Richard J. Elkus, Jr., Prometrix Corporation (Panel Chair)
Robert B. Cohen, Consultant
Birney D. Dayton, NVISION
David G. Messerschmitt, University of California
William F. Schreiber, Massachusetts Institute of Technology
Lawrence E. Tannas, Jr., Consultant
"High definition" describes new products or systems whose value resides in their ability to process greatly increased amounts of audio and video information. Processing of information is fundamental to the infrastructure of electronics, telecommunication, and media markets. The panel's goal was to study technological developments in Japan pertaining to high definition systems. A brochure from Japan's Ministry of Posts and Telecommunications described high definition television as "the cornerstone of the information age," which indicated a dedication to the concept of HDTV in Japan. The purpose of this dedication seemed to be to focus the Japanese electronics industry on a problem that, when solved, might have advanced the state of the electronics manufacturing art in Japan a generation beyond that of the rest of the world.
The Japanese manufacturers the panel visited indicated that near-term applications of HDTV technology that would justify their investment were in information systems and industrial applications. Public relations literature made clear the long-term focus of Japanese electronic companies on the increasing use of speech, image, and video in all phases of information systems and illustrated a combined vision of and commitment to a new age of information technology.
The panel report does not address the new digital approaches to HDTV, which were publicized after the panel had completed its work.
High definition systems require a lot of bandwidth to store and transmit video. The two major technological components of high definition systems (HDS) are digital signal processing (DSP) for compression and quality enhancement, and high-resolution displays. An example is the Japanese MUSE system, which is analog transmitted by satellite but uses large doses of DSP in the transmitter and receiver to compress the bandwidth. In 1989, six Japanese manufacturers were cooperating with the public broadcasting organization NHK on a reduced-cost MUSE receiver that required development of thirty separate application-specific integrated circuits. The panel saw several projects engaged in compression of digitally-encoded HDTV.
The importance of these DSP developments transcend their near-term application to HDTV. For example, the U.S. was strong in DSP, which was a technology driver because it required high arithmetic processing rates that often exceeded even those of supercomputers. DSP was also a key component of many military and commercial systems. HDS requires some of the highest processing rates of any DSP applications and, hence, drove Japanese manufacturers toward very advanced electronics technologies and advanced architectures such as multiprocessor DSP. The Japanese expect HDS to be an element of many future commercial applications, such as multimedia applications in computing and new products in medicine, manufacturing, publishing, filmmaking, education, and telecommunications. Japanese manufacturers would be well positioned in these markets, given their DSP and display capabilities.
A twenty-year research effort coordinated and facilitated by NHK led Japanese manufacturers to world leadership in HDTV technology. Participating Japanese manufacturers could justify their investment knowing that, with NHK coordinating, their components would fit into the larger system. NHK's coordination was much more important than any public-sector monetary support it offered. This illustrated one way to pursue a research effort for a system so complex that it transcends the capabilities of any single manufacturer.
High-quality, high-resolution displays are critical to the success of HDTV. At the time of the panel report, one technical limitation of HDTV lay in the display. The five problems were to: (a) generate the resolution in one continuous image plane; (b) make the image plane large to create realism; (c) change images to show real-time dynamics; (d) create the image in color; and (e) combine all these features at a consumer market cost with acceptable weight, power, and volume characteristics. Many display panels could meet some of these requirements. For example, ac plasma panels could be made with high resolution, but not simultaneously in color or at acceptable cost. Japanese industry was attempting to develop a large ac plasma panel and active matrix liquid crystal flat-panel, direct-view HDTV display prototype by 1995. U.S. industry was reportedly no longer attempting to develop an NTSC TV flat-panel display to hang on the wall. HDTV displays available in Japan had come about from improvements in cathode ray tube (CRT) and projection technologies. The second contender for consumer HDTV displays that the panel identified was the LCD light valve using three active-matrix liquid crystal cells. It was not yet clear whether this technology could compete with CRT projectors.
JTEC panelists were often told that the Japanese could build to any standard within one or two years of learning about it. The process of developing standards in Japan was similar in some respects to that in the U.S., but the panel also found differences. Japanese companies had been participating in the U.S. process. This participation had been made possible because many Japanese could speak English, the diverse nature of U.S. culture made it very easy to find proxies, and Japanese companies had a strong export orientation. By contrast, U.S. companies were usually distant from the standards process in Japan.
Numerous standards for different HDTV (1125/60) equipment had been developed or were under development in Japan. Work had been done on a variety of television standards of intermediate resolution (greater than NTSC but less than true HDTV) under the rubric "EDTV," or enhanced definition TV. Significant progress had also been made in standards setting for components, such as HDTV semiconductors and displays, and for end-use products, such as studio HDTV equipment, industrial products, and consumer products.
A rapid cycle of standardization, manufacture, improvement, adaptation, and restandardization characterized Japan's standards process. Japanese companies were willing to adopt standards from elsewhere, adapting them to suit their changing needs. By contrast, the standards generation process in the U.S. was seen as slow.
That HDTV existed as a standards issue in the U.S. was largely due to the development of a system and equipment in Japan, and to Japanese efforts to have their system adopted worldwide. NHK began HDTV development in 1970. The plan was to implement HDTV in Japan as an entirely new service, delivered to viewers by direct-broadcast satellites (DBS) to supplement the over-the-air (terrestrial) system that would continue to use NTSC, the color standard used in both the U.S. and Japan. Scanning standards were chosen with the intention of making the picture quality comparable to that of 35-mm motion pictures. Since standard satellite transponder channels were inadequate for this studio system, the MUSE transmission system was developed to allow a compressed version of the signal to be transmitted in a normal satellite channel. System and equipment developments were paralleled by efforts to have the studio system adopted as an international standard for program production and international exchange. However, the system was not optimum for cable or terrestrial broadcasting. U.S. industry may learn from the Japanese experience in HDTV development and devise a system suitable to U.S. needs.
Japan's leading electronics corporations and the Japanese government have invested substantially in R&D to commercialize HDS and HDTV. Many Japanese leaders seemed to view HDTV as the center of a move to a vastly different Japanese economy that would offer huge benefits in growth and consumption. They also appeared to believe that government financing for the early stages of HDS development was important to reduce corporate risk and ensure that private funds would be forthcoming for the first stages of commercialization. Government funds also supported the development of key HDTV component technologies.
Sales to industrial customers were expected to support the growth of the new HDS market initially. Corporations would develop controls for design, engineering, and production or service-delivery processes, advances that would create new market opportunities for these firms. Development of HDTV was likely to enhance the interdependency of some of the most dynamic parts of Japanese industry and promote further vertical integration of the largest Japanese electronics firms.
The strong base that Japan's major corporations had in the consumer electronics industry facilitated their move into HDS. By playing a major role in the consumer electronics and semiconductor industries, these firms had a greater ability to benefit from economies of scale in developing new display, semiconductor, and processor products. The Japanese recognized the need for government-promoted R&D in high-risk areas such as large flat-panel displays. Therefore, they created new business-government entities, including the Key Technology Center and an HDTV leasing corporation. The Japanese also expected a significant boost in demand for semiconductors from HDS development.
To Japanese businessmen, strategy is everything. Every person, business, and industry must have a goal and a strategy by which to achieve it. Because resources are usually scarce, the successful Japanese plan includes the concept of leverage. Some markets are considered more strategic than others. By targeting strategic markets, an infrastructure can be built that ensures a solid basis for economic expansion. However, the leverage is not based simply on the importance of one market over another, but rather on the assumption that, as they develop, strategic markets will become interrelated and interdependent, with the whole becoming substantially larger than the sum of its parts. Therefore, coordination of strategy and direction is essential -- a point that is fundamental to the strategy of product and market development in Japan. It is based on the concept that if the development of a product or market is pushed to its logical extreme, it becomes related to other products and markets. Thus, Japanese business strategy does not reject a product or market on the basis of profit potential, but rather assumes that every product becomes the basis for another, and every technology becomes the stepping-stone for the next. The resulting efficiencies of scale are enormous.
The market for high definition products and systems can help push the markets for electronics products, telecommunication services, and software (including mass media) to their logical extreme. The Japanese expressed the view that, perhaps by the year 2000, the requirements and possibilities created by improving the technology to rapidly process large amounts of audiovisual information would force a confluence of these three end-use markets into a single information systems market. They expected that the information systems market would grow to represent 33 percent of all capital investment, 44 percent of all new jobs, and 22 percent of all economic growth.
The Japanese felt that in the future information age, any nation without a proprietary position in or reliable strategic access to each of the market segments within electronics, the media (including software and mass media), and telecommunication services would be at a significant competitive disadvantage. This concept was in part the basis for the accelerated development in Japan of high definition products and systems, and underscored the significance of high definition technology and its effect on all parts of the industrial structure of Japan.