Tuesday, January 3, 2012

The Demise of Bandai Entertainment and the Future of Anime in English

When I heard the news about the effective cessation of operations of Bandai Entertainment on Monday, I felt a mixture of apathy and a bit of sadness. Somehow they’ve managed to almost get out all of the titles I was interested in just before their closedown date in February. The only other unreleased title I was interested in, “Nichijo”, will most likely be released in a physical format (probably DVD rather than BD) by Madman Entertainment, but there’s also a slim chance they might do the same for the long delayed “Turn A Gundam”. Well, one can only hope.

Initially I was going to do something similar to a post I did for another blog a couple years back in regard to the demise of Central Park Media, which involve looking at about half a dozen of the more esoteric or underappreciated titles they released. Looking at some of the reaction to online, well, it kind of narked me off really and my enthusiasm for doing my piece on some of the unloved Bandai titles evaporated. ANN’s interview with Ken Iyadomi of Bandai Entertainment made my heart sink in regards to the future, or lack thereof, of anime in English. First I think I’ll quote some of the more interesting titbits from the interview;
“Bandai Entertainment's corporate parent at Namco Bandai Holdings made the decision to exit the American home video business. Iyadomi says he wasn't privy to the fine details. "The decision was made in Japan by the contents SBU (Strategic Business Unit)." That business unit originally included the video games division, but recently was merged with all of the company's audio visual businesses, including Sunrise, Bandai Visual and Bandai Channel.

But the broader reasons are quite clear from the outside. The physical anime business in North America has shrunk substantially over the last five years, and shows no sign of returning to its former glory. "A couple of times we were hit with huge returns, and the financial result was pretty bad," Iyadomi admits. Still, he believes the division might have been able to keep going for a few more years, had the SBU allowed it.

"The pricing range for our products kept dropping in Western countries, and people tended only to buy sets with very reasonable prices, which we understand is what fans want, but it lead us to a different strategy than what Japanese licensors wanted," he remarked. "So we always had a problem [with licensors wanting something different than what consumers wanted].”

So the main thing we can take from that is that there is a clear disconnect between what consumers in the US market want and how a great number of Japanese distributors want to market anime. Seriously, how stupid is this? I fully understand that revenue from the US model is far less than a Japanese model. That is Japanese DVDs and BDs being sold at say 8,000 yen with lower amount of units sold is far more profitable than selling four times that amount at a much cheaper $25 price point. The gap widens significantly when you take anime series into account, i.e. in Japan a single 26 episode series on DVD may span 8 or so discs at 6,000 yen (about $75) or so per disc, compared with $50 - 70 for a half season set in the US. The bigger money maker is clearly the Japanese model;
“Only one thing is clear: the role of a distributor for anime in North America is changing, and some well-equipped licensors can now cut them out of the process entirely, if they choose. Japanese publishers can now create Blu-rays with English subtitles, ready to import to English speakers worldwide. While those won't sell as many copies as American-produced discs, the higher price point and lack of middleman can still result in a decent amount of revenue with little additional cost. Bandai Visual Japan recently discovered this for themselves with their release of Gundam Unicorn. "They found the results pretty good, and that's how I think they would like to move forwards," Iyadomi says.”

As previously mentioned by Iyadomi, not only is Bandai Visual releasing Gundam Unicorn this way (total cost for all six OVAs on BD will be about 33,800 yen, about $425), but other series such as “Horizon on the Middle of Nowhere” and “Tiger & Bunny” are getting similar treatment. Currently the only legitimate physical media with any sort of English on it (in this instance English subtitles only) are the BDs made in in Japan. To obtain all nine “Tiger & Bunny” BDs with English subtitles, it will set you back 50,500 yen (about $630). Note that in that example I did not include shipping from Japan, which is pretty expensive. Compare to Funimation’s half season DVD/BD combo sets which retail for about $70 each.

As somebody who prefers having a physical format over watching streaming video, I would certainly hate for large Japanese companies to release anime this way. I certainly understand why they would prefer this model. They have complete creative control over all aspects of production and distribution and wouldn’t have to worry about reverse importation. But it’s a bit of kick in the teeth to western anime fans. To be able to buy nearly half a dozen anime series for about $300 (with discounts of course) versus more than double that for one single series. I really can’t justify that, even for a series like “Tiger & Bunny”, and especially for series like “Horizon on the Middle of Nowhere”. There’s also the problem of the lack of English dubs on these discs (“Gundam Unicorn” being the exception of course). While I don’t really listen to dubs, a lack of one does immediately reduce the audience of the show by a huge number. While I think Funimation, Sentai Filmworks, NIS America, Nozomi (Right Stuf), Media Blasters and Discotek won’t be going away anytime soon, the market looks pretty shaky and has so for the last couple of years. Sure we have Siren Visual and Madman Entertainment as well, but Australia is a tiny video market and anime is niche product in that tiny market. Despite Siren’s many sub only releases, sub only anime isn’t exactly a big seller. For the moment, I still keep buying anime on a physical format (though I’ve cut back on purchases quite a lot), but it really feels my choices of anime in English in future may be severely limited. It’s quite frustrating and not a good way to treat English speaking fans, especially when they’ve supported anime for more than a couple of decades now.

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