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  • Japan's Home PC Penetration Lags U.S., AOL Exec. Says
  • May 1, 1998 (TOKYO) -- AOL Japan Inc. president Hidemaru Sato said that the company's online membership is soon expected to exceed 100,000.
    At a press conference held to commemorate the first anniversary of AOL's launch of services in Japan, Sato talked to reporters on the characteristics of AOL members and the company's overall prospects.

    The following are comments made by Sato at the press conference and in his exclusive interview with BizTech.

    Q: Are you satisfied with the projected figure of 100,000 members?

    Sato: Yes. I'm satisfied with that projection. A survey found that 53 percent of AOL customers are new to using the Internet. I'm proud that AOL has caught on with beginners, because the finding is in line with our company's philosophy of providing fun, easy-to-use and useful services.

    Q: A total of 94 percent of AOL members are home personal computer users. Why is this a characteristic of AOL Japan users?

    Sato: It is true that many users access AOL at home for fun and not for work. This is because PCs have caught on with households in Japan. However, there are still barriers for PCs to further expand in the home environment.

    Q: Do PCs being used at home have an impact on the number of AOL users?

    Sato: Because AOL Japan aims to provide easy-to-use services to PC users at home, the home PC market has an impact on the number of our members. However, I think AOL is doing very well considering the restrictions on the market.

    In Japan, most households have one computer. It's still a rare case that each member of a family would have their own PC. Most computers are for work, not for fun. Under such circumstances, it is a major achievement that 94 percent of AOL's customers are home PC users.

    Recently, PC prices in Japan have fallen close to the 1994 price levels in the United States. When Compaq Computer Corp., IBM Corp. and Hewlett-Packard Co. started reducing computer prices in the United States, it was a common sight that fathers took their children when they bought PCs at stores. Japan today is close to the United States of 1994.

    However, high communications fees are the bottleneck hindering rapid growth of home PCs in Japan. Users are concerned about high communications fees when they utilize the Internet. The number of users will not grow if communications charges remain high.

    Q: Will Japanese consumers spend more free time on PCs if conditions are improved?

    Sato: That is a problem, too. PCs caught on with families and schools after the hardware became cheaper and communications fees were lowered in the United States. In Japan, it's hard to imagine that given the same conditions, people will spend more money and time on PCs. That is a basic difference between Japan and the United States.

    We must inform people about what a computer can do for them. The home computer market will not expand if no action is taken. It's important for the mass media, the academic community, research institutions and the government to work together to promote the use of personal computers in Japan.

    Q: Is AOL a provider or an online service agent, and what is your company's overall goal.

    Sato: We consider AOL to be a mass media organization like a magazine or newspaper. We hope that our users can enjoy AOL as a new type of digital media. We are not moving toward the direction of a mere provider or an online service provider. AOL Japan is a mass media enterprise.

    (Hi-Tech News Center)

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    Updated: Thu Apr 30 19:50:25 1998