Introduction
In recent years, Japan streaming platforms have grown rapidly as the penetration rate of Japan fixed broadband service households continues to increase, and the trend of consumers switching from traditional pay-TV to OTT video platforms has intensified. Among them, United States streaming media platforms are undergoing profound changes in Japan's audiovisual media market by virtue of their strong capital, strong content advantages and global operation methods, and controlling the dominance of Japan's audiovisual industry chain with investment and broadcasting platforms. Japan radio and television institutions have built local independent streaming media platforms, strengthened cooperation and resource integration, strengthened content supply, met the needs of multiple scenarios, built a comprehensive service platform, and successfully broke through under the heavy pressure of United States streaming media platforms, and major streaming media platforms have achieved profitability.
First, the United States streaming media platform has a first-mover advantage and maintains a large influence in the Japan market
United States streaming platforms place a high value on the Japan market. Since 2011, Hulu, Netflix, Amazon (Azazon Prime Video), Disney (Disney+), Apple TV+ and other mainstream streaming platforms in United States have entered the Japan market and become the top players of Japan streaming platforms. By the end of 2023, Amazon Prime Video has 18.6 million subscribers, making it the largest subscription platform in Japan; With 8.1 million subscribers, Netflix is the second-largest subscription platform; Disney+ has 3.8 million subscribers, ranking fourth. Among the top four streaming platforms in terms of subscribers, United States streaming platforms occupy three of them, accounting for 80.26% of the total number of users.
Deeply cultivating the Japan market, the United States platform has multiple advantages:
First, strong capital and global operation mode. United States streaming media is a global platform with strong capital advantages and user scale advantages. In 2023, Netflix revenue will be about $33.7 billion; In the first quarter of 2024, Netflix's revenue was close to $9.4 billion, an increase of 14.29% from $8.2 billion in the same period in 2023. As of the first quarter of 2024, Netflix has about 270 million paid subscribers worldwide. In the second quarter of 2024, Disney+ will reach 154 million global subscribers, making it one of the global streaming giants. Amazon Prime Video's total revenue in 2023 is about $5.16 billion, with 200 million monthly active users as of April 2024.
The second is to control the dominance of Japan's audiovisual industry chain with investment and broadcasting platforms. After Netflix entered the Japan market in 2015, it smashed the door of Japan animation with a lot of money. First of all, a large number of popular Japan classic animation works such as "Saint Seiya", "Dragon Ball" and "Attack on Titan" were acquired to increase the gold content of Japan content on the platform. Second, buy out the global distribution rights of Japan animation and control the Japan market. "Violet Evergarden" aired in 2018, the first project of Netflix and Japan's Kyoto Animation, Netflix limited the show's online and offline DVD distribution channels in Japan with a long exclusive broadcast rights. Finally, it signed a "comprehensive project cooperation contract" with Japan animation company to strengthen the dominance of the industrial chain. In 2018, Netflix began to try original animation production, and successively signed "comprehensive project cooperation contracts" with many large Japan animation companies. Among them are Production I.G, the company that produced "Ghost in the Shell", the "Bones Society", the production company of "Fullmetal Alchemist", and the "David Production" company that produced "JoJo's Bizarre Adventure".
With the support of strong funding and a global platform, Netflix has greatly influenced the development of Japan's animation business model, especially when Netflix set up studios in Japan, bypassing the "production committee" and directly co-producing animation programs with production companies, without seeking any rights other than exclusive distribution, resulting in the gradual decline of the Japan animation "production committee" model.
The third is to make good use of the ecological advantages of the platform. Amazon Prime Video relies on platform e-commerce services to form an ecological competitive advantage. In 2015, in order to completely open the Japan market, the head of Amazon's Japan market applied for a budget of hundreds of millions of dollars to create local original content for Prime Video. Through the unique mass media product of video, Amazon members in Japan have grown rapidly. Three months after the Prime Video service was launched in Japan, Amazon membership increased by 16%, of which 27% of users purchased membership mainly because they wanted to watch movies and TV shows. Watching movies and TV shows also enjoys additional e-commerce services, which makes Amazon very competitive at a price.
Fourth, strong content advantages. Whether it's Netflix, Amazon Prime Video, or Disney+, content is its biggest advantage, and these platforms not only provide rich United States and global content, but also local Japan content. Although Amazon is an e-commerce platform, it attaches great importance to the construction of audio-visual program content. In May 2022, Amazon signed an agreement to buy Hollywood film and television giant MGM for $8.45 billion. As one of Hollywood's eight largest studios, MGM owns the rights to more than 4,000 movies and 17,000 TV shows. This large amount of content has expanded Amazon's film library to 55,000 films, far exceeding Netflix's 20,000 films. In 2022, Amazon spent $18.9 billion, up about 14% from the previous year.
Second, strengthen platform construction, and Japan's local streaming media cluster rises
Through joint operations, rich content, diversified operations, etc., Japan's local streaming media platforms have developed rapidly and generally achieved profitability, surrounded by Netflix, Amazon Prime Video, Disney+, Apple TV+ and other United States streaming media giants, Japan's local video platforms have quietly risen.
(1) Create an exclusive independent streaming media platform matrix to meet the needs of multiple scenarios
NHK is Japan's most important broadcasting and public service television organization, and was an early adopter of the launch of online audiovisual services. On the one hand, NHK keeps pace with the times and launches a variety of Internet-based audiovisual services at different stages of technology. In 2008, NHK launched the NHK on Demand service, which allows users to enjoy some of NHK's TV programs and some NHK original classics and dramas during the week. In 2009, NHK began to broadcast on the Internet, allowing viewers to watch the content of TV channels simultaneously on NHK's global network. In April 2020, NHK normalized the simultaneous broadcast of programs and launched NHK Plus.
On the other hand, NHK is working with other platforms to increase its dissemination. In 2016, NHK On Demand entered the U-NEXT platform. In 2019, NHK joined the TV portal TVer.
WITH THE DEVELOPMENT OF NEW MEDIA, NHK HAS DEVELOPED VARIOUS NEW MOBILE APPLICATIONS ACCORDING TO THE NEEDS OF DIFFERENT AUDIENCES, AND REFINED THE ORIGINAL APPS, SUCH AS NHK WORLD TV IS AN APP FOR FOREIGN USERS, NHK FOR SCHOOL IS A LEARNING APP FOR Japan'S "STUDENT PARTY", NHK EASY READER IS A BARRIER-FREE APP FOR USERS WITH DISABILITIES, AND SO ON.
Founded in 2007, U-NEXT was one of the first platforms in Japan to launch a streaming service, formerly known as GyaO NEXT, which was renamed U-NEXT in 2009. In 2020, U-NEXT had more than 2 million paying subscribers. In March 2023, U-NEXT merged with Paravi, with a combined user base of approximately 3.7 million. In 2023, U-Next is the fastest-growing streaming platform in Japan, accounting for 30% of the total number of new users in Japan. Currently, U-NEXT is the largest platform in Japan with more than 4.2 million paying users.
(2) The five major TV stations have strengthened cooperation and jointly built a streaming media platform
In the face of the trend of streaming media development, Japan's five major commercial TV stations preferred cooperation and jointly launched streaming media platforms. In October 2015, Japan's five major commercial television stations jointly launched TVer, a video playback service platform, which is limited to about one week after the TV broadcast. As of the end of July 2023, TVer has 63.54 million downloads and 28.36 million monthly active users, higher than Amazon Prime Video, which ranks second. According to the survey data of Video Research Co., Ltd. of Japan, as of May 2023, the number of video views on the TVer platform was 345 million, and in December 2023, the monthly active users were 31.29 million, an increase of 24% year-on-year, and the monthly playback volume was 398 million, an increase of 50% year-on-year.
(3) Give full play to the advantages of TV terminals and carry out live streaming media + on-demand integration business
In April 2016, TV Asahi and Cyber Agent, a Japan Internet company, jointly established Abema TV, an online TV platform, with CyberAgent holding 60% of the shares and TV Asahi holding 40% of the shares. Abema TV's business is divided into a live streaming service and a subscription video-on-demand service (SVOD), which currently has more subscribers than the former. Abema TV's live streaming business, like terrestrial TV, has more than 20 channels such as news, Japanese dramas, Korean dramas, anime, martial arts, etc., which are broadcast 24 hours a day, providing free services, and the main income is advertising. In 2020, Abema TV carried out a series of brand upgrade activities and officially changed its name to Abema, with more than 10 million logged users in 7 days.
Abema paid services include monthly memberships (Abema Premium) and pay-per-view services. Among them, monthly paid members can enjoy unlimited replay, no pop-up ads when watching, and other services. In June 2021, Abema surpassed the 68 million mark in downloads. In addition, Abema TV has built a WINTICKET system for live broadcast of large-scale public events · real-time Internet voting services, as well as a support function that supports online gift-giving, an online shopping mall, etc., and the revenue channels are very diverse.
Third, user-centered, take multiple measures to improve market competitiveness
Although United States video platforms dominate the Japan market, local streaming media platforms in Japan recognize that original content is the foundation of the streaming media industry, actively strengthen content construction, carry out diversified operations, and have strong market competitiveness. In 2023, Japan anime, live-action TV series, and variety content accounted for 65% of the total viewing of the VOD category on streaming platforms. On Amazon Prime Video, U-NEXT, Abema, Niconico, Hulu Japan and other major platforms, "Japan Anime" ranked first in terms of hits.
(1) Strengthen the supply of content and create a comprehensive service platform
In recent years, most Japan streaming media platforms have developed towards comprehensive platforms, and the product content is no longer limited to TV dramas and variety shows broadcast by TV stations, but also expanded to movies, anime, music, sports live broadcast and other fields; Genres are not limited to the widest range of video in the consumer market, but also the popular digital print content. In addition, Japan streaming media has also followed up early on with new broadcast standards such as 4K and Dolby Vision brought by United States streaming media giants. By continuously improving the user experience, expanding the content, and improving the technology, the number of new users continues to grow.
The core strategy of U-NEXT is copyrighted content. As of June 2024, the U-NEXT platform has more than 320,000 movies and TV shows and more than 190 magazines, ranking first among Japan streaming platforms in terms of content scale. According to a survey by GEM Partners, both Hulu Japan and Netflix have only about 30% of U-NEXT's content library. In the Japan streaming market, monthly subscription fees range from 500 yen (about 30 yuan) to 1500 yen (about 100 yuan), and U-NEXT is the only platform whose subscription fee has exceeded 2000 yen (about 120 yuan) after the tax increase.
In June 2020, U-NEXT launched its online concert delivery business for the first time and took this business as a new growth point. Since then, U-NEXT has successively undertaken the online concert delivery business of many artists such as ONE OK ROCK and Official.
Fuji TV's streaming media platform FOD provides more than 40,000 audio-visual works, including about 5,000 Fuji TV's original audio-visual works that can only be viewed on the FOD platform, and has launched manga and magazine sections alongside videos, including more than 130 electronic weekly magazines, and the content sources are not limited to Japan, and many movies and TV series from Europe, America, Asia and other places have been launched on the platform. Back in 2016, FOD turned a profit.
In addition to providing common TV dramas, movies, anime, variety shows, music and other content, Abema has also opened up relatively niche video zones such as mahjong, fighting, chess, fishing, and HIPHOP, providing a professional platform for enthusiasts in related fields and meeting the audience's demand for diverse content.
(2) Improve the internationalization level of the platform and continuously open up "new channels" to the sea
In 2014, Japan TV station NTV acquired Hulu, the first United States streaming platform to enter the Japan market, and used its mature video business and rich Internet operation experience to launch the streaming platform Hulu Japan to achieve its own transformation. At the same time, we actively expand the international market by taking advantage of the cooperative relationship with the United States. Hulu Japan has a paid model, and users can watch more than 100,000 shows anytime and anywhere for only 933 yen (about 55 yuan) per month.
In February 2016, Hulu Japan acquired the exclusive distribution rights of United States HBO in Japan, and the rich TV content (mainly TV dramas and variety shows) and many high-quality original series series have made Hulu Japan well received in the market. Currently, Hulu Japan has become a mainstream streaming platform in Japan with more than 70,000 titles and a replay service for popular TV shows in Japan. In July 2023, Walt Disney (Japan) Co., Ltd. ("Disney Japan") and HJ Holdings, Inc. announced the launch of a new bundle for Disney+ and Hulu Japan, allowing consumers to enjoy Disney+ branded content, including award-winning movies, animations and reality shows from Disney, Pixar, Marvel, Star Wars, National Geographic, and Star TV, as well as popular domestic TV series, anime, and Hulu Japan's popular domestic TV series, anime, Variety shows, live music, and sports programs, among others, are 1,490 yen (tax included) per month, which is 25% cheaper than subscribing to each service individually.
Since April 2018, Hulu Japan has been broadcasting new dramas for overseas productions in 19 countries in Asia. In addition, Hulu Japan is actively involved in the development of overseas works, and continues to open up "new channels" to go overseas.
The Abema platform has a large amount of Chinese and Korea content, and places overseas content such as "Hallyu · Chinese Stream" and "K-POP" in the first-level directory that is as important as "movies" and "TV dramas", so as to highlight the international characteristics of the platform. Abema has also developed a new online live streaming platform, Abema Live, which allows users to purchase and watch a variety of pay-per-view content overseas, such as concerts, plays, sporting events, and fashion shows. ONE Championship, the world's largest martial arts organization, became Abema's first PPV event to be broadcast live in Thailand, the Philippines and Korea. As of January 24, 2024, Abema has started service in three countries, Thailand, the Philippines and Korea, and plans to gradually expand its market.
U-Next renewed its content deal with Warner Bros. Discovery to become the primary supplier of HBO programming on Japan's SVOD streaming platform. Japan animation playback platform Niconico (referred to as N station or Nico) launched an English version in 2012, as well as a new user translation tool and a new video player.
(3) Enhance user experience and expand users with characteristics and high-quality services
Niconico continues to strengthen the user's social experience and create a unique barrage culture. Similar to shared video sites such as YouTube, Niconico is unique in that user comments appear on the program in the form of a barrage, which is favored by users. As of February 2024, Niconico has a total of 11,098 channels and 97.96 million registered members, including about 1.25 million premium members.
U-NEXT focuses on improving the user experience by optimizing the TV remote control function and special services, and has installed the U-NEXT button on the remote control attached to the newly sold TV set. U-NEXT has also partnered with other organizations to launch special services, such as partnering with Japan's Kansai Electric Power Company to provide bundled services (with U-NEXT appliances, etc.) to customers using low-voltage electricity, increasing users through new channels.
In general, the secret of Japan's streaming media to achieve a "breakthrough" is to give full play to the advantages of local content, carry out diversified businesses such as live on-demand, achieve integrated development with traditional TV, and realize the integration of platform resources through market mechanisms, avoiding involution competition.
Source: WeChat public account "China United Booth", "National Radio and Television Think Tank"
Author: Hu Xiang
Editors: Deng Rumeng, Li Xianghe (intern)
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