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Assaulting Japan's connectivity market--from NYC
by Alex Goldman

It's Friday morning and I'm on the phone with Kiho Shin. He lives on the information superhighway in a way that most of us can just dream about. His Wall Street, Manhattan apartment is in a building wired with fiber optic cable. "The T-1 line is $100 per month," he says, "and I get two IP addresses." For Web professionals, it's difficult to beat that price. It's so cheap to do a Web business from the United States--why set up shop in Tokyo?

Kiho's latest venture, Datamail Corp., will do business from the United States, working with offshore programmers. "They promised more than they could deliver," he says, but he solved that problem. When the Windows version of his software appeared virtually immediately but the Macintosh version was plagued by delays, he simply hired someone in the United States to write the Macintosh version.

The software? A killer app for the hottest part of the new software market--connectivity. Datamail's app allows remote users to e-mail commands to a Filemaker Pro database. Thus, for example, a salesperson could record a sale in the corporate database while on the road.

And this is all about Japan. Filemaker Inc., which produced a high-quality Japanese version of its software early on, now estimates that there are seven million users in Japan. Datamail Corp. will turn a profit if it can reach 1% of those users.

Kiho is a long-time user of Filemaker Pro, and says that the people at Filemaker Inc. have been very helpful. They've just released the English version of Filemaker Pro 5, and are enthusiastic about Kiho's plug-in. "Filemaker Pro limits plug-ins to 68Kb of memory," Kiho says. Of course, Internet connectivity requires more than 68Kb. He won't say exactly how, but with research and with the support of Filemaker Inc., he found a way around that problem. "I'm a fan of Filemaker Pro. I nearly gave up on them around Filemaker Pro 2, when they did not have a relational database, but then they released one. Now, Filemaker Pro is one of the best user interfaces around. It's so intuitive. It's beautiful."

Kiho has this advice for Web entrepreneurs doing business in Japan: With costs so high, do as much of your business in the United States as you can. All of your initial costs, from phone calls to Web hosting to equipment, will be much lower in the U.S. For example, a full-service basic e-business provider will charge as low as $20 per month for a service that includes secure sales, a fraction of the price charged in Japan. And the cost of networking during the creation of the software--phone calls, e-mails with large attachments--it's all so much cheaper in the U.S. Furthermore, if you're selling software, why package it at all? Just make it small enough so that it's easy to download even on a metered phone line (Datamail's plug-in will be less than 200Kb), use a standard e-business provider, and you have almost no overhead. The only problem? "Japanese distribution. We need someone to distribute to the Japanese market or the Asia-Pacific Rim for an up-front fee . . ." So here's another idea: Create a major software download site--free downloads--in Japan (a site similar to America's, which is owned by Softbank).

As I prepare to hang up, Kiho is talking about the next gadget of the future: a device that links your telephone directly to the Internet so that all calls, domestic and international, are the price of a single local call.

Alexander Goldman is a freelance writer in New York.

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