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Japan's Internet market is slowly taking steps toward becoming a global leader after long standing in the shadow of Korea, an Internet hot-house, and China, the world's biggest market. The island nation has been continuously investing in the industry, and as a result it is now drawing attention from companies around the world. Japan has 10 times as many subscribers to the super-fast Fiber To The Home (FTTH) Internet service as Korea, and the number of Japanese households using the Internet exceeds 26 million. All this seems to signal an age of "online Japan."
¡ß International companies rushing to Japan
Many of the world's leading Internet businesses are rolling up their sleeves to compete in Japan. EBay, the world's biggest online auction site, announced on Nov. 4 that it will work with Yahoo Japan to take on the Japanese auction market. China's leading portal Baidu launched a Japanese site in the first quarter of the year, and its top e-commerce platform Alibaba announced last month that it will partner with Yahoo Japan to establish a joint venture in Japan. Google, Microsoft and Amazon are already doing business there. Local companies like Yahoo Japan, Rakuten, and Mixi are doing their best to stay on top.
¡ß Japan set to lead the world Internet market
A simple reason lies behind Japan becoming a center of the world Internet industry -- the rapid growth of its market. Stimulated by Korea's success in building a large high-speed Internet network in the early 2000s, Japan has continuously invested in improving its own network and has now outpaced Korea. As of March 2007, Japanese subscribers to FTTH numbered some 8.8 million, whereas Korea has no more than 700,000 subscribers. With speeds of around 1 Gbps, FTTH is up to 10 times faster than the high-speed LAN technology common in Korea.
¡ß Japanese market both a threat and an opportunity
The dark horse emergence of the Japanese Internet industry is a big issue among Korean Internet companies. Many of them have staked their fate on success or failure in Japan. Neowiz Games president Choi Kwan-ho said, "If Korean companies fail to enter the Japanese market, it will greatly affect their overseas business plans." Neowiz has purchased Japanese game portal Gameon to aggressively attack the local market. Another Korean company, Nexon, plans to list on the Japanese stock market next year rather than listing in Korea.
NHN also plans to launch a Japanese portal next year following a game service it has already launched there. Pinning its future on the Japanese market, Korea's largest portal company is doing everything it can to make Naver Japan a serious player. The company staff toil late into the night and even spend their lunch hours strategizing, much as they did when they first started in Korea. Jason Lee, a senior consultant at IT consulting firm ROA, predicts tumultuous changes in Japan's communications industry next year when its Internet infrastructure is greatly expanded. Korean businesses would be wise in taking that as an opportunity, he advised.
(englishnews@chosun.com )
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