TOKYO -- Talk about hefty promises.

Sony

(SNE) - Get Report

, Japan's top consumer electronics and game maker, promises that kids of all ages will tap into the World Wide Web by using its flagship PlayStation 2 game console. Rival

Matsushita Electric Industrial

(MC) - Get Report

insists Japanese consumers are dying to be able to check how many eggs they have left in the fridge via their mobile phones.

The ideas are catchy enough to make Japanese technophiles giddy, but investors are being cautious. The market gobbled up shares of Matsushita and Sony when the Internet tsunami hit Japan's shores last year, but with the dot-com selloff, these stocks, too, have languished. Sony's American depository receipts -- shares of the company that trade in the U.S. -- are down 34% from their highs this spring, while Matsushita's ADRs are 14% off their highs.

Sony and Matsushita will release fiscal first-quarter results in the coming week, and at this point, nobody is expecting any miracles. With investors still licking their wounds from the global tech shakeout earlier this year, many players are waiting around for Sony and Matsushita's new Net ideas to turn into profits before they plunk any more change into shares.

Sony posts its numbers Wednesday, and analysts reckon the firm will likely post a group net loss of up to 110 billion yen ($1 billion) for the quarter, compared with a net profit of 18.43 billion yen in the same period last year. That's because Sony has racked up unexpected expenses of about $950 million from its U.S. movie operations due to new U.S. accounting rules. The new law, set to take effect in December, will make it mandatory for film companies to book all related expenses three months after a movie's release, when previously they could spread expenses over 10 years.

Other than the movie trouble and the Internet worries, investors have been troubled by local reports saying that only two games are being sold with each PlayStation2 console, which is about half of what Sony originally expected to peddle.

The short-term ills, however, should not deter investors, reckons Hiroyuki Matsumoto, analyst at

Kokusai Securities

.

"I definitely don't think Sony's shares will rise more than 17,000 yen this summer

vs. Friday's closing price of 10,680. However, the value in the long term is much higher, since everyone thinks Sony will be one of Japan's top digital companies," he said. Matsumoto has a neutral rating on Sony but said he would re-evaluate after the second-quarter figures are released; he expects those to be much brighter.

Matsushita will likely boast a group operating profit of about 30 billion yen. Healthy demand for air conditioners and vacuum cleaners is helping Matsushita recover from its dismal year last year, after the strength in the yen cut into profits generated from overseas sales.

But though many analysts say Matsushita will likely do well for the rest of fiscal 2000, the firm has an image problem. For example, the newly instated president

Kunio Nakamura

told reporters recently that he would personally oversee the firm's IT strategy. However, investors were disappointed when he didn't explain what, exactly, that strategy was. This problem isn't new. Matsushita has long touted how it upholds Japan's old-school ways (it hardly ever fires staff) and has been slow in presenting its new operations (robust demand for liquid crystal displays, which are used in mobile phones).

And on top of all that, the market is fretting over a possible interest-rate rise that could come as early as mid-August. So unless Sony quickly improves the sales of PS2 and related games, and Matsushita loosens its stodgy corporate image, it looks like shares of both firms will be mired in the summer doldrums for at least a few months.