Fujitsu Annual Report 1997 - Operational Review

Information Processing

Server Systems

Servers hold the key to the expanding role of network computing. Demand for enterprise servers grew, with orders coming in from the manufacturing, finance, distribution and public sectors. Dramatic improvements in the price/performance ratio, made possible by advances in CMOS chip technology and the use of parallel processing technologies, were instrumental in fueling the demand. CMOS-based servers have the leading share in the world market, with Fujitsu holding the number two position. The company continued to strengthen its network offerings and increase sales, and is now focusing on the development of next-generation servers.

Reebok

In midrange and low-end servers, Fujitsu completely renewed its server product lineup, releasing a new series that serves both the UNIX and Windows NT operating systems environments. The variety and flexibility of our lineup gives customers one-stop shopping solutions.

Personal Computers

The Japanese personal computer market repeated its phenomenal growth of the previous fiscal year with sales of 7.5 million units, a 30% increase in fiscal 1996. Fujitsu vigorously worked to expand sales by releasing notebook personal computers developed in pursuit of small size and light weight. Sales of personal computers thus grew for companies and individuals alike, reaching two million units shipped. Overseas, Fujitsu released its notebook personal computers in the U.S. in July 1996. To market and service Fujitsu's personal computers, a new company was established in the U.K. for the European market. In October 1996, our new lineup of notebook personal computers received a warm welcome when it was released simultaneously in the U.S. and Europe under the same brand name. The company's efforts in fiscal 1996 were rewarded with shipments of more than 2.8 million personal computers worldwide. That put the company in the number 8 position worldwide. To climb to the number 3 slot by the year 2000, Fujitsu will continue to strengthen its development, manufacturing and sales infrastructures around the globe.

Hard Disk Drives

The increased demand for personal computers brought with it the need for large numbers of hard disk drives. To meet the demand, the company has increased production at its Thailand Plant and has started operating new plants in the Philippines and Vietnam. The three plants produce one million units per month, which are distributed worldwide and put us at number 7 in the world. We plan to be number 3 by the year 2000.

Services and Software

The services and software business, which has grown steadily every year, now has 37% of sales in the information processing group. In services, Fujitsu focused on systems integration, out-sourcing and maintenance services, working to strengthen its position in these areas. Systems integration holds the most important position in the solutions business, as it is the key to building successful large-scale networks. For example, Fujitsu implemented the world's largest client-server system, which integrates about a hundred servers, 10,000 personal computers and the associated software.

Tetra

Fujitsu's out-sourcing service, which handles customers' computer system jobs by proxy, expanded smoothly. To keep pace with the rapid expansion of this business, Fujitsu started construction of a second systems center following last year's establishment of Japan's largest systems center. In maintenance services, the company established an integrated support center to assist the operation of client-server systems, providing one-stop solution services around the clock, 365 days a year.
In network services, the company is now studying a service that allows easy access to the Internet from home-based television sets in cooperation with WebTV Networks Inc., an American developer of Internet TV technology. The Internet version of Fujitsu's animated chat service entered operation, visually enhancing the ability to chat with others in virtual space by personal computer.
In software, Fujitsu worked to expand worldwide sales of its groupware for Internet/intranet environments. The popularity of TeamWARE, which is groupware designed to improve office productivity by streamlining workflow, continued to grow in fiscal 1996. TeamWARE has been delivered to one million clients in 40 countries. Fujitsu has also developed and released a group of software products to increase the safety of electronic commerce over the Internet. The company is also developing and marketing powerful applications packages, based on know-how gained in building systems and serving customers.

Other Milestones

The demand for products was active in Asian markets and sales growth was significant. To strengthen its information systems business, Fujitsu established a new company in Singapore that oversees operations of the other Fujitsu companies in Asia. This new company integrates activities in Asia into a single channel, enhancing the opportunity for increased business in the region.

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