The first five articles in this series discussed early licensees of the Bell Telephone Labs (BTL) transistor patents in the US and Europe. However, one more geographic region was actively involved in transistor development during the early 1950s: Japan. This final article in the series covers the story of one Japanese company’s efforts to license, make, and use transistors based on the BTL transistor patents.
Japan’s surrender on August 15, 1945 and the subsequent signing of surrender documents on September 2 marked the end of World War II. That same month, Masaru Ibuka returned to Tokyo to find the city essentially destroyed. War damage was everywhere. During the war, Ibuka had been a member of the Imperial Navy Wartime Research Committee, studying new types of weapons to help Japan win the war. Now, he resolved to help rebuild his country from its ashes. Ibuka and a band of engineers took over the damaged switchboard room of the Shirokiya department store in Tokyo’s Nihonbashi business district and established the Tokyo Tsushin Kenkyujo (Totsuken), literally the Tokyo Telecommunications Research Institute.
The institute started fixing radios. Many of the radios in the city were broken and many others had been intentionally disabled by Imperial Japan’s military police to prevent people from listening to enemy propaganda. Totsuken repaired the broken radios and manufactured shortwave converters or adapters so that people could receive a wider range of broadcasts from the world. There was a growing demand for such radios from a war-torn populace, and the Asahi Shimbun, one of Tokyo’s largest newspapers, spread the word about Totsuken’s shortwave adapters in its social affairs column titled Ao Enpitsu (Blue Pencil).
The newspaper publicity grew Totsuken’s business and triggered another major event. Akio Morita in Kosugaya, far from Tokyo, read about Ibuka’s efforts and wrote to him. The two met and became friends while working on the Wartime Research Committee. Ibuka invited Morita to Tokyo. Morita’s family was in business making and selling sake, miso and soy sauce, so Morita had been trained in business since he was young, but he also had a degree in physics. He was a perfect fit for what was to come.
Meanwhile, Totsuken had branched out from radio repair and started making electric rice cookers, which were little more than wooden buckets with aluminum electrodes on the bottom and a power cord. Japan had a shortage of nearly everything, but it had ample electric capacity now that war manufacturing efforts had ceased. Unfortunately, Totsuken’s rice cookers didn’t cook the rice very well. The rice often came out of these cookers undercooked or overcooked. It was an instructive product failure for the new company. Meanwhile, other Totsuken products such as a vacuum-tube voltmeter (VTVM) succeeded.
On May 7, 1946, Totsuken became Tokyo Tsushin Kogyo Kabushiki Kaisha (Tokyo Telecommunications Engineering Corporation), or Totsuko. Ibuka became the company’s Senior Managing Director and Morita became its Managing Director.
From that point on, the company took on a variety of contract work. Japan’s Ministry of Communications ordered fifty VTVMs. However, vacuum tubes were then hard to find in post-war Japan, and obtaining electronic parts on the black market required frequent trips to the myriad electronic component shops in Tokyo’s famous Akihabara District or field trips far out of the city. Even then, only half of the vacuum tubes would meet specifications. Manufacturing equipment was also scarce, so the company’s engineers regularly scavenged materials from Tokyo’s bombed out ruins. They made do.
When Japan’s national broadcasting station NHK asked Totsuko to manufacture broadcast relay receivers so that its broadcasts would reach all of Japan, the company’s engineers requisitioned military receivers that were being held in reserve and repurposed them. The resulting connection with NHK would be important in the future. However, Morita knew that Totsuko needed a product to sell to succeed in the way he wanted. Contract work would not do. Totsuko needed a big product to meet Morita’s big goals. The big product turned out to be a reel-to-reel tape recorder.
The state of the art for instant sound recording at the end of World War II was the wire recorder. NEC loaned Totsuko a wire recorder that had been used during the war by the Japanese Army, and the engineers at Totsuko promptly took it apart and studied it. However, the wire recorder had very low fidelity. Meanwhile, Totsuko got a very new copy of a tape recorder from the Occupation Forces in Japan and immediately discovered that it had vastly superior fidelity. Ibuka and Morita decided that their company had to make a tape recorder, no matter the difficulty.
There are many technical hurdles when making a tape recorder, especially in a resource-strapped environment like post-war Japan. Even the recording medium, magnetic tape, had to be made from scratch. Totsuko overcame these difficulties and started making its own tape recorder, the “Tapecorder,” and its own magnetic tape, which it called “Soni-Tape.” That development effort consumed a full year.
Next, Totsuko needed a market for its new Tapecorder. It was an expensive machine. Only institutions could afford one, and sales were very poor. Morita and Masao Kurahashi, an investor who wanted to sell Totsuko’s Tapecorder, stumbled upon an American pamphlet titled “999 Uses of the Tape Recorder,” which listed hundreds of possible uses in alphabetical order. Not all of the 999 uses were applicable in Japan, but Morita and Kurahashi became convinced that the Tapecorder could be used in a wide range of social activities. Kurahashi went on the road to extoll the Tapecorder’s uses.
The timing was perfect. Japan’s schools were adopting visual teaching aids, and the Tapecorder permitted a teacher to demonstrate the visual aid, like an abacus, while the tape recording would explain the demonstration. NHK was broadcasting instructional programs daily for this exact purpose, and the Tapecorder allowed a school to capture the broadcast and use it again and again. The orders poured in and money started filling Totsuko’s coffers.
Meanwhile, Ibuka read an article about a new American development at Bell Labs: the point-contact transistor. “It has no future,” Ibuka concluded. Coincidentally, in March 1952, Ibuka decided to visit the United States to see how American consumers used tape recorders. He hoped to get some ideas for expanding Totsuko’s Tapecorder sales in Japan. During the trip, a friend told him that Bell Labs was licensing the transistor to any company for a license fee plus royalties. For some reason, the idea of challenging his engineers to make transistors suddenly appealed to Ibuka. Totsuko had hired many recent engineering graduates, and Ibuka worried about challenging them. Making transistors was clearly a big technical challenge. Although he tried, Ibuka could not get an audience with Bell Labs or Western Electric to discuss a transistor patent license for Totsuko. He returned to Japan empty handed.
Upon his return to Japan, Ibuka told his friend and partner Morita about his plan to make transistors. Fortunately, the plan made sense to Morita, whose physics degree likely helped make him receptive to the idea. Ibuka then went to MITI, Japan’s Ministry of International Trade and Industry, to tell them that Totsuko wanted to obtain a license for manufacturing transistors. MITI immediately refused permission, saying that the transistor manufacturing process was far too complex for a small company like Totsuko. MITI knew that Japan’s powerhouse electronics companies – Toshiba, Mitsubishi, and Hitachi – were already developing transistors based on an umbrella contract with RCA.
Ibuka’s stockbroker friend Shido Yamada in New York continued to pester Western Electric about selling a transistor patent license to Totsuko. He eventually succeeded, and Morita, who was visiting the US for other reasons, signed a provisional agreement with Western Electric for the BTL transistor patents. Ibuka was elated and immediately decided what Totsuko would do with the transistors: make radios. Certainly, radios had been in the company’s DNA since the beginning.
Ibuka went to MITI again to get permission to make transistors, and again MITI denied permission. Ibuka then informed MITI that Totsuko already had a license to make transistors from Western Electric, obtained without MITI’s permission. This news outraged MITI at the time, but a personnel shakeup at MITI at the end of 1953 flipped the situation. Ibuka and Kazuo Iwama, Totsuko’s general manager of tape recorder production, went back to the US and got the information from Western Electric that his company needed to make transistors. Iwama sent reports back to Japan that contained this manufacturing information. A week before he returned from the US, Totsuko’s engineers had hand-built and tested a working point-contact transistor.
By January 1955, Totsuko was manufacturing transistors and had developed a working transistor radio for consumers to buy. However, Morita perceived a marketing problem. He wanted to sell the new radio in the US, and he knew that Americans would have a lot of trouble pronouncing Tokyo Tsushin Kogyo. Totsuko wasn’t much better. The winning name for the new brand: Sony.