With an eye on a trade-conscious Congress, Nippon Telephone & Telegraph Corp. yesterday announced one of its largest high-technology purchases from an American company, a $140 million deal with Data General Corp. for a new generation of high-speed, integrated communications systems.
The two companies will work together to develop the advanced systems, which will allow switching of phone, data and image transmissions between and within offices on one network.
It will be offered to Japanese customers by NTT in the spring of 1989 and shortly afterward by Data General elsewhere in the world.
Research and development work will be done at three Data General facilities in the U.S., including one in Rockville, and the systems will be manufactured at Data General plants in the United States and the Far East.
Assistant U.S. Trade Representative Douglas Newkirk called the purchase "an encouraging sign" that NTT is improving its compliance with a seven-year-old agreement to buy more high-technology products from American companies.
The agreement was signed when NTT was a government monopoly, but new laws that have since been passed allow competition in the Japanese telecommunications industry. In addition, the government gradually is turning NTT over to private ownership.
"This is still not enough. NTT needs to purchase more from the United States," Newkirk said at a press conference called by NTT and Data General to announce the deal.
Data General sources said the press conference, together with a Capitol Hill reception tonight, was an attempt to influence congressional consideration of trade legislation that is aimed partially at the nation's record high trade deficit with Japan and the strong belief in the U.S. that the Japanese market is closed to American high-technology products.
Newkirk said that NTT officials frequently are critical of U.S. companies, who they say take a short-term view of selling in Japan by disappearing after either failing or succeeding in making a sale.
"This is not the relationship that NTT wants. The company says it wants a long-term cooperative relationship that produces a steady stream of business rather than a short-term deal," Newkirk said. "This agreement fits that pattern."
Data General gave the project the code name of "Asparagus" because that vegetable takes two years after planting to produce edible shoots but, once established, keeps producing indefinitely.
Edson D. de Castro, president of Data General, said that Data General got the contract after NTT staged a year-long international search because "we exhibited a willingness to work with them on something better rather than sell them a combination of off-the-shelf hardware and software."
In addition, Data General invested in a Japanese subsidiary in 1971 and has become well known as a reliable supplier in that country.
Takahiko Kamae, NTT research and development director, estimated his company would spend $140 million by 1994 on the Data General contract.
De Castro refused to say how much NTT was paying for research, but he added it is not a large sum. He said no technology is being transferred from Data General to NTT, but both companies will share technology that they develop jointly.