Anritsu Corporation Business Information, Profile, and History

Company Perspectives:

Company Philosophy: Anritsu, with sincerity, harmony, and enthusiasm, will contribute to creating an affluent ubiquitous network society by providing "Original & High Level" products and services. Company Vision: To be a shining light by contributing to the development of the global network society. To be a global market leader by transforming our strategy to be market driven and customer focused. Company Commitment: High return for shareholders; win-win relationships with customers; employees who are proud of Anritsu; contribution to society as a good citizen.

History of Anritsu Corporation

Anritsu Corporation is a leading global producer of test and measurement devices, equipment, and systems. The Kanagawa, Japan-based company primarily targets the market for wired and wireless telecommunications systems, developing measuring instruments and systems for mobile telephone networks, IP networks, and other ultra-high frequency and infrared-based, general purpose testing applications. The company's Test and Measurement division, which accounted for nearly 61 percent of Anritsu's sales of ¥78.40 billion ($742 million) in 2004, supports the full range of digital, cable, optical, RF/microwave and related transmission systems. Anritsu's Information and Communications division delivers video distribution and monitoring and related systems, primarily for the Japanese government and municipal customers. That division accounted for nearly 16 percent of Anritsu's 2004 sales. The Industrial Automation division, at more than 14 percent of sales, produces automatic weighing systems for industrial applications, while the company's Other Businesses division, accounting for eight percent of annual revenues, produces devices and precision measuring equipment, as well as overseeing the company's logistics, property, employee welfare and related needs. With roots tracing back to 1895 and the founding of Japan's communications industry, Anritsu is listed on the Tokyo Stock Exchange and operates manufacturing and marketing subsidiaries in the United States, England and the rest of Europe, South America, China, and throughout Southeast Asia.

Wireless Pioneer in the 20th Century

The development of the first telephone networks in Japan at the end of the 19th century introduced demand for the production of wire-line and wireless networking equipment and components, as well for the telephones themselves. One of the earliest of the new companies established to meet this demand was Sekisan-sha, founded in 1895. That company represented the earliest component of the later Anritsu.

In 1908, Sekisan-sha merged with another entrant into the country's telecommunications market, Abe Electric Wire Company, and the resulting company was renamed Kyoritsu. By then, Japan's telephone system had begun to develop rapidly, and, with growing penetration in both the public and private sectors, demand for telephones surged. Kyroritsu responded by stepping up its production of telephones, producing both desktop and wall based telephones. By 1925, the company had begun to manufacture public pay phones as well.

Wireless communications technologies had begun to develop concurrently with the deployment of Japan's wire-line telephone grid. One of the pioneers of wireless technologies in Japan was Annaka Electric Company, founded in 1900. In 1903, that company succeeded in developing its first wireless transmitter, which was used for setting off a fireworks display at the Japan Industry Promotion Exposition that year.

Annaka continued building on its wireless transmission technologies, resulting in the introduction of its TYK wireless telephone in 1913. By 1916, Annaka was capable of deploying a full-scale TYK-based telegraph system. Linking Toshijima, Toba, and Kamijima, the TYK system became the world's first wireless telephone network.

Radio became Annaka's major market in the 1920s with the launch of Japan's first radio broadcasts. The company began producing components for the new service, including receivers, headphones, and speakers. Annaka also continued expanding its transmission expertise, and in 1925 the company became the first in Japan to build a 500-watt radio transmitter. This was delivered to Tokyo Central Radio Station. Annaka also began developing its wireless transmission technology for other markets and in 1928 released a 2kW wireless transmitter for ocean-going vessels.

Annaka and Kyoritsu merged in 1931, creating Anritsu Electric Corporation. The enlarged company then turned its attention to developing transmission systems for emerging television technology. By 1922, Anritsu succeeded in building its first television broadcast transmitter. Meanwhile, the company also expanded its telephone systems expertise, launching the first automatic public telephone in 1939.

Testing and Measuring in the 1950s

Communications and related transmission systems remained central to Anritsu's development. The need to ensure transmission over greater distances led Anritsu to develop a coaxial-cable based repeater system in 1943. At the same time, measuring transmission strength, particularly for wireless transmission, became an essential factor in the deployment and development of these networks. This led Anritsu to begin building its expertise in the testing and measuring segment. One of the company's first products in this area, later to become the company's core development focus, was its ARM-6074 field strength meter launched in 1950.

While Anritsu continued developing telephone systems, including a new public telephone system equipped with a credit-based billing system launched in 1953, the company expanded its testing and measuring operations. This effort gained speed with the construction of a new production facility in Atsugi in 1961. The following year, Anritsu entered the industrial automation sector with the release of its first electronic micrometer. The company also began producing automatic weighing systems starting in 1964. In another extension of its technology, Anritsu began manufacturing traffic control systems based on its own hybrid IC technology.

Anritsu went public in 1968, listing on the Tokyo Stock Exchange. The listing enabled the company to expand beyond Japan for the first time, and in 1970 it began exporting its public telephones to Australia.

Testing and Measuring also remained a vital company focus. In the late 1970s, Anritsu had taken a lead in developing optical technologies, while continuing to develop its wireless transmission capacity. In 1977, the company launched an ultra-high-speed error detector, capable of transmitting at speeds up to two gigabytes per second. In that year, also, Anritsu launched the first of its measuring systems for optical instruments. Two years later, an order from the AT&T for measuring systems for microwave circuits brought Anritsu to the United States and put it on the map in the world test and measurement market. The following year, Anritsu entered Europe as well, setting up its first subsidiary there, in Luton, England.

In order to reflect its growth as an international company, Anritsu changed its name to Anritsu Corp. in 1985. Meanwhile, Anritsu remained a leading innovator in its field. In 1986, for example, the company debuted a pulse pattern generator for fiber optics-based communications networks.

Solutions Provider in the 2000s

By the 1990s, Anritsu appeared to have come full circle as wireless telecommunications technologies emerged to become the driving force behind the telecommunications industry as a whole. Anritsu positioned itself early on to capture a central position in both its domestic market and in the United States. This was particularly true following its acquisition of the Wiltron Company in the United States for $180 million in 1990. Wiltron had started out in the 1960s as an electronics outfit operating primarily in the defense sector. With the reduction of defense spending following the collapse of communism in the late 1980s, Wiltron had begun repositioning itself around a core of commercial wireless and wireless test systems. The addition of Wiltron, which was especially strong in the midrange-frequency sector, proved highly complementary to Anritsu's own product range.

Through the 1990s, Anritsu targeted the mobile communications market, particularly the test and measuring sector supporting the roll-out of cellular telephone and related technologies. In 1993, for example, Anritsu supported the emergence of digital mobile communications networks with a launch of a range of new generation measurement systems. The following year, the company launched a new ultra-high-speed error detector capable of operating in the 12.5GHz range.

In the late 1990s, Anritsu stepped up its drive toward building a truly global business. In Europe, the company opened a new European Measurement division in the United Kingdom in order to develop and manufacture test and measurement systems specifically for the European market. That operation launched production in 1997. The same year, Anritsu's U.S. subsidiaries were integrated into the larger structure of Anritsu Corp. The company also entered such key markets as China, Korea, India, Singapore, Taiwan, and Brazil. By the end of the decade, Anritsu was present in more than 50 countries worldwide, with sales topping $1 billion.

Back in Japan, Anritsu invested in its future growth, with special attention to extending its operations to include the pro- duction of components in addition to its full systems production. As part of this effort, Anritsu spent $30 million building a new laser diode facility in Panasawa. Anritsu also converted a facility that formerly produced electro-mechanical components into one specialized in producing components for optical, RF, and microwave transmission systems.

By 2002, components already accounted for more than 11 percent of Anritsu's annual sales, a percentage held low only because of the group's strong growth in its measurements business. In the early years of the 2000s, Anritsu's sales peaked at $1.3 billion. The ensuing worldwide collapse of the telecommunications market hit Anritsu hard, and sales dropped off accordingly, back to just ¥78 billion ($742 million) in 2004. Nonetheless, Anritsu's strong commitment to research and development had kept the company at the forefront of the industry. As the telecommunications market began to bounce back, with the advent of third-generation mobile telephone technology, Anritsu's product development promised to keep it as a leading figure on the global scene.

Principal Subsidiaries: Anritsu Aktiebolag (Sweden); Anritsu Company (USA); Anritsu Company Incorporated (Taiwan); Anritsu Company Ltd. (China); Anritsu Corporation, Ltd. (Korea); Anritsu Customer Services Co., Ltd.; Anritsu Devices Co., Ltd.; Anritsu Electronics (Shanghai) Co., Ltd. (China); Anritsu Electronics, Ltd. (Canada); Anritsu Eletrônica Ltda. (Brazil); Anritsu Engineering Co., Ltd.; Anritsu GmbH (Germany); Anritsu Industrial Solutions (Shanghai) Co., Ltd. (China); Anritsu Industrial Solutions Co., Ltd.; Anritsu Kousan Kabushiki Kaisha; Anritsu Ltd. (United Kingdom); Anritsu Private Ltd. (Singapore); Anritsu Pro Associe Co., Ltd.; Anritsu Proprietary Ltd. (Australia); Anritsu Real Estate Co.; Anritsu S.A. (France); Anritsu S.p.A. (Italy); Anritsu Techmac Co., Ltd.; Anritsu Technics Co., Ltd.; Anritsu U.S. Holding Inc.; ASIA & PACIFIC Business Description Paid-in Capital Voting Rights; Tohoku Anritsu Co., Ltd.

Principal Divisions: Test and Measurement; Information and Communications; Industrial Automation; Other Businesses.

Principal Competitors: American Meter Company; Fuji Electric Holdings Company Ltd.; ThyssenKrupp Technologies AG; Hewlett-Packard GmbH; Omron Corporation; Nikon Corporation; Andover Controls Corporation; Citizen Watch Company Ltd.; Yokogawa Electric Corporation; Ingram Micro Holding GmbH; Rheinmetall DeTec AG; Ibiden Company Ltd.; Futuris Corporation Ltd.

Chronology

• Key Dates:
• 1895: Sekisan-sha is founded.
• 1900: Annaka Electric Company is founded and develops the world's first wireless telephone transmitter.
• 1908: Sekisan merges with Abe Electric Wire Co, forming Kyoritsu, and begins producing of telephones.
• 1931: Annaka and Kyoritsu merge to form Anritsu.
• 1950: Anritsu debuts a field strength meter as part of its entry into the testing and measurement sector.
• 1961: The company opens a new factory in Atsugi and begins producing electronic micrometers.
• 1967: The company goes public on the Tokyo Stock Exchange.
• 1970: Anritsu begins exporting telephones to Australia as a first step to entering the international market.
• 1979: The company wins a large-scale order to produce measuring instruments for AT&T in the United States.
• 1980: Anritsu establishes a subsidiary in England in order to enter the European market.
• 1985: The company changes its name to Anritsu Corp.
• 1990: U.S. company Wiltron is acquired.
• 1993: Anritsu launches measuring instruments for the mobile communications market.
• 1997: The company opens a production facility in England to manufacture to European market specifications; enters China, India, Brazil and other countries; and begins manufacturing components and constructs a new $30 million laser diode at its production facility in Japan.