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Fujitsu annual report 1998
16
Telecommunications
Our telecommunications business
was adversely affected by reduced
capital spending on the part of do-
mestic carriers in the fiscal year’s sec-
ond half. An aggressive response to
global networking demand, however,
enabled us to increase sales in this
segment by 2% to ¥871.3 billion.
Profitability declined from the prior
year’s record high due to price cuts
brought about by competition
among domestic carriers and a higher
proportion of business in Asia, where
margins were tighter. The outlook
for the next several years is favorable.
Demand and profitability are ex-
pected to rise as a result of deregula-
tion, a projected rise in capital
investment after the upcoming dives-
titure of NTT, the advent of W-
CDMA and other factors.
In fiscal 1997 domestic demand
was sluggish as a whole, resulting in
an 8% decline in sales within Japan.
Although mobile communication
systems posted solid growth, there
were a number of negative trends.
One was slow growth in orders for
systems needed to build next-genera-
Fujitsu’s Telecommunications Business Strategies and Goals
TRANSMISSION
•Attain No. 1 position in the global SONET/SDH market.
Fujitsu’s successful SONET optical transmission business in the U.S.
has significantly contributed to success in Asia, Australia and China.
•
Broadband access–focus on ATM-PON, xDSL (Japan, U.S., UK, etc.)
SWITCHING
•Apply Fujitsu’s experience from information highway projects such as
North Carolina Information Highway, first commercial wide area
ATM network, to Asia and Europe (Japan, Hong Kong, Spain,
Germany, etc.).
MOBILE
•Focus on CDMA, deploy W-CDMA by year 2000
•Pursue global development (Japan, U.S., UK, China)
Segment Sales
(¥ billion, %) Years ended March 31
Review of Operations
SONET* Market for RBOCs**
(Shipped amount, 1 9 9 6 )
Market Size: U.S. $1 ,661 Million
tion networks. In addition, sales were
held back as communication provid-
ers curbed capital spending and or-
ders for switching systems and
transmission systems fell. Future
Worldwide Optical Transmission Market
(Shipped amount, 1 9 9 6 )
Market Size U.S. $8 ,156 Million
* Sonet is equivalent to SDH.
**Regional Bell Operating Companies
Mobile
Switching
Transmission
’98’97’96
62 5
85 5 87 1
52
30
18
52
27
21
50
29
21
Lucent (AT&T)
Fujitsu
NEC
Nortel
Siemens
Alcatel Others
[Source: Dataquest 1997 (GG98-Fuj-0 35)]
17.0%
15.6%
10.5%
11.4%
9.3%
33.5%
2.7%
Fujitsu
Lucent (AT&T)
Nortel Other
Alcatel
34.4%
29.0%
17.2%
12.9%
6.5%
[Source: Dataquest 1997 (GG98-Fuj-0 36)]