SOFTBANK TACKLES TRADE SHOWS

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Softbank Corp. is one of a new class of Japanese companies that doesn't do things by the book. At least not the book Japanese marketers have quoted from in the past to reach the ranks of top marketers.

Its president and CEO, Masayoshi Son (rhymes with lone), is largely U.S.-educated. He believes in an entrepreneurial approach to business. And his company is organized to reward performance, not seniority.

Softbank is taking one page from the book of accepted management practices, however: It is diversifying. In just six months, Softbank has become the computer trade show leader.

Late last year, the company acquired Interop Expositions, the events business of Ziff Communications Co., which produces 12 shows, for $202 million. And earlier this month Softbank finalized arrangements for $800 million for the computer trade show business of Interface Group.

Softbank Exposition & Conference Co., formerly Interop, is expected to earn about $9 million this year. Interface, now renamed Softbank Comdex, produces 17 exhibitions, including Comdex, the world's largest computer show.

The spring Comdex show opened April 23 in Atlanta; attendance for this fall's show is expected to be 200,000. While Comdex is widely considered to be extremely profitable, privately owned Interface didn't report revenues.

But to succeed in the exhibition business, Softbank must address concerns exhibitors and attendees have about the show.

"We are aware of the dissatisfaction with Comdex," said T.A. Dolotta, president of Softbank America.

"Present management was already on track to fix some of the problems," Mr. Dolotta said. "And without taking anything away from [Sheldon] Adelson, [chairman-CEO of Interface and the founder of the Comdex show], one thing we have that he doesn't is that we're of the computer business and he never was. Our relationships with all the major players in the PC business have always been extremely cordial."

"Our mission continues to be the creation and development of effective marketing and information platforms for our customers around the world," said Jason E. Chudnofsky, Softbank Comdex president-CEO. "We believe that as part of the Softbank family, our capabilities are significantly enhanced."

Some things, like half-hour waits in line for cabs, Softbank can't easily control. "However, if we can house the show, if we have fewer venues, that should improve" it, Mr. Dolotta said.

At the time of the trade show acquisitions, the company denied plans to integrate its exposition business into a single division, but didn't rule out that option in the future. Insiders point out that an integrated trade show business would present the company with several advantages, including an integrated database of attendees and exhibitors.

Mr. Dolotta said that there were no plans to specifically address the loss of such prominent ex-exhibitors as Compaq Computer Corp. and Oracle, which dropped out of the show in frustration over lack of responsiveness by previous management, but that such problems were matters of concern.

Analysts point to expenses related to the purchases of the trade show operations as the reason for recent volatility in Softbank's stock.

Mr. Dolotta admitted that the company stock has declined, but noted that the stock "has come down from a stratospheric height when it was first issued. The exact causes for the drop are hard to separate, but the entire Japanese stock market is down overall; the Kobe earthquake had a major effect" on the market.

Softbank began as a distributor of PC software in Japan in 1981. Today, it leads the market, commanding as much as a 50% share of the Japanese software, peripherals and systems market.

In Japan, the company is also the leading publisher of computer-related magazines and books, including Japanese-language editions of PC Week, LAN Times and MacUser, as well as 16 other Japanese-language titles.

Four other divisions in Japan make up the company's current business operations: telephone data, computer networking, SystemBank system integration and CAD-CAM distribution.

Mr. Son, who retains 70% ownership in Softbank, is the grandson of Korean immigrants. He finished both high school and college in California, where he received a B.A. in economics from the University of California at Berkeley in 1980. In 1981, he returned to Japan where he started Tokyo-based Softbank.

Richard K. Skews coordinates Marketing Technology.

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