Tokyo -- While Japan's crowded direct-to-home platform
business became more rationalized last week with the merger of two services, the going
remains tough for contenders in the pay TV distribution business.
In order to compete more effectively with other players,
PerfecTV and Japan Sky Broadcasting announced that they would equally merge their services
under the PerfecTV name. Financial terms were not disclosed. The agreement is expected to
be finalized by April.
Japan's DTH market has included three commercial
contenders in the past: 18-month-old PerfecTV; JSkyB, which was slated to launch this
spring; and two-month-old, Hughes Corp.-backed DirecTv Japan. As if that weren't
enough, public broadcaster Japan Broadcasting Corp. (NHK) is putting together its own
digital DTH service, to be distributed by the BS-4 satellite.
Under the terms of the agreement, JSkyB's shareholders
-- News Corp., Softbank Corp., Sony Corp. and Fuji Television Network Inc. -- will receive
one share of PerfecTV stock for each share of JSkyB stock owned at the time of the merger.
PerfecTV's shareholders include four trading houses --
Itochu Corp., Sumitomo Corp., Nissho Iwai Corp. and Mitsui & Co. Ltd. -- plus their
equity-owned satellite operator, Japan Satellite Systems Inc., and Tokyo Broadcasting
System Inc.
Management of the merged entity will be shared, with JSkyB
president Hajime Unoki becoming chairman and PerfecTV president Koya Mita retaining his
title.
Entrenched PerfecTV has garnered about 605,000 subscribers
with its lineup of 107 video channels and 106 audio channels. DirecTv Japan, which
hasn't disclosed its subscriber base, currently offers 63 video channels -- a number
that's expected to grow to about 90 by April.
In addition to the competing DTH platforms, the overall pay
TV market in Japan is likely to become more heated, following the government's recent
announcement that it will speed up plans to provide digital terrestrial broadcasting. The
Ministry of Posts and Telecommunications said it will push to convert existing terrestrial
television in the Tokyo metropolitan region to digital by 2000, and to gradually expand
coverage to the rest of Japan by 2006.
The MPT plan proposes to set aside a 6-megahertz band --
the same used for analog broadcasting here -- for each station. Three times as many
digital programs can be aired in this bandwidth, provided that the resolution stays at
analog levels. Moreover, this band can also be used for high-definition television
programs -- a format long championed by NHK.
With the government's push, NHK will have two digital
terrestrial bands, in addition to digital satellite bands on its new bird. The 'Big
5' Tokyo-based private broadcasters will get one digital terrestrial band each. The
eighth band is to be allocated to University of the Air.
