Takashi Hara

Back to Contents of Issue: August 2000

President, Vagabond

by Kyoko Fujimoto

Takashi Hara strikes one as being a little too casual to be a salary man and a little too formal to be head of a Net outfit. After graduating from Rikkyo University, he joined a think tank called JMA Research Institute, where he focused on information technology. Next he and an associate started Kai Co., a consultancy advising clients on IT and desktop publishing. About four years ago the Net bug bit him, and a content startup called Vagabond caught his attention. He became president in 1997.

Vagabond describes itself as an Internet content company. Primarily it distributes email newsletters, but it also has a related site for each title and finds other ways to squeeze money out of words, such as licensing its content to the likes of Yahoo, selling ads, and offering both free and pay-for versions of its offerings. It's also moving into cell phone content, one of the hottest sectors in Japan.

Don't underestimate the power of email newsletters in Japan. As we wrote last month, they're still the best way to reach Japanese online consumers. Kyoko Fujimoto met Hara at our offices.

Your company produces various content offerings. Could you explain the major ones?
We have eight types of content now. Scan Security Wire is the oldest one. It's about computer security, and we offer the content to Yahoo Top News, Daily BCN, et cetera, as well as having our own email magazine. Even though it's a bit technical, it has more than 20,000 subscribers.

The most popular email magazine of ours is Gamers Express, which has more than 60,000 subscribers. It provides information on upcoming games, popular-game rankings, game reviews, et cetera. We also have a weekly updated site, and i-mode and WAP content. We provide that content to goo [a big search engine in Japan] as well.

Talkin' Mail is also popular, with about 20,000 subscribers. It's all about movies -- introducing upcoming movies and offering reviews. The content is used in WalkersNet [a well-known entertainment site], Infoseek, and other sites.

Net Insider is still only about a year old, but it's popular among people in the Internet business. We have a Top Interview section where we interview one managing or high-level executive from a Net company every issue. It also has investment information.

Our most recent offering -- and we are expecting this to become really big -- is Taiyo no Kisetsu ["The season of the sun"]. Its target audience is people over 65, and the newsletter is based on contributions from readers. Senior citizens have a lot of money to spend and they don't mind paying for the content. We haven't even registered with any search engines because, it being contribution-based content, we can't deal with so many participants at the same time. But we already have about 1,500 people registered. They talk about what they were doing in the good old days, what happened at that time ... They're really active.

How do you make money?
The most profitable part is the ad sales. But our email magazines all have paid versions and we make money there as well. Except for the cell-phone version of the magazine, they usually cost more than ¥500. But it's amazing how many people are willing to pay for the content. We also provide content to other portals, and that's big business, too. And anther way is to make paper versions of email magazines, and sell them as data.

Who do you regard as your competitors?
We can't think of any competitors now. Many email magazines are free, and even though [the publisher] Impress has some pay-for content, it's quite different than ours and, what's more, they're still concentrating on making profits through ad sales, not through selling content. Our strength is that we have groups of people who are willing to pay for the content. Customers who pay for one offering tend to pay for two or more, which reduces our marketing costs.

What are your future plans?
We will continue to produce more content based on email magazines. Email magazines have the least risk -- you can start it right away, and if it turns out to be unsuccessful, you can stop it right away. But we don't start anything unless we have a certain business model. Just getting the market share doesn't mean much. Actually, there are many famous companies that produce content on movies, music, and such, but even the good ones only have 10 or 20 percent of the share. This means you can't be the only winner there. How you succeed depends on having different offerings and keeping the group of customers that pay for additional information.

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