Predictions for the anime industry!

[LK_LoA]

Wow... anime isn't cheap anymore.
But I still find it annoying that some broadcasted anime episodes have bad animation which gets 'fixed up' in the DVD version. What a way to make the fanoys buy the DVD. XD

[DrWho2002]

Well of course, the point is to make as much money as possible.

[Quarkboy]

Originally Posted by AvatarADV

...

So I'm not really worried. It's possible that there's a few too many companies cranking out anime, compared to what the market's really going to support, but on the other hand that just means that the consumer's got a better chance of having more good shows; the crap you can mostly ignore. (Heh, even if I can't...) And there's still a lot of room for anime to get bigger in the US; still a lot of people that were like you and I before we'd seen our first anime, thinking "hey, Japanese cartoons" but never having actually seen any.

As a specific question for ADV, I was wondering if ADV has any plans to start their own animation studio at some time in the future. With the 24 hour network, I can only assume the higher ups realize that remaining dependant on imported content is not a viable long term buisness model. At some point ADV needs to get more control over it's own product (think of a simpler industry like steel... if you had the choice of importing all your steel from China or setting up factories here in the states, which would be more profitable in the long run?). Either that or outright purchase (or official partnering) of an animation studio in Japan. Though US companies have growing influence on the Japanese one, I don't think they'll ever have enough influence to say, decide on what shows get made and what don't, only to nudge the studios one way or another. The only way to get complete control is to make it yourself, which enables you to shape your content to YOUR market, not Japan's.

But then the question would be.... would the hard core american anime fans accept a show made in America (well, more likely boarded in america and animated in Korea), no matter how anime-ish the style is, as anime? Would they reject it out of hand regardless of the quality of the show? Would they treat it as a seperate entity, giving it a new name like "Anamerime"?

Wonder oh wonder, how do I wonder?

[LK_LoA]

If the Lady Death movie is any indication, ADV shouldn't start its own studio.

[kj1980]

Originally Posted by Quarkboy

if you had the choice of importing all your steel from China or setting up factories here in the states, which would be more profitable in the long run?

Importing steel from China.

Low human labor and lax social welfare standards more than makes up for import fees.

Originally Posted by Quarkboy

Either that or outright purchase (or official partnering) of an animation studio in Japan. Though US companies have growing influence on the Japanese one, I don't think they'll ever have enough influence to say, decide on what shows get made and what don't, only to nudge the studios one way or another. The only way to get complete control is to make it yourself, which enables you to shape your content to YOUR market, not Japan's

I highly doubt this will come true, but if they are willing to, I am more than willing to quit my current job if such company would hire me as a advisor.

[Quarkboy]

Originally Posted by kj1980

Importing steel from China.

Low human labor and lax social welfare standards more than makes up for import fees.

Yeah, that was a bad example. In fact, now that Bush lifted the Tariff on Steel imports, the amount america imports from china has risen sharply. However, there is a big difference here I should point out: American companies import steel in order to use it to create something of value, like buildings and cars. They don't simply resell the imported steel raw to consumers (at least I don't believe there's any company that simply imports steel to resell it on the US market, there wouldn't be any profit in it, since the companies could just buy it direct from overseas). Anime, however, is imported as a completed product. The only thing of value american companies add to it is subtitles (or, in some people's opinions, dubbing), and of course availability. This buisness model doesn't make sense: As demand grows in America, the Japanese companies can simply charge more for licsensing fees, and the american companies have no choice but to comply, as they have no other source of their product. It's an inherent catch 22: The more successful they are, the more expensive it is to buy anime... I proper growth model is the opposite: as your buisness grows it should become _cheaper_ to make product.

[LynnieS]

Originally Posted by Quarkboy

They don't simply resell the imported steel raw to consumers (at least I don't believe there's any company that simply imports steel to resell it on the US market, there wouldn't be any profit in it, since the companies could just buy it direct from overseas).

Not much call for it, IMHO. There are also mini-mills in the U.S. that are more efficient than the big guys. Among their other benefits, these usually don't have the legacy retirement costs, which make the big boys less cost-effective and people more willing to wait till they go into bankruptcy before picking up their assets and ignore the liabilities.

Anime, however, is imported as a completed product. The only thing of value american companies add to it is subtitles (or, in some people's opinions, dubbing), and of course availability. This buisness model doesn't make sense: As demand grows in America, the Japanese companies can simply charge more for licsensing fees, and the american companies have no choice but to comply, as they have no other source of their product. It's an inherent catch 22: The more successful they are, the more expensive it is to buy anime... I proper growth model is the opposite: as your buisness grows it should become _cheaper_ to make product.

Companies outside of Japan can also act as advisers in their own right. Costs are astronomically high, and I see the market in Japan as being over-saturated. If you want growth and profitability, you are eventually going to have to look at consolidation of your resources and expansion to other markets to a greater degree. More visible partnerships and alliances, IMHO, are going to be the norm.

As for ADV's studio, hmm, whatever happened to their "Multineer's Moon" project? Nothing has come out about it since 2003 to early 2004.

I'm a bit interested in seeing if there'll be a price war in the U.S. anytime soon, though. People have been talking a great deal about the dollar getting weaker, and the interest rates are being moved higher so people should be starting to look more closely at their budgets - if not by the end of the year, then by the start of the next.

Originally Posted by kj1980

I highly doubt this will come true, but if they are willing to, I am more than willing to quit my current job if such company would hire me as a advisor.

ROTFL. Want an assistant?

[DaFool]

Originally Posted by Quarkboy

This buisness model doesn't make sense: As demand grows in America, the Japanese companies can simply charge more for licsensing fees, and the american companies have no choice but to comply, as they have no other source of their product. It's an inherent catch 22: The more successful they are, the more expensive it is to buy anime... I proper growth model is the opposite: as your buisness grows it should become _cheaper_ to make product.

So marketability in america is one of the causes for anime saturation in japan? I thought it should alleviate it.

[Arwyn]

Originally Posted by DaFool

So marketability in america is one of the causes for anime saturation in japan? I thought it should alleviate it.

Like kj1980 mentioned, it boils down to supply and demand. There is a lot of supply (anime), but market demand is soft in Japan. That leaves the anime studios in the postion of expanding their market or consolidating.

The anime studios are in a very similar situation to what is taking place in the US game market. Originally there were very few companies producing software, and there were no "rules" on how game had to be developed, so there was a lot of experimentation with what few games came out.

Once there was an established market, more companies got into the business and then you had several blockbuster titles that "fixed" the genres in the industry, as well as set standards for what kind of performance "successful" titles needed to have. That meant that now banks and venture capital companies were willing to invest in the game market, since they now had "standards" to measure against.

The result of "standardization" was a raft of "me too" titles. So Doom hit big? Then everyone makes FPS games. Dune/Starcraft hits big? Everyone makes a RTS. Not because the companies dont want to do different things, but its a case of funding. If X product sells Y units and makes Z money, then its easy to get a bank to loan you the money to make a similar product since they have something to gage their investment againts.

Now the situation becomes a case of higher and higher expectations of performance for titles. Games that dont make those performance goals tend to die, and the studios responsible tend to get bought out/up by larger conglomerates. If you look, over that last 10 years, game companies have dwindled rapidly, leaving the production in the hands of a few big corporations, with a few independat studios that still manage to crank out some new ground breaking title that sets the next "genre" for the industry as a whole.

That is exactly what kj1980 is describing.

Anime has saturated the home market, and now the studios are looking overseas to sustain coporate revenue. Thats a good thing for anime fans outside of Japan, but at the same time, it isnt sustainable in the long run for several reasons.

International markets are driven by different rules, and that generally means that money and financial backing follow successful titles/companies, leaving the smaller companies to either innovate and grow, or they are bought by larger rivals for IP, or they simply fold up and go out of buisness.

The biggest factor in sustaining anime growth in the US is that Hollywood has been completely overtaken by accountants and has lost touch with the consumers.

Anime is popular right now because it still tells a story, there is character development, and it allows the viewers to relate to the protagonists in the story. Hollywood has by and large abandoned those to go for the special effects and sensationalism realm. Look at the crap that passes for entertainment on American TV and you can easily see why anime has become so popular.

But, thats not going to stay that way. The Japanese studios are going to have to change due to economic pressures, and the US market will follow the money. That has already started to happen, look at the deal that Disney did for the Miazaki titles just recently.

As kj1980 put it, the bubble will burst, and there will be a market consolidation. Throw into that mix a stronger international market, and more money and you will see the market shake out into a few very large players with a few small independant startups that shake up the industry and set new trends.

[LK_LoA]

All this speculation is nice but I wonder where it is possible to get the numbers. I'm interested in the amount of R1 anime DVDs sold.
My prediction was that liciensing to US gave the anime industry a new lease of life. So I'm curious whether the numbers support my theory or disprove it.

[Pepperidge]

I disagree. I think the "mass licensing" that distributors like ADV are practicing right now is going to die down considerably in a couple of years. Unlike manga, I don't think the anime video market in the west can become much more penetrated or over-inflated than it already is.

[LK_LoA]

Pepperidge,
Why do your think manga won't be just as over-inflated?

btw anime is being mass licensed but I don't think it's over-inflated yet. I mean, they haven't license Bottle Fairies. (Come on, you know that Bottle Fairies is better than Samurai Champloo =p)

[DaFool]

Originally Posted by LK_LoA

Pepperidge,
Why do your think manga won't be just as over-inflated?

Books are tough to pirate (it's easier to copy a CD / DVD than to own a printing press, and few people go through the trouble of scanning every page, and more people find hardcopies easier to peruse).

Has there been such a thing as a bubble for the publishing industry? All I know is that they follow a different distribution pattern compared to videos. Has there been an oversupply of science-fiction and fantasy novels? Maybe the crappy writers just didn't get published in the first place.

[Pepperidge]

Well, people have compared manga to the comic book bubble burst from the late nineties, but that's not really an accurate comparison since they're two completely different markets with two completely different audiences with two completely different business models.

Likewise, the audience interested in manga specifically is a little broader than the amount of people who will ever be into anime. Even if bookstores keep getting flooded with new titles, the reader base is large enough to support them. You can accuse Tokyopop of oversaturating bookstores with too much crap, but if some of the their lesser titles really, truly aren't selling, then they can just cancel them. ADV already seems to be doing that with some of their titles.

[Quarkboy]

Not to mention that licensing and distributing manga is much much cheaper (per series) than anime. I'm not sure of the numbers, but I could imagine you could probably license 10 manga titles for the price of one anime, especially if they are not that popular. So what one might interpret as a oversaturation of manga titles, in economic terms it's still profitable for the companies (i.e. it's a lot easier to take a loss on a particular manga that flops when it's a smaller investment).

[LK_LoA]

I guess that's why so many anime today is based on a manga that's still current (and not finished). It's got a built-in audience already...

[Quarkboy]

Originally Posted by LK_LoA

I guess that's why so many anime today is based on a manga that's still current (and not finished). It's got a built-in audience already...

Someone with a greater sense of history please correct me if I'm wrong but... I believe that has ALWAYS been the case. If the anime is based on a manga (and not the other way around), it is normally based on a manga that is still ongoing (or just finished). The only exceptions to this are anime that animate "classic" manga like the current Blackjack, which are the exception to the rule.

[DaFool]

from animenewsnetwork:

Nintendo to Produce Anime (2004-11-26 11:59:26)
Back in September, Nintendo's adviser Hiroshi Yamauchi announced at a press conference that Nintendo would be investigating the possibility of forming an animation studio. Now Japanese newspaper Nihon Keizai Shimbun reports that Nintendo will enter the anime business in 2006. It will produce properties with anime and video game tie-ins. Source: Magic Box [ discuss (20 posts) ]

So does this mean over-saturation? or is it only for otaku-centric anime that's over-saturated, while video-game based (read children's video-game based) anime are not affected, since this is the same mass marketing practice that applies to cartoons and action figures and cereals?

[Quarkboy]

Originally Posted by DaFool

from animenewsnetwork:

Nintendo to Produce Anime (2004-11-26 11:59:26)
Back in September, Nintendo's adviser Hiroshi Yamauchi announced at a press conference that Nintendo would be investigating the possibility of forming an animation studio. Now Japanese newspaper Nihon Keizai Shimbun reports that Nintendo will enter the anime business in 2006. It will produce properties with anime and video game tie-ins. Source: Magic Box [ discuss (20 posts) ]

So does this mean over-saturation? or is it only for otaku-centric anime that's over-saturated, while video-game based (read children's video-game based) anime are not affected, since this is the same mass marketing practice that applies to cartoons and action figures and cereals?

Naw... This is just Nintendo looking to the future. It's always had an eye on animation tie-ins to its products, going way way back (anyone remember the "Super Mario Show"?), and by having its own studio just gives the company better control and profit margin. I would highly doubt they would produce anything that was wasn't entirely designed to sell more video games and video game systems. I don't think this wil contribute to over-saturation at all.
Note however, that this is a risky move by Nintendo... look at what happened to the last video game maker that tried to split off its own animation studio ("Final Fantasy Spirits Within" anyone?)...
Although video game movies are becoming more and more popular here in America. Even though they are by all considerations bad, a certain segment of people still go to see them anyway. Even Doom II is getting a movie made based on the game. Well, this is getting

[LK_LoA]

So far anime seems to follow the trend I discovered from RPG ideas. The older it gets, the weirder it becomes. XD