Ask John: Is America’s Anime Industry in Recovery Right Now?

Question:
According to AnimeonDVD.com’s licensing list, more than 30 titles have been picked up between this time last year and this year. Is the anime market back on the rise, and can we expect this trend to continue?

Answer:
Ironically, I’m not certain that this question really does have the obvious answer that it seems to have. Judging by licensing announcements alone, America’s anime industry does seem to be climbing out of the hole it was in just a few years ago. But cold statistics alone may not provide a reliable basis for estimation. I think that close scrutiny reveals a more accurate image of today’s American anime industry.

American licensing hit an all time high in 2004, reaching nearly 120 titles announced for American release within the first 7 months of the year. Just a year later that number dropped by half before starting a slow recovery. Similarly, there were only ten titles announced at the 2005 Anime Expo, the traditional clearinghouse for new industry announcements. In 2006 that number rose to 16. This year Expo hosted 28 licensing announcements.

The fact that many of America’s anime distributors are licensing new titles signifies that they have the investment capitol necessary to license anime. However, the quality of those licenses may reveal more about the true health of America’s anime industry than the sheer number of licenses. After all, market saturation – in other words, the sheer number of anime DVDs available to consumers – is widely accused of having contributed to the American anime market contraction in the first place. A large number of license announcements means little if consumers don’t buy the titles that are licensed and released.

While there have been a larger number of anime titles announced for American release so far this year, a significant number of them are re-releases of titles previously available in America (Aika, Lost Universe, Love Hina, Golden Boy, Orguss, Silent Mobius movie 1). More importantly, a rather large number of this year’s licenses are titles with probable minimal domestic market potential. Titles like Itsudate My Santa, Tide-Line Blue, Nobody’s Boy Remi, Cat’s Eye, Magikano, Engage Planet Kissdum, Project Blue ~ Earth SOS, Kyoshiro to Towa no Sora, Jyu-Oh-Sei, Angel’s Feather, Ayakashi Ayashi, Baldr Force EXE Resolution, and Sasami ~ Mahou Shoujo Club, among others, are titles that with a low profile in America’s anime fan community, and titles without much potential for breakout mainstream American success. Titles including Kissdum, Project Blue, and Sasami Club have been barely even fansubbed, meaning that if American fans aren’t even interested in watching these shows when they’re available for free, their sales potential can’t be very positive.

In mid July, Bandai Visual USA president Tatsunori Konno estimated that there are presently less than 200,000 core American anime fans, and that the value of America’s anime market was around $350 million. Less than a quarter million serious American anime consumers is a relatively small number in the context of the American entertainment industry. The estimation of the market value of anime in America at $350 million is also down considerably from 2003-2004 estimates that valued the American anime market at $500 to $550 million.

By any observation, America’s anime industry is in a recovery from the slump of 2005. The healthy, steadily increasing number of licenses announced in 2006 and so far this year may be the most evident sign of renewed vigor in America’s anime distribution industry. And I think that the companies that managed to pull through 2005 and early 2006, the biggest backward step in America’s anime market growth since the market explosion began in the early 1990s, will be able to continue to sustain themselves. But a mere increase in licensing doesn’t reveal the truth of current conditions in the American anime business. America’s anime industry is recovering, but it’s well below the level it was at in 2004, and I don’t see evidence to suggest that America’s industry will be able to reclaim that former status. There are fewer titles being licensed now than three years ago. And America’s industry generates less sales revenue now than it did three years ago. The American anime industry may be smaller now than it was just a few years ago, but hopefully the industry is more stable and more sustainable now, as well.