Hisashi Hieda

This interview originally appeared in the MIPCOM 2010 issue of TV Asia Pacific.

 

It’s no secret that Japan’s economy took a battering during the global downturn, with media outlets experiencing heavy losses in ad revenues. For the territory’s leading commercial broadcaster, Fuji Television, the past year has been challenging but, as chairman and CEO Hisashi Hieda reveals in this interview, recovery is well under way. The company has remained firmly focused on delivering high-quality drama, variety, entertainment, news and more in order to draw viewers and advertisers. It has also expanded its activities, moving into movie production, pay TV, merchandising and other businesses. Fuji Television is just one part of the sprawling Fuji Media Holdings, the parent group that also owns Nippon Broadcasting, as well as production, publishing and music assets, among others. In this exclusive interview, Hieda discusses what has kept Fuji at the head of the pack and what lies ahead for the group, which celebrated its 50th anniversary last year.

 

TV ASIA PACIFIC: How did Fuji’s ad revenues hold up amid the downturn?

HIEDA: Although the Japanese advertising market continued to decline due to the effect of the worldwide recession, it is now on a recovery path. Last fall, our spot ad sales increased compared to the previous year. The first quarter witnessed sales that exceeded the previous year for the first time in three years. Our programming is [favored by young people] and women—the main target of our sponsors—helping us maintain our top position in viewer ratings for six consecutive years. Fuji Television’s strength in content production is providing a powerful underpinning for our sales activities.

 

TV ASIA PACIFIC: You’ve reorganized the company, creating Fuji Media Holdings to serve as the umbrella for all your operating divisions. Why was this important for the business?

HIEDA: Because the media industry is witnessing such major changes, we’ve established a holding company structure to be able to have an overview of each of our companies and conduct a more efficient group management. This enables us to grasp more highly concentrated business conditions and make [more] speedy business judgments than before. Also, by centralizing funds that have been scattered throughout the group companies, an even more efficient operation of management resources has become possible.

 

TV ASIA PACIFIC: What policies have you put in place to weather Japan’s current financial storm?

HIEDA: With the downward trend in ad sales, in order to secure profit, we try to efficiently operate costs through a comprehensive inspection of program production costs as well as other areas. At the same time, our policy is to focus our goals on strengthening non-advertisement related businesses that are less subject to the economy.

 

TV ASIA PACIFIC: What efforts have you made to expand your non-advertising revenues?

HIEDA: Making good use of our strong skills in content production, Fuji Television was among the first broadcasters in Japan to take part in non-broadcasting businesses such as motion-picture production and live events, achieving a huge success in various genres. Our current focus is expanding operating revenues in new fields such as mobile phones, the Internet and IPTV. In particular, the on-demand service of Fuji Television programs is witnessing a steady growth in sales, and will soon contribute to our company’s profits.

 

TV ASIA PACIFIC: Fuji celebrated a milestone 50th anniversary last year. What have been the keys to your success over the past five decades?

HIEDA: Our corporate culture is fresh, bright and flexible. Without fear of failure, Fuji Television has never stopped taking part in the development of software and businesses that lay paths to new eras. I believe that another important key to our success is the fact that we have always made it our policy that human resource is the most important asset for our company. 

 

TV ASIA PACIFIC: The Japanese market has become much more competitive. How have you been able to retain your market-leading position?

HIEDA: I think it’s all in our strong content-production skills. No matter what kind of new media were to emerge, the content to be shown on that media will no doubt play a significant role. That is why I am confident that Fuji Television’s position as Japan’s most powerful content producer will never waver, no matter what kind of media emerges. 

 

TV ASIA PACIFIC: You produce so much content in Japan. How are you monetizing this on a global scale?

HIEDA: As a content producer, we are fully aware that expanding businesses to overseas markets is not an easy task. Still, in order to expand and increase the entire group’s profitability, going global is an extremely crucial theme. That’s why we intend to continue strengthening our program sales and format sales as well as actively take part in the overseas trials of various new business ventures, not necessarily related to content businesses. 

 

TV ASIA PACIFIC: How do Fuji and Nippon Broadcasting System complement each other?

HIEDA: The two companies cooperate with each other through television and radio programs as well as co-funding and co-hosting events. Currently, Fuji Television and Nippon Broadcasting are taking part in a joint venture that will provide multimedia broadcasting services via the bandwidth that is currently allocated to analogue television. 

 

TV ASIA PACIFIC: How is Fuji participating in the transition to digital terrestrial?

HIEDA: The switchover to digital broadcasts is Japan’s national policy. The necessary upgrading of broadcasting facilities and transmission infrastructures has been completed. We are now at the stage of making the switch to digital widely known to our viewers by informing them through television programs and events. Once the switchover to digital terrestrial broadcasts is completed smoothly in July 2011, the image quality and functions of televisions will improve. The strength that today’s television possesses will be passed on, so I have high hopes that it will evolve into an even more powerful media.

 

TV ASIA PACIFIC: How are your interests in the pay-TV sector performing?

HIEDA: Three pay-TV channels have already been launched in the Fuji Television brand name. They have already established a strong position and have gained much popularity. Fuji Television is also the leading shareholder of WOWOW, which is a huge success in pay-TV broadcasting via satellite, as well as Nihon Eiga Satellite Broadcasting Corporation, very popular for its movie channels. Fuji Television is also a big shareholder of the satellite platform operator, SKY Perfect JSAT. We have actively developed and expanded businesses and financial resources in the pay-TV sector. We will continue focusing on pay-TV businesses while carefully evaluating profitability and market potential.

 

TV ASIA PACIFIC: What are your goals for the company in the next 12 to 18 months?

HIEDA: During these past few years of difficult economic times, we have displayed a significant management policy to strengthen and toughen up our business quality so that we can achieve tremendous growth when the economy recovers, as well as to shift our business structure in a way that we are less subject to the fluctuating economy. Therefore, no matter what the situation of the economic environment is, we will be able to head toward an increase in profit. In addition, if the external economic environment improves, Fuji Television will be blessed with an even bigger opportunity to increase its profits.