"Quo vadis, NHK?" is probably one of the most frequently asked questions among Japan's broadcasting professionals as well as tens of millions of NHK viewers. Ever since the few scandals over embezzlement by NHK senior producers of popular programs were exposed in late 2004, the mammoth public broadcaster has been constantly under fire from all directions – fee paying viewers, government agencies and commercial terrestrial networks – all for different reasons.

In the process, the network's char ismatic president, Katsuji Ebisawa, had to resign. He was succeeded by Gen-ichi Hashimoto, who came from a "neutral" engineering background, in January 2005.

NHK is the acronym of its Japanese name, Nippon Hoso Kyokai, which t ranslated into English means Japan Broadcasting Association. Founded in 1923 as Tokyo Broadcasting Corporation, NHK has since grown into a media giant with a little over 11,000 employees, supported almost exclusively by viewing fee revenue of about US$5 billion, compared to BBC's 3.8 billion Sterling pounds or US$6.6 billion in 2004.

In Japan, the NHK viewing fee (which is something that's akin to BBC's license fee) is mandatory under the country's broadcasting law. Although there is no penalty for those who fail to pay, almost 80% of about 46 million Japanese TV households make monthly payments of about US$12. The 2004 scandal, however, triggered waves of consumer discontent, resulting in about 1,280,000 refusals to pay. This translates into a total revenue loss of some US$42 million, or 7.4% of NHK's gross revenue for the fiscal year 2005 which ended in March 2006. The percentage of fee-paying consumers dropped by almost 10%. In response, NHK announced measures to cut its fiscal year 2006 budget and manpower by about 10%, respectively.

Minister Heizo Takenaka of Internal Affairs and Communications, known for his provocative policy proposals for a freer market system, is urging discussion on ways to improve broadcasting, and advocating that NHK be far more flexible in its organization and broadcast ing to pave the way for further competition within the industry. Foreign Minister Taro Aso is asking NHK to play a bigger role in global news delivery, "even with financial support of NHK: Public Broadcaster Under Siege By Tad Osaki revenue from commercials, if necessary." Prime Minister Junichiro Koizumi, adopting the Foreign Minister's position, indicates the need to increase English-language broadcasting hours.

At present, NHK has two 24-hour global TV channels – NHK World TV and NHK World Premium. Beginning this year, NHK World TV programmes have been 66% English. It has also operated the short-wave NHK World Radio Japan in Japanese and English since 1935; and in 22 languages since 1991, covering most parts of the world. However, in order to turn all of the NHK World programs into English – which NHK hopes to achieve as its 2008 target – the production cost alone is likely to double from the current level of about US$25 million. The hefty budget increase seems difficult when NHK is trying to cut its budget, hence the foreign minister's proposal for revenue from commercials.

In February, president Gen-ichi Hashimoto of NHK hinted at a press conference that NHK had begun introducing commercials to support and develop program distribution overseas, as the BBC does via its subsidiaries.

His comment invited strong opposition from commercial broadcasters, who have always sweated to raise income from commercials, according to senior members of National Association of Commercial Broadcasters in Japan (Minporen). Commercial revenue for NHK operations is totally unheard of. For 53 years, the public broadcaster has enjoyed a huge revenue stream from its viewing fees. Seiichiro Ujiie, Minporen chairman between 1996 and 2003 and board chairman of Nippon TV, believes that excessive growth of NHK in size is hampering growth opportunities for commercial broadcasters. It is way too much for NHK, the public broadcaster, to operate a total of eight terrestrial and satellite TV and radio channels, he observes. He suggests splitting the NHK for partial privatization, if the revenue decline strains NHK's budget and operations.

Other Minporen members, such as current chairman Michisada Hirose, president of TV Asahi, has proposed an introduction of penalties on those who refuse to pay NHK viewing fee if the current trend for non-payment continues, "because NHK should not in any way compete with commercial broadcasters for ad revenue."

In April, minister Takenaka's private forum came up with a proposal to create a new organization, to be jointly invested by NHK and commercial broadcasters, as a means to bolster Japan's global broadcasting capability, as well as to amend the existing broadcasting law to penalize those who do not pay their viewing fee.

This proposal will be further discussed both at the House sessions and by Minporen for the remainder of the year.

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