TOKYO — Japan’s five commercial networks and pubcaster NHK serve 49 million households — and for decades have reigned over visual media, despite the emergence of dozens of cable and satellite channels.

But now their dominance is, if not ending, under attack. In 2007 terrestrial TV ad spend totaled a stupendous $18.85 billion, but this figure was down 0.9 percent compared with the previous year — the third straight year-on-year drop.

Among the Reasons for the decline are the include the faltering Japanese economy and, more threateningly, the migration of auds to other media, followed by advertisers. Last year, ad spend for cable and satellite media rose 10.8%, and for the Internet, 24.4%.

This trend has continued in 2008, resulting in sharp drops in spot ad sales at the commercial networks — so much so that last summer the prexies and other top execs at four networks took pay voluntary pay cuts to atone for lousy first-quarter results.

This downturn could hardly have come at a worse time, since terrestrial broadcasters are scrambling to prep for the skedded switch from analog to digital broadcasting in July 2011. According to an estimate by the National Assn. of Commercial Broadcasters in Japan, the total tab for the changeover in the coming three years will be $833 million for all commercial broadcasters, with as many as a third of local affiliates falling into the red as a result.

One bright spot is brisker foreign sales for Japanese TV programming, particularly formats. “Hole in the Wall,” a format adapted from a popular variety show game in which contestants try to squeeze through cutouts in a moving panel — and flop into the water if they fail — has already sold to more than 20 countries — including in the U.S., where Fox snatched it up.

Also a hit with overseas buyers is “Sasuke,” a TBS game special — broadcast in more than 20 installments since 1997 — in which contestants, ranging from Olympic athletes to pudgy TV comics, challenge fiendishly difficult obstacle courses. U.S. cabler G4 airs the show under the title “Ninja Warrior.”

Seeing more gold in the Japanese formats hills, William Morris announced in September that it is repping three formats from the TV Asahi network — but this and other foreign format deals will probably not be enough to staunch the flow of red ink on network balance sheets.

The digital revolution is proving to be a bigger profit obstacle for the nets than anything the “Sasuke” producers could devise.


“Atsu-hime” (NHK)

“Code Blue Dr. Helicopter: Emergency Rescue” (Fuji TV)

“Quiz! Hekisagon 2” (Fuji TV)