FinNode Japan Creative industry services (pdf)

Creative Industry in Japan
FINNODE project 2010
Finpro Japan
Senior Consultant
Masahiro Kimura

Table of contents
1. Preface ………………………………………………………………………… 3
2. Overview of Creative Industry in Japan …………………………..…… 12
3. Market Trend in Creative Industry ……………………………………… 29
4. Government Approach to Creative Industry ………………………….. 58
5. Japan’s Creative Industry and New trends of Society ………………... 71
6. Suggestion & Hint to Creative Industry in Finland ………………….… 83
Date; 071010 Creative Industry in Japan © Finpro, Finnode Japan 2
Page

Summary of this Chapter;
1. Preface
21 st Century is called as Creative economy era in the context of Service
Industry dominated Society than Manufacturing dominated society in
developed countries.
This means that structure of economy is changing from Industrial one to
Creative Economy.
In Japan, Creative Economy/ Industry is rising up by Japanese original
contents like Animation, Movie, Game, Design, Fashion and Pop culture.
This Japan case can be reference for planning Finland‟s innovation program of
Industry.
In this report, figure out the situation of Creative Industry of Japan with some
hints and ideas of Finland‟s Creative Industry Development program & project.
Date; 071010 Creative Industry in Japan © Finpro, Finnode Japan 3

Background; Structure of Economy is changing (1/2)
Especially in fully developed countries, a major
paradigm shift is desperately needed in response to
such social changes as increasing awareness to
environment, wider recognition of corporate social
responsibility, and moves toward more sustainable
society.
Fig. 1-1 Industrial Economy to Creative Economy
Date; 071010 Creative Industry in Japan © Finpro, Finnode Japan 4

Background; Structure of Economy is changing (2/2)
As Stanford University professor Paul Romer argues in his "endogenous growth theory",
knowledge and ideas will play significant roles for economic growth in the 21st century.
Knowing that the shift is being made from Industrial to Creative Economy, many
governments, from local to central, are now trying to develop a creativity-based society
in order to achieve their own sustainable growth.
Fig. 1-2 Creative Economy Century
Date; 071010 Creative Industry in Japan © Finpro, Finnode Japan 5

Background; Creative industry, Production & Service
• Service Industry dominated society drives development of new emerging
industry field, Creative Industry, which overlaps cultural industry service
sector.
• It is estimated that Creative industry service/community can be one
solution of people‟s problem as a part of Human technology, which refers
technology adding people‟s mental, physical, social wellbeing and
promotion of human dignity.
• Creative Industry and its services concern about delivering value including
cultural wellbeing and social wellbeing.
• Creative Industry Studies are concerned with financing structures, valueadded
chains, organizational change in the cultural sector, and with legal
and cultural policy frameworks.
• It is said that Creative industry contributes to an overlap with definitions of
art and culture, and even aspects of traveling activities and sport.
Educated consumers‟ Wellbeing & Personal development trend is pushing
not only production side but also service side of Creative industry.
Date; 071010 Creative Industry in Japan © Finpro, Finnode Japan 6

Background; Japan can be a reference for Finland
• Japan's Creative industry remains vibrant and with growing popularity
in Europe and America as well as Asia, the phenomenon of "Cool
Japan" is being observed.
• Examples of this phenomenon include the movie awards for an
animated film as well as the affection overseas for Japanese
character e.g. Pokemon and Hello Kitty. In addition, there are many
Japanese films are being remade overseas with a large number of
Japan-themed movies.
• This kind of Japanese pop culture is something by which the values
that have been nurtured by Japan over the centuries and have
become increasingly universal are, through full use of modern
technology, being evinced in a new manner.
• These phenomena could be able to be a hint for promoting Finnish
Creative Industry, and its strategy. Further more survey contents
should be a future reference for regional creative economy
development programes & innovation projects of Finland.
Date; 071010 Creative Industry in Japan © Finpro, Finnode Japan 7

Targets of Analysis (1/2)
• In this survey, the main focus is to identify Japanese
specific figure of Creative industry and related service
sector to contribute business/industrial development:
1. Identifying Range of creative industries in Japan
2. Defining General market trend and Perspectives on the
Size & Shape of Creative Industry Sectors in Japan
3. Observing Governmental approach to Creative Industry,
Japanese Intellectual Property Power and its role in
international market, The NPO Market as Incubator and
Contribution to Economy
4. Japan's specific technical items for new industry innovation
in terms of ICT from cross industrial point of view.
Date; 071010 Creative Industry in Japan © Finpro, Finnode Japan 8

Targets of Analysis (2/2)
• This survey will abstract Japan's Trend for Product
and Service by view point of "Creative Industry" that
can be recognized as new business conceptual
segment of cultural industry, and expected to:
1. How "Creative Industry services" can deliver the value for
cultural wellbeing and social wellbeing in Japan?
2. Japan's value-added chains, organizational change in the
cultural industry sector and cultural policy promotion
frameworks.
3. New business structure & models, market disruptions in
creative industry markets in Japan: what are the new ways
to do business e.g. social media earning models, new
combinations of subsectors etc.?
Date; 071010 Creative Industry in Japan © Finpro, Finnode Japan 9

Issues to be picked up in this report
• The following issues are to be taken up in the report:
1. Japan's fundamental recognition including e.g. Definition of Creative
Industries, Differences between the cultural industry and creative
industry, Difference between industrial and intellectual, Cross
industrial promotion and Environmental agenda and Creative
Industry.
2. Japanese specific figure of Creative industry and related service
sector described in previous chapter.
3. Market trend for the fields of e.g. Advertising, TV and Animation,
Design, Architectural Design, Communication Design, Fashion
Design, Editing- criticism and media, Movie industry and video, Art
and Illustration, Digital media, Computer Game development,
Handicraft, Performing art, Music Industry and Publication
4. Case studies regarding Japanese specific trend and event e.g.
Kawaii, Otaku (geek, fanatic), Mediamix, Cool Japan, Regional
regeneration project by creative sectors, together with their business
model domestic and internationally.
Date; 071010 Creative Industry in Japan © Finpro, Finnode Japan 10

Goals and method of Research
• This report identify Japan's Creative industries, by taking into account
that a shift is being made from "Industrial Economy" to "Creative
Economy" in Japan and many other industrialized countries.
� Since there is no official definition on Creative Industry in Japan, we
will define the industry with our own scope by explaining the relation
of "Cultural Industry", "Content Industry" and "Creative Industry".
� Then current status of the industry is summarized, find some
potential factors, and hopefully discuss the future perspective of
Japan's creative industry.
• This report also introduce some distinctive approaches by governments,
ministries and private sectors, and would finally try to make some
suggestion to the Finnish future industry policy.
Public documents, literatures, and preceding studies are the main sources of reference,
adding Finpro’s knowledge and expertise in this field. JRI (Japan Research Institute
http://www.jri.co.jp/english/ ) is used as outsourcing service provider to collect information,
and support drafting of the report.
Date; 071010 Creative Industry in Japan © Finpro, Finnode Japan 11

2. Overview of Creative
Summary of this Chapter;
Industry in Japan
In late 1990s, UK started national development strategy by Creative Industry.
Because of early timing action, UK‟s definition of Creative Industry becomes
de-facto standard. But on the other hand, other international parties determine
their own definition.
In this chapter, the definition of Japan‟s creative industry is made. From that
definition, Japan specific industry segments based on Japanese culture can
be found.
It is recognized that such Japan specific segments can be advantage in
International market.
Size of Japan‟s market and deep consideration about the structure of Creative
Industry are explained, too.
Date; 071010 Creative Industry in Japan © Finpro, Finnode Japan 12

Historical background of Creative Industry
• In late 1990s UK started the development of "Creative Industry" as a
part of its national brand strategy. In "Creative Industries Mapping
Document" published in 2001, Department for Culture Media and
Sport (DCMS) defined thirteen industries as UK's Creative Industry
sectors. The sectors include advertising, architecture and others.
Since then UK has been implementing its Creative Industry strategy in
line with the framework.
• UK defines its Creative Industries as follows;
� "Those industries which have their origin in individual creativity,
skill and talent and which have a potential for wealth and job
creation through the generation and exploitation of intellectual
property.“
• UK clearly addresses that Creative Industries deal with wealth,
economy, job creation and intellectual properties that are stimulated
by creativity.
Date; 071010 Creative Industry in Japan © Finpro, Finnode Japan 13

Japan‟s situation, Past and Present
• Compare with UK situation, Japan has no official definition on its Creative
Industry. Various government ministries and agencies have had their own digital
content strategies or Japan brand strategies, reflecting a position of each
organization.
� As a whole, Japan's "Content Industry" policies have been heavily focused
on digital media industries.
� But in a recent document, METI reflects on the less-coordinated approaches
on the content industry of the past, and discusses a need for long-term
strategy and cross- ministerial approach for Japan's creative industries. The
document "Bunka Sangyo Taikoku ni Mukete (Towards a World Power on
Cultural Industry)" was presented to the members of Industrial Structure
Council, the Ministry of Economy, Trade and Industry (METI) in April 2010.
� And finally in the "Industrial Structure Vision 2010" published by the
Industrial Structure Council in June 2010, Creative Industry was newly
recognized as one of five strategic areas to strengthen Japan's global
competitiveness.
• The vision clearly states the need for establishing a Creative Industry strategy in
order to leverage not only Japan's pop culture but also traditional culture to
improve Japan's global presence and competitiveness. METI indicates that
"fashion", "food", "living", "tourism" as well as manga, anime and other contents,
could play key roles in creating domestic and international demand and
improving the current employment situation in Japan.
Date; 071010 Creative Industry in Japan © Finpro, Finnode Japan 14

Definition of Creative Industry (1/2)
• There are many definitions and scopes for Creative Industry.
• UK's DCMS lists the thirteen creative industry sectors in alphabetical
order and treats them in the same manner, while the UNCTAD
classification of creative industries is divided into four broad groups:
heritage, arts, media and functional creations, then these groups are in
turn divided into nine subgroups.
• Concentric Circles Model, advocated by David Throsby and many
other scholars, explains that "Core creative arts" is placed at the center
of the circle and larger circles are surrounding it concentrically
according to the level of economic significance of the creative activities.
• World Intellectual Property Organization (WIPO) categorizes creative
industry sectors into the three groups; "core copyright industries",
"Interdependent copyright industries", and "Partial copyright industries"
to reflect the level of relation to intellectual property rights.
Date; 071010 Creative Industry in Japan © Finpro, Finnode Japan 15

Definition of Creative Industry (2/2)
Fig. 2-1 Models of definitions by several sectors
• (Note) * "DCMS": Department for Culture Media and Sport. * "UNCTAD": United Nations Conference on Trade and Development. * "WIPO": World
Intellectual Property Organization.
Date; 071010 Creative Industry in Japan © Finpro, Finnode Japan 16

Definition of Creative Industry (UK DCMS Model)
• Advertising
• Architecture
• Art & Antiques
• Crafts
• Design
• Designer fashion
• Video, Film & Photography
• Music
• Visual & Performing Arts
• Publishing
• Software
• Computer Games & Electronic Publishing
• Radio and TV
Date; 071010 Creative Industry in Japan © Finpro, Finnode Japan 17

Definition of Creative Industry (UNCTAD Model)
• Four broad groups
1. Heritage
2. Arts
3. Media
4. Functional creations
• Nine subgroups
1. Cultural sites
2. Traditional cultural expressions
3. Visual arts
4. Performing arts
5. Publishing and printed media
6. Audiovisuals
7. Design
8. New media
9. Creative services
Date; 071010 Creative Industry in Japan © Finpro, Finnode Japan 18

Definition of Creative Industry (Concentric Circles Model)
A. Core creative arts
Literature
Music
Performing arts
Visual arts
B. Other core cultural industries
Film
Museums and libraries
C. Wider cultural industries
Heritage services
Publishing
Sound recording
Television and radio
Video and computer games
D. Related industries
Advertising
Architecture
Design
Fashion
Date; 071010 Creative Industry in Japan © Finpro, Finnode Japan 19

Cultural Industry and Creative Industry sectors
Cultural Industry
• An intellectual domain in which arts and culture are the focus of preservation, academic
researches, promotion and financial support. Public museums play central roles in the
preservation of cultural heritage.
Contents sector
• An industrial domain where economic values are pursued and created by monetizing such
contents as films, games, or design.
Creative service sectors
• A social domain where not only economic but also social values are created through a growing
presence of creative services in society, which can be enhanced by interaction and resonance of
various elements across different industries.
Table 2-1 Different feature between Cultural Industry and Creative Industry
Cultural Industry Creative Industry
Content sector Creative services sector
Sub sector Museum, etc. Video, music, film, game, etc. Advertising, architectural services,
design services, food, tourism,
healthcare, etc.
To promote Culture, academic concept Contents Creative lifestyle, sustainability,
Created Value Intrinsic, cultural value Industrial, economic value Instrumental, social value
Key enabler Aesthetic value Copyright Internet, social media
Creating entity Professional artist Professional designer, creator Consumer, individual, community
Supporting agency Cultural agency, arts patronage Economy, industry and technology
agencies
Date; 071010 Creative Industry in Japan © Finpro, Finnode Japan 20
etc
Local community, art NPO

Focal area of Creative industry
• Creative Industry is made of "Content sector" which could generates economic
values and "Creative services sector" that could creates social values, and would
focus on these sectors in Japan.
Fig. 2-2 Concept and structure of Creative Industry
Date; 071010 Creative Industry in Japan © Finpro, Finnode Japan 21

Identifying Creative Industry Sectors in Japan
• 13 Creative Industry sectors of the UK are juxtapose to
the focus areas of Japanese ministries in their respective
plans and strategies. It is obvious that, unlike the UK,
Japan could not have made a coordinated approach
toward creative and content industries.
• The Japanese government just recently began to realize
the need for establishing a Creative Industry strategy.
They plan to leverage not only Japan's pop culture but
also traditional culture to improve Japan's global presence
and competitiveness by creating domestic and
international demand and improving the current
employment situation in such areas as "fashion", "food",
"living", "tourism" etc.
Date; 071010 Creative Industry in Japan © Finpro, Finnode Japan 22

Definition of Creative Industry in Japan
Following table shows the classification of Japanese Creative Industry sectors made for this
report. We followed Digital Content Association of Japan (DCAJ) for the classification of
content sector, referred to the UK classification, and add or highlight some Japan-specific
factors. Table 2-2 Definition of Japan‟s Creative Industry
Sector Classification Association with
Creative Industry
Creative
services
sector
Core Creative Services Software
sectors of the UK
"Software"
Peripheral and Social
Services
Advertising service "Advertising"
Architectural services "Architecture"
Design "Design"
Fashion "Designer fashion"
ICT Japan-specific segment
Food
Tourism
Healthcare
Artifacts Visual arts "Visual Arts" of "Visual &
Performing Arts"
Crafts "Crafts"
Others
Date; 071010 Creative Industry in Japan © Finpro, Finnode Japan 23

Definition of Creative Industry in Japan
Table 2-3 Definition of Japan‟s Creative Industry
Sector Classification Association with Creative
Industry sectors of the UK
Content sector Film & Video Video "Video" of "Video, Film &
Photography"
Film "Film" of "Video, Film &
Photography"
TV broadcast & related services "TV" of "Radio and TV"
Music & Sound Music "Music"
Karaoke Japan-specific segment
Radio broadcast & related services "Radio" of "Radio and TV"
Games Game software "Computer Games"
Online games
Mobile games
Arcade games Japan-specific segment
Books, Newspapers, Graphics Books "Publishing"
& Texts Magazines
Free paper, free magazines
Newspaper
Packaged software
Internet based services
Mobile based services
E-book publishing "Electronic Publishing"
Performing Arts Stage "Performing Arts" of "Visual &
Performing Arts"
Concert
Major "Otaku" Content Anime (Animation, Japan style) Japan-specific segment
Manga (Comics) Japan-specific segment
Date; 071010 Creative Industry in Japan © Finpro, Finnode Japan 24

Fig. 2-3 Difference
from de-facto standard
means originality as an
advantage of business
Analyze your country‟s culture can give advantage
Definition at
UK
Definition at
Japan
Differences
can be Value
globally
• There are Several “Japan specific segment” in the
definition of Japan‟s creative industry (Table 2-2,3)
when compared than UK‟s definition.
• UK‟s definition is a kind of de-facto standard for
considering creative industry because of its strategic
approach.
• But the differences de-facto standard can be an
advantage for international market. Because those
are original & unique industry sector that other
countries do not own.
• It is very natural that each country has its original
creative industry sector, as it has connections to
each nation‟s culture and tradition.
• Analyze country‟s traditional culture as a resource of
unique industry sector is important to keep
competitiveness in international market.
Date; 071010 Creative Industry in Japan © Finpro, Finnode Japan 25

Scale of Creative Industry in Japan
• Japan's Creative Industry sectors are affected by long-term
economic slump and are not having made major growth in
recent years. The market volume of the Content sector was
about 14 trillion JPY in 2008, which comprises about 3% of
Japan's nominal GDP of 500 trillion JPY (4.5 trillion Euros).
Creative services sector worth 90 trillion JPY which is equivalent
to 18.3% of the nominal GDP.
� Such Internet-based services as e-book, online game or
mobile game are still small in volume but showing steady
growth.
� Tourism has the largest volume in the Creative services
sector, but the contribution of international tourists is just 6%.
Increasing the number by attracting these foreign travelers is
one of the urgent issues for the Tourism Agency.
Date; 071010 Creative Industry in Japan © Finpro, Finnode Japan 26

(Billion yen)
7,000
6,000
5,000
4,000
3,000
2,000
1,000
(Billion yen)
0
200
150
100
50
0
Size of Creative Industry in Japan (1/2)
Books, Newspapers, Graphics & Texts
by Mobile based services
Fig. 2-4 Sizes of Japan‟s Creative Industry sectors
Scale of content sectors in Japan
Books, Newspapers, Graphics & Texts
Film & Video
Music & Sound
Games
2004 2005 2006 2007 2008
25000
20000
15000
10000
5000
Manga (Comics)
Performing Arts
Anime 0
2004 2005 2006 2007 2008
(Billion yen)
Online games
Mobile games
E-book publishing
Scale of creative services sectors in Japan
2004 2005 2006 2007 2008
International travel
(domestic consumption)
7.6%
One-day trip
21.1%
Date; 071010 Creative Industry in Japan © Finpro, Finnode Japan 27
ICT
Architectural services
Consumption of international
tourists in Japan 6.3%
Multiple-day trip 65.1%
Tourism
Software
Fashion
Food
Advertising
Design
(source) summarized from DCAJ, METI and other public statistics

Size of Creative Industry in Japan (2/2)
Table 2-4 Sizes of Japan‟s Creative Industry sectors
Sector
Classification
Volume (billion yen)
CAGR
Definition
2004 2005 2006 2007 2008
Content sector Film & Video Video 831 827 747 730 692 -4.5% Sales revenue from packaged and distributed video
Film 211 198 203 198 195 -2.0% Box-office revenue
14 trillion yen
TV broadcast & related services 3,720 3,769 3,802 3,888 3,746 0.2% Revenue from TV broadcast and related services
= 2.8% to GDP
Film & Video Total 4,762 4,794 4,752 4,816 4,633 -0.7%
(2008) * Music & Sound Music
Karaoke
778
747
782
743
777
740
756
718
750
690
-0.9% Sales revenue from packaged and distributed music
-2.0% karaoke revenue
Radio broadcast & related services 226 224 220 210 196 -3.5% Revenue from radio broadcast and related services
Music & Sound Total 1,751 1,750 1,736 1,684 1,636 -1.7%
Games Game software 377 377 461 429 440 4.0% Game software revenue
Online games 37 60 74 83 92 25.9% Online games revenue
Mobile games 41 59 75 85 87 20.5% Mobile games revenue
Arcade games 649 682 703 678 543 -4.4% Revenue from arcade games operation
Games Total 1,104 1,178 1,313 1,275 1,162 1.3%
Books,
Books 943 920 933 903 888 -1.5% Book sales revenue
Newspapers, Magazines 1,697 1,761 1,698 1,641 1,538 -2.4% Magazine sales revenue
Graphics & Texts Free paper, free magazines 284 336 368 355 7.7% Advertising revenue for free paper, free magazines
Newspaper 2,380 2,419 2,332 2,217 2,217 -1.8% Revenue of newspaper publishers
Packaged software 216 218 240 216 189 -3.4% Packaged software revenue
Internet based services 197 246 126 147 154 -5.9% Revenue from Internet based services
Mobile based services 82 94 129 170 180 21.8% Revenue from mobile services (wallpaper, weather service, etc.)
E-book publishing 4 6 14 29 46 88.8% E-book sales revenue
Books, Newspapers etc. Total 5,518 5,947 5,807 5,692 5,565 0.2%
Performing Arts Stage 127 138 141 151 151 4.4% Stage ticket sales revenue
Concert 136 143 152 144 144 1.4% Concert ticket sales revenue
Performing Arts Total 263 281 293 295 295 2.9%
Major "Otaku" Anime 176 188 193 184 169 -1.0% Anime industry revenue
Content Manga (Comics) 586 587 584 577 -0.5% Sales revenue from comics and comic magazines
Creative Core Creative Software 10,476 10,298 11,466 4.6% Software business revenue
services sector Services Advertising service 6,788 6,628 6,704 -0.6% Revenue of advertising agencies
Architectural services 2,363 1,811 -23.4% Revenue from housing sales by the major 50 contractors
90 trillion yen
Design 4,983 5,017 5,089 5,157 4,942 -0.2% 1% of GDP is applied (EU design industry accounts for 1% of GDP)
= 18.3% to
Fashion 10,013 10,157 10,276 10,285 9,828 -0.5% Apparel industry's retail market volume
GDP
(2008)
Peripheral and
Social Services
ICT
Food
21,070 21,570
9,910
22,680
10,130 9,153
3.8% Market volume of platform layer and communication layer
-3.9% Revenue from "restaurants (excluding casual dining restaurants)",
"soba and udon noodle restaurants", "Sushi restaurants", and
"Japanese-style ryo-tei restaurants"
Tourism 24,500 23,900 23,500 23,500 23,600 -0.9% Domestic spending on travel consumption (One-day trip, multiple-day
trip , etc.)
Healthcare 23 Revenue on system, service and software in health management
market
Artifacts Visual arts
100 Sales revenue of contemporary art
Crafts
194 183 177 -4.4% Production volume of government-authorised traditional crafts
(source) summarized from DCAJ, METI and other public statistics
Date; 071010 Creative Industry in Japan © Finpro, Finnode Japan 28

3. Market Trend in
Summary of this Chapter;
Creative Industry
Japan‟s tertiary (service) industry has been increasing its presence as well as
other developed nation like, UK, Germany, Sweden and Finland.
Technological development in ICT field accelerate this phenomenon, and
become one of the basis of Creative Industry Development.
Contents sector spillovers to many business sectors e.g. Tourism, Fashion,
Food and Design goods.
Pokemon case is explained as an example for this.
Japanese “Otaku” culture with traditional culture promotes such spillover effect
as an important backup for developing Creative Industry.
Japanese situation regarding Animation, License business, Advertising,
Design, Fashion, ICT, Food and Tourism are analyzed..
Date; 071010 Creative Industry in Japan © Finpro, Finnode Japan 29

Industrial and Social Changes Underlying Creative Industry (1/2)
• Japan's primary industry was weakened mainly because strategic
protectionism of "infant industry" lost effectiveness and became stale in the
course of mass-migration from rural areas to cities after the War and under
the trend toward free trade.
• Japan has long been suffering from deflation since the collapse of the
bubble economy in 1990. The lack of good development and investment
opportunities is leading to poor capital investment by manufacturing
companies, and ultimately leading to the gradual decrease of secondary
industry under this situation.
• Contrary to other two industries, Japan's tertiary industry has been
increasing its presence in the economy mainly because consumers began to
enjoy better living with more durable goods came in every part of our daily
life which significantly increased the importance of value-added service and
information economy.
• UK, Germany, Sweden and Finland, all of these nations have their own
economic environment to suppress the contribution of manufacturing and
secondary industry to GDP.
Date; 071010 Creative Industry in Japan © Finpro, Finnode Japan 30

90
80
70
60
50
30
20
10
0
Industrial and Social Changes Underlying Creative Industry (2/2)
(%) Germany:
40
Sluggish eastern German economy
dampening overall economic growth.
Rapid industrialization
Fig. 3-1 Industrial trend behind Creative Industry
Growing importance of service and information economy
Secondary Industry
Primary Industry
1955 1960 1965 1970 1975 1980 1985 1990 1995 2000 2005
Tertiary Industry
Sweden:
Fall of the Swedish Model and
financialization of the economy.
UK:
Excessive deregulation and
financialization of the economy.
Date; 071010 Creative Industry in Japan © Finpro, Finnode Japan 31
23%
20%
13%
24%
Finland:
Manufacturing industry had been
exceptionally stronger in Finland
than in other EU nations, but its
presence subdued in the 2000s.
(source) Cabinet Office of Japan "National Accounts of Japan", OECD statistics

Technological Developments Impacting Creative Industry (1/2)
• Infrastructure for both creative and promotional activities in the
Creative Industry changed drastically because of huge innovations
in information technology industry. Because of these technologies,
the way people behave in a society and the way they communicate
with each other changed significantly in reflecting such radical and
fundamental desires as pursuit of personal preference, community
oriented networking, or return to individualism.
� Before the Internet, people had limited access to information which
mainly comes from mass media, but now in the digital age, we can
have access to all sorts of information through many different types of
tools.
� Digital media also changed the way you create, deliver your creation
to the market or society, or express yourself. Andy Warhol once said
that "In the future, everyone will be world-famous for 15 minutes", and
now we are seeing ordinary people suddenly grab their global fame
stemming from such online media as YouTube or Reality TV, etc
Date; 071010 Creative Industry in Japan © Finpro, Finnode Japan 32

Big
Level of volume and presence
(in economic and social terms)
mall
Technological Developments Impacting Creative Industry (2/2)
Times of Passive Citizens
(Information was controlled and Censored)
Mass communication
* Monopoly, oligopoly of media conglomerates
(because it's infrastructure-intensive industry)
(due to scarcity of spectrum)
Deflation (lower income)
Birth of the Internet
* Principle of avoiding media ownership
concentration lose its substance
commercialization
of the Internet
the advent of
ADSL
1995 2001
Fig. 3-2 Technological innovation behind Creative Industry
2005
5 trillion yen
FTTH
growth
2009
Times of Active Citizens
(Real democracy and freedom)
The value of Internet content increases
Mass media lose
trust from citizens
regime
change
1 trillion yen
Losing trend continues even
after the economic recovery
Critical
point
Rise of fully aware
and active citizens
Growth of fully
aware and
active citizens
2011-2012 2015 2020
Alternative and interactive
communication
Scenario A
* Significance of mass media continues to sink
* Growing presence of Internet communications
Scenario B
* Collapse of the mass media business model
* Alternative and interactive media take turns
Major restriction on Internet access
Scenario C
* Death of the Internet
Date; 071010 Creative Industry in Japan © Finpro, Finnode Japan 33

Content Sector spillovers to many industries (1/2)
In the Content Sector, a single content like “Pokemon” could be at first merchandised into TV
programs, movies, books, games, etc., then made into characterized goods, toys or fashion
clothing, and so forth, generating great spillover effects not only in the content sector but also into
other industries.
Fig. 3-3 Contents Industry spillover to many industries (example Pokemon)
Tourism
Over seas market;
over 2 trillion JPY
Pokemon Centre
6 places in Japan
Movie/DVD
0.35 trillion JPY
Pokemon market
size in Japan;
over 1 trillion JPY
TV Anime
Over 40% audience
for 4-12 years old
Games
0.3 trillion JPY
Books
0.2 trillion JPY
* TV anime; 68 countries, 25 languages * Movie; 284million USD
* Game boy; 1 trillion sets * Licensee; around 500 companies
Fashion
Contents Related business
Total; 0.7
trillion JPY
Date; 071010 Creative Industry in Japan © Finpro, Finnode Japan 34
Toy
Other goods
Figures; all copyright is reserved by Nintendo/ Creatures Inc./ GAME FREAK Inc.

Content Sector spillovers to many industries (1/2)
Restaurant
Tourism
Welfare
Fig. 3-4 Contents Industry spillover to many industries
Culture
Accessories
Food
DVDs
Game
software
Manga
Character
Content
Online game
Fashion
Date; 071010 Creative Industry in Japan © Finpro, Finnode Japan 35
Anime
Music
Film
Stationery
Apparel
Design
Toy
Daily goods
Education
(source) summarized from Digital Content Association of Japan (March 2009)

“Otaku” is the most promising area in spillover effects
– Definition of “Otaku”
• Among various content originated in Japan and in terms of spillover effects,
one of the most promising area would be so called "Otaku".
• "Otaku" is a combination of honorific prefix "o" and "taku" which means
"house" in the Chinese character. So the word literally means "your
honorable house". It was basically used by upper class women, and
became popular among middle-class housewives especially after the War
as a polite way of saying "you" or "your home" in conversation.
� In late 1970s and early 80s there were some sub-cultural communities
among creators and fans of underground comics or science fiction
animation in Japan. They began to use the word "otaku" when
addressing other person in conversation as a kind of slang, bringing
their mothers' phrase into their world.
• Their underground comics and animation came to gain recognition amid
Japan's rapid economic growth, and found a place in the mainstream of
Japanese entertainment industry. These creators and fans looked shy and
a kind of nerdy, but their creation had a certain level of intensity and quality.
People began to call them "otaku", and the whole phenomena became
"otaku" culture.
Date; 071010 Creative Industry in Japan © Finpro, Finnode Japan 36

“Otaku” is the most promising area in spillover effects
• "Otaku" is sometimes used synonymously with English words
"maniac" or "freaks", but in "otaku" world there are a lot of deep
interaction between creators and consumers, while "maniac" is mainly
a consumer side phenomena.
Creators
Consumers
Otaku Maniac
• Today people have access to huge amount of online information
through social networking services, and this is accelerating the
international demand for "Otaku" culture.
� A variety of "otaku"-themed expos and festivals are now taking
place outside Japan. These events are also helping to introduce
"otaku" culture to foreign consumers.
� “Otaku” fan can make the most of virtual space (Internet) by
getting information or buying content online, and share their
experience with other fans at real space (events).
Date; 071010 Creative Industry in Japan © Finpro, Finnode Japan 37
�
� �
Deep interaction
between creators
and consumers
Mainly consumer
side phenomena
Fig. 3-5 Otaku and Maniac

150,000
100,000
50,000
Salon del Manga (Barcelona, Spain)
Example of spillover effects; Penetration of "Otaku" Culture
among International Consumers (1/3)
Number of visitors to Japan Expo (Paris)
200,000
0
2000
1 3 5 7 9 2009
Virtual
space
Japan Expo (Paris, France)
Gathering information, taking
part in co line community,
buying e-comics, etc.
Singapore
Anime Festival Asia (Singapore)
Real
space
Participating events,
sharing the
experience with other
"Otakus"
Anime Expo (Los Angeles)
Los Angels
San Diego
Comic-Con International (San Diego)
Cities where large scale "Otaku" festivals are held
Fig. 3-6 Large Scale “Otaku” Festivals and “Otaku” Consumer Behavior
Date; 071010 Creative Industry in Japan © Finpro, Finnode Japan 38
Fortaleza, Brazil
SANA (Brazil)

Example of spillover effects; Penetration of "Otaku" Culture
among International Consumers (2/3)
Japan Expo (Paris, France)
• Not only Japanese pop culture such as manga, anime, game,
music, fashion but also such traditional culture as calligraphy,
martial arts and tea ceremony are introduced in the expo.
• Organizer: Sefa Event (France)
Anime Expo (Los Angeles)
• One of the largest anime convention in North America including
Interactive events (band competition, karaoke, plastic models
contest, otaku symposium, etc.), Costume play event, manga cafe,
etc. Held annually since 1992
• Number of visitors: more than 100,000 for a 4-day events
• Organizer: Society for the Promotion of Japanese Animation
SANA (Brazil)
• Performance by Japanese anime singers, autograph sessions, talk
show, fun meetings, etc.
• Number of visitors: more than 40,000 every year
• Organizer: a local event planning committee
Date; 071010 Creative Industry in Japan © Finpro, Finnode Japan 39

Example of spillover effects; Penetration of "Otaku" Culture
among International Consumers (3/3)
Comic-Con International (San Diego)
• Broad range of pop culture is introduced such as comics, manga, SF film, anime, VFX (Visual
Effects), etc.
• The event is used for the promotion of SF movies, animations and VFX movies
• Famous film directors, producers and actors are participating
• Number of visitors: more than 130,000 for a 4-day event
• Organizer: Comic-Con International (a nonprofit organisation)
Anime Festival Asia (Singapore)
• Newest trend on anime, manga and other Japanese pop culture are introduced
• Performance by Japanese anime singers, anime film screening, costume play event, manga
drawing event, etc.
• Number of visitors: 46,000 for a 2-day event (2008)
• Organizer: I*PROMO (an event company which has strong ties with Singaporean government)
• Japanese partner: Dentsu (the largest advertising agency in Japan)
Salon del Manga (Barcelona, Spain)
• Expo on Japanese manga and anime
• Famous for its costume play event
• Number of visitors: 65,000 (2009)
• Organizer: FICOMIC (a comic publisher in Spain)
Date; 071010 Creative Industry in Japan © Finpro, Finnode Japan 40

Japanese Traditional Culture and Creative Industry
Current Japanese manga and anime are sometimes identified with unique deformation or
emphasis on plot and storyline. These qualities are actually built on Japan's old aesthetic
and cultural heritage layered along its long history and tradition. Followings are briefly
looking into the History of Expression and that of Appreciation in Japanese art.
>
• Integration of literary and visual expression has been a major trend in Japanese art as you
can see in "The Tale of Genji Scroll", produced in as early as the 12th century.
• Storyline based on novel, romantic narratives, erotic suggestions have been important
elements of expression, and current manga/anime stories are loaded with these factors.
• A scroll made in the Heian period "Animal Caricatures" is seen as the origin of manga and
anime. It depicts personified animals on various comical actions in a story sequence.
• The word "manga" was stemmed from "Hokusai Manga", illustrated books of people,
animals, plants, supernatural beings and all sorts of thing sketched by Katsushika Hokusai
(1760-1849) in the Edo period. "Manga" literally means "something sketched in idleness“.
• A contemporary artist Takashi Murakami creates manga-inspired artworks, placing his works
in the context of traditional Japanese art. His style came to known as "superflat“.
• His artworks use such old aesthetics as flatness and two-dimensionality, effective use
of void space, lack of perspectives, and combine them with contemporary manga style.
Fig. 3-7 History of Creative activity in Japan
Date; 071010 Creative Industry in Japan © Finpro, Finnode Japan 41

Reference material; The Tale of Genji Scroll
The Tale of Genji is a classic work of Japanese literature attributed to the
Japanese noblewoman Murasaki Shikibu in the early eleventh century,
around the peak of the Heian period. It is sometimes called the world's first
novel, the first modern novel, the first psychological novel or the first novel.
Date; 071010 Creative Industry in Japan © Finpro, Finnode Japan 42

Reference material; Animal Caricatures
Animal Caricatures "Chōjū-jinbutsu-giga" is a famous set of four
picture scrolls, or emakimono, created in 12 th centry in Japan.
The reading direction of Animal Caricatures can still be seen in
modern manga and novels in Japan. Animal Caricatures is also
credited as the oldest work of manga.
Date; 071010 Creative Industry in Japan © Finpro, Finnode Japan 43

The Great Wave of Kanagawa
Reference material; Hokusai Manga
Hokusai Manga
http://www.youtube.com/watch?v=znSUPSglRKM
Katsushika Hokusai was a Japanese artist, ukiyo-e painter and printmaker of the Edo
period. Hokusai is best-known as author of the woodblock print series Thirty-six Views of
Mount Fuji (which includes the internationally recognized print, The Great Wave of
Kanagawa, created during the 1820s. In 1811, at the age of 51, Hokusai changed his name
to Taito and entered the period in which he created the Hokusai Manga and various art
manuals.
Date; 071010 Creative Industry in Japan © Finpro, Finnode Japan 44

Reference material; Takashi Murakami
Takashi Murakamiis a prolific contemporary Japanese artist who works in both fine arts
media, such as painting, as well as digital and commercial media. He blurs the
boundaries between high and low art. He appropriates popular themes from mass media
and pop culture, then turns them into thirty-foot sculptures, "Superflat" paintings, or
marketable commercial goods such as figurines or phone caddies.
Date; 071010 Creative Industry in Japan © Finpro, Finnode Japan 45

Global Presence of Japanese Animation Industry
• According to the Association of Japanese Animations (AJA), Japanese anime programs
and films are shown in 112 countries, reaching to 87.2% of global population.
• The international presence of Japanese anime is very high, but sales revenues of
Japanese anime industry shows that only 10% of revenues come from outside Japan.
• Piracy is a serious issue for the Japanese anime industry. There is a staggering amount of
pirated Japanese anime products marketed in Asian countries. The industry definitely
needs to tighten its copyrights management in order to increase international revenues
and turn the potential of Japanese anime industry to actual monetization.
Fig. 3-8 Japanese Anime Industry in Global market
Global presence of Japanese animation
Broadcasting deals on more than
6 Japanese animated works
Broadcasting deals on 1 to 5
Japanese animated works
(Billion yen) Sales revenue of animation industry in Japan
200 126 140 176 188 193
9.3
184 169 Total
150
4.5
12.0
6.1
13.6
13.7
28.9
15.6
15.7
29.4
16.9
18.6
16.8
19.0
14.0
14.2
16.5
5.7 Others
13.4 Overseas
Music, publishing
19.6 Merchandise
Internet
100 11.6
65.2 70.3
79.9
75.8 53.5
Video
50
0
26.8 26.1
33.5 34.3
42.7 36.6 33.3 TV
(source) summarized from The Association of Japanese Animations (AJA)
Date; 071010 Creative Industry in Japan © Finpro, Finnode Japan 46
63.1
6.0 4.3
74.3
13.9
13.3
17.6
18.6
2002 2003 2004 2005 2006 2007 2008
32.7 Film

Imports/Exports of Royalties and License Fees
• U.S. dominates the export of royalties and license fees in
Creative Industry, with the total amount of $57.4 billion in 2005.
Japan is the second largest exporter with $17.7 billion.
� U.S. has been the big exporter of royalties and license with
amount of export always exceeding that of import.
� In Japan the export began to exceed the import around at
2002. This could attribute to the increase in the remake
deals of Japanese films in foreign studios, or increased
publishing deals of Japanese manga and anime in global
market.
� Finland‟s import-export of royalties and license fees is fairly
balanced.
(see graph on next page)
Date; 071010 Creative Industry in Japan © Finpro, Finnode Japan 47

(Billions of $)
60
50
40
30
20
10
0
(Billions of $)
57.4
15
10
17.7
13.3
5
0
Imports/Exports of Royalties and License Fees
Top 10 performing countries by
exported value of Royalties and
license fees (2005)
6.8 5.9 3.9 3.3 1.2 1.1 1.1
US
Japan
UK
Germany
France
Netherland
Sweden
Finland
Italy
Belgium
Trend of royalties and license fees
1996
1997
1998
1999
2000
2001
2002
Fig. 3-9 Royalty and Licensing in major countries
2003
Exports
Imports
2004
2005
13.3
9.1
(Billions of $)
(Billions of $)
60
50
40
30
20
10
5
4
3
2
1
0
0
1996
Trend of royalties and license fees
1996
1997
1998
1999
2000
2001
(source) United Nations Conference on Trade and Development (UNCTAD) "World Creative Economy Report 2008"
Date; 071010 Creative Industry in Japan © Finpro, Finnode Japan 48
2002
2003
Exports
Imports
Trend of royalties and license fees
1997
1998
1999
2000
2001
Exports
Imports
2002
2003
2004
2004
2005
2005
57.4
24.5
3.3
1.5
(Billions of $)
(Billions of $)
20
15
10
5
0
2
1
0
Trend of royalties and license fees
1996
1996
1997
1997
1998
1998
1999
1999
2000
2000
2001
2001
2002
2002
2003
Exports
2003
Exports
Imports
Trend of royalties and license fees
Imports
2004
2004
2005
2005
17.7
14.7
1.2
1.1

Nominal GDP, Private final consumption expenditure
Creative Services Sector in Creative Industry;
Core Creative Services - Advertising
Advertising is one of the major segments in Core Creative Services sector. There is
a global trend of "power shift" in the advertising industry and Japan is no exception.
Incumbent media providers such as newspapers and TV networks are losing their
market volume. On the contrary, the sales of Internet advertising are growing
significantly in the recent years.
(trillion yen)
600
500
400
300
200
Nominal GDP
Private final consumption expenditure
100
0
1
9
8
5
1
9
8
7
1
9
8
9
1
9
9
1
1
9
9
3
1
9
9
5
1
9
9
7
Fig. 3-10 Advertising Market in Japan
1
9
9
9
Promotional media
Magazine
2
0
0
1
2
0
0
3
Internet
2
0
0
5
TV
Newspaper
(trillion yen)
3.0 30,000
2.5 25,000
2.0 20,000
1.5 15,000
1.0 10,000
0.5 5,000
Radio
0
Satellite media
2
0
0
7
(Note 1) * "Nominal GDP": fiscal year basis. "Private final consumption expenditure": fiscal year basis. * "Advertising revenue": calendar year basis. * "POP": Point Of Purchase.
(Note 2) * Scope of the Japanese advertising revenue was revised in 2007 and adjusted retroactively for 2005 and 2006. * "Magazine": Some of the magazines were added in
the scope (specialized and local magazines were added). * "Internet": Revenues for advertising production was calculated. *"Outdoor": Outdoor screens and poster boards were
added to previous scope of advertising boards and neon billboards. * "Transport": Airport and taxi were added to railway and bus advertising. * "Newspaper inserts": advertising
price was revised for newspaper inserts. * "Direct mail": private sector mailing was added to the previous postal mailing revenues. "Free paper, free magazines": advertising
revenue was calculated.
Date; 071010 Creative Industry in Japan © Finpro, Finnode Japan 49
Advertising revenue
Outdoor
Transport
1
9
9
9
2
0
0
0
Breakdown of promotional media
Newspaper inserts
2
0
0
1
2
0
0
2
Direct mail
Yellow page
2
0
0
3
2
0
0
4
2
0
0
5
2
0
0
6
Signage
POP
2
0
0
7
2
0
0
8
(billion yen)
700 7,000
600 6,000
500 5,000
400 4,000
Free paper,
free 3,000 magazines
200 2,000
100 1,000
0

Creative Services Sector in Creative Industry;
Core Creative Services - Design (and Japanese Aesthetics) 1/2
• There have always been "glitziness" and "plainness" coexisting in the Japanese aesthetics
from the past to the present. Performing art such as Kabuki or some of the traditional crafts
can explain the glitzy side of Japanese design, but "plainness" explains more about the
tradition of Japanese designs.
� An exhibition "DNA of Japanese Design" took place in Bangkok in 2006 as a joint project
by the governments of Japan and Thailand. In this event, which was jointly organized by
Japan External Trade Organization (JETRO) and Thailand Creative & Design Center
(TCDC), fifteen "genes" that characterize Japanese design and manufacturing from
ancient times are introduced, and various products were displayed in order to explain
the unique DNA of each.
• Culture of samurai warriors was introduced to Chanoyu (tea ceremony) in the medieval
period of Japan where spirituality found visual presentation, and then ultimately culminated
in the concept of "simple beauty".
• Philosopher Soetsu Yanagai started his Mingei (folk art) movement in the 1920s with the
concept of "beauty of function". This movement gave certain directions to the subsequent
trend of Japanese design.
• With the high economic growth after the War, various designers with Mingei spirit came to
gain success both in and out of Japan. Some even gained great international fame.
• “MUJI" or Ryohin Keikaku Co. is a Japanese retail company which sells a wide variety of
household and consumer goods with simple designs inherited from Japanese sensitivity.
� "MUJI" offers simple-designed and eco-friendly products with reasonable prices, and is
gaining trust from both domestic and foreign consumers.
Table 3-1 "Genes" of Japanese Design
Making it smaller, thinner, Expanding space and time Automation and labor- Enabling anyone to use it Exploiting materials
and lighter
saving
Combining functions Doing away with frills Making expertise
accessible by the public
Mirroring nature Pioneering materials
Mobility integration Interfacing communication Making new variations Organising into a system Beautiful wrapping
Date; 071010 Creative Industry in Japan © Finpro, Finnode Japan 50

Creative Services Sector in Creative Industry;
Core Creative Services – Advertising with Design & culture
(Source) Asahi Shinbun Newspaper 19 Oct 2010
Advertising is one of the effective marketing tool.
Airport promotion;
New terminal for international
flight at Tokyo Haneda airport
(open in Oct 2010) is planned
by Japanese traditional design
to appeal it as Japanese new
strategic Hub concept
Reference; Good idea but
limited promotion without
strategy at Vantaa airport
27 Oct. 2010 51

Creative Services Sector in Creative Industry;
Core Creative Services - Design (and Japanese Aesthetics) 2/2
Chanoyu (Tea ceremony) Mingei (Folk Art) Movement
Sori Yanagi
"Butterfly Stool" (1954)
Fig. 3-11 Design trend from Japanese traditional culture
Sen-no-Rikyu rejected glitzy
and decorative utensils that
had previously been
appreciated, and proposed
tea bowls with a certain
aesthetic tension in simple
and rustic qualities.
Modern design after the WWII
The period after the War show various Japanese
designers who inherited the spirits of Mingei. Sori
Yanagi, a son of Sōetsu Yanagi, designed such
daily products as saucepans and chairs.
Further evolution in Modern design
"Mingei" means "People's
Crafts (Folk Art)", and
indicates daily items handmade
by unknown
craftsmen. Mr. Yanagi and
his fellows found beauty in
those simple products, and
collected them by travelling
all over Japan.
"MUJI" is trying to bring such
traditional Japanese sensitivity
as anonymity in design,
simplicity, unexpected use of
ordinary materials, awareness
to natural environment, etc. to
today's modern life.
Date; 071010 Creative Industry in Japan © Finpro, Finnode Japan 52

Creative Services Sector in Creative Industry;
Core Creative Services – Fashion (1/3)
• In 1980s, a new generation of Japanese fashion designers shocked
the world. Issey Miyake, Yoji Yamamoto, Rei Kawakubo and other
designers run up to the global stage of fashion industry in concert with
Japan's high economic growth. What was shocking to people in the
Western fashion world was their wrinkled, holed, ragged and torn
clothes those Japanese designers exhibited. They were totally
contrary to the aesthetics of western clothing, just so bold and
revolutionary.
� Then their approaches came to be understood as deconstruction
and reconstruction of Japanese traditional aesthetics. Uneven
sleeve length was digested as the concept of asymmetry and
misfit, stoic use of monochrome colors was related to old ink
paintings of infinite gradations, drapes made by simply putting a
slice of large fabric to human body were seen as coming from
kimono, or from the philosophy of "Ma", which roughly means
"gap", "space", or "pause".
Date; 071010 Creative Industry in Japan © Finpro, Finnode Japan 53

Creative Services Sector in Creative Industry;
Core Creative Services – Fashion (2/3)
• Early 1990s show the collapse of bubble economy and entered the
long tunnel of deflation. Expensive designer fashion gradually
subsided, and street fashion of hip Shibuya/ Harajuku district and fast
fashion of Uniqlo came in with strong line up of various casual clothing
with less expensive prices.
• "Uniqlo" of Fast Retailing Co. became a leading company of today‟s
Japanese fashion industry with its massive color variations, strong
product development such as innovative "heat-tech", collaboration
with world-famous fashion designers, and so forth.
• "Tokyo Girls Collection" is a series of fashion events started in 2005
and taking place twice a year. The event attracts thousands of young
women to the huge venue in which the show is delivered more like a
rock concert than fashionable catwalk. And the event is directly
cooperated with mobile commerce, where event participants can
immediately buy her favorite cloths that models are wearing on the
stage. The events are major success with such new approaches
unprecedented in the incumbent pret-a-porter or haute couture
collections.
Date; 071010 Creative Industry in Japan © Finpro, Finnode Japan 54

Comme des Garçons
(Rei Kawakubo)
"Boro look" (1982)
Creative Services Sector in Creative Industry;
Core Creative Services – Fashion (3/3)
Fig. 3-12 New Fashion trends are creating from Japan
new generation of Japanese fashion designers “Fast fashion” in Japan
Yoji Yamamoto "Boro look" (1983)
* “Boro” means “ragged” or “shabby".
Event with mobile commerce
“In 1997, Uniqlo adopted a strategy of "SPA" (Specialitystore/retailer
of Private-label Apparel) means producing
own clothing and sell it exclusively. Uniqlo is becoming
Japan's leading clothing retail chain in terms of sales and
profits. They also operates in China, Hong Kong, South
Korea, UK, France, US, Singapore, Taiwan, and Russia.
http://www.uniqlo.com/uk/
In "Tokyo Girls Collection" a fashion show event is
directly cooperated with mobile commerce, where
event participants can immediately buy her
favorite
cloths that models are wearing on the stage.
Ministry of Foreign Affairs and the Tourism Agency
are supporting the event to attract foreign visitors.
http://tgc.st/10AW/whats_en/
Date; 071010 Creative Industry in Japan © Finpro, Finnode Japan 55

Creative Services Sector in Creative Industry;
Core Creative Services - Peripheral and Social Services (ICT)
As you can see from the recent growth of Internet-based services and mobile-oriented services, the
significance of ICT industry is ever growing and its contribution to the Creative Industry is huge.
� Since Japan's broadband infrastructure is very much matured, consumers can use it
without much stress. Creative Industry is definitely energized by information technology.
Creators, consumers and governments are all trying to make the most of it by
communicating, interacting, and collaborating on ICT infrastructure.
Fig. 3-13 Use of ICT in Creative Industry
* Promotion of creative city project
* Outreach program for local community, etc.
Interaction between
government and creators
* Collaboration in the
creative process
* Designing
* Digital data transfer
* Social networking
* Teleworking
* Research and development,
etc.
Government domain
Creator domain Consumer domain
* Education
* Archiving service
* Tourism campaign, etc
Interaction between
government and consumers
* Online games
* Social networking
* Communication on fun sites
* File sharing
* Online auction,
etc.
Interaction between creators and consumers
* Promotion * E-publishing
* Advertizing * Online game service
* Journalism * Live performance, etc
* E-commerce
Date; 071010 Creative Industry in Japan © Finpro, Finnode Japan 56

Creative Services Sector in Creative Industry;
Core Creative Services - Peripheral and Social Services (Food & Tourism)
• "Food" and "Tourism" are the important elements of Peripheral
and Social Service sectors in Creative Industry. Japanese
government regards their significance and insists that it might be
effective to combine them with Japanese old tradition and pop
culture in cross-sector approaches to attract international
visitors.
� The Japan Tourism Agency was established in October 2008
as an affiliated agency of the Ministry of Land, Infrastructure,
Transport and Tourism. Their "Visit Japan" promotion
programs aim to stimulate the international demand for
Japanese contents and culture. Effective and practical
strategy must be needed to attract more foreign tourists.
� In Japan, local film commissions are actively promoting their
regions to attract film studios and TV networks. Some of the
regions are using film commissions for regional
development, promotion of local culture and tourism
promotion.
Date; 071010 Creative Industry in Japan © Finpro, Finnode Japan 57

Creative Services Sector in Creative Industry;
Core Creative Services - Peripheral and Social Services (Food & Tourism)
Fig. 3-14 Strengthening Cross-sector Coordination in Peripheral and Social Services Sectors
Strengthening cross-sectoral coordination with "Fashion" x "Content" x "Tourism" x "Food culture", etc.
Coordinated approach on international tourist attraction strategies, improving the capability of each
tourist site in Japan by effectively appealing to foreign tourists
"Fashion" x "Tourism" "Food" x "Tourism"
Japanese fashion is very
popular among East
Asian young women.
Japanese food attracts
many people, regardless
of age and nationality.
"Film" x "Tourism"
Location sites of hit films
attract many tourists.
Coordinated approach on tourist attraction strategies, improving the capability of each tourist site
* Planning large Japan culture events abroad, strengthening tourism promotion
* Improving the capability of each tourist site in Japan
Collaboration with local economy
Support for the development of tourism goods and souvenirs
"Anime" x "Tourism"
Anime lovers tend to
come visit Japan
regularly.
* Support for drawing international tourists to local events, improving communications with foreign tourists
* Development of fashion, art, or food related tourism goods and souvenirs
(Source) METI "Bunka Sangyo Rikkoku ni Mukete (Towards Cultural Industry-oriented Nation)" (June 2010)
Date; 071010 Creative Industry in Japan © Finpro, Finnode Japan 58

4. Government Approach
to Creative Industry
Summary of this Chapter;
As a background, political regime change in Japan and its impact to creative
industry development is mentioned.
Japanese government has several activities to prepare good fundamental
circumstances for private players.
Digital archive project, Intellectual Properties strategy, International promotion
activities (KANSEI value creation initiative, Japan Creation Centre) are
implemented by Japanese government.
Date; 071010 Creative Industry in Japan © Finpro, Finnode Japan 59

Regime Change in Japan and its Impact to Creative Industry (1/3)
• In August 2009 Democratic Party of Japan (DPJ) won a historic
victory in the general election after 50 years of almost unbroken
rule by Liberal Democratic Party (LDP).
� It is still unclear how this regime change would affect Japan‟s
cultural policies or Creative Industry, but it is certain that DPJ is
going to shift government spending priorities “from concrete” to
“people”, a major shift from LDP administrations‟ "hakomono" =
Hardware construction policies.
� In "Hakomono" policies LDP administrations used huge amount
of government budget for the construction of roads, public
buildings, museums all over Japan especially in the time of
bubble economy, but these facilities were not used effectively
as local government the lack the operational skills to use it.
"Hakomono" policies were only for helping construction industry,
and not fit to the major trend from Industrial Economy to
Creative Economy
Date; 071010 Creative Industry in Japan © Finpro, Finnode Japan 60

Politicians’'
basic
relationship
with arts and
culture
Framework of
cultural policies
Ministry-level
coordination
Approach to
Digital Economy
and ICT
Industry
Regime Change in Japan and its Impact to Creative Industry (2/3)
Table 4-1 Change of Basic Policies on Cultural and Creative Industry
LDP administrations DPJ administrations
LDP has had a long-term, sometimes collusive
relationship with existing arts organizations to
keep its strong support base. This made it
possible for politicians to have direct
communications with creators through the
interaction with these groups as a result.
Promotion of "Hakomono" policies.
Many public museums, music halls and other
facilities were constructed all over without careful
planning or long term perspectives.
Politicians had collusive relation with construction
industry.
Under Aso administration, government promoted
the construction plan of " for Media Arts" ( ), a
museum for manga, anime, video games and
technology art.
Multiple ministries covered a same industry,
sector, or field.
Many attractive, pleasing, flattering initiatives
and plans but no substantial measures.
Internet-based campaign was banned during
an official election campaign period.
They put a focus on the construction of ICT
infrastructure, but could not develop effective
measures to use ICT for economic growth.
Due to the lack of enough experience and expertise on cultural policy making,
lack of enough understandings on local communities and its culture, their
cultural policies might become something ad hoc and shallow.
Kan administration, which overtook Hatoyama in June 2010, positions "Cool
Japan" as a major factors to make a strong economy, and plans to make
strategic investment to food, music, culture, fashion and design to promote them
for the international consumers, protect digital content from piracy, and
encourage new digital-oriented businesses. We need to watch their operability
carefully.
"From hakomono to softpower, from concrete to people".
To differentiate themselves with LDP, budget for public halls or museums could
be cut under the name of "screening process".
DPJ administrations stopped LDP’s construction plan.
Instead, DPJ allocated the budget for the support of local residents and workers
at local theaters and music hall, and for the support of nonprofit organizations
and local governments who are committed to the inheritance and revitalisation of
traditional culture.
METI reflects on the less-coordinated approaches on the content industry of the
past, and discusses a need for long-term strategy and cross- ministerial
approach for 's creative industries.
In the recent industry vision, Creative Industry was newly recognised as one
of five strategic areas to strengthen 's global competitiveness.
Ban on Internet campaign (update of campaign site) during election
campaigns was lifted.
Minister Haraguchi of Internal Affairs is discussing the need for creating the
"Japanese FCC", and promoting various ways to use ICT infrastructure thorough
his "hikari no michi (light path)" plan.
Date; 071010 Creative Industry in Japan © Finpro, Finnode Japan 61

Regime Change in Japan and its Impact to Creative Industry (3/3)
Fig. 4-1 Japanese Governments„ Policies and Initiatives on Cultural and Creative Industries
Intellectual Property Strategy Headquarters
IT Strategic Headquarters
Council on the Movement of
People Across Borders
The Japan Foundation
* "LDP": Liberal Democratic Party * "DPJ": Democratic Party of Japan
Content businesses promotion
policies (April 2004)
Comprehensive measures
on Japan content promotion
in the digital age (March 2008)
Asian Gateway Initiative
(May 2007)
Contents Global Strategy Final Report
(September 2007)
"KANSEI" Value Creation Initiatives
(May 2007)
Five Recommendations on Strengthening
Japan's Capability of Dissemination
(June 2007)
LDP administrations
Japan Brand Strategy
(March 2009)
New strategies towards the digital
new age - three-year emergency
plans- (April 2009)
Content strategies for 2015
(June 2009)
Measures and System for Strengthening Japan's
Capability of Dissemination (February 2008)
September 2009
DPJ administrations
* Nurturing the dramatic arts, * Promoting the media arts and films, * Promotion of activities enabling children to experience arts and culture,
* Promoting cultural activities in local areas, * Preservation and utilization of cultural properties, * Responding to copyright policies for a new era,
* Japanese-language policy, * Dissemination of Japanese culture and measures for international cooperation through international cultural exchange,
* Promotion of the Ainu culture, * Religious Juridical persons and administration of religious affairs, * Promoting museums
Industrial Structure Council
Media and Content Industry Division,
Commerce and Information Policy Bureau
Design Policy Office,
Manufacturing Industries Bureau
IP Strategic Program 2010
(May 2010)
Development of creative industries in local
regions (Planning Committee's priority issue)
(March 2010)
Establishment of the Japan Creative Centre
(November 2009)
Kansei value creation years (FY 2007- FY 2010)
Pop-Culture Diplomacy
Report by the Study Group on the Content
Industry's Growth Strategy (May 2010)
Development of creative industries in local regions
(Haraguchi Vision, December 2009)
The 4th International MANGA Award
(April 2010)
* Arts and cultural exchange, * Japanese-language education overseas, * Japanese studies and intellectual exchange
Towards a World Power on
Cultural Industry (April 2010)
Date; 071010 Creative Industry in Japan © Finpro, Finnode Japan 62

Digital Archives of Cultural Heritage (1/2)
• In Japan, discussion on digital archives started around in 1994 among
academics and scholars.
• In the "white paper on telecommunications" published in July 2009 by
the Ministry of Internal Affairs and Communications, the Japanese
government outlined the two basic directions to promote integrated
approaches on digital archives; 1) encourage interactions among
digital archives, 2) implement field trials on the archive digitization
methods. These measures are expected to strengthen Japan‟s
Creative industry.
� To respond to these government plans, many public-run cultural
organizations such as National museums are implementing
various projects to digitize their assets and collections to offer
them as online archive services. In addition, discussions on MLA
(Museums, Libraries and Archives) coordination are already in
progress in the recent years.
• It is considerable that both public archives and private archives in
Content sector are delivered as convenient and useful services they
could significantly contribute to the enhancement of social capital in
Japan.
Date; 071010 Creative Industry in Japan © Finpro, Finnode Japan 63

Digital Archives of Cultural Heritage (2/2)
Strategic approach to construct digital archives distributes
opportunities for Creative Industry (Contents & service) to use
Japan‟s Cultural heritage for innovating future industrial development.
Content sector
Release of archived data on
broadcasting, music, design,
architecture, etc.
Fig. 4-2 Significance of Providing Digital Archive Services
Cultural Industry
Museums
Broadcast archives
(NHK, etc.)
Audio archives
Design archives
Architectural
archives
Libraries
Archives
Passing on cultural heritage
to next generations
* Accumulation of knowledge
* Trend for MLA (Museums, Libraries
and Archives) coordination
Creative
services sector
* Development of data
preservation technology
and archiving technology
* Development of customer
platform
* Useful archive services
* Strengthened social
capital
Digital archive services can
contribute not only to
economic values but also to
social values
Date; 071010 Creative Industry in Japan © Finpro, Finnode Japan 64

Government Measures to Protect Intellectual Properties (1/3)
• Japanese pop culture has significant global presence (Page 46), but this is
not necessarily leading to monetary value.
� In the "Intellectual Property Strategic Program 2010" published in May 2010
by the Intellectual Property Strategy Headquarters, the Government
addressed that "Japan's technological capabilities are still at the highest level
in the world, but this is not necessarily leading to Japan's industrial
competitiveness in the global market".
• In order to create major economic impact from the Japanese technologies
and contents which have significant potentials, the government has to have
consistent and centralized IP management strategies and training programs
to develop professionals in IP rights who could conduct tough negotiation
with foreign counterparts.
• The Content Overseas Distribution Association (CODA) was established in
August 2002 to stamp out piracy and promote the legal distribution of
Japanese content, in particular in Asia. The association is composed of
Japanese content providers and copyright-related organizations from films,
music, game, broadcasting and anime industries.
� In June 2009 it signed a Memorandum of Understanding (MOU) on counterpiracy
measures with the Motion Picture Association of U.S. The both side
agreed to work on coordinated counter-piracy measures against Internet
piracy in China and a joint review of automatic content recognition technology.
� CODA's current focus is on China, Hong Kong, and Taiwan.
Date; 071010 Creative Industry in Japan © Finpro, Finnode Japan 65

Government Measures to Protect Intellectual Properties (2/3)
Fig. 4-3 Cross-industrial Measures to Strengthen Intellectual Property Strategies
Main objectives
* Broaden the use of patent system especially among start-ups and SMEs.
* Encourage private enterprises to fund for research projects at universities and public research institutes.
* Decrease the number of Japanese companies which suffer from copyright infringement.
* Cost reduction measures for patent applications
* Creation of one-stop assistance service bureau for patent applicants
Focus areas
* Use of "co-creation" platform for coordinated researches among researchers
* Upgrading the social status of professionals who do research management or
technological support, training and fostering these professionals
University, research institute
Promoting more effective use of Patent system
Customer-oriented assistance service
* Ideas
* Researchers
Support
Seek advice
One-stop service
Train and foster professionals
Innovation
Start-ups,
SMEs
Platform for "co‐creation"
Enterprise
* Research funds
* Researchers
* Review the patent system for more customer-oriented procedure
More convenient and
friendly system
(easier application
procedure)
Streamlined licensing
Patent system (innovation infrastructure)
Facilitate the acquisition of intellectual property rights
Reinforce the protection of intellectual property rights
Environment to support global business
Date; 071010 Creative Industry in Japan © Finpro, Finnode Japan 66
Patent
* Establishment of patent data base systems for international users,
introducing work-sharing systems
* Reaching Anti-Counterfeiting Trade Agreement with as many countries
(Source) summarized from Intellectual Property Strategy Headquarters (April 2010)

Government Measures to Protect Intellectual Properties (3/3)
Fig. 4-4 Collaborative Anti-piracy Measures by CODA and Motion Picture Copyright Associations
Japan and International Motion
Picture Copyright Association
Content right holders in Japan
1) contracted monitoring 6) reporting
Database
on violations
2) automatic monitoring
using crawlers
2) manual monitoring
using manpower
Operation center
Collaborative Measures by CODA and MPA
4) request for removal
E-mail
5) removal confirmed
Mail Tool
special network
International Federation Against
Copyright Theft - Greater China
3) suspicious sites
Beijing office
Consumer generated video site
operators in China
(Source) METI "Bunka Sangyo Taikoku ni Mukete (Towards a World
Power on Cultural Industry)" (April 2010)
Date; 071010 Creative Industry in Japan © Finpro, Finnode Japan 67

International Promotion Activities by Government - "KANSEI" Value Creation
Initiatives by the Ministry of Economy, Trade and Industry (METI) 1/2
• Kansei" means sensibility or sensitivity. Through its "Kansei"
Initiatives (FY 2007- FY 2010), METI is trying to promote
designs and manufacturing with a focus on Japanese sensibility.
It aims to provide business opportunities for talented designers
and manufacturers in Japan, and communicate these Japanese
sensibilities to international consumers.
� A design exhibition was held in Paris in December 2008,
then in New York in May 2009. Both exhibitions showcased
high quality Japanese designs to the international market.
� Through these events, some small but creative Japanese
manufacturers actually began to attract buyers abroad, and
are increasing their international sales revenues.
Date; 071010 Creative Industry in Japan © Finpro, Finnode Japan 68

International Promotion Activities by Government - "KANSEI" Value Creation
Initiatives by the Ministry of Economy, Trade and Industry (METI) 2/2
Fig. 4-5 Concept of KANSEI Value Creation Initiatives and Some Achievement of Participating Companies
Material fulfillment
Manufacturing
Manufacturer
Using "KANSEI" to Create Economic Value
Commitment
Spirit
Appealing to user's emotions
Joint creation
Feeling empathy with manufacturers
"KANSEI" Value
"To", a watch without clock face and hands
by Seiko Instruments and Tokujin Yoshioka
Emotional fulfillment
Communicating a story
Preference
Interests
Consumer
"Kotori", a lighting made of paper and bamboo
by Hiyoshiya
* Traditional umbrella
industry was declining.
* Hiyoshiya had a revenue of
only a million yen in 1997,
almost out of business...
Hiyoshiya
Manufacturer of traditional
Kyoto-style umbrellas
with 7 employees
* In 2004,
they started
using their traditional
skills to make modern lightings.
*Collaboration with an
Australian designer and
a Japanese calligrapher
* They made a revenue of 57 million
in 2009 from the sales of umbrellas
and lightings.
(Source) METI "KANSEI Initiatives", Hiyoshiya website
Date; 071010 Creative Industry in Japan © Finpro, Finnode Japan 69

International Promotion Activities by Government - Establishment of "Japan
Creative Centre", a joint collaboration by Japan & Singapore (1/2)
• In November 2009, Cabinet Office of the Japanese government established the Japan
Creative Centre (JCC) in Singapore.
� It was a result of the Japan-Singapore summit meetings held in 2007. Between Prime
Minister Abe and Prime Minister Lee an agreement was reached to set up the JCC in
Singapore as a base for disseminating information on Japan and its culture to Asian
people.
� "Innovation and tradition" is the main theme of the Centre. The Centre is trying to
showcase Japan's "soft power", such as anime, manga and other pop-culture as well as
traditional arts.
Fig. 4-6 Background of "Japan Creative Centre" Establishment and Its Activities
>
• The government is trying to position itself as an
international hub for art and design by attracting
talented designers from outside.
• This is their new approach for the development of
international hub strategy after financial, bio
medical, and green technology hubs.
• Singapore proposed the creation of JCC to the
Japanese government.
>
>
• JCC was established with
"Innovation and tradition" as
its main theme.
• Korea, China and Russia are also approached by Singaporean government,
and are considering the creation of their own cultural centres there.
(Source) summarized from Japan Creative Centre website
Date; 071010 Creative Industry in Japan © Finpro, Finnode Japan 70

International Promotion Activities by Government - Establishment of "Japan
Creative Centre", a joint collaboration by Japan & Singapore (2/2)
Fig. 4-7 “Japan Creative Centre” is collaboration between Japanese and Singaporean Government
• Canon Singapore launched the Tsuzuri
Project Exhibition in partnership with JCC in
March 2010.
• It was a part of their cultural heritage
preservation initiatives, in which Canon
makes digital replicas of important Japanese
artworks using its technology.
• The project aims to preserve irreplaceable
Japanese cultural properties, in order to
provide both Japanese as well as people
from other cultures the opportunity to view
and understand Japanese art and culture.
• It is indeed a fusion of Innovation and
tradition, and the company could gain good
publicity.
• JCC website is delivering
information on Japanese
anime, manga, design,
tourism, film, fashion,
architecture, tradition, and
food culture to the
international community.
(Source) summarized from Japan Creative Centre website, Canon press release (March 2010) and Sankei News (May 2010)
Date; 071010 Creative Industry in Japan © Finpro, Finnode Japan 71

5. Japan’s Creative Industry
and New trends of Society
Summary of this Chapter;
Developing new values of industry is principle action in today‟s new market
trend. Consumers request more social responsible value like sustainable
concept, clean energy, new food production system and welfare/medical
services. In this trend, universal and sustainable design as a part of creative
industry is collecting people‟s eyes.
This means Creative Industry can be good integration tool in cross industrial
fields.
In the action of strengthening of social capital, Regional Development projects
are mentioned with examples. Those projects can be the ignition key for
developing creative industry.
NPO‟s contribution to creative activities is also introduced.
Date; 071010 Creative Industry in Japan © Finpro, Finnode Japan 72

Role of Creative Industry in New trends of Society (1/2)
• In the "Industrial Structure Vision 2010" published by METI in June
2010, the government outlined the basic measures to improve
Japan's global competitiveness by setting the five strategic areas to
strengthen;
1) Infrastructure related / system export
2) Environment and energy problem solving industry
3) Cultural industries (fashion, content, etc.)
4) Medical, nursing, health, and child care services
5) Frontier fields (robots, space, etc.)
• These measures are meant to outgrow "Mono-pole structure" solely
depending on the automobile industry, shift from "High quality,
product-specific sale" to "System sales and Creative Added Value
Models", and change such constraints as aging population into
"Problem Solving Industry".
• It is recognized in Japan for the importance of providing new values
to the world in an integrated approach as well as to strengthen these
five areas respectively in order not only to regain global
competitiveness in economic sense, but also to contribute to the
international community for a sustainable future.
Date; 071010 Creative Industry in Japan © Finpro, Finnode Japan 73

Role of Creative Industry in New trends of Society (2/2)
• Creative Industry could play an important role in the future of society if it
can develop and use a lot of creativity in such critical areas as environment,
energy, food production, aging society, welfare and medical services.
• Especially such areas as medical services or health care can turn creativity
into social value if these industries could develop good universal and
sustainable designs.
• These good universal and sustainable designs could enhance Japan's
medical service and healthcare service delivery, and could strengthen
manufacturing industry by creating various innovative products, machines
or equipments in the long term.
Fig. 5-1 Shift in Structure of Japanese Industries and the Five Strategic Areas
(Source) METI "Industrial Structure Vision 2010" (June 2010)
Date; 071010 Creative Industry in Japan © Finpro, Finnode Japan 74

Role of Creative Industry in New cross industrial trends
Creative Industry could play an important role in the future society for critical areas as
environment, energy, food production, aging society, welfare and medical services. This
means that Creative Industry is becoming the integration tool for Innovative Industry (e.g.
Areas in Cyber World including Intelligence System Robots).
Fig. 5-2 Creative Industry is becoming the integration tool for the Future Society
Creative
Industry
Date; 071010 Creative Industry in Japan © Finpro, Finnode Japan 75

Building Up Social Capital for Sustainable Society (1/2)
• METI's "Industrial Structure Vision 2010" (June 2010) stresses the
importance of social capital as a foundation for diverse
developments in Japanese industries.
� While "economization of Culture" can largely be performed in the
content sectors by monetization of films, music, anime, etc.,
"Culturezation of Economy" is achieved by diverse interactions
in creative services sectors. Strengthening the creative services
sectors could increase the volume and quality of Japan's social
capital and leads to more sustainable society.
Table 5-1 Culturezation of Economy" and Strengthening Social Capital
"Economization of Culture" (Monetization of content)
A phenomenon that creative expression become the
source of economic value. Content industry is a typical
example.
"Culturisation of Economy" (Shift from personal needs
to social needs)
A larger phenomenon than "Economization of Culture",
seen in the area of wider social economy.
Contents create economic value not only in content
industry but also integrated in wider economic activities.
Content acts as an output. Content is embedded in other entities, acting as an input.
Entertainment content is more appreciated.
Non-entertainment content is a major force, acting for
quality of life.
Date; 071010 Creative Industry in Japan © Finpro, Finnode Japan 76

Building Up Social Capital for Sustainable Society (2/2)
Lack of social capital
* Small number of social entities
* Each entity lacks volume
* Entities are not networked
* Local policies are sometimes implemented without
being fully digested.
* Once a connection between an entity to another entity
is cut up, it is hard to reconnect them.
* "Love lasts as long as money endures."
* A program does not necessarily lead to a new
program and long-term communications.
Fig. 5-3 "Culturization of Economy" and Strengthening Social Capital
Creative Services Sectors play
important roles in bringing
"Culturization of Economy" to the
society, and when they become
more and more massive...
Abundant social capital
* Large number of social entities
* Each entity has certain volume
* Entities are networked (even with
entities outside the society)
Networking
with entities
outside your
own society
* Local policies are fully digested, and then implemented with the involvement of many entities.
* Even if a connection between an entity to another entity is cut up, a web of network could
recover that.
* Since many entities are rooted in the local community, it is easier to create new programs.
(Source) summarized from METI "Industrial Structure Vision 2010" (June 2010) and Jung Hoon Kim
[Assistant Professor, Research Institute for Digital Media and Content, Keio University] (December 2008)
Date; 071010 Creative Industry in Japan © Finpro, Finnode Japan 77

Strengthening Social Capital at Region Development project Using
Creative Resources
In Japan, many regional area including small cities promoting "Creative City"
projects. Those are working on long-term regional development by leveraging their
traditional culture or by boldly introduce New and Foreign culture. These cities
typically implement their programs with strong support from local residents and
nonprofit organizations (NPO).
Table 5-2 List of Local Communities Working on Regional Development with Creative Industries
Nanao, Ishikawa Pref. A famous actor's theater group plays regularly, and the city intends to make
performance art take root in the community, increase population and attract tourists.
Matsumoto, Nagano Pref. Through Maestro Seiji Ozawa's "Saito Kinen Festival Matsumoto" held every
summer, the city tries to attract tourist who love classical music and promote the
region.
Kōka, Shiga Pref. Regional development through ceramics industry. With its artist in residence
program, the Shigaraki Ceramic Cultural Park contributes to the region's cultural
exchanges by inviting 30-some ceramic artists every year from home and abroad.
Takayama, Gifu Pref. Tourism developments with landscape planning where natural & historic sites are
carefully preserved, as well as with traditional wood crafts using quality local timber.
Naoshima, Kagawa Pref. The small island serves as a big showcase for modern art, attracting many tourists
from home and abroad. Art lovers call the island a "Mecca for contemporary art".
Fukuoka, Fukuoka Pref. The city works on fashion industry development, mainly targeting Asian countries.
Organising promotional activities in Taiwan & trade fairs for Chinese buyers, etc.
Date; 071010 Creative Industry in Japan © Finpro, Finnode Japan 78

Region Development project Using Creative Resources
Example case at “Naoshima” (1/2)
Naoshima is a small island of 8 km² located in the north of Takamatsu. The town is
administratively composed of the island and other 20-some smaller islands. Local
residents were facing such serious issues as environmental destruction, depopulation in
the increasingly aging community. But the island turned these negative circumstances
into creating new positive values using creative economy and environmental programs,
significantly strengthening the region‟s social capital.
>
The island started their art tourism activities and regional development in 1980s, around the time a private corporation set up
an art museum as a part of its philanthropy.
• The company plays a leading role in making modern art take root in the community and attracting tourist. Local government
and nonprofit organizations support the activities.
• With the concept of "cultural village Naoshima", founder of Benesse (an education company, former Fukutake Publishing)
initiated the activities to nourish people and culture of Naoshima in late 1980s.
• Various artworks from world famous contemporary artists are exhibited not only inside the museums but also in the island‟s
natural landscape as site specific works.
• Artists and local residents came to interact through the Art House Project in which artists actually live in the island and
transform vacant local houses into artworks.
�The idea of "Art House Project" came from village officers who were worried about vacant houses increasing in the
aging community, and told Benesse about it.
>
• Naoshima had no specific local industry but that of fishing. In 1916 the town accepted the establishment of Mitsubishiaffiliated
copper smeltery to ease the financial difficulties. Its population and tax revenues increased thanks to the smeltery,
but they came to suffer serious air pollution that completely killed the trees of neighboring islands.
• In order to turn the polluted island into something rich in nature and better place to live, the town and Mitsubishi constructed
and began operation of the industrial waste disposal facility in the property of Mitsubishi plants, accepting industrial wastes
from neighboring Teshima island which also had serious problem with industrial wastes.
Date; 071010 Creative Industry in Japan © Finpro, Finnode Japan 79

Region Development project Using Creative Resources
Example case at “Naoshima” (2/2)
Art Tourism was expanded to neighbouring local communities,
culminating to the concept of "Kagawa Setouchi Art Tourism"
Number of tourists visiting Naoshima Town by main activities
History, culture
Industrial sites
Sports, recreation
Benesse House opens
1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008
(Source) Town-Naoshima Tourism Association
Fig. 5-4 Creative Industry (Art Tourism) in Naoshima
Spill-over effect of Art tourism in Naoshima
Art House Project starts
Chichu Museum opens
Contribution to local society not only with art
tourism but also with environmental projects
and recognition of local agricultural traditions
Stabilised local economy
Local and international tourists
The brand image was enhanced
Not financial but more versatile support
increased, 12% of total tourists
for the company which runs the
Local government
to Naoshima came from
long-term philanthropy programs
outside Japan in 2006
in the island
Public
From participation to
Long-term Commitment
Transportation and
active involvement
by Bennese
other social infra-
Private
Residents
structure was upgraded
More elder residents came to
Corporate philanthropy Human capital
participate in the local communities
(Source) The Japan Research Institute
Art Tourism in Naoshima
through art projects
Date; 071010 Creative Industry in Japan © Finpro, Finnode Japan 80

NPO Market Player; Number of art-related NPOs (1/2)
• Growing number of nonprofit organizations have been
established in Japan since the implementation of the Law to
Promote Specified Nonprofit Activities or NPO Law in December
1998. There are a significant number of art-related NPOs
created in recent years, some of them are engaged in regional
developments or communications using art and creativity as a
powerful media, and not limited to the development of art
activities itself.
• As more local governments are committed to their creative city
projects, art-related NPOs could play important roles as
mediators who could intermediate local governments,
enterprises, residents, and local community, as provider of "new
public" in brief. It is believed that art NPOs have huge potential
in acting as influential key players who could work for
strengthening social capital of the region, not just as small
culture clubs for amateurs.
Date; 071010 Creative Industry in Japan © Finpro, Finnode Japan 81

Authorized NPOs
40,000
35,000
30,000
25,000
20,000
15,000
10,000
5,000
0
NPO Market Player; Number of art-related NPOs (2/2)
Fig. 5-5 Number of art-related NPOs in Japan & Some Cases on Government-NPO Collaborations
Number of art-related NPOs in Japan Collaborations between local governments and art-related NPOs
35,669
4,000
23,608
28,777
32,630
3,500
3,550
3,000
2,500
* Kawasaki, Kanagawa
"Kawasaki Art Center" is owned by the municipal government and jointly operated by
the local culture foundation and an NPO specialized in cultural facility management.
* Osaka Prefecture
18,757
2,006 2,000
An art NPO has been operating Osaka Contemporary Art Center with the
commission by the government. But the newly-elected Governor Hashimoto is trying
13,250
1,420
1,730
1,500 to close it down as a part of the government restructuring programs.
1,123
1,000
535
500 * Tokamachi and Tsunan, Niigata
Art NPOs are deeply involved in the regional development through art and culture by
0 planning international art festival and operating cultural facilities, in collaboration with
the local government's tourism agency.
Sep, 2003
Sep, 2004
Sep, 2005
Sep, 2006
Sep, 2007
Sep, 2008
Number of authorized NPOs Number of art-related NPOs
Art-related NPOs
* Kobe, Hyogo
Art NPOs rented the old immigration center facility from Kobe City and converted the
space for the citizen's creative activities.
(Source) summarized from Art NPO Link and other public documents
Date; 071010 Creative Industry in Japan © Finpro, Finnode Japan 82

NPO Market as Incubator and Contribution to Economy
Art NPOs have a huge potential in empowering social community, but in reality, there still are
only a few of them which are actually working and as effective incubators to create new value
or making economic contribution to the society.
• With deteriorated financial base and budget cut caused by economic slump, many local
governments are abandoning sustainable cultural activities. Some NPOs are affected
by these situations, which have been supporting local government's cultural activities.
• There are many issues involving NPOs, such as balance between “public” and
“private”, outgrowing mere government subcontractors, securing financial base for
more independence, etc.
• According to a survey conducted by nonprofit organization "Art NPO Link" in 2006,
average revenue for art-related NPOs was 10.47 million yen, which is just a half of
average revenue for all types of NPOs which is 21.4 million yen.
> >
� Because of the lack of knowhow and experience, many
NPOs can not support themselves.
� Subsidy programs specific to art NPOs are not fully
implemented.
� Corporate tax break, tax system for donations, etc. such
tax incentives are not sufficient to promote activities by
NPOs.
� NPO workers can not support themselves with low salary
and suffer from severe working environment.
� Lack of financial base affects operational resource.
> >
� Local governments tend to use NPOs as mere
government contractors with smaller budget.
Table 5-3 Problems Associated with Art NPOs in Japan
� Activities of art NPOs are not fully recognised and
understood among local governments and private
sectors.
� Activities of art NPOs are not fully recognised and
understood among residents and local communities.
Date; 071010 Creative Industry in Japan © Finpro, Finnode Japan 83

6. Suggestion & Hint to
Creative Industry in Finland
Summary of this Chapter;
Comparison between Japan and Finland. It seems Japan and Finland have
similar feature & development level of creative industry.
Because of such situation, Japan‟s case can be valuable example when
Finnish creative industry innovation work will be planned.
6 hints are introduced for Finnish creative industry promotion work. All those
hints are coming from the analysis of Japan‟s case.
The idea for developing Finnish creative industry (including practical project
concept of the packaging creative industry by regional development) is
recommended on final page.
Date; 071010 Creative Industry in Japan © Finpro, Finnode Japan 84

Comparison between Japan and Finland (1/4)
In fact, Japan and Finland are considered as the countries that have
similar potential level of Creative industry.
This means Japan‟s case can be reference information to make Finland‟s
Creative Industry/ business development program.
Fig. 6-1 Finland and Japan both have good competence in Creative service industry
(Source) DESIGNIUM, the Design Innovation Centre at the University of Art and Design in Helsinki "Global
Design Watch 2008" (September 2008)
Date; 071010 Creative Industry in Japan © Finpro, Finnode Japan 85

Comparison between Japan and Finland (2/4)
Fig. 6-2 Finland and Japan have similar feature in Creative service industry
(Source) DESIGNIUM, the Design Innovation Centre at the University of Art and Design in Helsinki "Global
Design Watch 2008" (September 2008)
Date; 071010 Creative Industry in Japan © Finpro, Finnode Japan 86

Comparison between Japan and Finland (3/4)
Table 6-1 Social and Economic Environment Surrounding Creative Industry in Japan and Finland
Society Japanese are famous for
its love of art.
Japan Finland
Strength & Opportunities Weakness & Threat Strength & Opportunities Weakness & Threat
From kids to adults,
people like manga and
anime as essential part of
daily life.
People are very receptive
and flexible to foreign
culture such as art and
food.
Economy Good at "single content,
multiple uses" strategy.
Various measures to
create economic value or
social capitalisation from
local culture.
Japanese like art, visit
museums a lot, but not so
many people actually buy
artworks.
Under deflation, civil
activities are not
necessarily creating
economic values or social
capital.
TFP and labour are not
making significant
contribution to economic
growth.
High level of education on
art, culture and creativity.
Welfare and innovation
are strengthening the
country's social capital.
Innovative companies
such as Nokia are the
source of international
competitiveness.
Education sits at the heart
of the creative offer, with
polytechnics linking with
creative businesses.
TFP and labour make
significant contribution to
economic growth.
Creative processes in
rural areas are not being
developed to their
commercial Creative
Industries potential.
The link between
universities and creative
businesses could be
strengthened.
(Source) summarized from Tom Fleming "A Creative Economy Green Paper for the Nordic Region" (November 2007) and other public documents
Date; 071010 Creative Industry in Japan © Finpro, Finnode Japan 87

Comparison between Japan and Finland (4/4)
Table 6-2 Social and Economic Environment Surrounding Creative Industry in Japan and Finland
Japan Finland
Strength & Opportunities Weakness & Threat Strength & Opportunities Weakness & Threat
Politics Government began to take Attractive policies and plans, A very strong track record in Cooperation between
comprehensive approach not but they are not sufficiently policy support for the Creative ministries, regional partners
only with digital content but coordinated or implemented. Industries.
and sector development
also with food and tourism.
organisations needs to be
Realising the need for cross- Need to create and
Support with public funding advanced.
ministerial cooperation. strengthen centralised IP
strategy.
and IP protection measures.
Kan administration is
Ministry of Education has
committed to "Cool Japan"
great authority on public-
strategy.
funded museums, theaters,
orchestras, as well as on
locally funded or subsidised
organisations and civil
activities.
Shift "from hakomono to
Policy coordination is
softpower, from concrete to
increasing, e.g. between The
people"
Ministry of Education and
Culture and The Ministry of
Trade and Industry.
Technology High level of designing and Asian countries are gaining A world-leading cluster of Empowering SMEs as well as
technology.
experience and expertise in design-led technology and big companies like Nokia
anime production, threat content businesses. could enhance the country's
Good at incorporating Japanese competitors. Global presence of Nokia. global competitiveness even
traditional culture and
innovative technology.
further.
Ecology High level of technological Not fully aware that creativity From governments to High level of awareness to
potential in contribution to can contribute to environment residents, higher level of environment and welfare is not
environment and welfare. and social capital.
awareness to environment and necessarily leading to cultural
Use of robotics technology for
welfare.
development and social
welfare industry, etc.
capitalisation.
(Source) summarized from Tom Fleming "A Creative Economy Green Paper for the Nordic Region" (November 2007) and other public documents
Date; 071010 Creative Industry in Japan © Finpro, Finnode Japan 88

6.0
5.0
4.0
3.0
2.0
1.0
0.0
-1.0
0.96
1.62
0.46 0.48
0.49 0.34
0.31
1.88
2.05
0.39
Study from Japan‟s case
Components of GDP growth in Japan
6.0
Components of GDP growth in Finland
Contribution of manufacturing industry to Total GDP
Collapse of the
asset bubble
1981-1985 1986-1990 1991-1995 1996-2000 2001-2006
Poor capital investment by private sector
due to the lack of good development and
investment opportunities
11.9%
Fig. 6-3 Components of GDP Growth in Japan and Finland by Growth Accounting Frameworks
Full-scale deflation
(1998-)
1.65
0.04
0.86
0.30
0.73
TFP
Non-ICT capital
0.25
0.28
0.40
0.50
0.23
0.42
ICT capital
Labour composition
-0.38
-0.23
-0.60 -0.38 Hours worked
Cut in working hours and
workforce due to corporate
restructuring plans
Technological innovation is beginning to raise the TFP growth
Contribution of ICT capital to Total GDP growth
91-96 02-07
5.0
83-88 94-99
85-90
84-89 96-01 96-01 91-96 01-06
95-00 84-89
4.0
Japan US UK Finland Sweden Korea
before the country's financial crisis
after the country's financial crisis
3.0
Date; 071010 Creative Industry in Japan © Finpro, Finnode Japan 89
2.0
1.0
0.0
-1.0
-2.0
-3.0
-4.0
1.07
0.38
1.02
0.22
-0.11
1.13
1.09
0.50
0.69
-0.11
The fall of the Soviet
Union brought a drastic
drop in export and
seriously damaged the
Finnish economy
Industrial
restructuring
0.86
0.22
0.91
-2.74
0.05
1.95
0.56
0.63
1.27
0.18
1.18
0.35
0.40
0.26
0.42
1981-1985 1986-1990 1991-1995 1996-2000 2001-2006
Significant contribution of
manufacturing industry to
TFP growth and innovation
Productivity through labour input seems
more effective compared to Japan
9.4% 15.7% 33.5% 17.8% 14.7% 15.1% 13.7% 15.4%
(Source) summarized from EU KLEMS Growth and Productivity Accounts (November 2009) and
Cabinet Office "Annual Report on the Japanese Economy and Public Finance" (July 2009)

Creative Industry Promotions in Japan (1/2)
In order to become a "World Power on Cultural Industry", Japanese
government is now shifting its focus from digital media industries
and taking more comprehensive approaches by leveraging Japan’s
"food" and "tourism" as well as manga, anime and other globally
competitive contents.
• The plan started with the government‟s notion that Japan has been
a big importer of foreign culture but rather weak in the volume of
cultural exports. Now they are trying to promote Japanese culture
not only with manga or anime but also with our food, tourism and
overall Japanese culture, committed to become a "big exporter of
culture" and increases Japan's national strength.
• Japan has long adopted foreign culture from the continent through
China or Korea. Japanese arts, medical science, and astronomy
flourished through contacts with the Western culture of Portugal and
Spain in the 16th Century Azuchi-Momoyama period. People's
lifestyle was largely westernized after the War. As you see, the
capacity to adapt foreign cultures makes some basis for
Japanese culture.
• On the other hand, Japanese culture has not made major impacts in
terms of export volume.
Date; 071010 Creative Industry in Japan © Finpro, Finnode Japan 90

Creative Industry Promotions in Japan (2/2)
With various new and innovative expressions, Japan's
creativity gained a global presence in the recent years. But
this was achieved not necessarily because of government
promotions but because of quality of individual work and
product, as well as "connoisseurs" who can evaluate these
Japanese local contents and products in the context of global
market and "enthusiasts" that truly enjoy them. Development
of Information technology is pushing further their deep
engagements with Japanese creations.
• What a government has to do is build environments and
infrastructure (regulatory frameworks and strategies, intellectual
property measures, education, subsidies and tax incentives, etc.)
that can accelerate positive trends happening in the private
sector and make creators and productions generate maximum
economic returns.
Date; 071010 Creative Industry in Japan © Finpro, Finnode Japan 91

Creative Industry Promotions in Japan and Finland (1/2)
It is believed in Japan that the Finnish
government stands head of the Japanese
government in terms of consistency, continuity
and policy implementation capability in general.
• It is understandable that, as a part of EU member
states, Finland needs to follow EU-wide regulatory
framework not just of creative industries but also of
various other industries and sectors. In spite of
these constraints Finland is confidently showing
and offering the Finnish values, identities and
creativity to the rest of the world.
Date; 071010 Creative Industry in Japan © Finpro, Finnode Japan 92

Creative Industry Promotions in Japan and Finland (2/2)
Fortunately both Japan and Finland have their own stock of creativity
in abundance, and are competitive in the global market.
• Japanese people have a lot of respect and feel close to Finnish culture (e.g.
Finnish glassware and furniture are very much appreciated among Japanese
consumers. High level of education and welfare is what Japanese have to learn
from Finland.) There is a lot of possibilities that Japan and Finland can
cooperate each other to develop Creative Industry promotion project.
• Finnish Competitive ICT can be one of the basis for empowering creative
industry through contents industry & creative service industry.
• Using the creativity stock and showing grand perspectives, Innovative sector &
business players can lead the country not just with economic force but also with
more comprehensive strength.
• Nonprofit organizations could play important roles in strengthening social capital
and raising cultural capabilities in local communities.
• Through the accumulation of such small activities, a sustainable society can be
achieved in response to the shift from "Industrial Economy" to "Creative
Economy".
Date; 071010 Creative Industry in Japan © Finpro, Finnode Japan 93

Learning points & Hints from Japan‟s case (1/2)
1. Advantages of Japan‟s Creative Industry are Japan specific
segments and/or strong fields. Those industry segments are
coming from Japanese traditional cultures and its history. Reanalyzing
Finnish culture and tradition that affect on Creative
activities can give the idea what kind of advantages are in
Finnish creative industry.
2. Japanese Contents industry utilize spillover effect to other
related business fields strategically. Contents itself only make
a part of profit for Creative industry. Cross industrial idea
should be necessary elements when development/innovation
program of Creative industry will be launched.
3. International activities with the usage of foreign cultural
influence can be effective way to promote Creative industry.
Cooperation with foreign creative sector (e.g. Japanese
creative project/ program) will be needed to consider seriously.
Date; 071010 Creative Industry in Japan © Finpro, Finnode Japan 94

Learning points & Hints from Japan‟s case (2/2)
4. In cross industrial idea, Contents (Game, Animation Movie etc),
Design, Fashion, ICT, Food and Tourism can be combined
each other. Regional development projects leaded by local
government in Japan can be valuable example case if Finnish
project will be promoted.
5. Local government sector should have more active involvement
to develop regional creative industry sector followed by
analysis of local tradition and culture.
6. There should be “integrator” if Creative Industry is hoped to
make profit/ benefit as much as possible as cross industry filed.
Government or local government (and its related innovation
centre) can be integrator. NPO has also a possibility to be key
element of project group.
Date; 071010 Creative Industry in Japan © Finpro, Finnode Japan 95

Eco city planning
(City Design segment)
Farmer’s
market
(Tourism)
Project idea;
Whole package of creative industry as regional development project
Restaurant
(Food)
Fig. 6-4 Image of regional development project
Design, Fashion,
and Art studio &
shops
(contents, service)
Eco tourism
Spa
(Tourism)
3 generation
park (Design
of playground
equipment)
ICT, Degital
archives, etc
Historic
Heritage
(culture,
contents)
Date; 071010 Creative Industry in Japan © Finpro, Finnode Japan
96

Project idea for developing Finnish Creative Industry
• Government or Innovation centre can be integrator to make cross
industrial type project in Creative industry.
• Analyzing the feature of Finnish culture that is leaded by integrator
should be necessary to find Finnish specific segments.
• Regional development project is one good solution to integrate many
parts of creative industry. Spillover effects can be hoped in this case.
• One regional development model can be reference case for other local
area.
• Cooperate with foreign sector (e.g. Local area of Japan) can be one
good solution if regional development project will be hard to establish in
Finland. Finnish creative industry players can introduce their service
and products into foreign regional development project with
internationalization process.
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Date; 071010 Creative Industry in Japan © Finpro, Finnode Japan 98