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TV Tokyo's Iwata Discusses Anime's 'Road to Survival' (Updated)

Keisuke Iwata, the executive in charge of TV Tokyo's AT-X animation channel and its animation division, predicted in a Wednesday lecture that "the global marketplace for Japanese animation will shrink from 2010 onward." Iwata spoke at the "Anime Business Forum + 2009" event at Digital Hollywood's University of Digital Content in Tokyo.

In Iwata's view, there is no room for growth since Japanese animation has reached the saturation point in the global marketplace. Due to the worldwide recession and illegal net distribution, Iwata concluded that the North American marketplace is battered, the European marketplace is in grave condition, and the Japanese companies cannot rely on the Middle East, Asia, and other regions as potential new marketplaces. He added, "as it stands, we may have to go back to the way it was in the past — back to selling Japanese animation only to the Japanese marketplace." In order to survive in the current adverse climate, TV Tokyo is proceeding with new initiatives that include animation on American video-distribution sites.

According to Iwata, the global spread of Japanese animation expanded widely and rapidly due to 1996's Neon Genesis Evangelion. Until then, the global marketplace had been mostly consuming so-called "border-less animation" such as Kinpatsu no Jeanie, Moomin, and other titles that are set in overseas locales. However, Iwata asserted that Evangelion expanded the global marketplace's willingness to accept animation that is distinctly Japanese in one broad stroke. Around 1997, Pocket Monsters became a major commercial phenomenon worldwide. Yu-Gi-Oh! expanded the marketplace further, and Japanese animation became a seller's market. Starting in 2002, Naruto also became a worldwide hit and captured the interests of overseas teenagers and the otaku generation.

However, Iwata said that the marketplace has already reached the saturation point. Iwata added, "It is easy to imagine the global marketplace shrinking from 2010 onward." The market saturation, the worldwide recession, various circumstances in each country, illegal distribution on video-submission sites, and the rising yen all had a deep impact on the declining anime export business.

In addition to the severe economic conditions, the ratings for Japanese animation on broadcast television stagnated or fell. 4Kids Entertainment, an American company that deals with the distribution of Japanese animation, withdrew its animation programming from the Fox television channel. Even the Cartoon Network in America withdrew Japanese animation almost across-the-board during prime time. Cartoon Network restored some anime on the Adult Swim programming block for otaku 14 years old or older, but reportedly no longer anticipates another hit on the level of Pokémon or Naruto. The DVD marketplace also became more difficult as some titles sold less than 400 copies nationwide.

According to a 2008 Association of Japanese Animations survey (which was also quoted by a government report this month), the Japanese animation industry peaked at 2006 with 258.8 billion yen (US$2.9 billion), only to fall to 239.6 billion yen (US$2.7 billion) in the following year. Of the 127 companies in the National Association of Commercial Broadcasters in Japan, about 40% or 55 companies were operating in the red in the fiscal period ending in September 2008. Due to falling ratings, many anime can no longer broadcast in "Golden Time" slots in key stations. However, the number of avenues to release anime have grown, thanks to the BS and CS satellite channels, digital television broadcasts, net distribution, mobile phone distribution and videogame consoles with video distribution capabilities.

TV Tokyo began putting its "strongest media content" such as Naruto and Gintama on the Crunchyroll video-sharing website in America within one hour of the Japanese broadcast. For that early viewing service, the site has signed up over 10,000 subscribers at about US$7 a month in about a month. By comparison, it took TV Tokyo's AT-X channel a decade to reach 10,000 subscribers. A Naruto episode receives an average of 160,000 accesses on three sites when it streams for free, a week after the Japanese broadcast. According to Iwata, the main purposes of the services are not just the revenues from fees and advertising, but also the counterweight it provides against unauthorized fansub distribution.

Source: ITmedia News

Errata: It took TV Tokyo's AT-X channel a decade to reach 100,000 subscribers, not 10,000 subscribers.