Thursday, October 25, 2007

All of a sudden,

The home media bubble and its effect on anime as a home media force, and what the future will hold.

Since I am currently a freelance licensing agent, and event consultant, there are times when all of a sudden out of nowhere all this work lands on your head and you have no time for keeping up appearances on the interwebtubes. Now is such a time, however I do feel the need to continue to update this blog lest the content become amazingly stale.

I had a conversation today with a former colleague (read; "boss") of mine regarding a few historical things, our mutual insane friend, and where things are headed. From every perspective, it would seem to be official, the home media business is imploding. If this phenomenon wasn't so close to pure physics it would be just horrifying for us in this business to watch unfold.

As DVD expanded and became the dominant force, a few things happened to change the home media market.

1) Real Estate:
The shelves of any retailer who carried any home media, all of a sudden became capable of carrying an exponentially larger amount of releases since DVDs took up less space on the shelves in the store. That means for the same rent, the store can carry the same amount of titles without any financial risk what soever (that's because of "returns"... I left AWO a message about what "returns" are... maybe they'll play it maybe they won't).

2) Production Cost.... no Manufacturing Costs: DVDs take less time than a VHS to make, and since they can hold so much more video content, all of a sudden the massive libraries of TV productions become viable products. Supply ends up slightly outpacing demand, and a paradox is on it's way. Much like the real estate market is almost about to deal with now... nobody cared. They were making money and getting their sales commissions, the future would have to hold the bag so what did they care.

3) Market indigestion -or- Collective buyer's remorse:
OK so everything you've ever wanted (except Daria and Miami Vice ...thanks RIAA bastards) is now out on DVD for a price that seems too good to be true. Of course you're going to binge, you are only human right? So now what... the consumer home media market binged, passed out and is now very hung over in the "never gonna do that again" phase.

Number three is what's affecting the market now. The new genres that exploded during the infancy of DVD (anime being a major part of that) are now the ones being cut back on. The number of genres forcing this implosion range from softcore adult, to indie films, budget horror (thanks Blair Witch), documentary, martial arts, and anime.

So are there any survivors? ...Only one, and that's TV on DVD. Why? Well there's the obvious fact that these shows are on TV first and what better advertizing can you have? But that's only half of the equation, and half a tank of gas won't get you where you're going. You ask what the other half is? Cannibalism. TV on DVD has bitten out such a huge chunk of Hollywood movie DVDs that it can now survive whatever the market throws at it. mmmmm market share.

So what does this mean for anime? In a single explanation, it's growing pains. In 1999 Taeko Baba of all people (if you don't know who she is, you don't know much about the anime business ...but not in a good way) gave a very detailed presentation at The Japan Society expounding the differences between the American and Japanese "otaku" consumer markets. She also prophesied the eventual transition of the then US consumer market model into the Japanese consumer model, which was an immensely major transition. I invited her to the Anime Convention I chaired in Albany NY to give the same presentation... I am not sure how that worked out since I more or less blacked out that weekend.... but um...

Anime is in there... somewhere

The US market is in the midst of that transition. If you want to really have a true understanding of this, I suggest you read; A Clustered World, The Japanese Economy, Japan Inc (I know it's old but read it anyway), Shadow Shoguns, Hit and Run, Good to Great (full of market-speak), and just for fun try the translation of the novel Battle Royale. Just a bit of light reading. Such a transition will see losers and winners, and lots of both. No one may know what the future holds, so place your bets... place your bets.

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