IT firms come to Japan's aid, assess damage to operations

MANILA, Philippines - The harsh forces of nature can bring out the best in people, including those behind the largest technology companies in the world that came forward to help rebuild earthquake- and tsunami-ravaged Japan while also picking up the pieces of their disrupted operations.

Japan is home to several of the world’s major high-tech manufacturers. Fujifilm, Panasonic, Canon, Sony, NEC, Kyocera, Epson, and IBM are among the first technology titans with extensive operations in Japan to come to the aid of the Japanese people who suffered a horrific 9.0 magnitude earthquake followed by a massive tsunami that destroyed everything in its path.

Although many of the high-tech firms are still struggling to assess the damage to their own operations, corporate citizenship and patriotism came first as they donated huge amounts of money and technology support to aid relief and rescue efforts.

Panasonic, Canon and Sony each pledged to donate at least ¥300 million (roughly $3.6 million), while NEC, and Kyocera committed to give $1 million each to aid their disaster-stricken country. Sony and Panasonic also donated thousands of radios to help relief efforts following the disaster. Epson is donating ¥100 million.

IBM, for its part, offered an initial corporate donation of up to $1 million in technology and services and is encouraging its employees to make cash donations to Red Cross and Japanese charities to help Japan during this crisis of historic proportion. IBM Japan is also offering free use of LotusLive to parties involved in the relief and recovery efforts.

Mitsubishi pledged $6.1 million. Fujifilm Holdings Corp., along with its group of companies, FujiFilm Corp. and Fuji Xerox Co. Ltd., extended a relief package of about ¥300 million cash and ¥470 million of relief supplies, including several diagnostic ultrasound systems and masks for dust and virus protection for those affected by the earthquake.

As power outages and a looming nuclear meltdown add to Japan’s woes, Fujifilm also decided to help ease the gravity of the situation by cutting down its power consumption by switching off all its outdoor advertising and refraining from non-urgent consumption of electricity.

Also downgrading its operations to save energy in the light of the disaster is Sony, which tried to alleviate stress on the nation’s power grid by completely suspending operations at its four facilities in Miyagi, which make chips for contact-less smart cards, magnetic discs and Blu-ray discs and other devices. Sony also shut down its two facilities in Fukushima that produce lithium-ion rechargeable batteries.

A statement on Sony’s website explained that it is voluntarily suspending operations at several sites due to widespread power outages. The company said there were no significant injuries to employees working at those sites when the earthquake or tsunami struck and that they were still evaluating the full impact of the disaster and related power outages on its businesses and consolidated financial results. Among the tech companies affected by the twin natural disaster, Sony appears to be the worst hit.

Meanwhile, Google was quick to deploy its interactive Person Finder database technology about an hour after the earthquake struck. It is designed to be a central database to help individuals search for missing persons online, or submit information on people who are injured or are missing.

The Person Finder, launched after the Haiti earthquake and also used during the recent Christchurch earthquake in New Zealand, already tracks some 8,000 records available in both Japanese and English. The Person Finder for the Japan earthquake and tsunami is at http://www.google.co.jp/intl/en/crisisresponse/japanquake2011.html.

IT meltdown

Amid the temporary shutdown of major high-tech Japanese companies, the global IT industry is concerned about supply shortages and escalating prices for electronics.

Aside from Sony, which has stopped production at six factories, including its Sendai Technology Center in Tagajo, Miyagi prefecture that sustained earthquake and tsunami damage, other high-profile IT companies such as Canon, Sanyo, Nikon, and Fujitsu were also forced to suspend operations at their damaged facilities.

At its corporate website, Canon reported that the earthquake severely damaged three Canon Inc. sites and five Canon Group companies in northern Honshu, the area hardest hit by the earthquake. Damage was also significant at Canon Inc.’s Utsunomiya office where 15 people were injured and at Fukushima Canon Inc.

Canon continues to ascertain the damage to its facilities and believes it will take time before operations can resume at its affected sites. Its other offices, plants and companies in the western half of Honshu, however, were able to resume operations on March 14. If production must be suspended for one month or more, Canon said it will consider using alternate sites that were not damaged by the earthquake to continue production.

Texas Instruments, the second-largest US chipmaker and the biggest maker of analog chips, reported substantial damage to one of its plants in Miho, 40 miles northwest of Tokyo. The Dallas-based company issued a statement that it is working to shift production to its other facilities. The Miho plant accounts for 10 percent of Texas Instrument’s output by revenue. The company estimates it would take them until September to reopen the plant, so it would definitely hurt their sales in the first two quarters and may result in higher prices of chips in the near term.

Nikon also reported damage to its equipment and buildings at its four group companies, subsidiaries and plants. It already halted operations to get a complete picture of the damage.

Panasonic’s three factories in Miyagi and Fukushima prefectures reportedly sustained some damage as well as three other plants in Sendai that produce components for digital cameras, optical pickups for Blu-ray and DVD discs and other components.

Epson also had its share of damage to its Sakata plant and also to its group of companies in the Tohoku area, but fortunately reported no injuries to its employees. Epson’s Atmix Corp. plant in Hachinohe temporarily suspended operations after being hit by the tsunami, while Akita Epson Corp. operations in Yuzawa also temporarily shut down due to power outages caused by the earthquake.

Epson’s Toyocom Corp. Fukushima plant also suspended operations due to structural damage caused by the earthquake and because the plant is only 16 kilometers from the Tokyo Electric Power Co.’s Fukushima No. 1 nuclear power station, and therefore within the evacuation area. Epson still doesn’t know when operations at the facility will be resumed, according to statement posted on its website.

Toshiba, which produces at least one-third of the world’s NAND memory chips used in devices like the Apple iPad, also reported an outage at its Yokkaichi plant that could create a 20 percent production setback for two months. The company also warned of possible delivery interruptions due to factory damage. A contingency measure to restart a chip factory in Iwate, northern Japan, is apparently underway.

Fujitsu, which is also a big chip manufacturer, reportedly had to close down its factories near the earthquake-affected prefecture.

Japan accounts for about 40 percent of the world’s NAND flash memory chips and about 15 percent of the world’s DRAM chips. Any disruptions in productions at Toshiba, Fujitsu and possibly other chipmakers are a cause for concern in terms of pricing and supply. Japan also produces a significant share of components for LCD and LED panels so two-month delays in production could also upset the market.

Production costs of mobile phones and other mobile devices are likewise expected to shoot up as companies such as Nokia and Sony Ericsson also weren’t spared by the quake and tsunami. These companies are also still studying the effects of the double disaster on their operations in Japan.

Further aggravating the dire situation in Japan are the disruptions in communications and transport systems, both of which directly affect the electronics industry’s operations. There have been reported breaks in two segments of Pacnet’s EAC cable that links Japan and the West Coast of the United States. The Pacific Crossing system also went down, reports said. Also, mobile phones services in the Sendai area have been largely out after the tsunami.

On hold

Japan’s monstrous earthquake and tsunami left a trail of destruction and stopped everything in its tracks, including the seemingly unstoppable giant marketing force that is Apple.

The Cupertino, California company had scheduled the release of its iPad 2 in Japan on March 25, but had to postpone it indefinitely due to the disaster. Japan represents a huge market for Apple, accounting for about five percent or $1.4 billion of the company’s revenues last year.

Also putting on hold another product launch following the devastating tragedy in Japan is Sony Computer Entertainment in Europe. The company scratched off the original March 18 release of PlayStation 3 racing game Motorstorm Apocalypse in the United Kingdom and other markets. The game is already distributed in some markets but out of respect for Japan, the company decided to best cease further distribution considering that the game’s underlying theme is about off-road drivers racing in a supposedly earthquake-ravaged San Francisco-like city.

Epson also canceled its Color Imaging Exhibition in Japan this year.

Tech wonders

In the midst of the recent grim events, technology still managed to shine. Immediately after nature went on a rampage in Japan, popular online networking services were inundated with personal accounts and video images of the disaster that helped tell the world what happened.

Vivid satellite photos from Google Earth and especially those snapped by NASA’s Terra and Aqua satellites that watched the planet from above showed the extent of destruction caused by the devastating floods and fires. The stark images of Japan’s northern region were taken a day after the natural disaster as part of NASA’s MODIS Rapid Response system, which uses satellites to provide near real-time images of earth’s landmasses every day.

Unfortunately, the ugly side of technology in the form of online scams also capitalized on Japan’s misery. Hours after the catastrophe, Symantec, an Internet security company, reported a sudden birth of multiple domains that pertain to the Japanese earthquake and tsunami. Such could be a sign that online scam artists are already at work to spread bogus “urgent” e-mails soliciting donations for tsunami victims, viral websites and fake Facebook videos of the tragedy. Authorities warn against responding to unsolicited e-mails that direct unsuspecting people to fake charitable websites.

Meanwhile, any geek who’s been to Tokyo is probably wondering, if not worrying, about Akihabara, the electronics shopping mecca in Japan. The good news is, it is safe, spared and intact.

A blog called AkibaBlog posted pictures of Akihabara after the earthquake that showed a gloomy row of electronic shops, with some closed, but not totally deserted. People who were stranded when the train service stopped have decided to stroll and shop around Akihabara or to kill time playing games on their devices.

Yes, play, which may not be the most appropriate thing to do after a natural calamity, but many gamers around the world as well as game publishers are also helping out Japan in their own way.

Gamer Megan Marie, who is an associate editor for Game Informer magazine, is auctioning her rare collectible Nintendo DS on eBay to raise money for Red Cross Japan. The console is the original DS model in red with autographs by Shigeru Miyamoto, Koji Kondo (composer), Charles Martinet (Mario voice actor), Eiji Aonuma (director of numerous Zelda titles) and Martin Leung (performer who tours with Video Games Live). As of press time, the DS console was already going for $1,800. The auction will end today, March 21.