ABSTRACT
In order to analyze the changing forms of interfirm cooperation and the role it has played in innovation in the computer and telecommunications industry, this chapter examines several of the major cooperative innovative efforts of the late catch up and early frontier period in Japan. In the 1960s a number of major computer and telecommunications projects were undertaken that involved not only university or government labs and individual private firms, but also cooperation to differing degrees between firms in the same industry, i.e., competing firms. The changing modes of cooperation in these programs, the different degrees of success, and the ways in which cooperation was used are very instructive. Nippon Telegraph and Telephone Corporation has for decades made use of cooperative research projects to develop a wide variety of products. The incentives for reorganization into cooperative "groups" were generous subsidies, low-interest loans and, of course, the possibility of continuing good government-industry relations.
