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In Japan, television is tightly woven into the fabric of most people’s daily lives. The Japanese television market comprises five terrestrial, free-to-air commercial networks, including TV TOKYO; one terres- trial public broadcasting service; and more than 100 small and medium-sized satellite channels. Terrestrial television has a 99% penetration rate among Japanese households, with television ownership exceeding 100 million units, or almost one receiver per person. Japan is the world’s second largest advertising market, behind only the United States. Within total annual advertising expenditures of around ¥6 trillion, television advertising expenditures account for approximately 34%, or ¥2 trillion, making television the dominant advertising medium in Japan. For advertisers, terrestrial television is regarded as the most efficient and effective mass advertising medium. Japanese television program content is regarded as being among the world’s top class. The myriad programs produced by Japanese broadcasters have found their way into the national affec- tions, enjoyed by everyone from children through to the elderly. Many programs in all genres, from anime to drama, have also been successfully exported. TV TOKYO was launched as a station in 1964 and currently serves over 16 million households in the greater Tokyo area. TV TOKYO also acts as the lead station in the TXN network, which com- prises six stations that reach a combined 32 million households in all of Japan’s major urban areas. In this role, TV TOKYO provides news, entertainment and other programming to roughly 70% of total households. In programming, we follow three guiding principles: originality, quality and vitality. Based on these principles, TV TOKYO has built a strong reputation among audiences for business news and documentaries. We have also achieved prime time audience shares of over 10% with entertainment- oriented programming. In Japan and globally, we are in the midst of a period of far- reaching change, both technological and in terms of people’s media exposure patterns. One important milestone in this change process was the launch of terrestrial digital broadcasting services in Japan in December 2003. TV TOKYO is presently simulcasting in analog (channel 12) and digital (channel 7) formats. More than half the Japanese population has adopted new communications technology, such as the Internet and mobile phones, which continue to increase in sophistication. For TV TOKYO, this environment makes it even more crucial that we create synergy between our broadcasting and rights management businesses as we strive to enhance our overall performance. I also believe our commitment to producing and supplying content with an emphasis on originality, quality and vitality will be the key to our success.

PRESIDENT Sadahiko Sugaya

Originality, Quality and Vitality

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