Osamu Sato, president of Tokyo-based record company Pony Canyon, says the label would suffer "incredible damage" if Internet service provider Livedoor succeeds in its hostile takeover bid for AM radio
TOKYO -- Osamu Sato, president of Tokyo-based record company Pony Canyon, says the label would suffer "incredible damage" if Internet service provider Livedoor succeeds in its hostile takeover bid for AM radio network Nippon Broadcasting System. NBS owns 56% of Pony Canyon.
"The Fujisankei Group, with Fuji TV at its core, has already informed us that should we leave the group and allow Livedoor to control us, they will immediately cut off all business relations," Sato tells ELW.
"This would result in an estimated ¥23.4 billion ($223.8 million) drop in sales, with a corresponding ¥8 billion ($76.5 million) drop in gross profits, causing incredible damage to our company," adds Sato, who is also chairman of the Recording Industry Assn. of Japan.
In a recent series of stock transactions, Livedoor -- which is viewed by the Japanese business establishment as an unruly upstart -- has gained nearly half the shares in NBS. Pony Canyon, Fuji TV and NBS are components of the Fujisankei Communications Group, Japan's largest media company.
"First the staff will quit, then the artists will leave, then the contracts for content will disappear as well, leaving us with nothing," Sato predicts should Livedoor assume control over NBS and Pony Canyon. "We could well be left with nothing but the originals of past recordings."
Sato would not comment on what steps might be taken to keep Pony Canyon within the Fujisankei Group.
Pony Canyon has a roughly 3% share of the Japanese recorded-music market.