"Social Device" Special Interview

The contents were published from July 2016 to February 2017 on"Nikkei Technology Online", the engineering information website run by Nikkei Business Publications, Inc., and reprinted with the author's permission.

※Information of affiliations and titles is true and accurate at the time of publication.

Consumer Electronics Development Evolves:
New Approaches for New Directions

Consumer electronics have appeared in rapid succession ever since the widespread usage of electricity, bringing about a variety of changes in our lives and society itself. In recent years, however, the development environment is also evolving. Kiyotaka Umemoto, Division Manager, Consumer & Smart Device, Corporate Market Strategy Div. of Rohm Co., Ltd., with extensiveexperience in semiconductor devices for consumer electronics, discussed the current situation and future outlook with Yuko Nakazawa, president and CEO of UPC Inc., a start-up with a growing range of innovative new household appliances.

Umemoto

 Rohm is a semiconductor device manufacturer, and I am involved especially in product and market development for consumer electronics, such as AV equipment, household appliances, and lighting. Specifically, I work with semiconductor devices including power supply integrated circuits (IC), interface ICs, and sensors.

 The company began as a resistor manufacturer in 1958, and first started working with semiconductor devices in the 1980s. Today we offer a variety of products for a wide range of industries including industrial equipment and automobiles. We have been involved in the consumer electronics market from the beginning, however, and it has been a major pillar of corporate revenue.

 There are many companies in this industry, mostly major corporations, but UPQ is unique. I think what really caught everyone's attention was when you made your very first product announcement with 24 products in 17 types.

Nakazawa

 The fact that we developed 24 products from the start was newsworthy, but when I was involved with mobile telephones at a different manufacturer, we worked on development projects for multiple handsets, simultaneously. UPQ worked at the same pace, and we ended up with 24 products. We didn't plan on developing that many from the start, though. In February 2016 we announced our second series of products, boosting our total offering to almost 60 products.

Creating New Value the Key Issue

Umemoto

 Your product line-up consists entirely of consumer items. Have you specialized in consumer electronics?

Nakazawa

 Well, if you go to a household appliance mass merchandiser you'll see a variety of products trumpeting their functions or performance in an effort to attract your attention. We thought it should be possible to make a product stand out from the crowd with entirely different criteria. That's something we're always thinking about.

 None of the products we've released so far have been especially revolutionary; we've merely added some innovation to existing designs to make them unique. We try to design products that users will want to show off to their friends, and their friends want to know more about it, and they end up explaining it in detail... that's the sort of product we try to create.

Umemoto

 A unique product planning style. But for AV equipment and household appliances, won't product planning get harder as market penetration rises?

 Japanese consumer electronics manufacturers making televisions, mobile phones, audio equipment, personal computers and the like continually evolve their products, offering their customers new experiences and lifestyles. We contribute to their efforts by supplying the requisite components, and we've grown together with the consumer electronics market. We provide the products demanded by consumer electronics manufacturers, such as large-scale integration (LSI) chips for circuit optimization, power supply ICs to minimize energy consumption, discretes for smaller and thinner formats, and a variety of sensors to add value. But even though we've been supporting the consumer electronics market for decades as a supplier, we can't win consumer support merely with conventional functions and performance.

 Many manufacturers in the consumer electronics industry are working on innovative product plans in an effort to provide consumers with a completely new dimension in added value.

Nakazawa

 Yes, it has become much more difficult for manufacturers to secure a reasonable share of the market, competing with many other companies for a slice of the pie. In combination with an agile, small-scale start-up like us, with small production lots, it is now possible to release product to the market very rapidly, and boost profitability. Some of the major corporations in the field are beginning to adopt this approach, too.

Umemoto

 I think the reason the majors are so interested in the unique technologies and innovations of start-ups like yourself is that it has become harder to create added value using only conventional approaches, and extensions of existing technology. We are also shifting from the traditional business model, namely developing and providing products in response to customer requests, to developing products in advance of market needs and proposing new solutions to equipment manufacturers. And part of that initiative is developing new collaborative efforts with overseas manufacturers and start-ups engaged in aggressive product development.

 UPQ is a late-comer to the household appliance market, and most of your competitors are large-scale corporations with significant development resources. How did you innovate product planning to support your entry into such a competitive field?

The Key Point: Being Unexpectedly Good

Nakazawa
Fig. 1 UPQ Phone A01 Smartphone, Sold Jailbroken
Fig. 1 UPQ Phone A01 Smartphone, Sold Jailbroken

 For example, the smartphone in our first product release was designed to be stylish but inexpensive (Fig. 1). When we started product planning the market already existed for jailbroken phones, and it was possible to buy very inexpensive SIMs on the open market. We expected that cheap SIMs would result in phones being snapped up by middle school students and other relatively young users buying their first smartphones, but we couldn't find anything like that on the market.

 We decided to make a low-end smartphone that the young age groups could easily purchase, and was stylish enough to make them want to pick it up in the store. The key factor was price in this case, and we figured that even an unknown brand should be able to compete. And if we could get users to recognize that it was unexpectedly good in spite of the low price, we knew we could successfully challenge the established smartphone manufacturers in the market. That's a key point for us: being unexpectedly good. If we can get the customer to think that way about a product they had low expectations of, we've got them hooked.

 We set our retail price for the smartphone low, at only 15,000 yen. To make the price possible we had to cut some functions and specs, but we gave it a very stylish design.

Umemoto

 You certainly can draw customer interest with the unexpected, I agree. That's a pretty effective method to get your product noticed. And you are developing a variety of products in addition to smartphones, such as displays, headphones, smart light bulbs, suitcases and bags with recharging functions, touch keyboards, and more.

Nakazawa

 Many of these products were planned based on constituent technologies from the smartphone: elements like flat-panel displays, audio, LEDs, communications, and rechargeable batteries. Originally I wanted to be part of mobile phone product planning, and after I graduated university went to work at a handset manufacturer as a project leader for product planning. I spent a lot of time with development engineers, and picked up a lot of knowledge about the various technologies used in smartphones. Now I'm putting that knowledge and expertise to work.

Proposing New Technologies for End-Use Products

Umemoto

 I think a lot of new product plans must stem from constituent technologies. As a component manufacturer, we try to introduce new technologies to equipment manufacturers developing innovative new ideas.

 Right now we are telling them about the new USB Power Delivery (USB PD) standard for interface USB (Fig. 2), to connect information equipment and peripherals. USB PD can supply up to 100 W through a single USB port. That means we can provide the power needed for even power-hungry devices like notebook PCs and televisions through a USB connector, and once the USB PD interface is in use across the board it will be possible to make a general-purpose AC adapter that can be used with everything. On business trips or vacations, you won't have to lug around a jumble of AC adapters for all your gear. The increase in supply wattage will also slash charging times for smartphones, tablets and similar equipment to a quarter or less. ROHM is shipping the BM92TxxMWV series of power delivery controller ICs equipped with USB PD interface circuits.

Fig. 2 USB Power Delivery (PD) Technology Transforms Power Supply Thinking
Fig. 2 USB Power Delivery (PD) Technology Transforms Power Supply Thinking
Nakazawa

 I think it's pretty difficult for people to understand chip features and functions unless they're engineers.

Umemoto

 We're improving our marketing, too, so that new products and technologies can be utilized by as many customers as possible. Instead of just presenting the functions and specs of individual components as we did in the past, we provide concrete solutions to problems the customer is facing, along with information on how to use the components, and required peripheral circuits.

 For example, our Sensor Medal module is an evaluation kit we offer to designers. A circular printed wiring board (PWB) measuring 33 mm in diameter is mounted with sensors for air pressure, geomagnetism, and acceleration, along with a power microcontroller, and Bluetooth transceiver module. For the demo we mount the PWB in a medal-shaped case. The Sensor Medal can be connected to tablet PCs or smartphones via the onboard communication module (Fig. 3). All the customer has to do is install a program into a tablet PC, and they can easily develop applications using data from multiple sensors. In addition to letting them evaluate sensor function, this approach also helps them develop a prototype system very efficiently.

Fig. 3 Development of an Application System Based on the Sensor Medal
Fig. 3 Development of an Application System Based on the Sensor Medal
Nakazawa

 It looks like a big wristwatch. Why did you decide to make it look like a medal?

Umemoto

 That was quite intentional; we selected it because we are interested in developments in wearable devices.

Fig. 4	Explaining the Sensor Medal to President Nakazawa
Fig. 4 Explaining the Sensor Medal to President Nakazawa

 In the same vein, we also offer a development support tool for wireless power supply systems. It consists of the BD57020MWV-EVK-001 reference board for the transmitter, and the BD57015GWL-EVK-001 for the receiver, and both are certified under the WPC Qi medium-power standard. Both boards mount wireless power control ICs developed by ROHM. With both board, the user can easily make a wireless power supply system compliant with the WPC Qi medium-power standard (Fig. 4).

 Wireless power supply can handle supply and charging needs without a power cord, which vastly improves usage ease for a variety of equipment. It is a practical technology, but it couldn't even pump 5 W. The new medium-power standard, however, can handle up to about 15 W, which is a huge increase in the range of potential applications. The merits of the new technology will no doubt nurture a host of new product ideas.

Innovative Product Ideas from Established Firms, Too

Nakazawa

 In the major consumer electronics markets today, replacement and second-unit purchases account for a considerable portion of revenue. And since quality is improving and equipment breakdowns becoming less frequent, most consumers are never in a situation where they are forced to purchase a replacement unit. I wonder if this situation doesn't mean that purchasing consumer electronics these days is actually more like buying something because you like it, rather than the specs, for example. If you look at your products as something to be liked or disliked by the customer, then you need innovations and ideas to make the customer view them favorably.

 If the major manufacturers wanted to, I'm sure they could turn their designers loose and make the same sort of innovative products that the start-ups are producing. They have ample in-house technical resources, and their revenue is already assured so they can pursue new business ideas without much worry. A new technology start-up can't enjoy those advantages.

Umemoto

 I suspect you're right. What you say applies to us as well, but I think it will take some time before people in the company can get used to the new approach, and make it work.

Nakazawa

 There must be many people at the big electronics companies who feel the same way as we tech start-ups do. I've been explaining the UPQ approach to many people recently, and many of the people who come to listen are employees of major manufacturers in their 40s or 50s. When I talk to them, I've found that many of them want to do exactly the same sort of things. One common theme I hear is that they want to develop some product they feel strongly about. If those people got together whether in a big company or a start-up, I'm sure they could dream up some very original products.

Umemoto

 I agree that there seem to be fewer engineers who are experts in a particular field, and who also want to create innovative products based on that technology. When I talk to engineers inside and outside the company, though, I always run into people like that. Instead of just inventing technologies, I want to show engineers how to utilize them effectively, and spark other new innovations.

 ROHM engineers, of course, also apply their knowledgeand expertise to developing new products, and I feel a responsibility toidentify the engineers who really care about what they're making, and help them develop personally, while developing our business. The synergistic effect of our motivation, the efforts of the equipment designers, and consumer support, can make an impressive contribution to the development of the consumer electronics market.

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