Even the locals seem to find Japan’s labyrinthine distribution system hard to break into if they have a new product that does not fit their existing products profile, it seems. The forthcoming Atmark version of the Apple Computer Inc PowerPC 603- based Pippin games machine design marks a big departure from things like the Mighty Morphin’ Power Rangers for toymaker Bandai Co Ltd, and so rather than try to fight with Sega Enterprises Ltd and Sony Corp for shelf space, it plans to follow the Dell Computer Corp model, bypass the normal retail channels and sell direct – that is by mail order – at about $620, seen as high for what it is. Bandai claims that direct sales will help it manage inventories and collect information on customers. Mitsubishi Electric Corp is contracted to make the things at 30,000 a month, but can raise output if demand justifies. The Pippin will run a range of entertainment, educational and business software on television sets – 460 companies are contracted to create CD-ROMs for it – and will provide access to the Internet. Sales are due to start in Japan on March 22 with US sales from September and European sales by the end of this year. It looks to sell 500,000 in the first year. Bandai will pay Apple a royalty of somewhat under $20 a machine, software companies writing for it will pay Apple a royalty of $2 or $3 for each disk they sell.
