Is Japanese technology past its prime?

Japanese electronics makers are hemorrhaging red ink. Overseas competition (Samsung and LG) is intensifying, the domestic labor pool is shrinking and consumption is limp. Are Japan's glory days as a technological powerhouse over?

That's the question posed by this insightful article by David McNeill in The Independent quoting yours truly. Yes, it's amazing to see how much Sony, whose first product was a rice cooker that didn't work, is struggling amid these tough times.

The article highlights the fact that Japan is essentially a hardware-oriented culture. It's no surprise that the Internet was not created in Japan, and that the most recent popular electronics that make use of it are not Japanese. Are Japanese manufacturers destined to fade away due to the old cliche that Japanese lack "groundbreaking creativity"?

I don't think so. Japan is a very creative, imaginative society, as anyone who's studied it to any extent can attest. There are many factors that limit the spread of successful, innovative Japanese products, some social or structural and others economic. Besides, the products that are gaining market share may not have a Japanese brand on the outside, but often have Japanese technology on the inside, as McNeill notes:

Toshiba, for example, manufacturers the mini hard drive that powers the iPod, Japanese companies monopolize the production of semiconductor-grade silicon, and make much of the optical fiber and laser diodes that form the backbone of the internet; Nikon and Canon supply many of the optical machines that print lines on computer chips, and so on.

I think the death of Japanese manufacturing has been greatly exaggerated.