When it comes to technology, Japan sets the pace. For proof, just take a look at the cult website dynamism.com, which makes gadgets from over there available to geeks over here. Fancy a watch that is also a USB key and plays MP3 files? Or how about the Kohjinsha SA1 ultra-mobile PC, which has a seven-inch swivel screen and weighs 960 grams?
The Japanese also point the way to the future of media consumption. According to the ad agency Dentsu, of a population of around 127 million, 87 million people have mobile phones, around 75 million of which incorporate browsers. A typical handset can download videos, play games, pay for shopping and work as a remote control for the TV (as well as make phone calls). Broadband penetration stands at 21 million users - one of the highest rates in the world - with comparatively inexpensive connection fees. Of all media, the internet has the third-highest daily reach, at 34.8 per cent of adults, after newspapers at 49.5 per cent and TV at 86.4 per cent (according to ZenithOptimedia).
But that's only half the story, King Lai, the chief operation officer Asia-Pacific for Initiative, says: "The important thing is not the existence of sophisticated technologies, but the way they are converging to provide new opportunities. Say you have a store whose cameras incorporate face- recognition technology. These can identify regular customers and, as soon as they cross the threshold, send targeted information to their mobile phones: or simply dispatch a member of staff to tell them about appropriate offers or promotions."
So what technologies are creating a buzz among Japanese consumers?
QR code advertising
Mobile phone campaigns using special barcodes are becoming common in Japan. Known as QR or Quick Response codes, these can carry far more information than conventional barcodes because they take advantage of the vertical as well as the horizontal axis. A QR code on your business card, for instance, allows the recipient to photograph it with their mobile phone and download all your contact details, without having to laboriously tap them in.
This technology has obvious benefits for advertisers, who are increasingly placing QR codes on print ads and billboards. Naoto Oiwa, a creative director for the interactive communication division of Dentsu, points to a recent campaign for client Shogakukan Books, one of the largest publishers of manga comic books.
"In Japan, the number of mobile sites where manga can be viewed is growing. To spread recognition for this type of service, Shogakukan adopted the approach of redesigning popular Japanese comic characters such as Doriemon and Lam-chan as QR codes. Posters incorporating the code were placed in train stations and, when people took a picture of it using their mobile phones, they were automatically transferred to the comic's site."
It's been a while since Japanese mobiles were just about making calls. They are now entertainment centres, wallets and personal organisers. In April last year, a new type of digital terrestrial broadcasting enabled users to watch high-definition TV on portable devices.
The service is popularly known as "one-seg". A channel for digital terrestrial broadcasting is divided into 13 segments, of which 12 are used by terrestrial broadcasters and the last is used for broadcasting to mobiles.A TV picture appears on the upper half of the screen, while news and other text information runs along the bottom. Users can also browse the internet for background info on programmes. Although they pay data-transmission fees for web browsing, the TV shows are free.
Sales of one-seg handsets have topped one million units at KDDI Corp since launch and NTT DoCoMo, Japan's top mobile operator, has joined forces with Fuji TV and Nippon TV to develop a one-seg service.
Initially an underground movement driven by a handful of websites, Flash animation has gone mainstream, with the format cropping up in TV shows and movies - and advertising is expected to follow suit. The craze was driven by a character called Frogman, an amateur Flash animator who scored a hit with his own TV show last year. Frogman writes, directs and designs the animation for the show.
Until three years ago, he had no experience of animation. Having moved from the city to the countryside, he taught himself Flash animation as a hobby. When he created a website, the cartoons became a viral hit through e-mail and blogs. Frogman then put them on a DVD, which he sold through his site - shifting thousands of units. In 2006, he was hired by Asahi TV to create his own show.
Takashi Kameda, a producer in the entertainment business division of Dentsu, says: "Flash animation broke away from the long hours and high production costs by abandoning high picture quality and favouring script and story. Viral content needs to be both efficient and attractive - and clients' needs for such content are rising daily."
Video games are both the world's most under-used and its most promising advertising medium. A clear indication of this was Microsoft's estimated $400 million acquisition last year of Massive Inc, a company that specialises in placing ads in games.
The original versions of PlayStation and Xbox only considered advertising revenue as an after-thought, but the Xbox 360 and the new PlayStation 3 have marketing capacity at the top of their agendas. According to Steve Blakeman, the channel strategy director of Initiative Asia-Pacific, it's estimated that 60 per cent of these boxes will be hooked up to the internet: "It's a whole world of opportunity for marketers. In-game advertising - or IGA - is taking off in a big way in Japan."
Blakeman says virtual posters, sponsorship and even multi-level video commercials will become commonplace. And ads can be adapted to suit individual gamers' preferences - or the time of day. In addition, as recent events in Japan have proved, gaming isn't limited to the young. Nintendo's Brain Training games are popular with older people who want to keep their grey matter in shape. Such games have driven sales of the Nintendo DS consoles among the over-50s.