Your company is famous for cameras. But you also are much more than cameras.
We are grateful for the customer support that our camera products enjoy. And we have been successful in applying our expertise in precision optics and precision machining in new product lines. Most notably, we have become the world leader in photolithographic steppers for imprinting circuitry patterns on silicon wafers. We also have developed business in microscopes, measuring instruments, surveying equipment, binoculars, eyeglasses and other optical products.

The world is going digital, isn't it? Does film photography have a future?
The quality of digital photography has improved dramatically, and digital cameras have become essentially as good as their film counterparts for lots of purposes. We at Nikon, unlike most of our competitors, even offer single-lens reflex (SLR) digital cameras. They are available with interchangeable lenses and other accessories.
   Some photographers, of course, continue to prefer film cameras. They believe that film allows for subtle nuances that are difficult to simulate with digital photography.
   Our job is to offer an appealing range of high-quality products, both digital and analog. That is what we are doing, both in medium-priced cameras and in high-end models.

Digital cameras are a mass-production sector subject to intense pressure on profit margins. How will you make a profit in that sector?
Part of the answer is to shift production of large-volume products to nations that offer a lower-cost operating environment than Japan does. We already make some of our lens units for digital cameras in Thailand, and we are building a factory in China that will be our second digital camera plant in that nation.
   Another part of the answer is volume. Fortunately, our models in each category have proved popular enough to support profitable economies of scale.

What about Japan? What kind of manufacturing will you continue to do there?
Japan is and will remain the main platform for our research and development. It also will remain our production base for high-end cameras and for semiconductor manufacturing equipment.

Each generation of semiconductor devices packs more circuitry into less space. What's in store for photolithographic systems?
Several exciting technologies are in the works. We keep finding ways to do more with optical systems. A new generation of laser technology will put more and finer circuitry onto chips.
   We and other manufacturers are exploring the so-called extreme ultraviolet range of the spectrum, which is close to X-ray wavelengths. We also are working on electron beam technology.
   The next-generation laser systems will come on line in a couple of years. We expect them and extreme ultraviolet lithography to be the main manufacturing systems for mass-production semiconductor devices for at least a decade. Electron beam systems also will go into commercial production in a couple of years. We expect them to become the main systems for manufacturing low-volume semiconductor devices for demanding applications.

Doesn't an American head your U.S. subsidiary for marketing semiconductor manufacturing equipment?
He was the right person for the job. We are opening the doors of management broadly to non-Japanese employees,
and we are identifying management candidates throughout our operations.
   Japanese occupy the top spots at most of our operations, but non-Japanese managers are coming on strong. We are going out of our way to create more opportunities for exchange. Our measures include hosting employees from abroad in Japan for short and extended stays. Stepped-up international exchange in management will be indispensable in maximizing efficiency in our global operations.

Your company does not bear the Mitsubishi name, but Nikon has been a core Mitsubishi company since its beginnings. How do you feel about your Mitsubishi connection?
Most people, even in Japan, are unaware of our connection with the Mitsubishi community of companies. Nikon has been highly independent. I would say that we have relied less on Mitsubishi ties over the years than some of the companies have.
   On the other hand, we consult freely with our counterparts at other Mitsubishi companies. As technological development becomes increasingly sophisticated and expensive, carefully considered collaboration--especially with other Mitsubishi companies--is inescapable.