Downsizing
When personal computers became popular, Japan's large corporations quickly saw the economy, speed, and flexibility advantages those personal computers offered over the simple terminals they had used in their communication networks until then. Because the earlier, simple terminals had no storage or computing capability, they could be used only to input data to and receive data from centralized computers. The storage capacity and programmability of personal computers enabled them to handle much of the work that previously could only be done on central mainframe computers. Shifting much of the work from the central mainframe "server" to the personal computer "client" offered users great gains in economy, speed, and flexibility.
At that time in Japan, a single software product, say a spreadsheet or a wordprocessor, for a personal computer cost nearly as much as the personal computer itself. And Japan's large organizations needed several software packages for each of their hundreds or thousands of personal computer "clients". In short, the exorbitant prices of software products for personal computers at that time was preventing our clients from migrating to the "client-server" model of computing.
Prompted by some of our key clients, Ashisuto investigated personal computer software products for the first time in 1990. We soon found we could offer products comparable to the world's most famous products at less than one-tenth of prices prevailing then. So we began publishing a line of software products essential to large organizations wishing to use personal computers to migrate to "client-server" systems. Our strategy was to capture a large share of the market for software products on personal computers if the suppliers dominating the market at that time didn't bring their prices down (about ninety percent) to the new prices we set, but to get out of that business if those suppliers did bring their prices down to our new standards.
They came down to our prices, we got out of that business, and client-server computing has thrived in Japan ever since.
When Japan's large corporations began switching from centralized mainframe computers to clusters of "server" computers running on standardized operating systems like Unix, Microsoft Windows, and Linux, Ashisuto began supplying software for these servers. This was a difficult transition for us. We saw the need to move quickly to those servers, but in the early stages of the transition most of our clients' most important applications still ran on those older centralized mainframe computers and most of our revenues still came from software products for centralized mainframe computers. So we had to move deliberately without compromising either our support for our clients' "legacy" systems or our own revenues.
Very few of our suppliers and even fewer of our competitors from the era of mainframe computing were able to make that transition; most of our suppliers and competitors in the client-server era are new.
A decade later, we began facing another difficult transition: from "client-server" computing to true "web" computing based on the Internet. We again are managing that transition while maintaining our support for our clients' older systems, the primary source of our current revenues. Here again, many previous suppliers and competitors are dropping by the wayside while new ones emerge.
Facility Management
As managing and using information became one of the most critical and expensive factors of nearly all large organizations, responsive, secure, and economic operation of information systems became vital to their prosperity if not to their very survival. So Ashisuto began supplying software products to help large organizations programs, machines and facilities comprising their information systems responsively, securely, and economically. Over the years, this has become the third pillar of our business.
Free Software
During the past couple of years some of our most sophisticated users have been asking for free software, free as in freedom. This software is free of charge, free of restrictions imposed by the author or owner [of the software], and users are free to examine the entire contents [source programs] comprising the software to ensure it contains no spyware, Trojan horses, or anything else inimical to the user. These users have pointed us to various free software packages that appear competitive with, and capable of replacing, many popular proprietary software packages. For example, Ashisuto was able to switch nearly all of our nine hundred personal computers from the proprietary Microsoft Office suite of products costing us about ten thousand yen per computer per year to the free Open Office suite of free software, from Microsoft's Internet Explorer browser to Mozilla's Firefox, and from the proprietary software we were using for electronic mail to Mozilla's Thunderbird, saving our company about $100,000 per year, freeing us from restrictions and constraints imposed imposed by suppliers of the proprietary software we had been using, and freeing us from concern of being sabotaged or spied upon by "black box" programs we could not examine. We found this transition so easy and satisfying that we began offering support for Open Office, Firefox and Thunderbird for about one-tenth the price of Microsoft Office; after just a few months, it looks like a highly promising new business.
A number of us also have switched from Microsoft Windows to the free Ubuntu version of the Linux operating system, and we now are investigating the feasibility of converting the entire company from Windows to Ubuntu this year. If we find this transition as easy and satisfying as our transition to Open Office, Firefox and Thunderbird, we will offer support for Ubuntu similar to that we're now offering for those.
Three Pillars of Our Business
In sum, the three pillars of our business are:
- Supplying software products to help large organizations improve the productivity of developing and maintaining computer applications, to reduce the skills required to develop and maintain those applications, and to enable people with no previous experience with computers to use them without difficulty.
- Supplying software products to help large organizations manage huge amounts of data reliably, speedily, flexibly, and economically.
- Supplying software products to help large organizations manage the facilities comprising their information systems responsively, securely, and economically.
And we now hope that the fourth pillar of our business will soon become:
- Providing education and support services for free (as in freedom) personal ("client") computer products.
Within the basic prices of our products, we've always included thorough training and support to users of our products, including prompt and continuous telephone support. Recently, in response to demands from our clients, we've begun also offering separately-priced professional services closely related to our three categories of software products. These include helping clients organize their data in ways that economically and flexibly serve their needs; designing and tuning data bases for efficient storage and fast and flexible access of data; providing experts in our products to develop applications or to access, analyze and report data; helping clients develop procedures to operate information systems efficiently and economically; and advising clients on securing information systems effectively.
When we began pioneering the software products business in Japan in the early 1970s, all our packages were imported from the United States. As computing became more "open" we began finding excellent software products to import from other nations. Along the way, Japanese also began developing excellent software packages. Ashisuto now supplies a wide variety of products imported from the United States and several other nations as well as products made here in Japan. And, just recently, we've began offering education and support services for for free (as in freedom) personal ("client") computer products.
Recently we've come to realize that Japan's large organizations are entering a new phase of information technology. They already have computerized most routine work that can be done economically on computers. Their most important data is now stored in their computers and readily accessible from them. Most employees now comfortably and capably use computers. Networks make that data readily available to those employees. But few, if any, of these large organizations are using these data, computer and communications facilities, and human expertise as effectively as they could and should. Ashisuto's present mission is to help our clients use more effectively the data, facilities, and human expertise they've built up over the past several decades.
We plan to continue focusing on supplying software products and related services for the foreseeable future. We plan to add and expand products and services of our company's three "pillars" according to the needs of our clients. We do not plan to enter other product and service categories or to enter markets outside Japan. However, as the products we distribute become more attractive to smaller businesses within Japan, we hope to offer these same three categories of products and services to them as well.
What We Are & What We're Not
Ashisuto specializes in software products, which we sell in multiple quantities to various clients. Ashisuto does not develop software to satisfy specific needs of specific clients. To make an analogy to the construction industry, Ashisuto is a supplier of parts and tools, not a general contractor.Another analogy: Ashisuto is a publisher and distributor, not an author.
Although software products are Ashisuto's primary business, we do offer a limited range of professional services. The professional services we offer are subsidiary to our software products business and fall in three categories: (1) services so closely related to our software products that we can provide them more capably than companies specializing in professional services; (2) services based on exceptional talents of one or more of our employees; and (3) services we cultivate to provide more attractive career paths for our employees. Ashisuto has no aspiration to compete with the companies that specialize in professional services.
Ashisuto distributes software products made by others; it does not develop software products itself.
Ashisuto distributes only software products that help organizations manage and use information. Examples of the kinds of software products Ashisuto does not distribute include those primarily intended for (1) personal use - because we are geared to helping clients cope with the complexities and difficulties that occur when multiple people share common computing, storage, and communication facilities to use common data - complexities and difficulties that don't occur when individuals work with their own data on their own computers; (2) entertainment; (3) education, unless that education helps organizations manage their information; (4) medical, scientific, or other technical specialties.
Since most large organizations in Japan are clients of Ashisuto, we feel a strong obligation to serve them all well. Therefore we do not distribute software products useful only to a small portion of those clients. For example, we don't distribute software products useful only to banks, only to insurance companies, only to hospitals, or only to any other small portion of the large organizations in Japan.
Ashisuto's strength is in distributing software products requiring significant training, implementation support, and quick response when unanticipated problems arise. Japan's large organizations buy from Ashisuto primarily because they trust us to provide first-rate support for the products we distribute. They buy simpler, less complex products not requiring much support from whoever offers the lowest price.
We want to expand our business to smaller organizations, but at this point we have our hands full serving the largest organizations in Japan - primarily businesses listed on the Tokyo Stock Exchange and other organizations of comparable size.
Ashisuto distributes software products and related services in Japan only. While China, Korea, and other nations are close geographically, their languages and cultures are so different from Japan's that we do not feel we can serve their markets adequately. Our priority is to extend our business to smaller organizations than we presently serve within Japan rather than trying to expand outside Japan.
Ashisuto focuses predominantly on its clients and employees. We have no outside shareholders; the owners of Ashisuto are employees and are paid on the same salary and bonus scale as other employees, so we don't seek profits to enrich shareholders. We serve suppliers honestly and diligently without attempting to help suppliers mine our market for short-term profits. We believe our primary dedication to clients and employees enables us to serve our suppliers best over the long-term.