Estimated reading time: 5 minutes

EPTE Newsletter from Japan - Microsoft's New OS - VISTA - Bang or Bust

Topics of the Week

Nikkei Shinbun, one of  Japan's leading newspapers, reviewed business trends for personal computers, paying particular attention to VISTA, the new operating system released by Microsoft several weeks ago.

PC sales have been sluggish since last October, and industry experts place some of the blame VISTA's release, believing consumers and other end users postponed purchases for new PCs until the new operating system was preloaded onto new computers.  Most of the PC manufacturers and mother board manufacturers in Taiwan, as well as Multi-layer board manufacturers and flexible circuit manufacturers in the PC industry are reporting slower sales and output.  PC shipments for the month were 20% lower compared to the same month last year. 

The industry was hoping for a rebound in sales upon VISTA's release.  February PC shipments in Japan posted their first positive growth in 13 months; however, it was less than spectacular at a 1.2% increase compared to the same month last year. A market research company reported that PC sales for the first week after the release of VISTA enjoyed a remarkable increase of 8% compared to the same week last year.  Unfortunately, it was a flash in the pan, and PC shipments for the second week remained flat compared to the same week last year.  Could the new operating system have design flaws?

A couple of my Japanese PC expert friends loaded VISTA onto their existing computers, replacing their older operating systems that included Windows XP.  They said the new OS had a lot of new capabilities for many functions and added it is not too manageable for novice computer users.  Many of their PC peripherals such as printers and scanners did not work with the new operating system, and some of their older software would not run.  One of my friends spent more than a thousand dollars to fix all of the issues with the new OS, and will advise any user that is not too technologically savvy to purchase a new PC with VISTA already loaded.  This will minimize both installation time and total cost.

A clever management team for an engineering company in Japan decided not to install VISTA throughout its network.  Instead, they took advantage of clearance sales featuring PCs and peripherals loaded with Windows XP and purchased them at dramatically low prices. They bought more than 100 units, and predict their network will perform flawlessly for another five years.

Historically, PC sales peak during March and April in Japan as students entering their freshman year in college, and aspiring graduates entering the workforce gear up with the latest technologies.  Electronic companies increase budgets for advertising campaigns during this busy season, and assume a significant return on their investments since PC sales are robust.  However, some companies have expressed concern over a weakened PC market and are unclear about the future.

In my opinion, Microsoft cannot be happy with the sales performance of their new VISTA operating system.  A big problem shared by the PC industry and manufacturers was the expectation of additional PC sales after the release of VISTA.  They retooled and expensed materials and equipment to prepare for the above average sales predicted; unfortunately, it has not come to fruition, and manufacturers cannot recoup their high operation rates for a while. We had a warm winter this year. I think the warm spring season for the industry will not come early this year.

Dominique Numakura, DKN Research (dnumakura@dknresearch.com)

Headlines of the week

1.      Mitsubishi Chemical (Major chemical company in Japan) 3/5

Plans to expand the markets of while color LED materials in the mobile electronics equipment.

2.      DaiNippon Printing (Major printing company in Japan) 3/5

Has developed the world smallest IC Tag (5.45 mm square) for the supply chain management. Volume production will start in July 2007.

3.      Panasonic (Major electronics company in Japan) 3/5

Will commercialize the first blue color LED chips built on GaN substrates.  The chips were packaged by flip chip technology.

4.      Asahi Kosan (Equipment manufacturer in Japan) 3/6

Has developed a new high-speed lifting machine (90 meters per min.) for the large size glass substrates of the 10G LCD manufacturing lines.

5.      Nikkei (Major economic newspaper in Japan) 3/6

Remarkable rebounding of PC sales were not observed in the Japan market after the release of Vista, the new OS of Microsoft.

6.      Denki Kagaku Kogyo (Major electronics material supplier in Japan) 3/7

Will commercialize a new heat sink material utilizing its thermal conductive tape "Denka Ele Thermal" for heat source such as LED lighting modules.

7.      Hitachi (Major electronics company in Japan) 3/7

Will use air flight to send the PDP modules of the large size TVs to the assembling plants in Mexico, the U.S. and Europe to minimize the inventories in the process. 

8.      Sumitomo Metal Mining (Flex circuit material supplier in Japan) 3/7

Will complete the construction of the manufacturing lines of the adhesiveless flexible laminates by the end of March. The total capacity will be 6.5 million square meters per year.

9.      TDK (Major component supplier in Japan) 3/8

Will commercialize a new memory device of memory disc utilizing flash memory technology. TDK expects the memory disc will be the main stream of the industry.

10.  JUKI (Equipment manufacturer in Japan) 3/8

Has opened a new office of Thai JUKI SMT ASIA in Thailand. The new office is responsible for both sales and engineering service of the

11.  Mitsubishi Electric (Major electric & electronics company in Japan) 3/9

Has unveiled the new power semiconductor module series "1700V 1GBT Module A Series" will small SMT spaces. 48 x 94 mm for 100A rating.

Interesting literatures about the packaging industry

Articles of DKN Research

1.  "2006 Global Material Projection for Flex Circuit" DKN Research, October, 2006. http://www.dknresearch.com/Products.html

2. "Introduction for the Printed Circuit Boards of Car Electronics, Flexible Circuits", (Japanese only), Dominique Numakura, Nikkan Kogyo Shinbun, June, 2006, 2400 yens.

3. "The latest semiconductor package, Part XXI, Teardown Analysis of FDD, CD Drive", Dominique Numakura, Electronics Packaging Technology, January, 2007 

4. "Five Year Projection of the Global Flexible Circuit Market" Robert Turunen, Dominique Numakura and James J. Hickman, The Board Authority, Volume 7, August, 2006

5. "Technical Trends and Market Projection of the Materials for the Flexible Circuits", (Japanese only) Dominique Numakura, Denshi Zairyo, October, 2006

6. "Leading Edge Material and Application of Polyimide (Materials for the Advance Flexible Circuits)", Dominique Numakura, CMC publication, August, 2006

7. "Business Trends and Technology Trends of the HDI Flexible Circuits -

Roadmap for the Ultra High-Density Advanced Flexible Circuits", Dominique Numakura, KPCA, October 31, 2006

From the Major Industry Magazines

1. "Flex-Based Interconnection Structures for High-Speed Applications", Joseph Fjelstad, CircuiTree, February, 2007.

2. "Organic and Printed Electronics: The Next Big Things?", Daniel Gamota and Jie Zhang, Circuits Assembly, February, 2007.

3. "First Article Inspection: Understanding the Problems", Greg Ross, SMT, February, 2007

4. "The PCB Design Outsource Proposition. Is outsourcing the right solution for your company?", Joseph Zaccari, Printed Circuit Design & Manufacturing, February, 2007.

5. "Fluxless Wafer Bumping by Electron Attachment", Christine Dong, Richard Patrick, Eugene Kawacki and Gregory Arslanian, Advanced Packaging, January/February, 2007

6. "From Chips to Systems via Packaging - A Comparison of IBM's Mainframe Servers", Hubert Harrer, George A. Katopis and Wiren Becker, IEEE Circuits and Systems Magazine, 4th Quarter, 2006

7. "Under the Hood-Latest DESIGN GEMS Unearthed",  presented by EE Times and techonline, December 2006