In August of 2013, popular idol group AKB48 released their 32nd single, “Koi Suru Fortune Cookie” (恋するフォーチュンクッキー, Koisuru Fōchunkukkī; “The Fall-in-Love Fortune Cookie”), or better known as Fortune Cookie in Love (I don’t think I’ve ever heard it called “The Fall-in-Love Fortune Cookie”). Over the next few years and into the next decade, it would become one of their more popular songs, even being remixed into some of the jingles for the Tokyo Metro. The music video would soon be released, a gargantuan performance involving thousands of extras and taking place in front of Hakata Station. The joyous, upbeat aspect of Koi Suru Fortune Cookie attracted the eyes of millions and gradually became one of their best-known songs alongside Heavy Rotation. You’ve probably heard it somewhere if you’re a weeaboo.

I’ve heard it hundreds of times!

One of the quirks of Koi Suru Fortune Cookie is the opener. They had a black DJ introduce them (who the heck was this guy??), which was not uncommon for many pop songs at the time. However, the lyrics have always stuck with me.

The guy goes:

おい日本のみんな、聞こえてるか？

What’s up Japan? Can you hear me?

最近日本は元気無いって？

Is life gettin’ you down?

カネがない、仕事がキビシイ、

No money, no job,

イマイチなニュースばっかりだもんな！

Too much bad news?

でもクヨクヨしててもしょうがないだろ？

Well, there’s no reason to be down.

いまは立ち上がって踊るのさ！

It’s time to get up!

AKB48から、オマエのテンションアガりまくる、最高にホットな新曲だ！

We have a hot new song from AKB48 to make you feel good!

「恋するフォーチュンクッキー」！！！

“Koisuru Fortune Cookie.”

踊れ、ニッポンよ

So dance, Japan!

踊り狂っちまえよ！

Crazy!

To a native English speaker, it sounds like stage banter. The gentleman is asking how you’re doing! Are you feeling down? Does your life suck? Well, AKB48 is going to cheer you up! Let’s get ready for AKB48! It’s just another introduction meant to hype you up, to set the stage for a cool performance. And that’s what I always assumed they were talking about, but I recently took it upon myself to go through the JP subs, which read a bit differently. I’m not sure if the translation was first written in JP or EN, but the JP subs are more directed.

Instead of addressing you, the audience, they address you, a citizen of Japan. Or more specifically, the people of Japan. The second line isn’t asking you as a viewer how down you are, but is more specifically asking about the national spirit of Japan itself. The rest of the introduction becomes a plea to the people and nation, with the context being societal problems of no money, no jobs, and terrible news, and how AKB is here to save the day.

While the EN listener thinks it’s a general “how’s it going, audience?” the JP reader gets a different picture; the scene is bleak, the nation is in stagnation, but here we are. The music video itself, with its thousands of people in the streets of Hakata, further exposes this concept; the people of Japan are dancing as the fortune cookie of love is going to change the national outlook.

And I don’t think this is a coincidence. What sounds like a catchy pop song to Westerners is a call to changing the fortune of the country.

To understand the background, we have to start in the ’70s and ’80s. A brief history lesson:

In 1985, the Plaza Accord was signed, which intentionally devalued the dollar and led to rapid yen appreciation. The Bank of Japan implemented monetary easing, leading to cheap credit. Over the next few years, speculation was rampant, and land and home values soared. The stock market could only go up! The national sentiment was great! It led to a culmination in ‘89, where the Nikkei peaked at an all-time high… for the next 35 years. Over the next year, the BoJ would drastically increase interest rates, tanking the Nikkei to about half of its value. The optimism of the bubble economy ground to a halt. Banks failed, hiring stopped, and the economy slowed down. The first lost decade (it was really only half a decade, kind of) kicked Japan in the balls. Worse yet, in ‘95, the national sentiment became grimmer after an earthquake and the Tokyo Sarin Gas Attack. The Nikkei would not return to its 1989 level until 2024.

However, in ‘96, temporary relief seemed to appear on the horizon. Due to banks stabilizing and increased exports, a brief moment of optimism shone through the economic downturn. Then, 1997? Thailand happened, and the Asian Financial Crisis, exacerbated by IMF shenanigans. Contagion quickly hit all the Asian economies, and Japan was not spared. A part two of the lost decade had hit the nation. Banks started to fail, the government basically bailed them out, and in ‘99, the BoJ basically gave up and basically made money free to borrow.

The ’90s were not a great time. One of my other theories for why there was so much grimdark post-apocalypse slop anime produced during this time was the post-bubble economy and the negative vision of the future.

In the ’00s, hope was rising. The economy started growing again, albeit slowly. Demand for Japanese machinery and electronics gave hope to the market. Sony and other Japanese tech giants seemed like they were doing well. And then, wham, ‘08 happened.

There’s a lot of politicking going around at this point, but GDP was in the dumps. It was so over. But in December 2012, a man named Shinzo Abe got elected.

Abe had a new vision: Abenomics. It consisted of three parts: aggressive monetary policy (really, easing), flexible fiscal policy (spend money on bridges to nowhere), and structural reform (putting women and old people to work). And somehow, it kind of worked in the end. However, Abenomics emphasized one pivotal point: Japan would not only have to revamp its economics, but also have to reimagine the optimism that would allow it to achieve its economic goals. It wasn’t enough to just set policy; Abenomics had to set expectations.

The people would have to believe in and look toward a better future. If people believed that the future would be better, they would manifest it. It’s Japan’s self-fulfilling prophecy, a national version of Keynesian expectations. More specifically, the cycle went like this: higher expectations for the economy -> more spending -> more growth -> higher expectations for the economy -> … It wasn’t enough that the economy should change, but rather that the behaviors of individuals in the nation should change.

The music video presents the AKBs in front of a giant parade, dancing in front of Hakata Station with thousands of onlookers. They’re not on some grand stage; they’re alongside ordinary people. The smiles are contagious. The music video pans to footage of regular people. Schoolchildren, office workers, families, commuters, tourists, police officers, companies, and government agencies all start to smile and dance. The message is to smile and join them! TV crews are in the background, everyone jiving and smiling, broadcasting the message throughout the nation.

“To capture good luck, put a smile on your face.”

“Make the fortune of tomorrow better than today.”

Following 30 years of continuously being kicked down by foreign currency manipulation, contagion, natural disasters, and economic depressions, Japan finally had a chance to reinvent itself. Koi Suru Fortune Cookie asked the audience to “break the shell” for something even “God wouldn’t know!” and for us not to take it negatively. It’s practically a song of national revitalization, spurring the listeners to do what? Generate economic value by smiling more.

Abenomics:

Optimism -> Spending -> Investment -> Growth -> More optimism

Koi Suru Fortune Cookie:

Smile -> Capture good luck -> Others join in -> Tomorrow becomes better -> More smiles

I have listened to this song hundreds of times without realizing what it was really about. It’s not just a love song! It’s more than a graduation song! It’s something greater - a call to a better vision of the future by the citizens of the nation. I think that’s partially why it’s so popular: it’s a song that manages to capture the sentiments and zeitgeist of the era. It’s no wonder this became one of their best-known songs! It spurred a huge trend and became a nationwide dance phenomenon for a reason. Smile, for things will get better! Understanding the song from that perspective makes me appreciate it just a bit more.

The Beef Wellington is a dish that’s notoriously difficult to make. It consists of a beef tenderloin in the center, a mushroom layer on top of that (sometimes with prosciutto or other intermediate layers as well), and puff pastry on the outside. The difficulty in cooking the dish lies in the heat control and guesswork required to cook the protein to exactly medium-rare while also not overcooking the puff pastry and burning it.

Out of all the recipes out there, hardly any is worse than Beef Wellington. I can’t think of any other dish where the individual components, cooked with minimal effort, taste better than their combination.

It’s a pointless dish. A beef tenderloin tastes amazing by itself with just a little bit of seasoning. Mushrooms, sautéed, baked, cooked with just a tiny bit of oil, or even grilled, taste amazing. And puff pastry is great on its own as well.

Put together, they don’t add anything to each other. Beef Wellington consists of completely non-complementary foods smashed together and presented on a plate. Yet we are supposed to pretend that it’s some kind of high-class dish, a masterpiece! It’s terrible!

In a way, Beef Wellington reflects the national ethos of Britain itself: tradition in the face of things that are simply better. It’s the culinary equivalent of the UK’s relationship with air conditioning. Presented with the straightforward option of installing a window unit, they instead explain that their homes are “built to keep the heat in,” buy three fans, open every window in the house, and convince themselves that sweating indoors is a cultural virtue rather than a solved engineering problem.

Anyways, the act of cooking Beef Wellington should be considered a form of food terrorism.

Almost two decades ago, I read an article that really was a foundational work in how I based my role in the internet ecosystem. It’s always stuck with me, and I truly do think about this all the time and it’s something that I always keep in mind when posting.

This article was written by a certain internet citizen, which was really a response to cultural anthropologist Grant McCracken’s post about microblogging being a form of phatic communication.

McCracken still maintains his blog, but his original article was wiped off the web; you can still find it here:

At the time, Facebook was peaking and Twitter had just begun to pop off. Those were some of the main microblogging sites back in the day, and as the monetization machine hadn’t made it truly profitable to gain retweets and shares in the attention economy, posting for the sake of microblogging was still well and alive. Don’t think the Twitter post attention economy is like that anymore, unfortunately.

Nowadays, Instagram stories has become the dominant form of phatic communication that most normal people here use. Instagram has stopped being a form of Flickr and instead has become Twitter, and Twitter has become some sort of perpetual attention-consensus-building marketing machine, the closest thing to a spiritual Roman forum that any other internet forum could be. There is much more signal than noise than on pre-Elon Twitter, for sure, for the majority of users. Too much signal in fact, making it more of a macroblogging platform than a microblogging platform and driving true microblogging - a bit of signal (a keep-alive!) and a ton of noise - elsewhere.

A feature on IG Stories is the ephemeral nature of posts, where the context window is what happened in the last 24 hours. I think that really moves it into the realm where a story is a cry for acknowledgment of existence, a true microblogging platform. Personally, I think it’s preferable to use it as such rather than as a marketing machine.

TL;DR

No, you don’t actually provide that much value to the Japanese music industry when you go to a concert in Japan. You don’t actually spend that much money. They don’t want you, not because they’re racist or xenophobic, but because to their music industry, you do the equivalent of ordering a $2 taco at a Mexican restaurant and filling up on chips. You simply aren’t built into the current monetization of the JP music market. They don’t make money through ticket sales, they make money through you buying CDs and merch.

CD and Physical Goods Sales

To understand the music industry in Japan, we must start our story in Sacramento. More specifically, a small record shop in Sacramento called Tower Records. Russell Solomon founded Tower Records in the 1960s, and it eventually grew to become the dominant record and music store in the USA. The Tower in the Tower Theater was named after the nearby Tower Theatre (still the oldest continuously running “Picture Palace”), which was named after the Tower Bridge, a historic Sacramento bridge linking the floodplains of West Sacramento to Old Sacramento and the capitol proper.

Shibuya is one of those places that you just have to go to in Japan. It’s a Tokyo staple, and if you’re a weeaboo it’s most likely one of the first places that you’ll go to. Down one of the streets of Shibuya, you’ll find a giant multifloor building. That’s the mecca of Japanese music, Tower Records, the flagship store. You’ve done it, you’ve reached your dreams, you’ve come to the largest music shop in the world, 9 whole floors of Japanese music and culture. You see the giant yellow tower on the front of the building. And yes that is the Tower Bridge in Sacramento, California.

Tower Records was an icon in the music world for decades, but is now dead. It filed for bankruptcy in 2006. Part of the reason for the decline in business was the rise of mass market discounters, but also the advent of the internet and early internet piracy made access to music easier. At this point, DSL had made it fairly instantaneous. Youtube started a year earlier at this point, and with Youtube immediately ripped music from CDs was uploaded online. Limewire was already more or less mainstream if you had internet.

But there’s another place where Tower Records still lives. And that’s Japan. If you’ve ever gone on JP Twitter, you’ve seen the attitudes that they have towards piracy. Don’t copy that floppy, you dirty thief! To this day, there are still dozens of Tower Records stores in Japan. Travel protip: you don’t really have to go to the Shibuya location by the way, the other locations will still probably have your stuff, but honestly it’s much easier just to ship things from amazon.co.jp to your hotel room.

But when was the last time you went to a CD or record shop in the west? Sure if you’re a hip and trendy zoomer with a digicam and wired earbuds and a matcha you’ll performatively buy a CD or a record from a mom and pop store, but how much money do you spend as a part of your income or net worth on these goods?

We in the west, or at least America, consume our day-to-day music through streaming. The Recording Industry Association of America (RIAA) has numbers for this, with the breakdown: the vast majority (85%-90%) of revenue comes from streaming, not physical media. The streaming market mogs the physical media market. No way Tower Records would survive here.

However, for one reason or another, whether it’s social or cultural or just an older way of doing things that I don’t know enough to go into, physical media is well and alive in Japan. If you’ve been on the internet long enough you would remember the stacks of AKB CD’s in the trash, bought on the hopes of a handshake ticket. You can pull up similar reports from the RIAJ (The RIAA but for Japan) and other sources, but current estimates show that most day-to-day revenue from music consumption is around a 60/40 physical/digital split. Japan is perhaps the world’s largest physical music market. Tower Records is still going strong.

Scale vs Depth

The core of the issue is that Japan’s music industry and the western music industry have different incentives. Here’s what I mean.

At some point, you can grow an entertainment industry in two ways. You can go either broad or you can go deep.

Western artists rely deeply on streaming revenue from Spotify or Youtube Music or Amazon Music or whatever else people use these days. You have revenue per play, and you have monthly unique listens or downloads. You have Spotify charts. This is important!

While Japan has been getting into the streaming business recently, it’s still at this point a smaller percentage of revenue than physical music media. They rely heavily on IRL stuff, folks going to Tower Records to buy CDs.

The incentives are different. You don’t make money in the USA by getting people to buy your CDs, you get money in the USA by hype. You get it through attention of the masses; after all, the more listens the better. You want as many streams and clicks as possible on your Spotify because for every click you get some amount of fee. But in Japan, what do you want? You want people to whale on your CDs. You want them to spend tons of money on your other merch and records. Whether it’s a better model or not is up for debate, but it is what it is. Streaming is important, yes, but get people to buy the CD’s and records.

Keep that in mind, because it’s important for how concerts are perceived and why Japan’s model is what it is.

Ticketing Markets

So far, we’ve only talked about revenue from music consumption on a day-to-day basis, or how the money flows from the music enjoyer to the music producer. Concerts are another deal.

The parties involved in the transactions within the US concert ecosystem are numerous, with each middleman wanting to take their cut. But let’s just talk about the supply and demand aspect of shows in the US. For the purposes of this blogpost let’s refer to them as lives. We all talk about how evil Ticketmaster or Stubhub or AXS or whatever is, but let’s define them as what they are: they’re market makers that attempt to match supply of tickets or seats to demand for those tickets or seats. The main problem with this is that supply is relatively more finite to demand, and as we’ve become more of an interconnected entity regarding similar tastes in music, demand can completely outstrip supply and drive the price up at a rate faster than linearly. AKA Taylor Swift has millions of fans around the US (and world), but she can only have so many concerts as she is only one person. Thus, her supply is significantly more finite than the amount of demand, even within a single city of her Eras tour, driving up nosebleed tickets to many hundreds or thousands of dollars. The average price paid was, I believe, around $700.

But how much were ticket prices in Japan for Taylor’s Eras tour? Around $140 for SS seats. So why the discrepancy? Logically, it would make sense for it to be at least a little bit more, as Swift is an international superstar. So why is that so?

The difference is in the markets.

The US concert market increasingly behaves like a financialized speculative market, where tickets are not just admission to the concert but tradable assets whose prices discover market-clearing demand. Secondary markets create liquidity almost to a fault, where tickets are exchanged willy nilly at free market rates and speculative arbitrage is normalized and even encouraged (well I don’t have a problem with it personally, at least!) You can make big money by buying that ticket, and if you can’t go, sell it later! The ticket itself is a real-time monetized asset that’s dynamically priced by the market maker, like flights booked with Southwest points that you cancel once prices drop. Additional value is captured through fees across day-to-day trades of the asset!

However, Japan essentially (not totally, but they do it really well) blocks this market mechanism. There is (pretty much) no secondary market for tickets, and there is no auction. Many live shows are done via lottery, where you enter for a chance to win, but if you win, the prices are more or less reasonable. Your seats may even be completely random within a section as well. Either you win, or you don’t, and you accept the results. Sure, there are ways around that, such as applying for multiple tickets, but from a pure social perspective, it can be considered a more equitable method of finding well-deserved butts to seats. After all, the folks who can often pay the most aren’t usually the ones who are the biggest fans of the artist. The main problem is this: if JP suppresses speculative resale and market-clearing ticket prices, how does the industry capture all the additional value that could have been extracted from the ticket as an asset?

But more importantly, why care who the biggest fans of the artist are? Why aren’t we optimizing here for pure economic profit, Japan? Who really cares who gets to see your show?

In the west, there are huge amounts of value captured by promoters, Ticketmaster, on these transactions. The artist does, to an extent, care that their fans fill seats with butts, and cannot actually raise the face prices of the tickets without pissing off the fans. But then, how do we ensure proper allocation of resources across the market? Thus, we have the fall guy, the secondary market maker, to take the blame. We all hate Ticketmaster, right? It’s about preserving the image of the artist.

But, suppose a secondary market cannot exist legally, as in Japan. What would the proper pricing to match butts to seats be? Could Taylor charge $700 a ticket at face value? No! Her JP fans who expect $100 tickets would seek to Twitter and complain! So Taylor leaves money on the table. And so do Love Live or Im@s or Momoclo or Mrs Green Apple or anyone else.

So is Japan just bad at extracting willingness-to-pay? Where does all that spending power that’s on the table go? Well, it’s captured elsewhere in the fandom.

Value Capture

We in the west treat the concert itself as a monetizable scarce asset. The show is the company, and the ticket price is its share price. The Spotify or Youtube Music price is fixed, and the product is infinitely reproducible, so it’s not scarce. It doesn’t mean anything to have the CDs anymore. Concerts are where willingness-to-pay gets aggressively extracted and distributed to producers, platforms, scalpers, and middlemen.

Japan’s incentives for concerts are different. With the majority of revenue still coming from physical goods, there’s less pressure to extract every last dollar of willingness-to-pay from the live itself. Instead, fans can dump that remaining spending power into CDs, merch, fan clubs, acrylics, collectibles, and the rest of the ecosystem. The Japanese concert ecosystem is designed (or organically came to be?) to be a catalyst for consumer spending across the artist’s products, and the value is captured long-term through deepening fandoms and increased spend through physical goods and other associated products instead of the concert itself, and the fandoms and spend eventually reinforce each other. Lives are special little treats for the fans, reaffirmation rituals acting as retention mechanisms for current fans and conversion mechanisms for new ones.

Who do we blame?

As to which system captures value more equitably or efficiently, I don’t really know and can’t speak to that. However, it’s important to understand that concerts serve different purposes in the US vs Japan.

Why doesn’t Japan transition to America’s model? Surely if there’s a third-party market maker like Ticketmaster then people can blame their lack of access due to overwhelming demand on the market maker instead of on the producer, right? The main reason is that it’s kind of just illegal to do it, but the reasoning I think (at least my personal opinion) is that it feels better to leave the ticketing gods to RNG. If you don’t get in, it wasn’t meant to be, and oh well! Next time! The venue can only be a certain size after all, we get it.

There are other benefits to their model. Instead of scalpers or market makers capturing that remaining willingness-to-pay through resale, their deeply loyal fans can spend it on hundreds of dollars of CDs instead. Penlights, can badges, fan clubs, acrylics, oshikatsu, whatever else - the money (in theory) will go into the ecosystem anyway, and long term good will is generated. In the end, the money is not just left on the table; some or most of it just enters elsewhere.

Think of the $1.50 Costco hotdog (180 yen in JP). No way they’re earning money on that Costco hotdog. But that’s fine, because you’ll go in and spend money on some dumb stuff that you didn’t need. But more importantly, you’re thankful for Jim Sinegal for an environment where you can get a hotdog for $1.50. Costco shoppers are some of the most loyal shoppers out there, and once you’re a Costco shopper, unless you move out of the area, you’re most likely a Costco shopper for life. It’s the JP fandom way. You’re into Im@s for 20 years, and you dress up your kids in Im@s, and you’re a producer for life!

However, if we applied the JP ticketing system to western audiences, there’s no similar money sink that fans can dump their extra money into! They aren’t going to buy CD’s - who do you know still has a CD player who isn’t performative or a boomer? Spotify only costs a certain amount a month, so does Youtube or whatever, and the companies themselves and all the other parties take a cut out of that anyway. So the concerts need to capture the willingness-to-pay! Otherwise, it just never gets monetized! Sure, they might be long-term fans, but who cares? There is no Costco for them to shop in so you have to raise the price of that hotdog to $8 to capture their money.

I’m not saying the Japanese system is better than the west’s. In fact, I think it is often worse. I’d personally much rather have Ticketmaster than chuusen.

Building Scarcity

These are more or less my opinions, but I believe that as concerts nowadays are a form of participating in luxury activities and developing caste in one way or another with regards to your position in the fandom is important to the experience. And what is more luxurious than scarcity? It’s all about scarcity.

The key is differentiation, JP builds scarcity by products, the west does it by price.

Posting about something is akin to proving your worth, and in the US, the biggest fans are the ones who go to concerts. In JP the biggest fans are the ones who have the most merch, the ones who perform oshikatsu, the ones who buy all the CDs and are in the fan club, and have the most acrylics and can badges on their itabag. Because in Japan, if you didn’t get concerts, it’s “oh well, what can I do?”

Why the Japanese Market doesn’t care to make it easier to foreigners

Simply put, you don’t really spend that much on goods.

“Well, I buy my idol CD’s every time from Mandarake.” The artist and the music industry do not capture the value from resale markets.

“Well I contribute towards Japan’s economy through flights, hotel stays, etc.” The artist and the music industry do not care. Sure, it’s great for the taxpayers, but Pony Canyon doesn’t care (well, as much)

Every spot a foreigner takes up in a domestic JP live is a lost opportunity to retain a loyal domestic fan or convert a new JP fan who will then proceed to generate revenue for the artist for a long time through merch and other purchases. Costco doesn’t want you to access their food court if you’re not a member or you aren’t going to ever be one because you don’t live in a place near a Costco.

It’s not that they don’t want your money; you’re just not integrated into the monetization loop and if you aren’t, then they aren’t going to cater to you.

Is this good?

No, but it’s the way they do things. There are existing networks of scale that US artists and promoters and groups can leverage to capture more value in concerts that I imagine JP artists are able to, so it’s probably extra hard to do business here. I don’t really know too much about the percentages of revenue and kickbacks that Swift gets from her shows but it’s probably more than what Love Live would be able to get at Levi Stadium.

What can US fans do

Nothing really, JP might switch to more streaming platforms and less of a physical merch ecosystem but who really knows? But I don’t think complaining at them will do anything because they really don’t have an incentive (well, that they recognize) to make JP stuff available worldwide.

One of the main issues with merch and physical goods is that they don’t actually have amazing margins, and that it’s well, physical. You have to make it, you have to transfer it, you have to have it in shops or online, or available at events. If you’ve ever done buppan at a live you know it’s an absolute bear. The logistics of doing that at overseas events and capturing enough overseas monetization is not, well, great.

So there’s not much incentive to make the process easier for you. Some folks do it, like for instance Holo, but as Cover has expanded internationally already, it makes more sense for them. But for more niche stuff, lol.

I think the best way is probably to just more Spotify listens & Twitter follows lol.