Japan has a well-deserved reputation as a country full of gadget lovers. The Japanese consumer electronics market consistently produces devices in some combination of useful, highly advanced, and downright cute, from Hello Kitty SMS devices to disturbingly detailed squid-shaped USB drives to the toilet in that Simpsons episode that gave Homer restaurant recommendations. Japan’s cell phone market is probably the most technologically advanced in the world – so why, as the New York Times asked on Sunday, haven’t their eye-popping innovations reached the rest of us yet?
Japan’s cell phone market is flooded with incredibly sophisticated devices – Wired characterized it as five years ahead of our own (3G networks, for instance, which have only recently begun unreliably spreading across the United States, showed up in Japan in 2001), and more than twice as many people use so-called smartphones in Japan than in the United States, despite a population less than half as large. While these characteristics make many in the U.S. envious, however, they put both Japanese manufacturers seeking to expand abroad and foreign manufacturers (like Nokia and Apple) seeking to penetrate Japan’s market at a disadvantage, and have led Japanese observers to coin the phrase “Galápagos syndrome” to characterize their woes: their market is just too different.
One useful way to think about these fascinating market dynamics is through the lens of disruption. One might expect that a market so saturated with high-end devices filled to bursting with features like TV tuners and videoconference-capable cameras would be ripe for disruption, but one high-profile device that would arguably look disruptive in Japan while being sustaining almost everywhere else – Apple’s iPhone – has had tremendous difficulty finding eager consumers. Compared to many other devices on the market in Japan, the iPhone has few features, an extremely low-resolution camera, a conservative design, and a low price, but its reception has been lukewarm at best. This appears to be because Japan’s consumers aren’t ready for disruption at all: they aren’t being overshot! The devices they can choose from may be fiendishly complicated (one Japanese engineer even mused that pushing buttons on his phone and discovering new features is “good for killing time”), but for the most part they demand and make use of those features – so much so that many Japanese citizens rely entirely on their phones and eschew PCs entirely.
The rapid technological evolution in this Galápagos of cell phones provides an excellent case study in disruption (or lack thereof) and serves as a reminder that disruptive innovations can only succeed when they’re “good enough” against what consumers consider to be important performance metrics. Perhaps over time Japan’s evolution will converge with some of the rest of the world’s, but then again, in consumer electronics a five-year gap is an evolutionary eternity.
