2015 New Year Message to Employees from Chairman & CEO Hiroshi Hayakawa (Summary)

January 5th, 2015

A Happy New Year to all the members of the TV Asahi Group and all the fellow staff members working with us. The first three days of the New Year were quite cold, but I am sure you have been able to spend a relaxing and peaceful New Year holidays with your family. And, Ifd like to sincerely thank all those who were at work during those holidays for broadcasting, programming, sales and business operations. Thanks to their hard work, the audience ratings during the first week starting on the New Yearfs day were 13.2% for golden-time and 13.3% for prime-time, placing us second for both slots. The overall ratings for the first three days of the New Year were 14.7% for golden-time and 15.0% for prime-time placing us at the top. Our 10 affiliate stations also had great results. Our audience ratings were somewhat sluggish from last spring to summer, but I feel now we have regained a momentum to move up again from the successful third quarter starting from October and the turn of the year programming. And yet, I do not think that we have charged enough power yet as of now to be fully competitive in winning the top ratings. As we start working in this New Year, I would like to tell you that the keys, or clues to be a competitive challenger in the race to win the top audience ratings lie in our recent hit contents we have created. The keys are the absolute requirements that we were able to fulfill in those hit contents, and now I would like to emphasize those requirements by giving specific examples.

The first example is gDoraemonh. gStand by me Doraemonh, a movie that we have invested in and premiered last summer, became a blockbuster hit with a total revenue of 8.3 billion yen. It is now 35 years since we launched the TV series gDoraemonh and started releasing its 2D movie in spring every year. And these works based on the original by FujikoEFEFujio have become major popular contents enjoyed by the people around the world. Even after 18 years since the original writer passed away, it still keeps the principal concept and the realm of the original. And this time gDoraemonh has taken on a challenge to use an innovative contemporary way of expression, 3DCG (3 dimensional computer graphics). The people who joined in the filmmaking included Director Takashi Yamazaki and his team from Shirogumi Inc. who created VFX blockbusters such as gAlways, Sunset on the Third Streeth and gThe Eternal Zeroh. The clue we get from the great success of gStand by me Doraemonh is that, if we are to aim for a higher level in revenues and audience ratings, it is essential to have a new collaboration with a talented and creative partner.

The next example is gAIBOU Tokyo Detective Duoh . Since gAIBOU Tokyo Detective Duoh started as a 2-hour drama in the year 2000, close to 240 episodes have been aired during the last fifteen years and the average rating of all episodes is above 16%. Its film version produced so far are five including spin-offs, and their total revenue amounts to 12 billion yen and the total number of audience is 10 million. As all of you know, aside from its films, we have been making substantial revenues from its DVDs, publications, events and whatnots. What are the factors that have kept it going without losing its quality or audience ratings for the past 15 years with continuous good reviews? The biggest factor is the contribution from Yutaka Mizutani, an actor blessed with a unique power of expression backed by successful experiences. The gworld of AIBOUh created by the leading actor with exceptional creativity and sensitivity at its core has attracted renowned actors, talented script writers and production staffs, and together they have produced a one of a kind drama which cannot be easily imitated. gAIBOU Tokyo Detective Duoh shows the importance of having partners in building a creative network. gAIBOU Tokyo Detective Duoh has almost all the factors required for a content to become a hit, and it is filled with clues and points to learn from.

The third edition of gDoctor-Xh has become a mega hit TV series achieving an astonishing average rating of 22.9% for its eleven episodes. Famous lines such as gI donft make mistakesh gI will not do ith and gGyoih (as you wish) have become clichés among the people making it a social phenomenon and a boom. I think the key factors of its success come down to three female hit-makers. First is the leading actress Ryoko Yonekura, who has deep ties with TV Asahi. Her first major appearance at TV Asahi was Seicho Matsumotofs gBlack Leather Notebookh , followed by gThe Bad Guysh , gBeast Alleyh , gThe Negotiatorh , gHUNT - Tax Investigation Officerh , and gBloom in Iceh . Actually, I think we can say that she is the actress that has the best chemistry with TV Asahi for the past 10 years leading to gDoctor-Xh . And our producer Uchiyama has been involved in all those productions and a deep mutual trust has been built between the two women. And there is Miho Nakasono, who is the scriptwriter of gHanako and Anneh aired by NHK. These three women have created gDoctor-Xh . I myself have been supporting this creative triangle indirectly, and our programming department has dealt very well with the relevant agencies, and all those factors have brought about the wonderful results.

We can derive many clues to success from these experiences, but the most important factors are that we need to brace ourselves for the fact that it takes a certain amount of time to create a hit-content and that it takes a sense of unity among the company top and the staff members on the site in order to build a solid creative network. TV Asahi 55th Anniversary Special, Taichi Yamadafs Drama Special gTime Never Stopsh received nine awards during last year alone. It was a production that could not have realized without the superb scriptwriter Taichi Yamada, but this drama was again a remarkable work accomplished by a close knit network of producers who have kept good relations with Mr. Yamada over a long time along with veteran directors and high caliber actors.

Now let us take another perspective and look at sport events. Starting from the turn of the century, TV Asahi has invested a large part of its management resources to acquire broadcast rights including gFINA World Championshipsh , gAFC Asian Cuph , and gFigure Skatingh . Every one of them was a great success, but the decision for the acquisition involved a considerable amount of risk. The decisions were made upon passionate proposals made from the young and the middle-management staff members, but we have made it a rule that the management will take full responsibility for the outcome of such decision, both of which have resulted in a more dynamic development to follow. We acquired broadcasting rights to gThe Japan Seriesh the year before last, gFIA Formula E Championshiph the electric car race, and most recently, gATP World Tour Finalsh with tennis player Kei Nishikori. These right acquisitions are the successful examples of our strategy to act speedily trusting information from our staffs working on the field.

Now I hope all of you have realized that the keys and clues to win the audience rating battle, especially to get back to our head on challenge to win the top rating can be found in the universal factors within the hit-contents and killer-contents that TV Asahi has produced. The main points can be summarized like this: 1. Build up a good relationship based on trust with leading actors and entertainers, and nurture cooperation and coordination with their agencies. 2. Creative network; cultivation of relationships with main actors, directors, scriptwriters, TV and film writers, musicians, production companies and partners. 3. Friendly relationship with right holders. 4. To invest both time and budget in middle-term and long-term strategies. 5. Continuity and challenge without a fear of risk of failure. All of these may seem obvious to you, but these are the factors common in programs and contents achieving the ratings of over 20% and they are the absolute requirements for creating big hits.

To close my message, I will talk about our variety shows that I did not refer as my examples today. Variety shows that gave TV Asahi much energy during the last 10 years seem to be losing steam now. Once it becomes successful, a variety show can stay as a long-running show, but because of its longevity, it is fated to face a day when it is no longer relevant to the needs of the time. However, now gAwesome!! Super Nippon Discovered by Professionals from Abroadh aired on Saturdays has become a hit show, and experimental and challenging shows and trials in the late night slots are becoming highly visible. Among the turn of the year line-ups, gAkira Ikegami Year-end Special: Will this yearfs news stay in history? Understanding 2014 by comparing now with the pasth, gDream Challenge 2015: Who are the Champions by the Super Duo Tunnels: 5-Hours Specialh , and gMatsuko & Ariyoshifs Angry New Party: New Year Specialh have done very well. I am confident that the staff members in charge of variety shows will remember their successful experiences and will prove their power to bounce back and create hit shows and hit contents. As for news shows, I would like to place my order to you to take on challenges to improve the ratings for our morning and daytime shows by using the know-how of gHodo Stationh and gSuper J Channelh which are the top level news shows in Japan.

In our five-year management plan gDigital 5 Vision 2nd Stageh that started last year in April, we have declared the streamlined management of our three waves: terrestrial, BS and CS, as our core business, the internet as our growth business, and creation of gMedia Cityh through 5-Media Strategy, but such strategies all depends solely on the qualities of our contents. So, please make sure you have grasp the essence of what I have said so far, and let us take our strong steps forward together to the goal of creating hit contents. What Ifm saying is not something new, but this is what I really want to tell you the most as we start the New Year together. In order to enlarge and strengthen our creative network with fresh and creative partners, let us all together give our all-out efforts and even if it takes time, let us take the high road to improve the audience ratings. As long as we spare no effort this year, the year marking the half way of the management plan, I believe that we will get a concrete result by the year 2016.

Thank you for your kind attention, and now I would like to close my New Yearfs Message by wishing you all the members of the TV Asahi Group, all the fellow staff members working with us and their families, a very good year with much happiness and good health.