sought to establish their position by taking the lead in developing a new Internet protocol technology.

Japanese firms in the three areas retained a relatively high level of technology and sources for new technologies. However, they could not gain genuine international competitiveness unless technologies and technological ideas were accepted more broadly. Accordingly, the Japanese government and firms pursued collaboration with their counterparts in Asia, mainly through three strategies. The first was the formation of a region-based forum for diffusing technology. This was the case in OSS development. METI took the lead in launching the Asia OSS symposium. The second was technical cooperation with Asian countries. In the horological industry, Japanese firms have advanced technical exchanges with China and India. This strategy contributed to the improvement of the technology level in these countries and generated strong support for Japanese proposals on technology issues at the ISO committee meetings. The ABP also aimed to promote technical cooperation with Asian countries. Among various policies under the ABP, the diffusion of IPv6 technologies was given priority. The Japanese government and business actors have also promoted bilateral collaboration with China for diffusing IPv6 products. The third strategy was joint development under specific institutional mechanisms. The government and firms of Japan, China, and South Korea set up the Northeast Asia OSS Promotion Forum to stimulate OSS development. The three countries also institutionalized the trilateral IT ministers meeting, where the development and diffusion of IPv6 technologies became a major agenda item for talks.

Japan's technology policy in all three segments examined here emphasized collaboration and linkages with Asia, which indicated a shift in Japanese preferences for technology innovation. The Japanese government and firms were strongly motivated to establish and diffuse Japanese technology standards in order to raise their presence at international forums or to challenge the existing Western rivals. This motivation encouraged them to adopt Asia-based technology policies and strategies in addition to domestic-oriented technology policies. Thus, regionalism was used as an intermediate way to strengthen political and economic leverage to raise the position of industrial and technology power in the international marketplace.

This article has also considered why Asian countries collaborated with initiatives and projects that were intended to develop and diffuse Japanese technology standards. As shown in the ABE some Asian countries could secure ODA funds through technology-oriented programs. In the horological case, technological exchange was a vital factor that encouraged Asian countries to promote collaboration with Japan. In the IPv6 and OSS cases, China and South Korea, which were at a relatively advanced technological level, were motivated to promote technological collaboration with Japan for several reasons. Both countries shared common interests with Japan: to decrease the payment of licensing fees to Western firms and to stimulate the development of new markets for their firms. China and South Korea also expected to benefit from Japanese-funded projects and joint technology development as well as to obtain information about various experiments that Japan had conducted in the domestic market. China, in particular, intended to utilize Japanese technological expertise in order to achieve its own technological objectives.

This study is supported by research funds from Ritsumeikan Asia Pacific University. I would like to thank Stephan Haggard and anonymous reviewers for their helpful comments and suggestions.


(1.) Agreement on Technical Barriers to Trade, Article 2.4.

(2.) Graham Vickery, "Global Industries and National Policies," OECD Observer, no. 179 (December 1992-January 1993): 11.

(3.) Daniele Archibugi and Jonathan Michie, "Technological Globalisation and National Systems of Innovation: An Introduction." In Daniele Archibugi and Jonathan Michie, eds., Technology, Globalisation and Economic Performance (Cambridge: Cambridge University Press, 1997), pp. 2-3.

(4.) Michael L. Katz and Carl Shapiro, "Network Externalities, Competition, and Compatibility," American Economic Review 75, no. 3 (1985): 424-440.

(5.) Carl Shapiro and Hal R. Varian, Information Rules: A Strategic Guide to the Information Economy (Boston: Harvard Business School Press, 1999), p. 231.

(6.) A famous example is the Beta-VHS struggle in standards for videocassette recorders. Although the Beta format was technologically superior to VHS technology, JVC, the main VHS producer, could win in the battle against Sony, the major Beta producer, primarily because of the effective formation of the VHS "family"; see Gregory W. Noble, Collective Action in East Asia: How Ruling Parties Shape Industrial Policy (Ithaca: Cornell University Press, 1988), pp. 95-100.

(7.) Richard J. Samuels, "Rich Nation, Strong Army": National Security and the Technological Transformation of Japan (Ithaca: Cornell University Press, 1994).

(8.) Gregory P. Corning, Japan and the Politics of Techno-Globalism (Armonk, NY: M. E. Sharpe, 2004).

(9.) Marie Anchordoguy, "Japan at a Technological Crossroads: Does Change Support Convergence Theory?" Journal of Japanese Studies 23, no. 2 (1997): 363-397; D. H. Whittaker, "Crisis and Innovation in Japan: A New Future Through Technoentrepreneurship?" In William W. Keller and Richard J. Samuels, eds., Crisis and Innovation in Asian Technology (Cambridge: Cambridge University Press, 2003); Derek Hall, "Japanese Spirit, Western Economics: The Continuing Salience of Economic Nationalism in Japan." In Eric Helleiner and Andreas Pickel, eds., Economic Nationalism in a Globalizing World (Ithaca: Cornell University Press, 2005).

(10.) Fukunari Kimura, "Kokusai boeki riron no aratana choryu to higashi ajia" [New trends in international trade theory and East Asia], Kaihatsu Kinyu Kenkyushoho 14 (January 2003): 106-116.

(11.) Douglas Webber, "Two Funerals and a Wedding? The Ups and Downs of Regionalism in East Asia and Asia-Pacific After the Asian Crisis," Pacific Review 14, no. 3 (2001): 339-372; Walter Hatch, "Regionalizing the State: Japanese Administrative and Financial Guidance for Asia," Social Science Japan Journal 5, no. 2 (2002): 179-197; Hidetaka Yoshimatsu, "Japanese Policy in the Asian Economic Crises and the Developmental State Concept," Journal of the Asia Pacific Economy 8, no. 1 (2003): 102-125.

(12.) For the activities of the council, see its homepage at

(13.) Nihon Keizai Shimbun, May 2, 2003.

(14.) Japan's e-Japan strategy began with the enactment of the Basic Law on the Formation of an Advanced Information and Telecommunications Network Society (IT Basic Law) in November 2000. The IT Strategic Headquarters, which was set up in accordance with the law, formulated the e-Japan strategy in January 2001. The strategy aimed at "making Japan the world's most advanced IT nation within five years." To achieve this goal, the e-Japan strategy prescribed four priority policy areas: the creation of the world's most advanced environment for the Internet, the facilitation of e-commerce, the realization of e-government, and the development of high-quality human resources. The government continuously reviewed and revised the e-Japan strategy, formulating the e-Japan 2002 program in June 2002 and the e-Japan strategy II in July 2003. Furthermore, in order to materialize the strategy, the government formulated the e-Japan Priority Policy Program in March 2001, in June 2002, in August 2003, and in June 2004.

(15.) In the e-Japan Priority Policy Program 2002, issued in June 2002, the IT Strategic Headquarters showed a prospect that the ABP should be formulated within 2002 as one of concrete measures toward the realization of an internationally balanced IT society in Asia. Afterwards, MIC prepared for the formulation of the ABE In July 2002, MIC organized the Study Group for the Asia Broadband Program. The purpose of this group was to deliberate on the specific substance and goals of the program. The group published a final report in December 2002 after holding six meetings. Importantly, four specialists and business representatives from China, South Korea, and Singapore became members of the study group. They explained conditions of the IT market and policy in their countries as well as their views on the broadband policy.

(16.) Other goals were to ensure broadband access for all people in Asia: construct international broadband networks with sufficient bandwidths to directly link Asian countries, prepare environments for secure and easy use of ICT in Asia, digitize and archive major Asian cultural assets, develop machine-translation technologies between major Asian languages, and increase the number of ICT engineers and researchers in Asia.

(17.) The homepage of the Asia Broadband Program is

(18.) "Collaboration with Asian Economies, Financial Assistance," Asia Broadband Program, available at

(19.) "Practical IPv6 Application Test Program," Asia Broadband Program, available at

(20.) MPHPT Communications News 12, no. 22 (February 4, 2002): 1-2, available at www.

(21.) These seven areas were 3G and next-generation mobile communications, next-generation Internet (IPv6), digital broadcasting, network and information security, open source software, telecom service policy, and the 2008 Beijing Olympic Games.

(22.) This project was implemented by the Communications and Information Network Association of Japan (CIAJ) and China Education and Research Network (CERNET), headquartered at Tsinghua University. The project included R&D on networks, applications technology, and technology standards.

(23.) Ricky Lu, "China Starts Full-Scale Implementation of IPv6," IPv6style, May 26, 2003, available at

(24.) In December 2003, the Chinese government formally launched the China Next Generation Internet (CNGI) project. The project aimed to construct a backbone IPv6 network linking China's major cities by collaborating with six Chinese telecom operators and research institutes, such as China Netcom, China Unicorn, and the China Education and Research Network.

(25.) Nikkei Electronics Asia, January 22, 2003.

(26.) For the activities of the CELE see its homepage at

(27.) METI, "Kihon senryaku hokokusho: e-Life inishiatebu" [Report on basic strategy: e-Life initiative], April 2003, p. 22, available at

(28.) Frederick Noronha, "Liberalisation Technology for the Lands of Diversity?" In Niranjan Rajani, ed., Free as in Education: Significance of the Free/Libre and Open Source Software ,/'or Developing Countries, available at http://

(29.) The second symposium was held in Singapore in November 2003, the third in Hanoi in March 2004, the fourth in Taipei in September 2004, the fifth in Beijing in March 2005, the sixth in Sri Lanka in September 2005, and the seventh in Kuala Lumpur in March 2006. For the development of the Asia OSS Symposium, see its homepage at

(30.) The CICC was established in June 1983 to cooperate with and assist developing countries in the introduction of computers and information technology and thereby to promote computerization for their economic and social development. The homepage of the CICC is at

(31.) The ASOCIO was established in 1984 in Tokyo with an eye to promoting close collaboration among the industrial associations in the computing industry in the Asian and Oceanian region.

(32.) Nikkei Computer, January 27, 2003, pp. 20-21.

(33.) The first was to take the lead in establishing an OSS promotion body in each country and to create the China-Japan-Korea OSS Promoting Partnership, where the activities of the three bodies would be united and coordinated. Other agenda items were that the promotion bodies would make concrete action plans, and that the three industries would encourage the governments to procure OSS in order to guarantee and improve the quality of OSS.

(34.) The Japan OSS Promotion Forum was established in February 2004, and the Information Technology Promotion Agency, an MITI-affiliated organization, assumed the secretariat of the forum. Six working groups were set up under the forum: desktop, development infrastructure, support infrastructure, business promotion, human research development, and standardization and certification.

(35.) The three governments signed the memorandum of understanding concerning ten areas for joint OSS promotion. The agreement aimed to promote joint research for user identification systems and to support the development of the Northeast Asian OSS Promotion Forum by the private sector.

(36.) Nikkei Weekly, August 29, 2005. In April 2006, the three companies established Asianux Corporation, a new joint venture created to become the main distributor of the common framework operating system in Asia, to strengthen linkages with global vendors, and to promote OSS in Asia.

(37.) Evan A. Feigenbaum, China's Techno-Warriors: National Security and Strategic Competition from the Nuclear to the Information Age (Stanford: Stanford University Press, 2003).

(38.) Xiudian Dai, "ICTs in China's Development Strategy." In Christopher R. Hughes and Gudrun Wacker, eds., China and the Internet: Politics of the Digital Leap Forward (London: RoutledgeCurzon, 2003), pp. 17-20.

(39.) Koichi Endo, "Nicchukan haiteku 'sangoku domei' no genso" [The fancy of the trilateral high-tech alliance between Japan, China, and South Korea], Shokun, December 2004, p. 209.

(40.) "Japan, S. Korea to Continue Exchanging Views on Telecom Technologies," Japan Economic Newswire, January 16, 2006.

(41.) Korea Times, April 1, 2004.

(42.) Nikkei BPnet, "China Proposed the Joint Development of Asian Linux and Japan Calmed It Down," July 29, 2004, available at (accessed November 2, 2005).

(43.) The Japan Watch and Clock Industry Association, "The Japanese Watch and Clock Industry in 2005: An Outlook on Its Global Operation," available at www.jcwa.or.jpleng/statistics/industry_05.html. There are no official data on world watch production.

(44.) ISO/TC114 Horology, "ISO/TC114 Business Plan: Executive Summary," May 9, 2005, p. 4, available at /ISO_TC_114_Horology_.pdf?nodeid=1162373&vernum=0.

(45.) The nine P members are Switzerland, Japan, France, Germany, UK, China, India, South Korea, and Russia.

(46.) ISO/TC114 Horology, "ISO/TC114 Business Plan: Executive Summary," p. 11.

(47.) Shiro Asano, "Tokei sangyo ni okeru hyojunka senryaku" [The standardization strategy in the horological industry]. In Watanabe Fukutaro and Nakakita Tom, eds., Sekai hyojun no keisei to senryaku [The formation and strategy of international standards] (Tokyo: Kokusai Mondai Kenkyujo, 2001), p. 52.

(48.) Interview, Japan Watch and Clock Association, Tokyo, February 2006.

(49.) Asano, "Tokei sangyo ni okeru hyojunka senryaku," pp. 49, 55.

(50.) The ISO/TC114 plenary meeting has been held biennally.

(51.) Masahiro Fujita and Yozo Kawahara, Kokusai hyojun ga nihon wo hoisuru [International standards roll up Japan] (Tokyo: Nihon Keizai Shinbumsha, 1998), pp. 196-197.

(52.) Japan Watch and Clock Association, ISO/TC114 tokei kogyo hyojinka kokusai kaigi hokokusho [The report on the ISO/TC114 horology meetings] (Tokyo: Japan Watch and Clock Association, 1997), pp. 26-28.

(53.) Asano, "Tokei sangyo ni okeru hyojunka senryaku," p. 57.

(54.) Ibid., pp. 50, 58.

(55.) Japan Watch and Clock Association, ISO/TC 114 tokei kogyo hyojinka kokusai kaigi hokokusho, p. 31.

(56.) Interview, Japan Watch and Clock Association, Tokyo, February 2006. South Korea became a P member in 2003 and hosted a plenary meeting in 2005.

(57.) Japan Watch and Clock Association, ISO/TC114 tokei kogyo hyojinka kokusai kaigi hokokusho, p. 3.

(58.) At the annual Interchange meeting, executives of both countries exchanged information and opinions about various issues concerning technology standards, intellectual property rights, statistics, and commercial relations.

(59.) At the meeting, the Japanese industry explained its proposals for the ISO/TC114 meetings and gained understanding and support for them.

(60.) The 1999 plenary meeting was held at Bangalore in India with participants from six countries (India, Japan, Switzerland, France, China, and the UK).

(61.) Interview, Japan Watch and Clock Association, Tokyo, February 2006.

Hidetaka Yoshimatsu is professor of international relations at Ritsumeikan Asia Pacific University, Japan. He is the author of Japan and East Asia in Transition: Trade Policy, Crisis and Evolution, and Regionalism (2003) and has published articles that focus on trade and industrial policy and regionalism in East Asia in journals such as Asian Survey, Pacific Review, Pacific Affairs, and Review of International Political Economy.
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