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Softbank, the Japanese internet investment company, and its affiliate Yahoo Japan have linked up to distribute video content on a new Yahoo portal in a step towards the country’s integration of broadcasting and the internet.

A joint venture, TV Bank, will procure content for the service, distribute it on the portal and operate an internet search system for video. The service highlights the growing convergence of broadcasting and the internet, driven by innovations such as faster internet connection and better picture quality.

Japan has one of the world’s highest broadband penetration rates, with more than 21m users, and the lowest connection fees.

The new services give Softbank and Yahoo Japan a lead over smaller rivals Rakuten and Livedoor, two internet service groups that this year made hostile attempts to acquire national broadcasters as a short cut to providing broadcasting services on their portals.

In contrast to those failed bids, Softbank and Yahoo Japan have signed up a range of content providers, including NHK, the public broadcaster, three of South Korea’s leading broadcasters, BBC Worldwide and AP, the newswire service.The portal offers a variety of content from Hollywood movies to TV dramas and sports programmes.

Masayoshi Son, Softbank president, said the groups were also in talks with other Japanese TV broadcasters.

As part of a trial service, TV Bank is offering 16,000 video titles that are free to view and from which it plans to generate advertising revenue. Another 15,000 titles, such as films, will be fee-based.

In addition, the portal will allow users to search from among 70,000 video titles that are freely available on the internet but for which TV Bank does not own the rights. Commercial services begin next March.

Softbank’s shares rose 8 per cent to a five-year high of Y11,700. Softbank owns 41.9 per cent of Yahoo Japan.

The service comes as Heizo Takenaka, minister for internal affairs and communications, has indicated he plans to set up a committee to study the integration of broadcasting and telecoms.

Conventional Japanese broadcasters have been cautious about embracing the trend. But Mr Son said he was optimistic that such services would become more popular.

Copyright The Financial Times Limited 2017. All rights reserved.
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