Cross-posted from the Convergence Culture Consortium.

The Japanese popular culture industry, especially for anime and manga, is an interesting case study for global fandom, but also for global industry. The comics, television, and film industry for animated popular culture in Japan has its own history, structure, and approaches, but over the past five decades, as it has reached millions of new, international viewers, new industries have risen to cater to these fans. Still, with the rise of the Internet and the economic troubles that most industries have gone through over the past decade, both the domestic and international manga and anime industries have been hurting for money, even with a surfeit of fans.

The anime and manga industry is especially volatile, because its domestic and international audiences have utilized the Internet to spread and consume the media at the expense of industrial and commercial models that cannot keep up with the audiences’ changing tastes, modes of consumption, and cultural behaviors of media consumption (sharing with friends, international online distribution, the culture of collectors versus mere viewers, etc.). The industries, both in Japan and elsewhere, must change: however, the success that anime and manga brought a decade ago have influenced the producers of these media to stick with old models that are no longer fully applicable to the current fan cultures that drive the markets.

Today, I want to discuss two very recent issues of the manga and anime industries — in Japan and in America — publicizing comments to fans in a way that might be seen by many as “giving up”: without adapting to technological, cultural, and commercial changes, the industries representatives have voiced concerns to fans by pleading with them to stop behaving as they current are — mostly by using the Internet to circumvent commercial models for their media consumption — and to think ethically about how these behaviors are affecting the respective industries.

Shueisha, a major publisher in Japan who print manga magazines and also co-own Viz (one of the top manga publishers in the United States), last week printed a letter to fans in Weekly Shonen Jump, a weekly manga magazine and one of the most popular in Japan. You can see the message (in the original Japanese) by clicking on the image below (in the bottom right), or read the translation:

To all our readers,

There are now many people unjustly posting copies of manga on the internet. These unjust copies are inconsistent with mangakas’ feelings. They are also distorting the authors’ intentions of “I want the work to be read this way”. The actions of posting these unjust copies on the net, into which the mangakas have poured their hearts, are not only hurting mangakas in real life but are also against the law, even if done in a light-hearted manner. Every time we discover such “unjust copies”, we talk to the mangaka and consider every possible countermeasure. But the number of inconsiderate people is great, and at present we cannot deal with all of them. We have a request for all our readers. The unjust internet copies are deeply hurting the manga culture, mangakas’ rights, and even mangakas’ souls. Please understand once again that all of that is against the law. Also, the mangakas and Shueisha will severely deal with any unjust copies found on the internet. We ask that our readers please continue to support us.

- Weekly Shounen Jump editorial department (translation via Devang Haven)

This is a critical development in the manga industry, not because the publishers are finally making a statement about the state of fan piracy, but also that the message comes from one of THE important players in the Japanese industry.

Now, there is some context behind this message: although here in America, a lot of talk goes around about the negative impact of scanlations (scanned and translated manga, by fans), this message is calling out specifically to a Japanese audience: fans in Japan who are uploading RAW scans of manga magazine pages to the Internet (that is, scans of the original pages: a direct copy of the book, circulated online away from the commercial market).

Now, the uploading of RAW scans in Japan is an obvious act of piracy, and direct piracy like this does hurt the industry. An interview with Ed Chavez (Vertical, Inc., a publisher of translated manga in America) explicates that copying of the primary source affects sales and loses audience members. And in response to Shueisha’s plea, a number of websites that hosted RAW manga are now closed or redirect to Shueisha’s homepage.

The issue with a message to Japanese fans is how international audiences should react to this call for fan ethics. A number of English-language sites carry RAW manga scans, for fan translators to distribute scanlations to English-speaking audiences. Although these scanlations still affect the market, they are not scans of the official translations published by companies in North America: therefore, they occupy a slightly different space. If we think philosophically about scanlations, then, English-language-only scans of manga available in Japan but not yet in America operate in a strange space: they can’t be read by Japanese fans who are looking for free Japanese-language manga, but they help spread the word about titles not currently available in English-speaking countries (at the same time, though, the consumption of scanlations may still affect the purchasing of these official copies once they are released, because some fans will have already read the scans and will not want to buy the official publication).

Will Shueisha’s plea work? Sales of manga in Japan have been on a steady decline for a few years now, due in part to piracy, but also to new modes of media consumption, for example through cell phones. All in all, it appears that the most important part of this issue is that Shueisha, as a major publisher, has the capacity to send cease-and-desist notices to websites that are sharing their original content for free (an illegal activity). These endeavors may help the Japanese industry’s woes with declining sales, but I would venture a guess that it will not affect overseas fan economies.

If we jump across the Pacific to America, another rhetorical development took place, this time via a message published by the president of an imported Japanese animation production studio.

Anime News Network reports:

Eric P. Sherman, President and CEO of the anime dubbing company Bang Zoom! Entertainment, has posted an editorial on the AnimeTV blog on Saturday, urging fans to buy anime instead of watching it via fan-subbed videos.

Bang Zoom! is a North American distributor (voice dubbing, subtitling, production, etc.) of Japanese animation television series, movies, and the like. Sherman, in his blog post entitled “Anime – R.I.P.,” writes in bold, “Anime is going to die.” He reiterates what many critics have been saying for years — “If people don’t resist the urge to get their fix illegally, the entire industry is about to fizzle out.” — but readers, both fans and those in the industry, realize that his words are about a decade too late.

The issue, of course, is that Sherman argues, “Japan is already suffering and struggling to bring out quality titles. They can’t rely on everything being picked up by US distributors anymore.” The problem with his argument is two-fold: 1) the Japanese domestic market is the key contributor to the financial success of Japanese animation, not a reliance on foreign distributors, and 2) the Japanese domestic market has been deteriorating as much as the redistribution market abroad (Adrian Brown, of SBS Dateline Australia gives a good rundown of the Japanese industry’s problems in this video segment).

In terms of American redistribution, FUNimation Entertainment currently leads the market in DVD releases (both dubbed and subbed), with Crunchyroll picking up the majority of what titles are left, releasing them subtitled online in their video portal. However, to repeat, the American licensors only provide a reasonable (though still small) fee to Japanese companies to distribution their intellectual property. Basically, the Japanese producers are taking what money they can get (especially money they can use to make up for domestic piracy losses), instead of letting reasonably accessible money slip by while foreign fans share subtitled anime online. Justin Sevakis, of Anime News Network, breaks down the process below:

The cost of producing TV anime has tripled in the last decade. The Japanese DVD market is also maturing, and R1 imports back into Japan for a third of the price (or less) of R2 are a growing problem for them. Hence, if they’re going to part with their intellectual property, it has to be worth at least the amount they’re likely to lose in reverse-imports, plus the production burden relative to whatever value they’ve attached to the R1 market in relation to the rest of the world.

When an anime is licensed, is the fee paid to the Japanese companies in the form of a one-time XX dollar payment, or in the form of XX dollars or XX percent profit off of each DVD that is sold?

Sort of a combination of both. Let me preface this by saying that the following isn’t just how anime works, but pretty much every motion picture and TV license.

First, there is an up-front change of money, known as the “license fee” or “minimum guarantee”. In the case of TV or OAV, this is usually a per-episode amount (though a licensor may insist on dividing longer series up in specified chunks of episodes). There’s also likely a charge for materials duplication (as cloning master tapes is expensive).

The releasing company then produces whatever DVD product and sells it (and may also have other rights like theatrical, TV, etc…). A certain percentage of those grosses are separated into a separate fund. That fund is used for the following:
1. Recouping any production costs. This includes dubbing, DVD authoring, replication and manufacturing, etc…
Once that’s all recouped, THEN…
2. Recouping the minimum guarantee. As the “minimum guarantee” implies that this is the guaranteed amount of revenue the licensor will make from the deal, funds are withheld until that amount is actually reached.
AFTER THAT POINT…
3. That percentage is paid as royalties to the licensor.

Now, that’s a lot of money to make back before the licensor sees any residuals. You’re probably wondering how many titles actually result in residuals being paid, and the answer is “not many”. The minimum guarantee is there so that even if the release tanks, the licensor will have made enough money to call it a day, but OTOH won’t lose out if it’s an unexpected success. Likewise, since the label takes the majority of the risk, they get to keep the lion’s share of the profits, should the release do well.

This is how the vast majority of deals are structured, and this system has been around in the entertainment industry for as long as anyone can remember. There are some exceptions, and the minimum guarantee and back-end percentages (“points”) vary substantially. Also, sometimes production expenses are recouped before separation into royalty percentages.

Justin Sevakis, Anime News Network (via ANN Forums)

All in all, the ultimate problem facing American distributors is that the cultural modes of anime consumption in America is changing once again: instead of needing a general and mediated flow of access to Japanese animation (which was achieved via voice-dubbed distribution), fans now want 1) immediate access to content to keep up with fellow fans, with whom they discuss shows online regularly and at a quick pace; and 2) subtitled anime, because hardcore fans have lashed out about authenticity of dubbed productions, through which many American redistribution directors have taken upon themselves to “redirect” in terms of voice acting (ie., it is a novel production, recontextualized for foreign fans). Instead of needing a moderator to introduce Japanese cultural concepts, terms, etc., most contemporary fans understand (at least the basics) of Japanese lifestyles, language, and behavior.

Therefore, it seems to me that Sherman’s plea for fans to “not pirate anime” is moot, at least at the end of this decade. He states, “Do the right thing. Plain and simple. Because if you don’t, I can guarantee you that this time next year, Bang Zoom won’t be bringing you anymore English language versions of it.” However, it seems that in relation to American fans’ modes of consuming anime, English-language dubs are no longer necessary. Instead, the model provided by Crunchyroll — immediate licensing of popular series, subtitled, and only set to stream online — caters to the largest general American anime audience. Dubbed anime in America might slowly fizzle out, but that business model will be replaced by another company that can better respond to fans’ behaviors.

The New York Times this past weekend ran a celebratory article (and you should read it) about film professor and critic, David Borwell. Bordwell teaches at the University of Wisconsin, Madison; he composes a huge compilation of analytical essays at his blog; and he’s the former mentor to one of my academic mentors, Henry Jenkins.

Bordwell has been a film critic for practically FOREVER, and he’s written some impressive and influential film criticism texts, such as “The Classical Hollywood Cinema: Film Style & Mode of Production to 1960″, in which he explains the history of film through the lens of technological development in relation to the Hollywood style.

Now, I’ve been thinking (also FOREVER) about media criticism and how I should apply it to both my thinking and my writing (specifically for this blog).

If we think about the fan response to Japanese animation (opinionated and published, by word, voice, video, etc.), the leading voices tend to have been reviewers: the trio from Anime World Order for a contemporary example, or — as an classic illustration — writers for old fanzines (such as through the Cartoon/Fantasy Organization) who compiled episode synopses and shared opinions about series to progress the knowledge that, basically, anime exists.

However, I want to push back against the concept of “the reviewer,” because the position sits as an odd point between objective journalism and subjective personal grandstanding. I appreciate the wonderful breadth of series that, for example, Anime World Order explores, because the number one rule to being able to talk about anime is to watch it. However, I feel that to gain a more detailed and elaborate understanding of anime, fans need to move beyond their position as reviewer and advance toward that of “critic.”

I bring up the Bordwell article, because the author describes Bordwell’s approach to film in exactly the terms that I want to approach analyses of Japanese animation:

Counting blinks is just one of Mr. Bordwell’s strategies for understanding movies, the fundamental goal of the critic. Rather than just gassing on about his interpretations (as reviewers can do) or starting with a theory and finding a set of movies that support that theory (as scholars will do), he looks to the movies first, analyzing what is happening at the level of sight and sound, then extrapolating meaning.

Now, the author also critiques academics, who can tend to analyze their subject in terms of their own ideas, rather than develop ideas based on their subject (one example might be the “X and Philosophy series,” of which anime has one). But I think that the core bit of appreciation that the article promotes is that the critic analyses the media and then extracts the meaning. Of course, to move beyond the reviewer, this meaning says something about how the media operates rather than simply what the media contains (and maybe the impressions that the media evokes).

I’m trying to push this blog (when I release more content habitually) toward the perspective of a critic, which is why I tend to avoid writing reviewer-ly articles. If you’re looking for more prolific authors, you should check out:

- Awesome Engine
- Anipages Daily
- Ani no Miyako
- Welcome Datacomp

Word came in today that I’ll be speaking at Ignite Boston 7.

I’m going to be speaking about Japanese fans’ affinity for 2D chicks at Ignite Boston 7 next week on Thursday 4 March 2010. If you can’t make it to Boston, the event is part of Global Ignite week, so the video will be streamed live online and eventually posted on the upcoming Ignite video portal.

Registration (it’s free) and info is here: http://microsoftcambridge.com/Events/IgniteBoston7/tabid/287/Default.aspx

But quick info for those disinterested in clicking links:

Ignite Boston 7 will be Thursday, March 4, 2010 from 6pm to 9:00pm. The event will be at Microsoft’s newest campus, the New England Research & Development office (NERD) right in Kendall Square in Cambridge, MA.

Since there is limited space at the venue, you must RSVP on this page to have an opportunity to get into the event; but admission is on a first-come/first-served basis (to account for RSVPs who end up not making it; we don’t want to waste spaces). By RSVP’ing you will also be entered for a chance to win $300 worth of O’Reilly books of your choice. You must be present to win. There will likely be other items like tee-shirts and other promo items for those who alert us ahead that they plan to attend. If you plan to attend, and do not RSVP you will be put in the ‘wait-list’ queue.

Anime Expo was awesome, hands down. If I have panels accepted next year, I will make an effort to return, definitely. And there are many critical comments I can make about Anime Expo, such as the relationship between industry and fans, or the large size of the convention as justification for its importance (though in my opinion it shouldn’t have to be). Today, I’m going to focus on the Anime Expo dealers’ room.

Anime Expo’s dealers’ room is gigantic. If you’ve ever been limited to East Coast conventions, I would estimate its size to be slightly bigger than that of Otakon. For illustration, it took me a half-hour to browse through one-third of the floor, and I only stopped at two booths for a maximum of three minutes each.

Because Anime Expo is an industry convention (versus a “by fans for fans” convention), the dealers’ room also somewhat resembles Japanese industry conventions, such as Tokyo Game Show. A lot of booths exist just to advertise wares, such as this Astroy Boy movie booth. Still, while a small number of booths boasted walls of gigantic placards, Anime Expo’s room is littered with ordinary booths that hawk anime, manga, and cat ears.

I’m honestly not one of those junkies who stalk out the dealers’ room on the first day of the con, constantly returning to check up on discounted prices, lurking in the shadows to pounce on that ultra rare figure that I hid in the back corner to elude the price-sniffing of others. I buy a lot of my anime and manga online. In the past, I made minimal effort to visit Tokyo Kid, the anime store in Harvard Square. Usually, I know what I want, and I go online to find it cheaply.

Of course, nowadays with the price of DVDs and books on the decline (you can find videos on RightStuf.com for $10 or less, or books on Amazon for at least 25% off), dealer’s rooms are trying to keep up. On most Sundays the dealers scream at the top of their lungs to make sure every fan becomes aware of their “Buy 1 manga, get 5 free!” bargain. Still, after paying $50+ dollars for the convention (though I haven’t done that in a few years, due to panels), I honestly don’t want to waste a few hours in the dealer’s room only to realize that they don’t have what I want to read. Once in a while, I’ll find a great deal (like all twelve volumes of Tezuka’s “Phoenix” manga for $100 at Anime Boston), but otherwise, why can’t I just find things I want online? I’m not into serendipitous buying sprees after all.

At Anime Expo, I bought only one thing in the dealers’ room (besides an omiyage poster in the Artists’ Alley): a copy of Tezuka’s “Swallowing the Earth,” published recently by Digital Manga. Truthfully, I only grabbed it because I got an in-the-last-15-minutes discount of $20. Otherwise, I looked around at every booth, but bought nothing.

However, I came home with a lot of anime-related booty. The cause? Book Off.

I wrote in an article last week about my experiences at the Book Off in New York City and how it’s easy to find manga on the cheap, usually for $1 per volume. While at Anime Expo, I had the privilege of staying with the illustrious Deb Aoki, writer and reviewer of the About.com manga section. On Saturday afternoon, she drove me and a few writers over at Japanator.com to one of the Book Offs in Los Angeles. While not as large as the NY Book Off, I still picked up a number of intriguing items (all of them in Japanese).

First, I found two not-so-expensive “Groundwork of Evangelion” art books. As you can see from the scanned images, they were Volumes 2 and 3, and I’m not so sure where I should pick up Volume 1, but (again, looking at the scans) I only spent $12.50 and $15.00 respectively. Awesome! Especially when the MSRP of these two books is ¥2500 and ¥3000 (about $25 and $30, though these would easily sell in the dealer’s room for $45+). The books are practically new — only the edges are slightly rough — and the images inside (all production sketches with a few color illustrations in the front) will make any Eva fanboy cream his pants.

The rest of the books I picked up were only $1 each. Pretty awesome finds.

First, I picked up some manga. As I mentioned in that previous article, buying manga at Book Off is a bit difficult, not only because it’s hard to find the comics by their publisher, but also if you haven’t done any research into the comics, you’re not necessarily sure with what reading level you’re challenging yourself. However, browsing through the titles, I happened upon School Rumble, a series that I’ve never read or seen, but one that has been constantly pimped to me by a number of reliable friends. After examining the content, I decided to pick up the first four volumes (there were about a dozen there, but #5 was missing).

Next, hidden among the art book section, I found Katsuhiro Otomo’s early works Anthology. The 250-page, large-size book features about a half-dozen of Otomo’s shorter stories that were never published in English (and, according to Deb, never will be, because Otomo doesn’t like his works localized, apparently). The art is amazing, and while I’ve been looking for good copies of the English translations of the Akira manga for months, it’s certainly a nice supplement.

Finally, also among the art books, I found this $1 piece of curated information on the history and development of anime in Japan. The title reads, “The New Conquering the World Japanese Culture: Japan’s Anime.” This is pretty much the book that needs to be published in America, because it’s a really interesting primer (with hundreds of large, color images!) for any type of anime fan that doesn’t know the basic history of Japanese animation. The text covers a lot of the major players, including Miyazaki, Tezuka, Otomo, Oshii, and Anno, and also provides good context for the commercial markets of kids’ anime and toys. One chapter focuses dually on the evolution of robots and cute girls in anime. The section that convinced me to purchase the book (besides the $1 price tag), though, was the end of the compilation, which provides a lot of information on the history of anime from 1917 to 2003 (the publication date), the digital creation of anime, and particularly the relationship between anime and the television studios that produced them. The last few pages present a nice timeline of anime on television starting with Astro Boy in 1963. The opportunity to look at anime history graphically really hits home the fact that, OMG, there’s a lot of anime out there.

If I have the time in the near future, I’m going to upload a LOT of scans from this book and attempt to translate what I can.

In total, I spent less than $40 at Book Off. Of course, you need to know Japanese to purchase these and actually comprehend them, but still… $40 for 5 volumes of manga and 3 rather impressive texts. And so I return to the thought imposed on the beginning of this article: Is there a future for anime and manga in convention dealers’ rooms? Basically, the answer will always be Yes. But it may be true that the stronghold that dealers’ rooms had on fans in conventions from the 1990s has almost certainly weakened today. Some of this might be attributed to fans not purchasing series after they watch fansubs or read scanlations, but also, with Netflix, Amazon, and other cheap alternatives, fans can own media for much less than in the past. No wonder the American industry is slipping. And with streaming websites that provide free episodes to fans online… Really, how many fans are going to buy the DVDs after they watch it once? Perhaps the real question might be: What kind of value are fans assigning to the media the consume? Where does the line of rewatchability exist for modern anime fans that do not possess knowledge of “anime greats,” like Oshii and Kon, like Anno and Ishiguro? And what might the breakdown be between the consumption of anime and manga versus other things, like cat ears, figurines, and other merchandise being sold in modern exhibition halls?