<p>J@pan Inc Newsletter<br>
The 'JIN' J@pan Inc Newsletter<br>
A weekly opinion piece on social, economic and political trends in Japan.<br>
Issue No. 525 Friday, December 24, 2010, Tokyo</p>
<p>5 Things We Learned In 2010</p>
<p>1. Facebook is the new Google, Google is the new Microsoft</p>
<p>There's no rule that one or two tech companies should always command
the spotlight, but that seems to be the way things work out. This year
the two companies competing head-to-head for your attention were Google
and Facebook. But the cool tech cachet that once characterized the
simplicity and user-first ethos of Google has been replaced by a
company burdened by a high stock price that must be protected at all
costs, and overloaded with billions in cash reserves begging to be used
for multi-billion dollar acquisition attempts (Twitter, Groupon, both
failed), expensive experiments (robotic cars), and mega real estate
purchases (New York building for $1.9 billion). Meanwhile, as the
company's Android OS successfully penetrates the mobile space in the
same way Windows once spread like a hardware-agnostic virus, the
company's primary product, search, flounders under the weight of an
extremely complicated search tool laden with so many features, simple
search has now become a test to see if you're as smart as Google's
engineers at managing complexity. </p>
<p>On the other side of Silicon Valley, Facebook continues its march
toward one billion users, and its CEO has captured the imagination of
the mainstream with sticky user experiences and relevant services
consumers can use "now" rather than an endless array of "beta" products
designed for engineers to love and end-users to ignore (yes, we mean
you, Google). At this point it seems clear that Google's lack of focus,
ironically fueled largely by its success and growth, has put it into
the conservative, sloppy generalist position usually occupied by
Microsoft. </p>
<p>2. Zuckerberg foolishly buys into the China hype</p>
<p>Facebook founder Mark Zuckerberg is smart to brush up on his
Mandarin, and his recent visit to China will likely help him to
understand what the competition looks like on a much better level. But
while China is undoubtedly Asia's biggest growth engine in terms of
pure numbers, the more transparent and easier to penetrate markets of
Japan and South Korea offer far more near-term opportunity for the
likes of Zuck. </p>
<p>3. Clone Wars: Groupon is more feature than product</p>
<p>Groupon's group buying model is a hit. The problem is that the
company's business model contains little in the way of "secret sauce."
The easily duplicatable model has been cloned many times over in Japan,
Korea and China, and the clones are doing quite well. It's not that
Groupon lacks Asia-market-savvy, it's just that its business is too
easy to copy. Historically, in the tech business this means that your
company's strength is more of a feature than a full-fledged product
(which is why Google came knocking). Groupon should enjoy these halcyon
days, because the clones wars won't end any time soon. </p>
<p>4. Japan is not prepared to go international, yet</p>
<p>Despite the public pitches to internationalize and use more English
in Japan by the CEOs of Rakuten, Softbank, and Uniqlo, based on the
lukewarm response domestically, it now seems clear that the Japanese
business community is quite content to continue operating in Japanese,
secure in a warm Galapagos bubble of predictability and process. The
situation may seem static, but Japan will change it's position when the
pain point becomes unbearable. Which leads us to...</p>
<p>5. South Korea, not China, is Japan's top business rival</p>
<p>If you're South Korea, you're more than happy for the world to tout
China as the major Asian tiger to be on the watch for—all the better to
give the ascendant giant time to gather more strength. In almost every
respect—culturally (movies, music, fashion), language (Korean students
seem to have a knack, that far surpasses their neighbors, for attaining
near native-levels of English proficiency), and technology (the list of
wins is quite long)—South Korea is poised to become the new fresh faced
dynamo of Asia, a position that Japan has enjoyed for some time, at
least in the eyes of the West. From automobiles, to software, to
hardware, if Japan intends to keep its position as the region's tech
leader, it would do well to focus more attention on South Korea than
China. </p>
<p>-Adario Strange<br>
<a href="mailto:adario@japaninc.com">adario@japaninc.com</a></p>
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Start a Company in Japan<br>
Entrepreneur's Handbook Seminar 19th of February, 2011<br>
If you have been considering setting up your own company,<br>
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