Rebirth Tokyo 1986

Chapter 360 Monopoly is the beginning of the loss of innovation

Time always flies, and before we knew it, the day of the groundbreaking ceremony for Xinghai Hospital's land had arrived.

After a few polite words of blessing, Takeshita Masato simply shoveled a couple of strokes into the ground.

Then came another round of pleasantries, with everyone going on stage to say a few words of praise.

The whole morning was wasted in boredom.

"Let's call it a day. Let's have lunch together and then head home."

"Yes, I understand."

Hiroaki Kobayashi didn't say anything, but immediately had his secretary inform everyone.

On such a happy day, we really shouldn't be too busy.

"Uchida-san, I'll leave this to you."

"Yes, please rest assured, Chairman."

"Yes, we need to pay close attention to what the outsourcing side is doing."

Xinghai Construction doesn't have a large workforce and can't complete the entire project within the stipulated time, so it needs to rely on outsourcing.

"Understood, but we're looking for clean-lined buildings."

"Hmm, not a bad choice."

Shimizu Construction is a long-established construction company with an excellent reputation. Xinghai Construction's decision to collaborate with them is indeed a very sound one.

The young man then looked at Hiroaki Kobayashi and said, "Next, you should visit more leading figures in the medical field, as well as those promising young doctors, to prepare for poaching them in the future."

"Don't worry, President, I'll take care of it."

Hiroaki Kobayashi already had a plan in mind.

The simplest way is to lure people with benefits; a more sophisticated way is to ask a big shot to help improve the hospital's equipment under the guise of seeking advice.

This way, when the hospital is built, its style will be exactly what the bigwigs like, naturally increasing the chances of successfully poaching them.

In addition, the fact that all the equipment is high-end makes it easier to attract renowned doctors from ordinary hospitals.

"Yes, and also, we should cooperate more with public schools; we won't be competitors."

It would be very difficult for Xinghai Hospital to collaborate with Keio University School of Medicine, while it would be much easier to collaborate with the more prestigious University of Tokyo School of Medicine and Tokyo Medical and Dental University.

As long as the money is sufficient, both major public medical schools are willing to support Xinghai Hospital.

For public schools, it doesn't really matter who they cooperate with, as it generally doesn't affect their status.

It could even be said that the two public medical schools are quite willing to cooperate with Xinghai Hospital.

This will greatly enhance the strength of their own medical department and provide more new career options for the doctors they train.

"Yes, but it may require a large donation."

"Sure, don't worry about spending money."

The donations will be at most a few hundred billion yen, there's no need to be so stingy.

"Yes, President."

After finishing his business at Xinghai Hospital, Masato Takeshita returned to Xinghai Capital.

“Mr. Jiaben, I plan to use Galaxy Capital to invest in semiconductor materials-related companies.”

Masato Takeshita really wanted to invest his own money in the acquisition, but considering that the first wave of the internet boom was coming soon, he suppressed his desire.

Although the money in Galaxy Capital does not belong to Masato Takeshita, control of it belongs to Xinghai Group.

Rounding up, this is essentially equivalent to him controlling the semiconductor materials and equipment industry.

"I think it's a good thing; we do need to strengthen our domestic influence."

Jiaben Longzheng firmly believes in the internet age described by his chairman and is also thinking of placing the more profitable fund business overseas.

As for domestic industries, it would indeed be more suitable to entrust them to Galaxy Capital, which only earns transaction fees.

What will happen to Galaxy Capital's losses?
That is impossible.

Galaxy Capital adjusts its stock portfolio every September. If losses occur, investors can immediately buy cheap, popular stocks through Xinghai Fund.

If we make a profit, we'll adjust our strategy and buy back the shares that Xinghai Fund misjudged.

In short, Galaxy Capital's annual returns have remained basically between 7% and 12%.

This is already a very high profit margin for a public fund.

Therefore, Galaxy Capital is extremely popular and already has more than $500 billion in funding.

This achievement pales in comparison to BlackRock, which in turn is worth trillions of dollars.

But in an era before investment groups rose to prominence, when investment banks were considered the most prestigious financial institutions, it was already at the world's top level.

“Okay, let’s do it that way. Starting tomorrow, you will use Galaxy Capital’s funds to acquire shares in companies such as Shin-Etsu Chemical and Tokyo Ohka Kogyo.”

"This is a list of companies I'm interested in. Keep it safe and write it down."

Masato Takeshita was prepared and handed Kamoto Takamasa a list of companies in the semiconductor materials field, which contained about 100 companies.

"so much?"

"It's alright, many materials companies are not very large."

Despite decades of development, the chip industry is still in its early stages.

If this is the case for end products, then semiconductor material companies are naturally not very valuable either.

The most typical example is the lithography machine field. Nikon held a position equivalent to that of ASML in its later years, yet its market value was only a few billion US dollars. Moreover, Nikon is a company that includes cameras, lenses, and other businesses, not just lithography machines.

"I see, I was being presumptuous."

As Jia Benlong flipped through the pages, he saw that many companies had annual sales of less than $1 million, and he understood what was going on.

"Yes, and also, some semiconductor materials are sideline products of large companies."

"Our best course of action is to persuade them to separate their semiconductor materials business and then cooperate with Xinghai Lithography."

The manufacturing of semiconductor equipment requires close cooperation from various fields.

Take the most well-known lithography machine as an example; it is assembled from hundreds of thousands of parts. Bearings alone may require supplies from more than a dozen companies.

What Masato Takeshita needs to do now is to control the most crucial part and then rely on Galaxy Capital to gradually take control of the entire process.

Yes, Galaxy Capital can still enjoy a portion of the profits when semiconductor material companies are about to take off.

We should never forget those who dug the well when we drink the water.

"I understand, I will try my best."

Kaben Takamasa wasn't very confident; he felt he wasn't very good at persuading others.

"Relax, Xinghai Capital's reputation is there for you. Few companies would directly refuse a semiconductor material that isn't very profitable."

Many businesses do not become expensive just because they are exclusive; sometimes, the cost is even lower.

The most typical example is grain. The four major grain traders monopolized the global grain trade by dumping their products at low prices.

This way, not many competitors will dare to enter this field, and even if one or two stubborn ones do come along, they will be driven out of business by the low prices.

Both Coca-Cola and Coca-Cola use the same strategy, focusing on low profit margins and high sales volume.

However, the four major grain traders occasionally engage in some volatile trading to make more profits through the futures market.

For example, soybean prices may surge by 50% or wheat prices may surge by 80% in a short period of time.

By working together in a tacit manner, the four major grain traders can easily reap the profits from the capital and companies involved in grain futures trading.

Japanese semiconductor materials companies employ the same strategy: selling at very low prices, leaving no opportunity for South Korean and Taiwanese companies to enter the market. After all, selling at a loss is not a viable strategy in the materials industry.

This is just a side business of a large company; even if it loses money, it's just a drop in the ocean.

Unlike semiconductor memory chips, which follow the lead of companies like Samsung in South Korea and suffer losses of hundreds of millions of dollars every year, sometimes even reaching billions.

Domestically, an economic crisis is occurring, and very few companies dare to risk bankruptcy to continue following suit.

Korean companies have American backers to bail them out, but Japanese companies don't.

The U.S. government and chip companies wish all Japanese semiconductor companies would die.

While Masato Takeshita was busy developing his medical and semiconductor businesses, Xinghai Software's branch in China also received a gift from him.

Console development equipment for Sega, Sony, and Nintendo.

Sega primarily used older console models for development, while Nintendo and Sony used the latest models.

In particular, Sony's console, which has not yet been officially released, is a key point emphasized by Masato Takeshita.

The Sony PS1 is just too powerful. Even when Nintendo and Sega consoles are bundled together, they can't beat the Sony PS1.

In addition, Masato Takeshita also sent Nintendo handheld console development equipment.

This is a device that is already on the decline, but it doesn't matter. Soon it will usher in a new era of glory and become the first gaming device to sell over 100 million units.

The game that saved it was called Pokémon, and the device was the Game Boy.

For a long time to come, Nintendo will have to rely on it to stay afloat.

Unfortunately, Gunpei Yokoi, who created this device, has been completely marginalized at Nintendo.

He had been squeezed out by Takeda Genyo and Miyamoto Shigeru, whom he had discovered, to the point where there was almost no one left to use.

With opposing ideologies, it's inevitable that one side will lose in the competition.

Of course, there were signs of this happening long ago.

When Gunpei Yokoi was developing the Game Boy, there wasn't enough manpower and the handheld console lacked games.

Ultimately, in his previous life, he relied on Hiroshi Yamauchi's son-in-law, Minoru Arakawa, and in this life, he escaped his predicament thanks to Hoshino Yugi.

However, it was actually a good thing that Gunpei Yokoi was sidelined at Nintendo, which gave Starsea Group the opportunity to successfully poach him.

"That's great! I never thought we could develop Nintendo games."

Qiu Bojun's eyes lit up, and he couldn't wait to start the development work immediately.

In terms of influence, Nintendo was probably the most influential in China in its early days.

However, most people don't know that they are playing a Nintendo Famicom clone.

Comparatively speaking, Sega was more well-known among ordinary people in mainland China in its early days.

Because of early Chinese magazines that introduced games, there were many Sega fans.

They frequently touted the merits of Sega, greatly influencing many gamers who bought the magazine.

However, Qiu Bojun was somewhat of an expert, so he admired Nintendo even more.

"It's alright. I think we should develop Sony's PS1 first. The chairman said that the PS1 has a greater chance of winning the competition for the next generation of consoles, so we should naturally choose the stronger one."

During this period, Lei Jun spent more than ten hours a day studying gaming industry materials. He had no bias towards the three console manufacturers and hoped to follow the chairman's choice.

"I know, but we can't give up on Nintendo either. We have plenty of manpower."

Qiu Bojun still didn't want to only develop for the Sony PS1; he insisted on fulfilling his wish to develop games for Nintendo.

“Okay, no problem, let’s develop two games first.”

There was debate in Beijing, but it was even more intense in Shanghai.

"We chose Sega because its hard-hitting, gritty style is the perfect fit for us."

"Why choose Sega? Nintendo is the best in the world."

"Neither will work. I still think it's best to follow the chairman's lead and choose the Sony PS1."

The office immediately fell silent as soon as the word "president" was uttered.

Because most employees of Xinghai Group greatly admire their chairman.

But soon, some clever people started to refute it.

"The chairman gave us four sets of equipment. Isn't that just so we can try them all out? He never said we could only develop the PS1. Nintendo is the dominant player in the console industry, so we should also study and learn from them."

"That's right, we can't just develop one console; we need to develop in all aspects. Sega is so popular right now, we have to have one too."

Soon, the meeting room was in an uproar again.

Ultimately, neither side in Shanghai could convince the other, and the decision was made to develop the three mainframes simultaneously.

Having money means you can be a little willful.

After all, it's right next to a university, so there are plenty of outsourced workers, and the prices are especially low.

This is also an advantage of China's entertainment industry at this time: it can earn yen and spend yuan.

However, in the previous life, only a few people in the animation industry seized this advantage.

Many animation professionals rely on outsourcing work from Japanese companies. Some earn a few thousand yuan a month, while others can earn over a hundred million yuan.

The cost, of course, is a rapid decline in the quality of Chinese animation.

Many talented animation professionals go to Japan to take on outsourced projects to earn money, so the remaining talent varies greatly in skill level.

Of course, even without the impact of Japanese animation outsourcing, Chinese animation was destined to decline.

State-owned animation companies have no money, and consumers have no money either, so they cannot support the Chinese animation industry.

Even with Masato Takeshita in this lifetime, the animation industry isn't much better off. But the gaming industry can start developing much earlier.

Even if game sales aren't great, it can still cultivate more talent in the gaming industry.

He didn't want to enter the online gaming era and start cultivating talent from scratch.

The decision made by Xinghai Software's two Chinese branches was quickly relayed to headquarters.

Masato Takeshita looked at the reasons on the document and couldn't help but shake his head slightly.

"Too greedy. Who knows what will happen in the end? But it doesn't matter. Even if we fail, at worst we'll just waste a few hundred thousand dollars."

For Chinese companies developing games, the biggest expenses are electricity and computer costs, which don't actually cost much.

Unlike in Japan, where the bulk of the cost of many games has become employee salaries.

Games have now evolved from products that can be completed by a small number of people into increasingly specialized products.

After signing "OK", Masato Takeshita continued reading.

"Huh, Xinghai Internet Cafe is also trying to develop the gaming industry?"

"It's definitely suitable; there are still too few PC games on the market right now."

Since Xinghai Software had agreed, Xinghai Internet Cafe naturally couldn't refuse.

However, compared to Xinghai Software, Masato Takeshita is less optimistic about Xinghai Internet Cafe.

Companies that control monopolistic distribution channels often struggle to create good games, especially when there's little to copy.

The same thing happened with Tencent, and later with Valve as well.

Yes, the young people also categorized Valve as lacking in innovation.

Since the rise of the Steam platform, Valve has not produced any well-known games.

(End of this chapter)