The Sankei and the State of Japan's Newspaper Industry 印刷機作業停止?産經と日本の新聞業界

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The Sankei and the State of Japan's Newspaper Industry 印刷機作業停止?産經と日本の新聞業界 Volume 8 | Issue 10 | Number 4 | Article ID 3318 | Mar 08, 2010 The Asia-Pacific Journal | Japan Focus Stop the Press? The Sankei and the State of Japan's Newspaper Industry 印刷機作業停止?産經と日本の新聞業界 David McNeill, Peter Alford said Blaine Harden, Tokyo correspondent for The Washington Post. “The elite press is in this Stop the Press? The Sankei and the terrible pickle. There is this incredible problem State of Japan’s Newspaper Industry about where you get money.” Harden said his own newspaper epitomizes the problem. It is Peter Alford and David McNeill still hugely popular, with over half the population of Washington seeing the Post in Introduction: David McNeill print or online every day. But with online advertising attracting just 11 percent of the There can be little exaggerating the vertiginous revenue of hardcopy versions, the paper lost decline of US print journalism. Daily newspaper $200 million in 2008. sales (of about 379 titles) down by 10 million to 30.4 million over the last decade; over 15,000 What about Japan? For years, Japanese US journalists sacked across the country in newspaper circulations seemed to defy gravity, 2008; some of the most venerable titles in print held aloft by the industry’s unusual success in media, including The Boston Globe, teetering scoring and holding subscriptions. Direct close to extinction; circulation of others, such deliveries to homes, backed by famously as the once invincibleNew York Times, tenacious distribution networks, account for plummeting – down by 7.3 percent in the six over 90 percent of all sales in Japan, according months ending September 30, 2009, according to Laurie Anne Freeman, author of Closing The to the U.S. Audit Bureau of Circulations. Shop. As Tokyo correspondent Peter Alford Chicago Tribune down by 9.7 percent in the explains in this piece forThe Australian, same period; LA Times down by 11 percent. newspaper circulation here has held And the decline is accelerating, double the 4.6 “remarkably steady”, losing less than 1.5 fall recorded from September 2007 topercent in a decade. Yomiuri editor in chief September 2008, says ABC. At the same time, and chairman Tsuneo Watanabe claims his American papers are cutting sharply into their company has lost just one percent of its international coverage, notably from Japan. In enormous readership. Japan still boasts 51.5 fall 2009 Time closed its Tokyo office as did million average daily sales with virtually every Business Week when it was absorbed by household receiving one or more of the big Bloomberg, while the New York Times, Los dailies: The Asahi, Yomiuri, Mainichi, Nikkei Angeles Times and Washington Post all cut and Sankei. It is one of the few advanced staff in their Tokyo offices. countries with a daily communist newspaper, Akahata, which claims a daily circulation of Yet big American newspapers attract 10-20 over 1.6 million. And let’s not forget the Soka- times more readers than in the pre-Internet Gakkai-affiliated Seikyo, with a claimed era, when hardcopy and online versions are circulation of 5.5 million. combined. The problem is that few newspapers have successfully monetized all those eyeballs, What explains Japan’s lingering love of print? 1 8 | 10 | 4 APJ | JF One reason is simply the weight of the past: magazines. But it is the fate of the rightwing subscriptions are overwhelmingly sustained by Sankei, down from 2,191,587 to 1,846,591, middle-aged and older people. As a trip on any which takes up most of Alford’s analysis here. urban train makes clear, however, the As he says, 2008 January-June sales (combined generations below largely shun newspapers for morning and afternoon) of Japan’ smallest daily the Internet, usually delivered via cell phones. dropped 14.7 percent. Japanese media proprietors have been savvy about protecting their turf, effectively cartelizing to jointly limit access to online content, unlike many of their Western counterparts who have cannibalized their expensive print editions for online versions out of fear of being left behind by competitors. Alford brings another factor into the mix here: the practice of oshigami, obliging distribution companies to buy newspapers far in excess of their orders from customers, which artificially inflates circulation by up to 20 percent and which is the industry’s “dirty little secret.” Slowly, however, the gravity-defying circulations appear to be heading for earth. ABC statistics on the main morning-edition circulation for 2006 to 2009 show that every Japanese newspaper recorded a loss of sales, except the business-oriented Nikkei. In relative terms, the declines are tiny: the world’s best-selling newspaper, the conservative Yomiuri is down from 10,042,075 to 10,018,117; the liberal-leftAsahi from 8,093,885 to 8,031,579; the liberalMainichi has taken a more substantial hit, from just under 4 million to 3.8 million. The Nikkei is up slightly from 3,034,481 to 3,052,929. Perhaps Sankei Shimbun Tokyo Headquarters more indicative, and worrying, for the industry is the sharp drop in advertising revenues: from Staring into the abyss, theSankei took the one trillion yen in 2007 to an estimated 600 radical step last December of making their billion in 2009, a year in which onlinenewspaper available free to anyone with an advertisements continued to grow. In 2009, iPhone and, Alford speculates, “stopped playing online advertisements increased by 1.2% to 707 oshigami.” The results have been billion yen, with the internet surpassingdiscouraging: revenue is down and he says newspapers as the No. 2 medium for ads, some industry watchers believe the 76-year-old trailing only television's 1.7 trillion yen,publication may have cut its own throat. according to data released on February 22 by Although still some way off, the collapse of one Dentsu. In that year, reflecting the economic of Japan’s Big Five newspapers would cause meltdown, total ad revenues plunged by 11.5%, tremors in an industry that appeared, until including 12% for newspapers and 19% for recently, invincible. 2 8 | 10 | 4 APJ | JF Why has the Sankei taken such a hit? As just defect to free content elsewhere. In an Japan’s smallest major daily newspaper it may effort to buck this trend, one of the global be simply be the most vulnerable to the industry’s biggest hitters, Rupert Murdoch, demographic, technological and economic announced in May that he would end free forces sweeping the industry. But it is possible access to the News International stable of to at least speculate that it may also have fallen titles, having previously done so with The Wall victim to the changing zeitgeist, it’sStreet Journal. "We are now in the midst of an conservative populism no longer in favor since epochal debate over the value of content and it the doomed regime of Abe Shinzo. Part of the is clear to many newspapers that the current Fuji-Sankei conglomerate, the newspaper was model is malfunctioning," said the News Corp. one of the staunchest mainstream supporters of chairman and CEO. As Alford explains here, former Prime Minister Abe Shinzo and his the Nikkei intends to launch one of the most agenda, and championed a notoriouselaborate subscription-based online services nationalist high-school textbook (published by a anywhere next year. All eyes will be on the company within the Fujisankei group) that venture, but whatever happens, the old model attempted to whitewash Japan’s colonial record is dead. DMN in Asia. Its columnists included rightwing Tokyo governor Ishihara Shintaro and Komori Yoshihisa, a revisionist well known in Washington circles. Could its decline be part of Omens from the shrinking Japanese the wider weakening of the conservative newspaper business movement? Peter Alford While Japan ponders the possible demise of the Sankei, the implications of the looming industry Something very odd happened toSankei crisis are already evident. Many of the big Shimbun’s circulation recently -- close to 15 per dailies have scaled back local reporting, relying cent of it disappeared. instead on partnerships with regional The decline of Sankei, the smallest of Japan's newspapers – a tie-up between the Asahi and five national daily newspapers, has been the Nigata Nippo (which reportedly has 60 sudden, steep and not well explained. percent share of local readership) is typical of the recent industry trend. Another trend is the The underlying reasons might be ominous for growth of free papers – event guides, small- the Japanese industry generally, or a salutary town free-sheets, movies and TV information, warning to the others not to go where Sankei restaurant guides and the like. The Japan has gone, and most likely a combination of Consumer Marketing Research Instituteboth. estimates that the country prints about 291 millions copies of free papers a year. Newspaper executives around the world often Advertisers are increasingly opting for these marvel at the Japanese market. The country's publications, says the Institute, drawn by their newspaper sales and penetration are, without a sometimes “immense circulation numbers” and doubt, extraordinary -- almost 51.5 million the “ability to blanket a geographical area with average daily sales to the end of last year. messages at low cost.” And until the end of last year, general So whither Japan’s big newspapers? One way newspaper circulation held remarkably steady, out could be to charge for online subscriptions, losing less than 1.5 per cent in a decade. In just but most publications have found that readers the six months to September, US newspaper 3 8 | 10 | 4 APJ | JF publishers lost 10.6 per cent of unit sales. advertising revenue is sharply decreasing, from Y=1 trillion ($12.35 billion at today's value) in But the Sankei January-to-June combined 2007 to the Y=600 billion expected this year.
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