Anime · Trivia

Why the anime bubble burst – part 2, the piracy issue

In part 1 of this series, I discussed the baffling decisions made by some cable TV networks by deciding to air anime shows that were not geared toward the casual fan. Today, I will try to explain the impact piracy had in setting back the acceptance of anime across the Pacific. Now I do not want to inflate the already over-inflated egos of certain hackers out there. The self-proclaimed NEETs and otaku did not have a significant impact on the economic aspect of the business. It was, however, the major corporations’ complete disregard of their presence and the growing e-commerce markets that set the industry back.

As a medium, anime has been more of a following than a trail blazer. It makes sense: a niche market should choose to wait and see which side wins when it comes to a new format war (e.g.: VHS vs Betamax; HD-DVD vs Blu-ray). Unfortunately, their loyalty towards Sony has turned out to bite them in the end multiple times (see: Betamax; Laser discs; and HD-DVD). There is one genre that is usually the barometer as to which format will win. And that genre, I must sadly admit is the adult entertainment  business (pr*n). That being said, there is a fine line between being pragmatic and being completely oblivious. And the anime industry, was blindsided by the internet.

To be fair, American companies were entirely aware that they were losing potential revenue from the internet. Not many fans would wait a long period of time to pay for a licensed, translated DVD when they could download a fansub off the ‘net just days, if not hours after it aired in Japan for free. Of course it wasn’t just anime that was being pirated. Movies, (live-action) TV shows, and music were being downloaded illegally for a longer time and at a much higher volume. Hollywood (no pun intended) acted on this situation right away, and the music industry (over?) reacted even more by taking the website Napster to court.

So why didn’t the Japanese corporations follow suit? Since I’m not a Japanese executive, I can only speculate. My hypothesis – they didn’t care. Since anime is targeted solely towards the Japanese audience, the producers do not give a second thought towards overseas markets. If someone wants to license a title overseas, well that’s just gravy for them. Not that they’ll give it away for free, oh no. Despite their indifference, they will not sell the overseas rights that cheaply. (Reason number one as to why anime titles cost so much vs domestic titles. Reason number two: the cost of translating and dubbing – writers and voice actors do not work for free.) On the other hand, Japan has always turned a blind eye when it comes to domestic piracy. In the publishing world known as manga, unlicensed material is known as dojinshi. Since it is perceived as a labor of love,and not as an attempt to grab cash away from the original artist, it is considered a form of advertising. So a fansub is considered the equivalent of dojin. Except, digital downloading is a lot closer to a cash grab, than a free promotion. Japan did not see the domino effect. Most foreign anime fans are young, and thus have very little disposable income. If there was a chance to see anime for free, many fans would take it. Even something perfectly legal, like having a Netflix account, ended up hurting the bottom line. The razor-thin profit margins that American anime distributors operated on were no longer there, and many companies began to go bankrupt. Slowly but surely, that gravy money from overseas was slowly dwindling.

So to recap: cheap bastards who don’t like to pay for anything have a new medium to watch anime for free. Anime companies turn a blind eye due to cultural dissonance and their utter disregard toward overseas markets. Then, the economy collapsed….

(Next on part 3 – the distributors, or shoujo doesn’t sell)

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