1. Basic management policy

The MTI Group understands that creating services required at any given time in this time of constant change and delivering them to every part of the world are of particular importance in the process of create a society in which customers can live more freely and be who they are. Under the vision of “Making the world move a step forward,” we will continue to be our customers’ partner, supporting them in their daily lives, and will contribute to the betterment of future society by providing services that make our customers’ lives more convenient and affluent.

2. Target management indexes

The MTI Group believes that sales growth rate and degree of improvement in operating margin are important management indices. Through the sustained improvement of these indices, we aim to continuously enhance corporate value. In addition, the Group’s policy regarding the total return ratio is to return profits to shareholders targeting a payout ratio of 35% over the medium term.

3. Medium- to long-term management strategy

Our strategy is to use a portion of the stable earnings generated by our content distribution and Real Affiliate business, our main earnings pillars, to invest in fields with high growth potential with the aim of fostering new fields capable of generating steady earnings. At the same time, we will invest in fields expected to have large markets and high growth.
  We will also strive to increase the number of subscribers in new fields amid the rapid growth in the market for smartphone services. Additionally, we will aggressively work to create business opportunities by developing new services targeting smartphones and we will work to realize sustained sales and continuous growth of profits.
  Medium- to long-term management strategies for each contents category are explained below.

a) Improvement in average revenue per user (ARPU) in the content business
With the penetration rate of smartphones reaching a high level, the Company will work to provide services that are easier to use and understand and services that that offer added value that is greater than that of the current services.
  Music, books, comics and video are uniquely popular among customers. That being said, the Company expects that the video-streaming market will continue to grow. To improve ARPU, it is therefore seeking to enhance the lineup of video content through an increase in the number of Hollywood movie titles.

b) Initiatives in the Healthcare-related business
The Company plans to operate the healthcare-related service business from a medium-term perspective, given its strong growth potential and the greater possibility than that in the past, of developing into a stock-type business by providing long-term support according to customers’ life stages.
  The Company provides an array of services related to the medical and healthcare fields and will work to make each service profitable at an early stage. At the same time, the Company will strive to establish services that are convenient for customers by integrating services in which multiple organizations such as medical institutions, dispensing pharmacies, medical checkup facilities, health insurance associations, and local governments collaborate with one another.

4. Issues to address

1) Enhancing marketing capacity
Customer needs are continuously changing and becoming more varied due to the evolution of mobile devices and the expanding base of mobile content users. We realize the importance of constructing a system for continuously improving our marketing capacity by accurately grasping these trends and delivering contents with a high degree of customer satisfaction.
  To this end we have strengthened organizational systems for our marketing divisions, bolstered personnel with specialized capacity and promoted the education and training of personnel by enhancing in-house training systems. These steps are allowing us to make marketing capacity, one of our strengths, even stronger.

2) Enhancing quality control capacity
We are aware that in order to encourage customers to use mobile contents on a continuing basis, customer needs obtained from marketing research must of course be reflected in the actual sites. We are also aware of the importance of building a strong quality control system in order to provide a product line up and a level of quality that will satisfy these customers.
  To this end we have clarified the procedures and quality standards for each step in the production of our content materials, while conducting thorough management of these steps. At the same time we have made continuous improvements through the training and education of personnel as well as through PDCA activities, while building a system for the efficient production of high-quality content materials.

3) Enhancing development capacity
We will be able to provide mobile content services with even higher added value as mobile handsets become even more advanced and as the speed and capacity of communication infrastructures increase. Building a high quality technical development system will be essential for continuing to win the support of customers well into the future.
  To promote development methods that can quickly and flexibly respond to changes in the technological environment, we are working to acquire and develop skilled personnel, while raising the technical skill levels of all development personnel. We will also promote offshore development to realize a high-quality and efficient system.

4) Enhancing design capacity
Services for smartphones allow for improved contents operability and greater expression. We realize that it is important to have a system in place for providing high quality designs, an extremely important point when customers select which services they will use.
  Therefore, we are researching user interfaces and customer preferences, while working to acquire and develop highly skilled personnel. In this manner we are building a system capable of providing high quality designs.