TOKYO -- Japanese pubcaster NHK will reorganize and rein in expenses over the next three years to pay for the huge cost of switching from analog to digital broadcasting in July 2011.

But the NHK board of governors, chaired by Shigetaka Komori, intends to cap the 2009-10 budget at its 2008 level, ¥138 billion ($1.3 billion).

The pubcaster unveiled its business plan for the 2009-11 period last week.

 The board is proposing a major reorganization of the NHK group, with some group subsids becoming independent. The aim is to boost the profitability of individual subsids and the revenues of the group as a whole. 

The board is also suggesting that NHK change its practice of sending execs to subsids once they hit the retirement age of 60.

"We should change a policy that results in nearly all the directors of subsidiaries now coming from NHK headquarters,"  Komori says.

 The board also urged management to cut receiving fees, which are supposed to be paid by all households with a TV set, if financially possible. Depending the whether households receive satellite or terrestrial service and how many sets there are families have to pay between $145.80 and $255.28 annually.

NHK has been under pressure to cut fees after viewers withheld them in protest at a series of internal scandals, most involving embezzlement of production funds by sticky-fingered producers.

 The board wants to boost the percentage of viewers who pay NHK receiving fees to 80%-85% compared with the current 70 percentile range.  

The board will present its revised proposals for the three-year plan to NHK management in July. Management will announce its final plan in September.

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