Wednesday, March 11

Anime industry grim forecast and challenges

Italics are newspaper original, bolds are mine. Beware, there is shitloads of text here.
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Future industry of anime in doubt
Money, success elude; outsourcing, piracy abound

After graduating from Tokyo Animator College, Yuko Matsui began working at a midscale animation production agency.

Two years later, she earns roughly ¥80,000 a month, averaging 10 hours a day doing the grunt work of filling out "in-between cels," drawings on transparent sheets used between key scenes to help create the illusion of motion.

Although she lives with her parents, she can't save any money and has given up on paying her national pension fees. Still, the 22-year-old apprentice considers herself better off than some of her peers who say they have to endure frequent all-nighters with few days off.

"There were seven others I knew who graduated with me at the same time, but three of them have already given up and quit," she said.

Matsui's story is typical of what many aspiring animators must face in a trade where only the best survive in a shrinking job market. And it's not just the employees who are hurting.


Man, blame Osamu Tezuka for this. Because of his pioneering cheap and cheerful labour to churn out anime in quantity, trying to use economies of scale in offsetting the cost. The malaise of animator career in Japan can be traced to this founder of anime directly and perhaps the animators should consider band together for a reform? However more unionized animators might see more jobs flee Japan and go to less problematic Korea, China etc. A Catch 22 for local animators indeed.


The deepening recession and rapid shift in the overall landscape surrounding the industry have caused many to fear for the future of one of the nation's most prized cultural exports.

"The global fan base for Japanese 'anime' is increasing, but with the old business model crumbling it isn't translating into profits," said Yasuo Yamaguchi, executive director of the Association of Japanese Animations.

For the past decade, the industry has been hammering out average annual sales of ¥200 billion in what experts described as an "animation bubble."

Yamaguchi predicted, however, that the industry's proceeds for fiscal 2008 — which have yet to be calculated — would be lower than 2007, when total sales dropped almost ¥20 billion from 2006, a record high year, according to AJA statistics.

"The financial crisis is forcing sponsors to cut down on television advertisement fees, and this in turn is shrinking the budgets for animations, pressuring everyone involved in the production," Yamaguchi said.

"I think we'll see a major decrease in the number of anime programs broadcast. Agencies dependent on television as a primary financial source will need to search for alternatives."

Not to mention Japanese economy contracted by 40 percent(rough estimate) and all who's who in Japanese economy powerhouse (Sony, NEC, Toshiba, Honda etc)is laying off workers which is unthinkable 20 years ago. Anime industry has to adapt like everything else and I predict more studios will file for bankruptcy like household name GONZO soon. The bubble burst has to go somewhere.

Hence globalization might help, the days of overwhelming domestic consumption focus should not be a primacy anymore? Like it or not, anime has gone global and has to be treated like one.

Besides the gloomy economy, the overwhelmingly adult content of recent television animation — many featuring violent or highly sexual material and broadcast during late-night hours — has played a part in limiting the audience and making both marketing and merchandising of anime-related products difficult.

I don't see this as liability, clearly here the writer make a personal jab at mature storytelling of animation. It is ain't Disney, moron. Limited, maybe but at least it opened more market to larger segment of people that might see animation is more than just family oriented entertainment. Mamoru Oshi would have agree with my opinion here.


Yoshihiko Noda, director of the media content division for ad agency Asatsu-DK, buys TV time slots for popular family programs such as "Doraemon" and "Crayon Shin-chan." He said these trends were a relatively recent phenomenon.



These are cartoons not anime. Sigh.

"The demographics of anime fans began shifting seven to eight years ago. Those who grew up watching cartoons became older, and began craving more 'otaku' (geek) and adult content," Noda said, noting such animation is mainly produced for DVD sales, with the late-night shows — usually consisting of only 13 episodes — used as bait to draw viewers into buying the full DVD set that comes with increased content and special features.

This lack of mainstream acceptability in anime content, combined with expensive title licenses and the exploding popularity of video-sharing sites, has helped erode the industry's distribution market in the West.


Mainstream did not necessarily meant profit and I felt the increasing specialization of anime genre enables the industry to survive since geeks are more willing to pay more if correct buttons (such as moe appeal, sci fi etc) were pressed. Frankly speaking, 13 episode package is good idea since it will hook the audience easier to buy plus it is not cost prohibitive since small number of DVD/Blu Ray discs involved. Plus the idea of sequels will make fans anticipation better. Of course there are trade offs here.


"Anime-related profits in the United States, especially DVDs, are dwindling," said Keisuke Iwata, director of animation channel AT-X.

"Thanks to megahits such as 'Evangelion' and 'Pokemon,' Japanese animation has fared well in the past. But it has already maxed out as an export industry," Iwata explained, adding that besides the lack of big-name titles and a decrease in overseas airplay in recent years, the greatest obstacle lies in the illegal Internet sites that provide free content.


"These sites upload programs almost immediately after they are broadcast in Japan," accompanied with "fan subs" — English subtitles translated by fans," Iwata said. "This is causing a very big dent in sales."

This is rather strange oversight by Japanese anime companies considering their state of the art consumer awareness and technology; completely ignoring the streaming concept anime. And let's face it, fansubbing quality tends (quite debatable here) to be better than commercial subs. So the onus is on the industry themselves to buck up in face of this issue. If you offer peanuts, you will get monkeys.





To counter the trend, TV Tokyo tied up with popular San Francisco-based animation-sharing site Crunchyroll in January, offering some of TV Tokyo's popular titles in advertisement-free, high-quality format with subtitles for a monthly fee of $6.95.

Yukio Kawasaki, manager of TV Tokyo's animation business department, said the move was an attempt to create a legitimate distribution channel between animation producers and overseas fans, as well as a way to send out a message.


I applaud that some of them sit up and notice now, embracing the more relevant digital distribution of content rather than spend more time suing people like RIAA, while not looking on how to solve the problem in long term. Kudos! There is still hope for anime industry yet. As I wrote before, I believe CR is the way of the future for anime broadcasting,internationally.


"Animation isn't free. It's the product of hard work and a lot of money, and we cannot continue producing quality content without the financial help from fans," Kawasaki said, explaining that if the strategy succeeds, they could expand by selling DVDs and comic books on the site, "like Amazon.com," and establish a valid business model.

Agreed very much here.

Kawasaki said they have signed up more than 10,000 fee-paying members since the tieup began Jan. 8 and hope to reach 50,000 by the end of this year.

"We are seriously concerned that the industry will not survive if things go on like this," he said, acknowledging that whether their new plan succeeds or not, the structural issue undermining the industry will still exist.


Increasing connectivity and broadband speed means increased sharing and instant gratification of consumers. Perhaps the animation companies should have tap into this in order to survive, besides going global in brick and mortar mentality.

"You've got to really love animation to be in this trade," said Takeo Ide, chief animator for the popular television series "One Piece."

Ide recalled how he used to make ¥70,000 a month in his rookie years, sharing a cheap apartment to get by before being assigned to draw the more pricey key frames — drawings that define the starting and ending points of movements.

Ide's is a success story in an occupation that, according to a study conducted by the Japan Council of Performers' Organization, has an appalling turnover rate of 80 percent.

The study revealed that a single cel on average earns animators a meager ¥186.9. Considering how a grunt worker has to fill in 500 in-between cels per month for a television animation series, this means a monthly wage of ¥94,000 at best — for an average of 250 hours of work — until an artist gets to handle key frames or storyboards.

With an estimated 90 percent of in-betweens being outsourced overseas — a result of the industry trying to squeeze out more content than it can from domestic hands — there are also concerns that opportunities to nurture future generations of quality animators are being lost.

"Drawing in-between cels is hard work and it sure doesn't pay much, but it's still an important skill that every animator should learn," said Masayuki Kawachi, president of the All-Toei Labor Union.


From animator to consumer, from meagre wage per cell to end product which can cost few hundred bucks each, someone is making money in between. Who? Perhaps more assessments should be done to see why someone is becoming rich while animators become emaciated in the process? Perhaps a better pay scheme should be considered so the animators will not flee? Could it be the old system becomes too big?

I forsee here the increasing phenomenon of self made animators soon, making small animes to sell catering on niche market thanks to increasing availability of computing power in next 5 years. Instead of old tradition of doujin mangas or eroge, perhaps one day we will see self made animes in Comiket? Just look at Touhou sub-genre as an example. Just like current scene of medical treatment, doctors do not hold complete monopoly anymore, consumers have more choice and more informed nowadays. The problem here is anime studios still did not grasp what/why consumers are more informed/misinformed than ever before. Sometimes they play it too safe, releasing cliche ridden animes or spray and pray mentality hoping to hit the target.

So yeah, guerrilla animators doing very specific niche driven small animes might hit the streets soon.





Kawachi, who handles special effects at Toei Animation Studio, said that in the current situation, most of such work is done in countries like China and the Philippines.

"And with the recession eating away at production fees and forcing agencies to downsize or go bankrupt, young and aspiring animators can't find places to work," Kawachi said.

Reflecting such times, animation studio Gonzo, a well-known name in the industry, recently confirmed it plans to pare the number of contracted creators from 130 to 30 over the next five years.

The Japan Fair Trade Commission on Jan. 23 released a report on the state of the animation industry, listing several major concerns.

One is the lack of copyrights attributed to production agencies — copyrights are divvied up among sponsors, a system widely criticized for robbing the actual creators of any secondary-use benefits, not to mention motivation.

Another is the popular practice of commissioning and recommissioning production work to smaller agencies that often leads to shady transactions.

Kawachi said such issues — not new to the industry — have largely been ignored in the past but will need to be dealt with one way or another if the industry hopes to remain the dominant force behind the global animation market.


Hence my comment someone is making obscene money above.

Apparently in study done by Japanese Fair Trade Commission,
which surveyed 533 companies and 114 responded. 42.4% of the responses said that the companies had to take low payments without sufficient negotiations. While 82 of the responding companies themselves farmed out subcontracting work to other companies, only 14 of them said they always arranged the contract conditions in writing before work began. 62.8% of the companies were small outfits with 10 million yen (about US$100,000) or less in capital each. Only 19.5% had more than 50 million yen (about US$500,000) in capital. 30.1% of the companies had 10 employees or less, although 63.7% had between 11 and 100 employees. These firms also have no trade protection against any sudden cancellation by commissioning companies and usually no compensation for their cost during production segment if the work is canceled.

Small wonder Japanese animators are dwindling fast. Basically the commissioning company bully the animators with impunity. I know it is cultural thing but it is incomprehensible to me that such unfair arrangement is possible. It's also sounds like that middlemen were strangling the industry, leaving the animators with not much space to breathe. Monolithic industry with tight group of oligarchs definitely will not give a fair share of profit to the industry.


In 2006, Kawachi's union, joined by the Federation of Cinema and Theatrical Workers Union in Japan, presented the culture ministry with a proposal on restructuring the animation industry, outlining main issues and suggesting solutions. Kawachi said they received no response from the government.

Yamaguchi of AJA, who also lectures on animation literacy at Nihon University's law school, predicts that in the end, quality, not quantity, will come to be emphasized.

"When we look at viewer ratings of animated television programs, we notice that the top slot is always dominated by 'Sazae-san,' the only program that is still produced using the traditional hand-drawn method," he said, adding that this trend could also be seen in last year's ¥15 billion-grossing hit "Ponyo on the Cliff by the Sea," a hand-drawn movie produced by Hayao Miyazaki's Studio Ghibli.





Perhaps the union should try again since current premier, Taro Aso is very receptive due to his status as anime fan (Rozen Maiden in particular)?

With 200 over new anime series and movies plus OVA/OADs in 2008 alone, the market looks markedly bloated and soon in my opinion it will crash. I can't see how long this artificial bubble can be pumped up in face of economic depression which looms over the world. Hence quality will save the industry, not quantity anymore. The Golden Age of anime will be over soon.

I kinda agree with Ponyo example but Sazae-san? Sazae-san is cultural icon so it is UNLIKELY to be affected by anything. Use late night anime slots for better comparison, not a prime time national pastime. It is distorting at worst.


"In this age of mass production, when most animation is digitized, we need to consider the implications of such data," Yamaguchi said.

"I think we need to think, philosophically, about what our users really want."


Much agreed again.

Source article

2 comments:

Anonymous said...

"This is cartoon, not anime" stuff crack me up. /lol

Anonymous said...

Sigh, tell me about it.