Press Conference by President Shinichi Yoshida(Outline)

October 28th, 2014

Speakers:

Shinichi Yoshida, President
Masaya Fujinoki, Executive Director in charge of Finance Division, Corporate Strategy Division, & Compliance Audit Department
Gengo Sunami, Executive Director in charge of Business and Administration Division
Takashi Hirajo, Executive Director in charge of Programming Division

Audience Rating Update:

Shinichi Yoshida:

I would like to give you my brief comments and review on the overall audience ratings. The previous quarter and the first half of this fiscal year were tough periods, but we have worked very hard and kept up the second position for average audience ratings, and at the same time we were preparing for our next offense as our lineup for the fall includes our major dramas with proven popularities. As you know, our third quarter started with a lineup of our powerful dramas. gDoctor-Xh kicked off very successfully with a rating of 21.3% for the first episode and continued to get over-20% ratings making it a record breaking drama in The Thursday Drama slot achieving over-20 ratings for three consecutive episodes starting from the very first episode. gAIBOU: Tokyo Detective Duo-Season 13h also had a successful start with a rating of 19.8%, which is the second best rating for a first episode in the whole series up till now. Moreover, the first episode of gWoman in the Crime Labh achieved 14.4% marking the highest rating for a first episode of a regular program of gWoman in the Crime Labh so this drama also had a successful start and these dramas have indeed come up to our expectations. So, personally, as well as company-wise, it is a great relief. As our other offensive moves, we have also started to tackle the problems we had on weekends by introducing new programs. And among such new programs is gAwesome!! Super Nippon Discovered by Professionals from Abroadh (tentative English title), that achieved a remarkable start with 13.9% for its kick-off special extended version. Another challenge we are making for this quarter is with our new variety shows in our midnight slots introducing more creative twists, and I think they are showing quite promising starts. I hope we'll be able to keep up this successful trend.

Takashi Hirajo:

The annual average audience ratings from the beginning of the year until yesterday are: 7.2% for all-day, placing us second, 10.7% for golden-time, placing us second among commercial broadcasters, 11.3% for prime-time, placing us second, and 7.4% for prime-2, placing us at the top. There are another 8 weeks and 6 days to go until the end of this year. We are aiming to be at second place or better for the third consecutive year in ratings for all-day, golden-time and prime-2. If we finish second for all-day, it will be the third consecutive year and for the sixth time since the launch of the station. If we finish second among commercial broadcasters for golden-time, it will be the third consecutive year and for the third time since the launch of the station. If we finish second or better for prime-time, it will be the third consecutive year and for the sixth time since the launch of the station. If we keep up our top position for prime-2 until the end of the year, we will be the top for ten consecutive years since 2005.

I'll continue with the update of the average audience ratings in this fiscal year since April: 7.0% for all-day, placing us second, 10.3% for golden-time, placing us second among commercial broadcasters, 10.9% for prime-time, placing us second, 7.2% for prime-2, placing us at the top. We are still half way through the fiscal year and we just passed the turn-around point. Ratings of regular programs have recovered since the start of the October-December period and we have the least number of single-digit ratings in prime-time regular programs among all the broadcasters, so I am looking forward to further catching up from now on.

The ratings for the October-December period as of now are: 7.3% for all-day, 11.6% for golden-time, 11.9% for prime-time, placing us second in all three categories and 7.2% for prime-2, placing us at the top. As the third quarter is only one third of its way, the final results of the rating races are yet to be known.

I will now report on how the individual programs are doing. In the October reshuffling, we lined up proven super-popular dramas and introduced new variety shows on weekends to boost the weekend ratings. I think the dramas kicked off very well. gDoctor-Xh, featured in The Thursday Drama slot, was extremely popular last year and the year before last, and this time its average rating for the first three episodes is 21%, keeping up the top audience ratings among all the serial dramas launched in the third quarter by commercial broadcasters. Moreover, gAIBOU: Tokyo Detective Duo-Season 13h achieved 19.8% for its first episode and it is the second highest rating for a first episode of the series. Also, I think gWoman in the Crime Labh featured in the Thursday Night Mysteries has achieved its best start as its first episode marked 14.4%, the highest rating for a first episode of this drama on a regular slot. The average ratings on an individual basis are: gDoctor-Xh for its first three episodes is 21.0%, gAIBOUh for its first two episodes is 19.4%, which made these two the first and the second in audience ratings among all the dramas launched by commercial broadcasters in the third quarter respectively. The average rating of gWoman in the Crime Labh is 13.6% for its first two episodes, placing it in the 5th position among all the dramas launched by commercial broadcasters in this third quarter. The rating for the first episode of our new weekend show, gAwesome!! Super Nippon Discovered by Professionals from Abroadh (tentative English title) was 13.9%. It is the highest rating of a first episode of the kind in four and half years since gNow I know, Akira Ikegami's News Show to Make You Smarterh. So much for the updates on our prime time new programs for the third quarter.

Upcoming Major Programs and Sports Coverages:

Takashi Hirajo:

As for upcoming special dramas, we have lined up two dramas: gDrama Special Seicho Matsumoto`Pro Bonoh starring Maki Horikita and gDrama Special Seicho Matsumoto`A House on a Hillh starring Machiko Ono. And there is gTime Never Stopsh. This drama won the Grand Prix at the Tokyo Drama Award 2014. It was also awarded the gMIPCOM BUYER'S AWARDS for Japanese Dramah at MIPCOM 2014, the largest global trade show for TV formats and programs held in Cannes. The award is granted to the most wanted drama chosen by ballot held at MIPCOM. The drama will be aired as a rerun on November 15th.

As for sports, gISU Grand Prix of Figure Skating Series 2014h has started. Tatsuki Machida had a great start and Yuzuru Hanyu will participate in the Lexus Cup of China held in China on November 7th and 8th. The event is scheduled to be aired in our prime time slot. Other sports on the upcoming list are: gthe 4th Game of 2014 Suzuki Japan-USA Baseballh and gAFC Asian Cup 2015h in January.

Sales Results:

Shinichi Yoshida:

The year-on-year sales results for the month of September are 97% for time-sales and 103.9% for spot-sales, making the total sales of 100.6%. The September time-sales went down slightly but we were able to make up for it with spot-sales and exceeded 100%. The reason why time-sales fell short of last year's level is because we had a program like gIBAF 18U Baseball World Cup Finalh last September but not this year. On the other hand, spot-sales market was strong, fueled by continuous demand from smartphone and gapph industries. Although we had to struggle with audience ratings, we have been efficient in our sales activities and were able to exceed last year's level. As for the share for spot-sales, we were able to get a record-high share for the single month of September.

Next, I will report on the sales update for the month of October. The year-on-year sales for the month of October so far are more than 95% for time-sales and more than 106% for spot-sales, making the total figure to more than 101%. As for time-sales, the sales activities on gISU Grand Prix of Figure Skating Series 2014h has started in October and we have been able to make deals with large-scale sponsors steadily. In the face of huge attention on Hanyu in this coming Series, we are expecting very good sales results. Sales for the g3rd Game of SMBC Nippon Series, Softbank vs. Hanshin Tigersh which we broadcast today from early evening has also been successful and is contributing to the sales increase. And our spot sales are expected to greatly surpass last year's figure backed up by good market conditions.

The year-on-year sales for November so far are more than 86% for time-sales and more than 82% for spot-sales, making the total more than 84%. Time-sales for November will be mainly from abundant sports events, which I believe will become the core of our sales results. In November, we will be covering gISU Grand Prix of Figure Skating Series 2014h held in China, Russia and France, and two road races, gJapan Inter-University Ekidenh and gYokohama Women's Marathonh . Also, as for baseball games now heating up with Nippon Series, we will cover gthe 4th game of 2014 Suzuki Japan-USA Baseballh. Each and every event that we are covering is likely to achieve high audience ratings, so we are now working very hard to accomplish successful sales on these events. As for spot-sales, on the other hand, consumption is not as good as we had expected and I got reports that advertisers are slow to react. Bonus campaign should be starting in November, so our plan is to stay in close touch with our advertisers and advertising firms to build up communication and sales one by one.

Revenues from Non-broadcasting Business:

Gengo Sunami:

I will start my report with gTetsuko's Room Concerth scheduled in December which was sold out immediately on the day the tickets were released. gTetsuko's Room Concerth is one of our very popular annual events, and it will be held again this year at two venues, in Tokyo and Osaka. The tickets for the events were released on the 18th of this month, and they were sold out on the same day for both venues. It is going to be the 9th concert. This year's guest stars for the Tokyo venue will be Yuzo Kayama, a household name from one of our programs, Judy Ongg, Kosetsu Minami, Harumi Miyako, Saori Yuki and Toru Watanabe. The guest stars for the Osaka venue will be Yuzo Kayama, Judy Ongg, Kosetsu Minami, Toru Watanabe as for the Tokyo venue, but Miyuki Kawanaka will take the place of Harumi Miyako and Saori Yuki. Gorgeous guest stars together with Tetsuko will enchant the audience with their lively talk and wonderful songs. The MC for the concert will be Noritsugu Watanabe and Naoki Tsuboi, both of whom are TV Asahi's announcers, very familiar faces for the audience.

Now I will introduce gSekigaharah(tentative title), a grand exhibition scheduled to open in March next year. March 2015 commemorates the 400th anniversary of the death of Shogun Tokugawa Ieyasu, and we will hold a large-scale exhibition planned and organized by TV Asahi entitled gSekigaharah at three venues in Japan, starting from Edo-Tokyo Museum. As you know, the battle of Sekigahara is known as the decisive battle that became the crucial turning point of Japanese history which cleared the path for the Tokugawa Shogunate, after the civil war period, leading to its peaceful reign that lasted for more than 200 years. Our staff members have been collaborating on ideas to design an exhibition that will show the whole picture of the Battle of Sekigahara and they spent more than four years on its preparation. As a result, we were able to collect a wide range of exhibits including weapons and armors used in the battle, letters sent back and forth between warlords, and precious scroll paintings, all in the largest-ever scale. I am proud to say that it will be an unprecedented exhibition, where you can get real-life images of the battle from many different angles as you enjoy the exhibition.

Takashi Hirajo:

I will report on our film business. gStand by me Doraemonh is now showing in the theaters, and as of yesterday, the total number of its audiences is 6,070,226 and its total revenue is 8,066,081,300 yen. With the total revenue exceeding 8 billion yen and the total number of audience exceeding 6 million, the film has become the grand number 1 film among all Japanese films released this year. As I have already mentioned before, this film has broken the record of the most revenue achieved by a film we have invested in, and every day it is breaking its own record.

*Hodo Station's report on Sendai Nuclear Power Station has come under deliberation at BPO (Broadcasting Ethics and Program Improvement Organization). Any subsequent measures?

Shinichi Yoshida:

I have expressed my apology at the last press conference regarding the fact that Hodo Station's report on Sendai Nuclear Power Station included misinterpretation of facts and inappropriate editing that led to a misleading expression. It is something that should never have happened. I want to express my sincere apology once again to all of our viewers and everyone involved in the matter for causing them inconvenience and trouble. Disciplinary measures in the company have been decided. Three staff members, the producer of gHodo Stationh, news desk of gHodo Stationh, and city news reporter at News Center in News Division, will be reprimanded with a pay cut for three months. Also, as I have repeatedly said, the management should be held responsible for the lack of stringent control and ineffective checking system so four staff members, the Director of News Center under News Division, the Co-Director of News Center in charge of City News under News Division, the Co-Director of News Center in charge of gHodo Stationh under News Division, and the Executive Producer of News Center under News Division have received official reprimand for their lack of responsibility in management supervision. And there is a Member of Board in charge of News Division who is the chief officer responsible for the Division, and he has decided of his own accord to cut 5% of his executive compensation for the term of one month. All reprimands will become effective on October 29th. Furthermore, it is decided that deliberation on the issue will start at BPO on October 10th. We will respond to whatever comes out of the deliberations made at BPO in good faith, and at the same time, the fact that the issue has become an agenda at BPO is in itself a matter that we are taking very seriously indeed.

*Countermeasures were announced at the last press conference, how are they really working?

Shinichi Yoshida:

The incident was caused by a vast omission made from an original memo, and on top of that there was a lack of communication regarding how the memo was outlined and what was omitted among the staff members in charge of the matter. And the one who read the transcription memo made a very basic mistake and misread what was written and it went through on air. And what was really critical was that double, triple checking systems that were supposed to be there were neglected because they were busy and none of the checking systems functioned, thus leading to the incorrect report on air. There are two pillars in our countermeasures. When we use a sound bite from a press conference or something of that sort, we make a transcription from the recording, and the one who has done the transcription knows the overall picture of the recording, so one of the countermeasures is to make sure that the director who has the understanding of the overall picture because he/she had done the transcription will be there at the editing process. Such system was already there, but we have taken strong measures to make it strictly obligatory. And the second pillar is a newly formed gSub News Deskh. It is located right next to the gNews Deskh with the same responsibility and authority as the News Desk. The role of the Sub News Desk is to watch over the allocation of directors from the point of view of risk management. That is to say, to keep a watch over the actual task and positioning. I have heard that approximately 70% of the News Division staff, TV Asahi staff and outside staff included, attended study meetings and workshops as of yesterday (October 27th, 2014). It goes without saying that we will make further improvements if we receive any suggestions from BPO which is now in the process of deliberating this issue.