USEN CORPORATION

Overview of the Media Content Business

With the rapid growth of the broadband market has come a rapid rise in user demand for content services provided through broadband infrastructure. The video broadcast market in particular is expected to reach \3 trillion. The USEN Group has positioned the logistics and services related to this digital content within our Media Content Business, fully expecting this segment to grow into a core business for the Group. The Group is building a structure whereby we will be able to provide superior content across the entire spectrum of customer demographics at any time and in any place over a variety of media formats, broadcasting video content, operating Internet music download sites and more, as well as offering music content in the Broadcasting Business.

As a unique advertising medium, GyaO is steadily gaining recognition. A simple initial registration process for all users provides USEN with the needed personal data to offer clients an array of specific segment target advertising opportunities. To date a total of 420 major household names have experimented with the service and advertising agencies are starting to step up their sales efforts having acknowledged the future potential and value of the service.

The History and Future of the Media Content Business

The free broadband broadcasting website "GyaO" (part of the Media Content Business) first launched in April 2005. During the current consolidated fiscal year, the site surpassed 15 million registered members. The site continues to add new channels and enhance content with major Hollywood productions. The Group is securing an overwhelming competitive advantage in the content broadcast market with its "ShowTime" open broadband content portal website and "GyaO Next" service offering flat-rate access to video content via TV set. Meanwhile, the GAGA Communications production "Babel" was a considerable hit for the firm.