TOKYO, July 23 /PRNewswire/ -- In an aggressive move to position itself at the forefront of Japan's growing fascination with the Internet, Net Perceptions(TM), Inc. (Nasdaq: NETP) today announced the formation of a joint venture in Japan with three of that country's leading technology companies.

The formation of Net Perceptions Japan K.K. represents a joint venture between Minneapolis-based Net Perceptions, Inc. and the Japanese companies of Trans Cosmos, Inc., NTT Software and Toyo Information Systems. All three companies plan to distribute Net Perceptions products in Japan. A CEO is expected to be named in the near future.

Net Perceptions Japan already has signed an agreement with Askul, Japan's leading producer of office supply products. Askul is utilizing the Net Perceptions for E-Commerce product at its web site. Other customer announcements are expected shortly.

"We are very pleased to have such distinguished partners in this venture," said Steven Snyder, president and CEO of Net Perceptions. "The formation of Net Perceptions Japan places us at the center of one of the fastest growing markets in the world for E-commerce. Our plans include localizing products, training and service conveniently to Japanese customers. This is a big advantage as this market continues to mirror the U.S. in its Web evolution," Snyder explained.

The new company will, for the first time, provide Net Perceptions products and services directly to local Japanese customers. Prior to the formation of Net Perceptions/Japan, the company's products were available in the Japanese market, but all training and service was handled from the U.S. The new entity will make the sale and service of Net Perceptions' products a seamless experience for Japanese customers.

Internet usage is surging in Japan. It is estimated that 17 million people -- or 11 percent of all Japanese households currently have PCs in their home and use the Internet frequently. By 2001, that number is expected to triple to nearly 40 million users.(a) And the amount of commerce being done on the Web in Japan is estimated to grow 50-fold by 2003.(b)

By comparison, the U.S. market for E-Commerce is estimated to be 35 times larger than Japan's. And Japanese adoption of home PCs and Internet technologies trails the U.S. by about four or five years. Nonetheless, Japan is expected to begin closing this gap and, by 2003 will have a market one-seventh the size of the U.S.(c)

"What this all adds up to is an unmatched opportunity to create significant growth in our business over the next four years," Snyder said. "If the interest in Net Perceptions' products in the U.S. is any indicator of what we can expect in Japan, then we are very optimistic about our long-term potential in this market."

The U.S. market for E-Commerce is now in what is termed a "rapid growth phase." According to International Data Corporation (IDC), the number of users who make purchases over the Web will jump from 31 million to more than 183 million by 2003. The annual dollar value of those transactions will top $1 trillion within four years.

IDC adds that with the U.S. now leading the Internet explosion on a worldwide basis, it is expected that other countries -- Japan being at the forefront -- will move forward rapidly to assume greater positions of leadership. By 2003, it is predicted that 65% of all Web users will be international and that the U.S. will account for less than half of worldwide E-Commerce.

About Net Perceptions

Net Perceptions is the leading supplier of realtime personalization solutions that enable businesses to market to customers on a true one-to-one basis. Net Perceptions solutions increase new and repeat business by learning more about each customer's individual needs, tastes and preferences with every interaction, then making increasingly personalized product and service recommendations. Net Perceptions, based in Minneapolis, is a publicly held company which operates additional offices in New York, San Francisco, and London.

Customers include many of the world's best known brands including: Art.com; Bertelsmann; Billboard TalentNet; CDnow; E!Online, Micron, SkyMall, Tower Records and Ticketmaster Online. For more information about Net Perceptions products visit http://www.netperceptions.com or call 800-466-0711.

Forward looking statements and comments in this news release are made pursuant to safe harbor provisions of the Securities Exchange Act of 1934. Such statements relating to, among other things, the prospects for the companies to complete the transaction and enhance operating results, are necessarily subject to risks and uncertainties, some of which are significant in scope and nature. These risks may be further discussed in periodic reports and registration statements to be filed by the company from time to time with the Securities and Exchange Commission.

(a) Japan Ministry of Posts and Telecommunications

(b) Japan Ministry of International Trade and Industry/March 1999

(c) Japan Ministry of Posts and Telecommunications

SOURCE Net Perceptions, Inc.