Japanese TV? Not Anymore They Don't!

This story makes me go, "Hmmmm?" Several Japanese TV manufacturers have stopped making TVs in Japan. This is truly the decline and fall of Japanese civilization!

I have already written about how high energy costs are going to force many factories to close especially if TEPCO is forced to raise electricity charges for these factories. For more on that, please refer to Japan's Collapse Will be Absolute and it Cannot be Stopped - Here's Why:

All one needs to do to see what that hollowing out has done to the middle class in America is to get on an airplane and fly to, say, Detroit to see what is left of industry there. It's not rocket science, but where's there's no industry, there are no jobs.

That is the future we are heading for in this country and I see no way out. Zerohedge writes in: A New Beginning in Japan: Glimmers of False Hope:

TEPCO, the bailed out owner of the Fukushima nuclear power plant, is trying to shove rate increases of 17% down the throats of its commercial customers—while rationing power at the same time. Power shortages will spread across most of Japan this summer as the last of 54 nuclear power plants will be taken off line in a few weeks. 

... Hitachi, a major Japanese TV manufacturer has already closed doors on TV production in Japan. Now this?

Toshiba drops Japan TV operations amid falling prices, global competition

Toshiba said Thursday it has stopped making televisions in Japan, citing slow domestic demand as falling prices, fierce global competition and a strong yen pressure the country’s electronics makers.

The IT-and-engineering conglomerate shuttered production lines at its last remaining domestic TV plant in Fukaya, near Tokyo, at the end of March, a company spokesman told AFP.

Toshiba, the maker of the Regza brand of televisions, has shifted all of its television production to factories in China, Indonesia, Egypt and Poland, he said, adding: “The fall in domestic demand is the reason.”

The move is the latest development highlighting the plunging fortunes of Japan’s once world-beating electronics firms.

A strong yen, intense global competition—particularly from South Korean firms—and falling retail prices of televisions have left Japanese manufacturers swimming in red ink for the financial year that ended in March.

The industry received a temporary boost from a now-ended government stimulus program aimed at encouraging the purchase of energy-efficient appliances, but demand has slackened in an economy that has been limping along for many years.

Domestic television demand also surged when the nation stopped analogue broadcasting last July, by which time nearly all households and corporations had bought new televisions capable of receiving digital broadcasts.

On top of low demand, I'm absolutely sure that the higher electricity costs played a major role in Toshiba's decision. 


There are two issues at play here. The problem of high energy costs in Japan (and they are going to go higher) and the collapse of the TV viewing audience in Japan. For more on that please refer to "Why the Digital Conversion Will Destroy TV Tokyo and TBS."


TV as a hardware industry and as entertainment vehicle have a poor future in Japan. The other two TV manufacturers in Japan, Sony and Panasonic, haven't thrown in the towel, but are attempting to tie up with South Korean manufacturers...


The time's they are a changing! If you had told people 20 years ago that the Japanese would not be manufacturing TVs today, everyone would have thought you were nuts.... What is Japan? Geisha, samurai, sushi... and TV sets.

TV isn't Dead... It Just Smells Bad!

Just returning from a trip to the USA whereby I spent the last week trying to help out a primary caregiver with my very ill father on hospice. 


It was/is a terrible situation and I hope that you don't have to go through this with any of your parents soon. But many will, so before that, won't you take one minute to take a look at this short message concerning that subject?


While there, I made some observations about television. It wasn't hard to do. I was staying at a household with my now 80-year-old father and his 80-year old live-in partner and caregiver where the TV was on from the first thing in the morning to the last thing, besides the kitchen light, to be turned off at night before bed.


Observing these folks watching TV was painful. The primary caregiver was constantly talking to the TV as if the conversation were all hers (seriously) and my dad was constantly complaining about how idiotic the TV was... Yet, on the TV stayed.... 


The situation with the TV on forever drove me crazy!


That house is, in my opinion, the typical TV household of the year 2011 and beyond. It represents the core of who are TV's main viewers today and it also represents why TV, in its current configuration, is dead. I've written about it before in "Part Two: Why the Digital Conversion Will Kill TV Tokyo and TBS":


These are folks who have seen TV all their lives. The Internet is still a new thing to them. My in-laws are the kinds of folks who turn on the TV when they wake up in the morning and leave it on all day whether they are watching it or not. They are terrestrial TV's prime audience.

Why are these people the typical prime target for a station like TV Tokyo or TBS? Think about it.

Who has the time to sit around and really watch TV for 2 or 3 hours a day, everyday (like people did 30 years ago)? Well, the only people who do have the time to do so are either:

1) Inactive
2) Poor
3) Retired or aged
4) Handicapped or ill

Think about that. Now, if you were a sponsor, would you spend money on TV advertising for people who fit any of the descriptions above? No. You wouldn't.

That's one huge problem for these dinosaur TV stations that have thousands of employees and a dropping revenue base.


This problem is universal. Perhaps countries like India or China haven't (nor will they???) face these challenges... (But I know that in India, people still use 45 rpm records and cassette tapes, so maybe they will someday soon!)


Japan and the USA are in the same boat, though, when it comes to TV. Here are some things I noticed while in the USA that just confirmed and consolidated my opinion on that:


TV in the USA is now playing a defensive strategy that I have seen stations play in Japan. It is a strategy doomed to failure. I have seen this with my own eyes and even argued this point against program directors and station managers as far back as 1998.


The strategy that these stations are trying can't possibly work in the long run. It goes like this: The audience of TV viewers is shrinking. So, instead of pursuing an aggressive policy to reach out to younger people and gather new viewers and a new audience, the stations pursue a defensive strategy to prevent erosion of their current audience (old people). The stations will, instead of making efforts to attract new viewers, will make efforts to keep their old veiwers and prevent them from switching channels to the other competing station (who is pursuing the same policies). This might be fine, but when you realize that your core audience is numbers 1 ~ 4 above, this is not an audience that is growing. This is an audience that is dying off and shrinking.


Now, it doesn't take a genius to realize that this sort of strategy is a sure-fire way to fail. Most promising new business plans attack new, growing markets; not old and shrinking ones.


A good piece of evidence for this is the many FM radio stations that are still playing Bob Seeger, Journey, Foreigner and Steve Miller Band; the same music they were playing 30 years ago! The current sad financial state of today's FM stations - in Japan and the USA - is a testament to the failure of this policy.


My conclusions about network TV in the USA pursuing this policy were reinforced by the commercials I saw. They were very heavily geared to an older audience. One particularly memorable commercial was for a boxed set of DVD's of Shirley Temple movies. Now, I like Shirley Temple as much as the next movie fan (OK, maybe not that much) but for lack of a better description, when I saw the commercial, I thought, "This is not 'cool'!" 


Now, who in the world would want to buy a Shirley Temple boxed set of movies? Anyone under 50-years-old? No? How about under 70? How about 75? 


One of the stations that my ill father and his caregiver watched constantly was ABC. I surmise that their favorite TV show is Good Morning America that has been on since before I moved to Japan in 1984. This show has definitely declined in quality and popularity (I could deduce that by watching shots of the audience). The main host Regis Philbin is retiring so he has good timing. These stations are trying to do anything to pump some life into their lifeless format but it fails miserably. 


It used to be only on late night TV like David Letterman that when the station returned from a TV commercial, would the audience scream and yell while clapping. But now, even on the morning TV shows, they do that. It used to be just polite clapping on morning shows. Now, it's a bunch of people yelping and screaming like a high school sports match or American Idol (which is the intelligence level of this nonsense).

It might have been OK to have these people screaming loudly like a bunch of junior high school kids excepting that one time, on Good Morning America, they foolishly showed the audience and there weren't twenty people standing there. Probably most people don't notice that, but I caught it immediately.


Twenty years ago, it would have been a few hundred people trying to gain their 15 seconds of fame. Now? 


In a related note, as I predicted long ago, many Japanese have turned away from TV. I predicted that the digital conversion would see Japanese TV stations voluntarily throw away 20 ~ 30% of their core audeince. Some people scoffed. I had written in Why the Digital Conversion Will Kill TV Tokyo and TBS:

It seems obvious to me that there's no doubt about it...  Basically:

1) People with money do not watch TV
2) The only people who do watch a lot of TV have either no money or too much time on their hands; they are not active
3) Advertising to people with no money and who are not active is a waste of money.
4) When digital goes online fully, then the only people who don't have the digital equipment are poor people
5) Poor people are the only ones who watch TV Tokyo and TBS now (see #2 above)

The countdown has begun. The digital TV conversion will kill TV Tokyo and TBS.

People aren't scoffing about what I predicted anymore. The TV people are panicking. It has happened and is happening right before your very eyes. The end of an era is upon us. TV, as we have know it for decades, is on its last legs and there is no one in that business (that I have met) who understands he problem enough to fix it. It is too late. The audience is gone.

Japan has lost a huge slice of existing viewers by cutting them off from digitial. They will not return. The USA still has the fashionable senior citizen crowd on Medicaid and Medicare....  

Japanese Are Turning Off the TVs.


Tokyo-- The Japanese, once one of the most TV-addicted people on the planet, are drifting away from the tube -- forcing networks to scramble for other sources of revenue, from pic production, satellite services, Internet streaming sites and other new technologies.

Daily TV viewing time, which averaged more than five hours in the 1970s, shrank to 3 hours and 28 minutes by 2010, according to figures compiled by the NHK Broadcasting Culture Research Institute.

Males aged 10 to 20 are watching less than two hours a day.

Meanwhile, program ratings have been trending downward for terrestrial networks, pubcaster NHK and commercial rivals TV Asahi, NTV, TBS, Fuji TV and TV Tokyo, despite spikes for major sport events and other special programming.

In June not one show on commercial TV in the 7 p.m. to 10 p.m. "Golden Time" slot won a rating of 10 or above -- once considered the minimum for survival.

Even long-running shows that once seemed immortal have either been axed or are on the brink. One that recently got the heave-ho after 43 seasons is period drama "Mito komon," which bowed in 1969. At its peak, the show's ratings reached as high as 43.7, but recently it has struggled to achieve double digits. Its last episode will air in December on MBS, an affiliate of TBS.

Various causes have been advanced for the ratings slide. Like other countries, Japanese families no longer sit around the TV watching the same show, as viewers did in the industry's 1960-to-1990s heyday. The Japanese now consume entertainment on a range of platforms, including PCs, smartphones and game consoles.

Also, an estimated 100,000 households, including a lot of elderly "Mito komon" fans, failed to make the switch from analog to digital in July, and have effectively given up TV entirely.

But the biggest cause, says Hiro Otaka, a media analyst for the Bunka Tsushin entertainment news services, is that "the programs have become boring."

Otaka blames network execs who have responded to falling ratings by cutting costs and hedging their bets.

There is no media in the world who can survive when the under 30-year-old crowd do not care about it. Can't be done. And under 30-year-old in Japan definitely do not care about TV... Come to think of it, why should they?


TV isn't dead... Yet. It just smells really bad.

Terrestrial TV Stations Getting Cold Feet?

All the major TV stations in Japan were supposed to stop broadcasting in analogue on July 24, 2011. There was one piece of information that wasn't made public until now, and that is that the Japanese government wanted the TV stations to stop broadcasting regular programming on June 30, 2011.

The government plan called for the TV stations to air only a notice that TV sets that cannot pick up Digital would only receive "snow."

As Yomiuri reports:

Commercial TV stations are likely to continue analog TV broadcasts until noon on July 24, deviating from a government plan to phase in terrestrial digital broadcasts and end regular analog service by the end of June, sources said.

This means the TV stations will not participate in a planned June 30 to July 24 transition period during which the government hopes analog broadcasts will be reduced only to a notice saying terrestrial TV broadcasting will go exclusively digital at noon on July 24.

After the changeover is complete, TV sets incapable of digital reception will display only "snow" on their screens. TV stations plan to start broadcasting an image of a snow-filled screen repeatedly in announcements to begin as early as this month to avoid confusion among TV viewers after the full transition.

The government is so unorganized that it is not even funny. Here we are 7 months from D-Day for these foolish TV stations that agreed to go into huge debt to go digital and the government - as is par for the course - hasn't got their ducks in order.

Hell, they stopped giving people so-called eco-point discounts on these digital ready TV sets already! (Now, don't get me wrong, I think these eco-points discounts, are a sham and the government has no business offering people discounts for products on the free market...) But if they are going to do it anyway, you'd think they would continue to allow credits to people to buy a digital set for at least a year after conversion... But no!

The government can't fill in a pothole in the road on time and on budget; who thinks they can control and run an entire country switchover to digital smoothly?

Let me make a prediction right here. When the stations stop broadcasting in analogue, they will lose viewers in huge numbers and they will receive a massive amount of complaints. This will affect their sales. I predict that the government and the broadcasters will start to quarrel and, before April 2012, some of the TV stations will request that they be allowed to broadcast in analogue also.

This will cause even more confusion and complaints amongst the people, manufacturers, broadcasters and the government. And that will, in turn, make TV an ever more undesirable method of advertising. This will also hurt TV viewership ratings.

The Japanese government will realize that they made a mistake by making digital broadcasting mandatory and then they will try all sorts of "fix-it" remedies - all of which will fail.

These sorts of events will help lead to TV Tokyo and TBS's bankruptcy by 2015.

Part 2: Why the Digital TV Conversion Will Kill TV Tokyo & TBS ...

Analogue TV will end broadcasting in Japan on July 24, 2011. I have written before that this will signal the end - and quick collapse - of TV Tokyo and TBS TV in their current configuration here in Japan. This is part two of why I firmly believe that TV Tokyo and TBS won't survive, in their current form, past 2015 and my proof for believing so.

On the surface, the reason that TBS TV and TV Tokyo won't long survive a digital conversion is that they are last in ratings even now. Sometimes, TV Tokyo gets a mere 1% of total TV viewers. That's terrible for a city like Tokyo that has 35 million households and only 5 terrestrial private TV stations.

They certainly will get even lower ratings when there are, not just 4 other private TV stations competing with them, but over 300 stations competing with them. I wrote about that in a previous blog:

...the stations like TV Tokyo and TBS are all crowing about their new digital channel... The content is still the same. Only the broadcasting platform has changed. What makes them think that just by changing platforms that their ratings and income are going to increase? Good question. If anything, their viewership is going to decline due to more choices being offered and some people opting out of buying an expensive new TV (at my home, we opted out of TV over seven years ago and haven't missed it once. I wrote about not having a TV and the benefits of that here and here.)

Today, TV Tokyo's ratings are dead last and they are losing millions of dollars a year and having to borrow massive amounts of money from banks to stay afloat. How long will banks keep lending them money?


...What makes TV Tokyo management think that, when digital goes online, and the competition increases one-hundred fold, that their fortunes will get better? 

Once the digital conversion happens, I estimate that TV Tokyo and TBS TV will lose at least another 30% of their audience. I also believe that my figures are conservative. Read on and I'll show you how I come to that conclusion using existing government, NHK and private company statistics as evidence.

From the Japan Times (July 30, 2010):

According to a survey conducted by the Ministry of Internal Affairs and Communications last March, 83.3 percent of Japanese households now receive digital TV signals. However, an NHK survey carried out two months earlier found this number to be only 63.7 percent, and a private research company quoted in the Yomiuri Shimbun said it was “less than 70 percent.”


Get that? The government says, "83.7 percent" of all households receive digital TV signals; NHK (a branch of the government) says "63.7 percent" and Yomiuri Shimbun says "less than 70%"! There's a huge difference between 63% and 84%. Something has got to give here.

I think this government figure of 83.7% is pure and complete nonsense. I think the private research is probably the closest to the truth but still exaggerrated...

In Japanese, this is called the "Minami Kanto Mondai" (Southern Kanto area problem). The Southern Kanto area problem is due to a very low percentage of homes having digital equipment (due to being  very low income and not being able to afford luxuries like digital tuners).

Besides the above consideration, in recent reports, it has become common knowledge around the world that Japan has a serious economic problem and that more than 15% of the people live below the poverty line. This is another critical factor in considering what is going to happen once the digital conversion is complete.  As the NY Times reported:

Many Japanese, who cling to the popular myth that their nation is uniformly middle class, were further shocked to see that Japan’s poverty rate, at 15.7 percent 

Just with that information, you know the government statistics are complete and totally cocked. People who are out struggling to make ends meet everyday are not out buying digital equipment that costs thousands of dollars a set. If 15.7 percent of the people are at "poverty line" then that means that, if you believe the government stats, then nearly every single person in Japan who is not on the poverty line has a digital tuner!?

What a load of rubbish!

In my own "Mike in Tokyo Rogers" informal survey, I registered 6 homes out of 10 that have satellite - I went around and knocked on doors and asked - and I took my survey in an upper-class neighborhood. If I include the one 10 unit apartment building that only has 2 satellite dishes, then we have 8 homes out of 20 (40%).

Consider these figures with the fact that more than 50% of the Japanese population lives in apartments - that do not normally have satellite TV (and are TBS and TV Tokyo's core bread and butter audience) - you can see where TV Tokyo and TBS are about to shut the spigot on possibly half their viewers.

Don't forget the fact that upper-middle class income families have been demonstrated to watch less TV per person, per week, than their middle-class income family counter-parts and you have TBS and TV Tokyo setting themselves up for a serious crash.

Oh, yes, I think TBS and TV Tokyo are in for a big surprise in their annual report to shareholders in mid 2012. I think current management are going to be out of jobs very soon.

Once you understand the above, you can see how - using simple math - TV Tokyo and TBS will lose at least 20% of their current audience from July 2011! They are losing money now. What are they going to do when 20% of their viewers disappear?

This 20% drop figure also has nothing to do with an increase in competition from other TV stations. It has to do completely with the fact that, in spite of the government spin, most likely, less than 80% of all Japanese households have digital equipment! In fact, the real numbers are far worse.

Depending on who you believe, I'd estimate that at the most, only 60% of the Japanese public has digital equipment. Go to any middle or lower class neighborhood that has huge apartments or "Danchi" and consider that fact that these dwellings do not have satellite TV! Even if it were an 80% penetration... TV Tokyo's ratings are last today. What's going to happen when they voluntarily throw away at least 20% ~ 30% of their audience?

At a "danchi" (apartment) in  Aizuwakamatsu, Fukushima You can count that only  4 of 24 apartments have digital TV.  That's only 16%

You might be saying now, "Those fools!" (there are more than a few of us who have been saying this for a few years) but it is too late. There's no turning back now. They've sold the farm on this digital bet. They've borrowed more money than they could ever pay back (sound familiar?).

The Japan Times reports:

NHK and the commercial stations have together spent ¥1.5 trillion to convert to digital, and the nation has contributed another ¥200 billion to the project. 

$1.5 trillion yen is about $17,000,000,000.00 (17 billion dollars!) NHK can get away with this because they are a blood-sucking parasitical publicly owned broadcasting station; no matter what happens to them, the tax payer will be forced to bail them out... But the private stations? Ha! Good luck with that!

With the economy in the doldrums and no relief on the horizon, people are not about to fork out several hundred dollars for digital equipment.

Why would they? Why would anyone think that they will? The digital equipment has already been available for years already in Japan and, still, to this very day, some surveys show that less than 70% of all households have digital equipment. Everyone has known for at least 10 years that the best TV is on digital, yet they didn't buy the equipment.

Why didn't people buy the equipment before? I figure it's because of one of six reasons (or maybe a bit of all six):

1) TV sucks, er, I mean, TV is boring

2) Digital equipment is too expensive for TV (see #1)

3) The Internet is much more interesting

4) DVD rental and things like Youtube are killing TV (and are much cheaper and more satisfying)

5) Young people want to play computer games and Internet and have no time for TV

6) Cell phones are more fun and personal for youth

It seems obvious to me that there's no doubt about it...  Basically:

1) People with money do not watch TV
2) The only people who do watch a lot of TV have either no money or too much time on their hands; they are not active
3) Advertising to people with no money and who are not active is a waste of money.
4) When digital goes online fully, then the only people who don't have the digital equipment are poor people
5) Poor people are the only ones who watch TV Tokyo and TBS now (see #2 above)

6) Internet TV is going to dominate the vewers habits.

I'd like to touch on that last point #6. I totally believe that the Internet is going to spell the death knell for the TV stations as they stand now. And that includes Fuji TV and NHK. Why? Because these old TV stations (and FM stations) are dinosaurs.

Someday soon, Podcasting is going to become super popular (the seeds are being sown now) and the big difference is that, no matter what, TV costs money to watch (not just electricity) but also TV Tokyo has more than 1000 employees at this very moment.

Some Podcaster is coming and is going to blow them away with viewership and that podcaster will have only himself and perhaps one other person to pay for. How in the world can a company compete with a lone individual with millions of viewers and basically no overhead when the TV stations have to pay the salaries of 1000 people? They won't.

They cannot possibly pay that money. The sponsors will have their own Internet TV or pay 1/100th the cost of regular TV advertising.

The countdown has begun. The digital TV conversion will put the TV stations in the coffin. The Internet will nail the coffins closed.
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Keywords: TV Tokyo, TBS, Mike Rogers, Marketing Japan, Digital, digital conversion, NHK, Yomiuri, analogue, Mike in Tokyo Rogers