An American manufacturer has succeeded for the first time in selling a high-technology item to Nippon Telephone and Telegraph Co., the giant Japanese communications monopoly that until recently had banned all foreign procurement.
The breakthrough was made by Motorola Inc., which will sign a contract shortly to sell NT&T annually from 50,000 to 100,000 Pocket Bells, a lightweight pager of the type now carried by more than a million Japanese executives, doctors and other professionals. The pager alerts them by a choice of two sound tones, to respond to a waiting telephone call or other message. The Motorola sale will account for about one-fourth of NT&T's needs.
The Motorola Pocket Bell -- actually a highly sophisticated radio receiver with a computer-like memory device -- sells for $250. This is the price fixed by NT&T for its purchases of the equivalent item from five Japanese suppliers, some of whom objected strenuously to Motorola's entry into the Japanese market.
NT&T maintains a monopoly in pagers. No one else in Japan can merchandize them. NT&T doesn't sell the pagers, but only rents them for a monthly fee of about $15 to $20.
In the United States, Motorola and other manufacturers sell paging devices, some more advanced than the Pocket Bell, for $100 to slightly more than $200 each.
Landing the NT&T contract is a success story attributable first to government-to-government negotiations begun early in 1979 by the Carter administration in an effort to open up the Japanese market to high-technology and other goods. But it took the special determination of a Washington-based Motorola executive, Lionel Olmer, to find a product that the company could make for NT&T.
It had to have the potential for a substantial sale, be competitive with Japanese products and at least skirt the lines of NT&T's traditional refusal to allow foreigners any contact with the actual heart of the telephone system. NT&T, a quasi-government corporation, is one of the more conservative bastions of tradition in the Japanese economy. It is more committed to protection of communications electronics than American officials are to guarding the defense industry.
Olmer observed the widespread use of pagers in Japan and was convinced that Motorola, with its wide experience in producing them for the American market, could meet NT&T's reliability standards and even undersell Japanese producers.
At a factory in Plantation, Fla. (just north of Ft. Lauderdale), Motorola has been able to produce the exact pager NT&T wants, exceeding the quality performance of the Japanese companies. Motorola says tests show a failure rate of only 0.5 percent for each 100 hours of use, against the Japanese standard of 1.0 percent.
Motorola could make the unit for $200, but NT&T doesn't want to give the Japanese companies the further problem of having to meet a lower American price schedule.
The relatively high cost for the small item is caused by the extreme precision needed. The radio frequency spectrum available for the pagers is narrow. Yet each must be programmed, with the help of an onboard microprocessor, to locate an individual instantaneously in a city like Tokyo, with a population of 11 million.
Olmer, whose name is scheduled to be sent to Congress by President Reagan as a nominee for the post of under secretary of commerce for trade affairs, first proposed his idea in January 1979 to Nobuhiko Ushiba, then ambassador for external economic affairs. Ushiba initially told Olmer it was hopeless to try to break down the NT&T reserve.
Under pressure from both American and Japanese officials to break down at least one barrier, NT&T was persuaded by Ushiba to let Motorola have a chance. NT&T provided the specifications, and what the Japanese now call the "pocketa-bell" appears to fill the bill. Except for two small parts, a switch and a transducer made in Toyko, all of the pager is made and assembled in the United States.