In Japan, the integrated circuit (IC) industry has led the way technologically for many other manufacturing industries. According to interviews with key persons at NEC, Tōshiba, and Fujitsu, IC firms' codevelopment with calculator and communication equipment companies greatly contributed to the strong competitiveness of the Japanese IC industry. However, the codevelopment between IC suppliers and their customers in the Japanese calculator markets also helps explain why the competitiveness of Japanese IC industry has been weakened since the late 1990s. The interfirm relations between Japanese IC suppliers and customers and its effects were not so simple and one-sided. The case of Japan's IC industry can be applied to other Japanese industries.