Japanese cablers log profitable year

Expenses down, subs up

TOKYO — Over half of the cable TV companies in Japan moved into the black in the last fiscal year, marking the first time since the government began tallying CATV data in fiscal 1992 that the majority of companies in the sector were profitable, the Ministry of Posts and Telecommunications said on Thursday.

The operating income on average for 310 CATV companies in the survey showed double digit growth for the fiscal year that ended March 31, 1999, it said.

An increase in subscribers and decreases in operating expenses helped cablers post strong earnings in the fiscal year.

Of the 310 CATV companies surveyed, 178 posted profits, which was 39 more cablers than in the previous year.

Preparing for digital

There are about 14 million CATV subscribers among Japan’s 45 million households.

Cable companies are expected to go through a wave of consolidation over the next few years as the ministry pushes for them to convert to a digital format by 2010 in order to complete the conversion of all TV broadcasts to a digital format.

The ministry said that all CATV trunk lines should be replaced with fiber optic lines by 2005 and the change would facilitate high-speed Internet service.

In order to help finance the CATV digital conversion, it recommended that the government should subsidize the conversion and give tax breaks to cablers. It also urged consolidation in the CATV sector.