Strengthening our Software Services Business

- Taking on new challenges for Fujitsu Frontech -

January 28, 2005 — As announced on November 30 last year, the restructuring of Fujitsu Frontech on February 1 will establish a new consistent structure across areas from system development to service operations that will include software operations in addition to our core hardware development and production. Fujitsu Frontech is committed to using all our resources to secure the benefits of this new structure, including enhanced solutions capabilities resulting from the development power of a concentration of software engineers, and providing "products that can contribute to realizing a ubiquitous society".
Therefore, on February 1 Fujitsu Terminal Systems will become a subsidiary company (Maebashi City, company name scheduled to be changed to Fujitsu Frontech Systems on the same day, 540 employees, hereinafter FJFS), with approximately 250 employees mainly consisting of software engineers being transferred to Fujitsu Frontech to form the core of the software services division that will be established. A base for the software services division will be established in Omiya in April this year.
With the addition of 290 employees from the new FJFS, the software services capabilities of the total Fujitsu Frontech Group will then come to 900 employees. The establishment of this new structure will provide rapid delivery, high reliability, high value-added solution products that will increase customer satisfaction as much as possible.
The goals and specific activities of the newly established software services division are as follows.

Strategic expansion of solutions business by utilizing new technologies (palm vein authentication, RFID, etc.)
Improved efficiency of existing business such as ATM and POS, and fast provision of solution products
Strengthening and expansion of life cycle management (LCM) business

ATMs and Financial Sector

Faster provision of ATM-related systems through improved efficiency gained by integrating the previously separate software development branches of Fujitsu Frontech and FJFS into the software engineering division

Retail Sector (POS, etc.)

Provision of solution products including mobile terminal systems by integrating the previously separate software development branches of Fujitsu Frontech, Fujitsu and FJFS into the software engineering division

Industrial Sector, Public Sector, and Infrastructure (New Technology, etc.)

Aggressive expansion of new solution businesses that utilize new technologies (palm vein authentication, RFID, etc.) into areas other than the financial sector

Embedded Systems

Development of firmware, middleware, and applications for integration into information devices such as mobile phones and mobile terminals

Services (LCM)

Strengthening and expansion of LCM by combining the three divisions of ATM outsourcing services (Fujitsu Frontech), POS help desk services (Fujitsu), and system development related to these services (FJFS)

Solution Field	Details
ATMs	・Systems related to ATMs
Financial Sector	・Bank branch systems ・Systems for securities industry
Retail Sector	・POS and mobile terminal device systems
Industrial Sector, Public Sector, and Infrastructure	・Display and medical systems ・Palm vein authentication and RFID systems for industrial sector ・Information infrastructure such as network and server systems
Embedded Systems	Systems for ATMs, POS, Network devices, mobile phones, mobile terminals
Services	LCM, including ATM outsourcing services and help desk services for POS

Along with the strengthening of these kinds of software and services business, the following important steps are being taken in order to increase business:

Provision of products and services that satisfy the customer

Fujitsu Frontech will promote shorter delivery lead-time and higher reliability of products for the financial and retail sectors and will provide LCM-type solutions in order to reduce the TCO of the customers at the same time.
・Pursuit of efficiency improvements and more stable hardware and software quality
・Provision of ATM outsourcing services and POS help desk services
Aggressive expansion through providing new products that combine system products, such as display systems, medical systems, and auction systems, with software services.

Contribution to a ubiquitous society by generating and expanding new businesses

Fujitsu Frontech will expand the new markets and new business by making use of the cutting edge technology and will make a contribution to a ubiquitous society.
・Palm vein authentication・・・Striving to become the de facto standard amongst financial institutions while expanding sales into new business sectors.
(New business sectors: Entrance and exit management, computer login, etc.)
・RFID・・・・・Aiming for business on the scale of 10 billion yen in 2007 (combined result for Fujitsu and Fujitsu Frontech)
・e-Documents・・・・・・Aiming for business expansion once the e-document law comes into effect.

Provision of products to the global market

Fujitsu Frontech will provide mechanical components and passbook printers, etc. to the Chinese market, which is continuing to grow in accordance with the improvements in IT infrastructure and also supply global components for automatic teller machines to the markets in the United States, Europe and Asia through our alliance with NCR.

(Reference) Transition of consolidated net sales of Fujitsu Frontech over the past 5 years and forecast for 2005
The new products for new businesses (palm vein authentication devices, RFID, etc.), the launch of new LCM services (ATM outsourcing etc.), and the effect of the integration by the restructuring of this time (unifying the structure of the hardware, software, and services divisions) are expected to make real contributions to sales performance from 2005.