Core Viewpoint - Japan once dominated the global semiconductor market but has experienced a 30-year decline due to policy shifts, rigid corporate culture, and global competition. The future direction of Japan's semiconductor industry is under scrutiny as it seeks to regain its competitive edge in a market projected to reach $733 billion by 2025 [2][4]. Group 1: Historical Context - In the late 1980s to early 1990s, Japan's semiconductor industry held over 50% of the global market share, marking the "Japan's semiconductor" golden era, with NEC, Hitachi, and Toshiba ranking among the top three semiconductor companies [2][3]. - Japan's initial success was attributed to advanced manufacturing technology and a management model based on General Electric, allowing for efficient operations through vertical integration and clear export strategies [3][4]. Group 2: Factors Leading to Decline - The decline of Japan's semiconductor competitiveness is multifaceted, with significant turning points including the policy failures marked by the "Japan-U.S. Semiconductor Agreement," which pressured Japan to open its market [4][5]. - Japan's focus on domestic demand and mass production led to aggressive price competition, perceived as dumping, and a reluctance to adopt U.S. semiconductor technologies [5][6]. - The vertical integration model, while effective initially, became a hindrance as the industry grew, leading to slow decision-making and an inability to adapt to market changes [6][7]. Group 3: Impact of Global Competition - The rise of South Korean companies like Samsung, which adopted owner-managed structures for rapid decision-making and investment, further exacerbated Japan's decline [7][8]. - Economic factors, including the appreciation of the yen and the bursting of the real estate bubble in the 1990s, led to reduced investment enthusiasm among Japanese manufacturers [8][9]. Group 4: Current Landscape and Future Prospects - Despite the decline of major vertical integration semiconductor manufacturers, Japan's materials and equipment sectors remain robust, suggesting potential for a resurgence in the semiconductor industry [8][9]. - The COVID-19 pandemic highlighted the vulnerabilities in global supply chains, prompting calls for Japan to rebuild its domestic semiconductor manufacturing capabilities to maintain industrial competitiveness [9][10].