JVC 2007 Annual Report Download - page 17

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15
The music entertainment software business
plans and produces music and video con-
tent, and the media business manufactures
and sells recordable media and prerecorded
content. In fiscal 2007, sales of the Software
& Media segment were 92% of the level a
year earlier, at ¥95.2 billion. The segment
booked an operating loss of ¥1.9 billion, a
¥4.5 billion deterioration from the figure a
year before.
500 100 150 200
’07
’06
’05
’04
’03
95.2
103.9
95.9
148.0
167.5
Sales (Billions of yen)
Share of Total FY2007 Sales
12.8%
Software & Media
JVC’s music entertainment software business comprises a number
of key companies, including Victor Entertainment, Inc., and Teichiku
Entertainment, Inc., which produce and sell music software.
In fiscal 2007, music CD production costs in Japan fell against the
level a year earlier and sales of prerecorded music DVDs inched
down. Against this backdrop, despite hits by pop-rock bands
Remioromen and SMAP, overall sales at Victor Entertainment were
slack due to a lack of hit releases in the second half. Sales increased
at Teichiku Entertainment on the strength of a major hit by singer
Masafumi Akikawa and other releases.
In fiscal 2008, the music entertainment software business is reor-
ganizing the structure and functions of its entire operations. Victor
Entertainment concentrates on music content planning, production,
and marketing, and is increasing investment in order to discover
new artists and produce hit releases.
Formed on April 1, 2007, JVC Entertainment, Inc., unified the video
content planning and production operations that had been dispersed
within the Company. It plans to capitalize on major business opportuni-
ties with the addition of advertising and electronic distribution businesses.
Teichiku Entertainment is doing well and continues to strengthen
its presence in original music and movies.
Recordable media’s changeover to discs from tapes accelerated in
fiscal 2007. The digital video camera (DVC) market shrank accord-
ingly. While unit sales of DVD-related products grew, the decline in
prices gathered speed. These trends also contributed to the decline
in sales for the recordable media business.
Despite the negative impact caused by the rapid spread of music
software downloading and the slump in overseas game software,
overall sales of prerecorded software edged down only slightly
thanks to our solid showing in DVD software.
In fiscal 2008, we will shift to higher-value-added products in the
recordable media business, including dual-layer DVD “DL” and 8cm
DVDs. We will restructure our sales organi-
zation in Japan and worldwide, press
ahead with sweeping structural
reforms in response to the rapidly
evolving market, and reinforce
our competitive strengths.
In prerecorded software,
we will enhance corporate
value through management
that derives synergies from
Group software companies, includ-
ing Victor Entertainment.
Media Business
DVD-RW Disk
Our 8cm DVD-RW disks for video cameras
use JVC’s original Ultra Hard Coat disk
surface protection technology and
deliver outstanding quality and
reliability through integrated
domestic production.
Music Entertainment Software Business
Remioromen
HORIZON
Masafumi Akikawa
Sen no Kaze ni Notte
(A Thousand Wings)
SMAP
Pop Up! SMAP