Olympus - Company History

Letting go of the thermometer to concentrate on the microscope

On 12 October 1919, Yamashita Takeshi (山下長), together with Matsukata Kojiro's trading house Tokiwa Shokai and Suzuki Taichi (鈴木泰一) and others, founded Takachiho Seisakusho K.K. with capital of ¥300,000 at Hatagaya in Shibuya Ward, Tokyo[1], and began making microscopes at once. Behind it lay the fact that the First World War had cut off the microscopes Japan had been importing from Germany, making a domestic supply base urgent[2]. Takachiho, the name of the company, was a mountain held to be Japan's equivalent of Mount Olympus in Greece, so it was written OLYMPUS in English[3]; combined with Tokyo, where the company stood, it was drawn up into a trade mark shaped from convex and concave lens forms, adopted in November 1920[4]. Terada Wakichi (寺田枠吉), who had experience in making microscopes, was brought in as chief engineer, and in 1920 the company completed the Asahi, a domestically built microscope.

The company had taken up microscope development expecting it to be comparatively straightforward, but ran into technical walls, cut its capital to ¥75,000 and handed the thermometer division over to Jintan as well[5]. In the three years from incorporation, lens development costs came to ¥300,000 in total — the same amount as the capital at founding, spent ahead of any return. In the 1923 sale of the thermometer business, liabilities were transferred along with it to the buyer, the firm that would later become Terumo, in an attempt to repair the finances. In 1928 the shareholder Morishita Jintan demanded a further transfer of assets and a withdrawal from the microscope business, and Yamashita sued in the Tokyo District Court. A settlement was reached in 1929, leaving the company the basis on which to carry on microscopes itself.

In 1928 the company completed a microscope of 1,500× magnification and won the grand prize when it was shown at the Tokyo Exposition for the Promotion of Domestic Industry held to mark the enthronement[6]. From about 1931 it made high-grade objective and eyepiece lenses corrected for chromatic aberration, but none of these were of its own design — they were copies of German products[7]. Its own designs arrived by way of camera lenses. After the Osaka industrial research institute developed a superior glass, the company produced a fast f/1.5 lens in 1936 and received a ¥9,000 prize from the Ministry of Commerce and Industry[8]. In April of that same year, 1936, it began manufacturing cameras[9], completing the Zuiko 75mm f/4.5 lens and then Japan's first 50mm f/1.5 lens, and put the first Semi-Olympus on the market[10].

The tilt to military demand, and production moved to Shinshu

In December 1933 the company was registered as a designated plant of the Navy Ministry[11], which opened a channel for supplying microscopes to naval hospitals. Capital was raised to ¥1m in November 1936 and again to ¥2m in November 1939[12], and in 1940, along with the completion of an f/3.5 lens, the company put out the Olympus Six[13]. During the war it was pressed to convert to products tied directly to military demand — optical weapons, binoculars and magnetic recorders[14]. The presidency passed from the founder Yamashita Takeshi to Chatani Yasusaburo (茶谷保三郎) in December 1938[15]. In June 1944 Kanda Shokichi (神田正吉), president of Ataka Sangyo, took on the presidency of Olympus concurrently[16].

In June 1942 the company changed its name to Takachiho Optical Industries[17]. At the request of the Ministry of Munitions as the war intensified, it built the Suwa plant at Okaya in Nagano Prefecture in December 1943 and the Ina plant at Ina in Nagano Prefecture in February 1944[18], and in the same year was designated a plant under Army and Navy control[19]. In May 1945 the head office and the Hatagaya plant burned down in an air raid, and the head office moved to Tagoto-cho in Shibuya Ward[20]. That fire destroyed all of the data in which the company's technology to date had been concentrated, and the post-war restart had to begin again from the initial designs[21]. The centre of production shifted to the two plants in Shinshu[22], and there the war ended.

With the end of the war the company began making microscopes at the Ina plant and cameras at the Suwa plant, moving across into peacetime industry[23]. In 1946 it drew up the plan for the Olympus Six, launched the following year in 1947, and completed the f/2.8 lens it had long wanted[24], retiring the f/4.5. In November 1948 capital was raised to ¥7m[25], and in January 1949 the name was changed to Olympus Optical Co[26]. In the same year the company moved into volume production of phase-contrast microscopes and finished a prototype gastrocamera for photographing inside the stomach[27]. In May 1949 it listed its shares on the Tokyo Stock Exchange[28], changing its character from a pre-war supplier of military demand into a post-war optical maker for civilian demand.

The gastrocamera that began with a doctor's request, and the study society placed around it

In 1950 Olympus took up a request from a doctor at the University of Tokyo and began developing the world's first gastrocamera[29], combining the precision optics built up in microscopes with its small-camera technology to reach a practical instrument. In May 1952 it formally began manufacturing medical equipment[30]. In 1955 it took on the secretariat of the National Gastrocamera Society[31], running the very forum in which gastroenterologists gathered. That gave the company its own route for feeding clinical requirements back into products, and it became the condition that kept competitors out for decades afterwards[32].

Monthly output in 1955 ran to $55,556 (¥20m) in microscopes and $233,333 (¥84m) in cameras, with microscopes accounting for 55 per cent of national production[33]. In May of that year the company took part in the management of Takachiho Shokai K.K. to strengthen domestic camera sales[34], while Olympus Shoji, established in 1954, served as sole domestic agent for cameras[35]. In October 1960 it began manufacturing measuring instruments[36], and in the same year introduced a divisional structure that reorganised the company internally[37]. Capital was raised in stages — $83,333 (¥30m) in December 1950, $166,667 (¥60m) in April 1952, $277,778 (¥100m) in December of that year, and $611,111 (¥220m) in April 1954[38].

The decade in which the Pen and the fibrescope grew together

The Pen EE, launched in July 1961, was a popular model carrying an automatic exposure device that made the act of shooting all but fully automatic; cumulative sales of the Pen series passed one million units by August 1963. In 1965 Olympus took the top share of the domestic camera market by units, and within the pen-size class held above 60 per cent[39]. By value, however, it stayed second, because its mainstay was the half-frame Pen[40]. Cumulative sales passed three million units in 1968[41].

In that same year, 1963, the company used optical fibre of its own development to complete a fibrescope-equipped gastrocamera, which was used for the early detection of stomach cancer and went to export as well[42]. To carry the production it opened the Hachioji works in August 1963[43], and it widened its sales network abroad with a European subsidiary in May 1964 and an American one in January 1968. As of 1967 capital stood at $3.3M (¥1bn) and employees at 2,650, and within a domestic optical industry producing some $277.8M (¥100bn) a year the company held about 10 per cent[44]. Its share of the domestic microscope market reached 55 per cent[45].

In a lecture in 1967, president Naito Takatomi (内藤隆福) explained that the First Division handled microscopes, measuring instruments and the gastrocamera while the Second Division handled cameras, and that the two were split roughly 50:50 in sales[46]. Cameras fell away sharply when the economy turned down, whereas microscopes, measuring instruments and gastrocameras were bought mainly out of government budgets — budgets fixed in better times — and so filled the trough when cameras were weak[47]. That was why Olympus could keep paying a 12 per cent dividend in a period when others in the same trade had dropped to none[48]. Over the previous decade cameras had grown 4.5-fold against 10.7-fold for microscopes[49]: unlike cameras, which swung widely from year to year, microscopes grew every year.