The Future of Commercial Anime

Recently, I had a thought in regards to anime and it’s current commercial nature. As we know in the West, anime is something we consume typically either in the form of physical media (DVDs, Blu-Rays, etc.) or on the Internet. And I’d wager that the Internet is by far the largest channel through which we consume anime.

But in Japan, obviously that’s not quite the case. Anime is still heavily restricted and commercialized via major broadcast networks, and it’s main channel of distribution is TV.

The question is, how long will it remain this way?

Personally, I think that it won’t stay that way for very long. And while I can’t say the exact nature of how anime will be distributed, I can speculate, which is the fun part.

But first, let me give my anecdote as to why I think things will change, and why it won’t take as long as you might think.

I’ve been teaching at a few junior high schools here in Japan for a little over a year now, and there’s one pattern that I’ve definitely noticed. There is one thing in particular that kids from the younger generation are doing now more than ever. If I ever want a sure thing as to what they did in their free time, either the night prior, the weekend prior, or a vacation prior, there is something.

And that is YouTube.

YouTube is extremely popular among the younger generation in Japan. If I ask the students in any given class what they did (prior night, weekend, etc.), and ask if they watched YouTube, I’d say that on average, 90% or more kids will raise their hand. Sometimes everyone. It’s extremely populsr, to the point that I’ve overheard several conversations in the teachers office about how much time students spend watching YouTube. Some students even stay up fairly late doing so, by their own admission (my equivalent was staying up playing gun game on Counter Strike: Source when I was that age, so not criticizing them for staying up haha).

But anyways, the point is that this youmger generation is very receptive to watching media online. Via smartphone (only about 20% of my students have a smartphone from my experience, but I also don’t live in the city so that may be different for kids in Tokyo or a more urban environment), tablets, or computers – these kids are consuming a lot of media online. Which is something that of course older generations didn’t do – their older equivalent would be TV and physical media such as manga or magazines, both of which are still relatively popular.

And of course, at the moment, anime is completely built around just that, TV, the older media consumption standard. Manga is also of course still quite popular. But that’s a whole other industry anyways.

What I’m getting to is this: if newer generations are more open to consuming media online, what does this mean for anime?

This is essentially what I was thinking about, and what led me to believe that anime will likely change within the next decade or so. Even if there is a prevailing mindset of “anime is watched on TV”, I can’t see it holding out forever. The benefits to moving online are too numerous.

No more restrictions based on broadcast slots, network requirements, seasonal lengths, et cetera. A large chunk of bureaucracy can be cut off. Even if large mainstream streaming services open up in Japan (to my knowledge, Netflix / Amazon are the biggest options at the moment because streaming isn’t really popular here yet), it opens up a whole new market. Sure, the existing network players can try and get a slice of the pie, but the nature of the Internet is that a whole new field of competition can be opened up – the barriers to entry aren’t as high as traditional TV broadcasting.

All it takes is for a studio to decide that instead of going through a TV network, they are going to release their work online. From there, other studios can follow until there is a hybrid system where the biggest productions remain on TV, and more indie work finds it’s way online. And then of course, from there, we could see everything eventually making it’s way online somewhere.

And we’ve already seen leaps and strides when it comes to streaming distribution platforms focused outside of Japan.

I mean, it basically already is all online for the West.

The biggest issue in Japan is likely just the lack of guaranteed revenue for a studio. There’s a lot of risk at the moment in putting all of the costs into making an anime, just for the chance that it’ll flop online and you’ll be out all the money you put in. TV networks clearly can mitigate that risk, or take it on themselves. But eventually, I think we’ll see studios taking that risk. The audience will clearly be more open to such a thing, if they are already spending copious amounts of their free time watching media online.

A good example of an all-online anime is Miru Tights, an ecchi anime centered around tights that I covered on Ecchi Hunter. Now, I clearly don’t know how successful it was financially, but considering they’ve released another episode since I covered the series, and another one is being released in just a few days (04/22), I have to imagine it wasn’t a failure at the very least!

How long until we see more productions like this?

I’m certain that Miru Tights won’t be the only one, and there probably already are other examples of online-only distributed anime like this. Even mainstream anime have dabbled in online releases, like how the final three episodes of Bakemonogatari originally aired online due to the unorthodox season length (15 episodes).

In addition, we see online platforms such as Netflix and Crunchyroll actually sponsoring the production of anime, which is great for the move to online distribution as it shows other studios that the possibility is there. Streaming platforms have shown that they can take the place of the traditional TV networks in that way.

Ultimately, while I can’t say for sure how it’ll play out, no matter how entrenched the current industry is in Japan, it’s only a matter of time before more studios begin to test out the waters of online distribution. If anything, the entrenchment will serve as a key reason for many smaller studios and new players in the industry.

And while my only anecdotes are my observation of the younger generation, and knowing how things have moved towards a streaming-centric market in the West, I feel like I’m correct in my speculation that anime will move in a similar way, to a more online distribution model. And I think it’ll happen sooner rather than later, within the next 10 years or so.

But perhaps I’ve missed something, or there’s something about the current industry that I don’t know or hadn’t thought of.

What do you think?
Does this seem like the natural progression for the anime industry?

Until next time,
Thanks for reading.

10 thoughts on “The Future of Commercial Anime

  1. It wouldn’t surprise me if this were the case. Most of the late-night TV anime (which is most anime these days) are basically like the equivalent of infomercials, with the production committees paying the TV networks to broadcast their show. It’s only the dwindling daytime/primetime anime market where the shows are still supported by network ad revenue in the traditional way. If the production committees felt like the Japanese market was ready to fully embrace streaming anime, especially if they had domestic companies lining up to pay the kind of streaming fees that American and Chinese companies pay to license these shows, they probably would have made that move already.

    Liked by 1 person

    1. If the market was ready, definitely there would be someone making that move, or pushing for it. But there’s also the tradeoff to be considered, because a move towards streaming anime (or honestly just streaming in general) takes away from the traditional TV networks. And I’m sure that established industry has a lot of clout of it’s own to throw around when it comes to these things. But yeah, I’m sure when the market is ready, it’ll happen, someway or another.

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  2. iniksbane

    So I’m surprised that Japan is behind the west on this. Most U.S. TV networks have been struggling with how to compete with the Internet for more than a decade. Hulu was actually one of their first attempts to compete.

    Now there is CBS All Access and Peacock and Disney Plus, who are all trying to grab a piece of that streaming market.

    I’m surprised the television stations aren’t trying to break into that market as well. But then again, I’m not as sure about how anime is distributed in Japan.

    Liked by 1 person

    1. Japan is behind the west in pretty much everything behind the scenes when it comes to making use of technology, despite their image that suggests otherwise haha. Stamping documents and sending faxes are still the norm, both in businesses and government. In the government in particular, documents are not digitized and so hard copies of everything are archived somewhere and sent around the country. I’ve heard similar stories about businesses like this.

      As for why, I’ve heard that one big reason may be the working culture. If someone is “obligated” to stay in the office for 10+ hours a day, and “productivity” is measured in how many hours you are in the office (which is the case in many companies), they’ll prefer to work inefficiently. Digitize and make things efficient, and they’ll be spending more twiddling their thumbs, making them look less busy, and therefore, less productive. Even though the opposite is the truth.

      As for anime and TV in general, I don’t know the whole process very well myself. I’m sure that the move to streaming is inevitable, because the market will definitely be there, but we’ll see who actually moves in on it. I just have to imagine that there will be studios that want to cut out the middle man, or take a better deal with an online platform.

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    1. Agreed. The only question is how soon it will happen. It’s possible that the established networks here may be able to prolong it, should they decide that’s in their interest. But I don’t know the specifics of how much sway they have over the various anime studios, and I have to imagine that there will be studios that decide to make the move regardless.

      Liked by 1 person

  3. Economically, I think the model that will work best is the one where the first and maybe second run of an anime will be on a network of some kind, broadcast or Netflix or whatever, and then they’ll go to Internet, first on subscription channels and then free after. Then they could use the free media to drive demand for pay media such as TV or disk.
    This really demands a response longer than I can type on my phone, but long story short, companies are moving to hybrid models where releases are meant to drive revenue from all sources

    Liked by 1 person

    1. Yeah, I doubt that airing on networks will stop anytime soon, especially when it comes to major studios and their big releases.

      But for the smaller players, I’m sure the option of online releases in some form or another will be tempting. Many studios / companies will be able to get creative when it comes to how they go about things. In many cases, merchandise makes more money than the anime itself, after all. It’ll be interesting to see how things go from here.

      Liked by 1 person

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