Problem is, it still ain’t perfect. Each channel and method has its own downfalls and drawbacks, so I intend to swallow a couple bucks to provide a reasonable practical guide. I had planned to co-write this series with Riex for Oi, Hayaku! quite some time ago, but of course we didn’t quite get to that, and now I’ve been beaten to the punch by Reverse Thieves and their very well-done analysis of Crunchyroll’s anime membership.

I want to preface this whole journey with one of the fundamental problems behind any streaming or online distribution method. At least for the forseeable future, both studios and licensors get their cash from DVD sales (well — that and merch). Any online distribution is seen as just a promotional tool for those DVDs. That’s a big reason why we haven’t seen a lot of HD/high-res/TV-watchable stuff out there yet. Younger generations of folks don’t necessarily need physical media — and considering that most anime started its life in a fairly transient way, as a television series, who can blame them anyway? More and more people are connecting PCs to TVs, and a lot of anime viewers aren’t interested in leaving their computers (which have higher-res screens than TVs) to begin with.

If you saw the recent half-off anime sale at Best Buy (aka Margin Eliminators, Inc.) you know that those plastic discs are not doing it like they used to, but there’s still a ways to go before we see anime companies on either side of the Pacific fully embrace digital, with or without DRM. That out of the way…

Enter the Apple

iTunes is a perfect candidate for cracking any tough market, since it persuaded a Napster-crazed America to start actually paying for music. Not only that, it persuaded us to pay for low-quality (128kbps), DRM-handicapped music. Granted, the DRM worked better than the ultra-crippling Windows Media kind, but it wasn’t the quality or portability that won customers over — it was Apple’s trademark ease of use. When they brought video to that, suddenly 5 bucks to rent a low-res movie didn’t seem that bad to people. It still does to me, especially as a longtime Netflix user, but it is portable, and every once in a while you end up with an iTunes gift card so what are you gonna do…

The first thing you’ll notice about finding anime on iTunes is that it’s really fucking hard to do. That’s because categories are pretty broad in the iTunes store and there isn’t one for “TV Anime.” There is one for Movies — and it fails hard, just check it out — but not for TV Shows, which is the meat and potatoes of the anime viewer’s diet. So Ouran High School Host Club falls under “Animation,” but your average tit-filled Gonzo action-fest is in the “Sci Fi” section.

FUNi Factor

The second thing you’ll probably notice is that, like a lot of the digital channels that I’ll be exploring, FUNimation rules the roost. Each site and store has its own unique players (like Joost’s Gong or Toei on Crunchyroll) but Funi is like the Visa commercial, everywhere you want to be. Also, I’m assuming that original licenses probably didn’t apply when they started going digital, so it’s far from being all of Funi’s stuff. That means a lot of Gonzo. If you’re not interested in the likes of Speed Grapher, Afro Samurai, Burst Angel… you get the picture, your choices start to drop tremendously. That’s not to say Funi doesn’t have good stuff on iTunes — Ghost Hunt, Ouran, FMP: The Second Raid, and Gunslinger Girl for instance — or that some of the Gonzo titles aren’t worth watching.

Gong Anime, a fixture in streaming sites, doesn’t really have a presence on iTunes, but the Anime Network does, and they have a few interesting titles: Tsukihime, Mahoromatic, Angelic Layer, Saiyuki, and Pet Shop of Horrors. Nothing earth-shattering, but hey it’s better than just watching Speed Grapher all day long.

Manga Entertainment, most famous for the “THIS SHIT’S NOT FOR KIDSSSSSS” trailers at the beginning of their VHS tapes of 90s OVAs (also for being the people who will never reprint End of Evangelion, thankyoujebus I bought it back in the day), has a few titles as well and most are really solid. Among them are Astro Boy, Stand Alone Complex, Gurren Lagann, Robotech, Macross Plus, Macross II, and Now And Then, Here and There.

And of course, tons of Dragonball, Naruto, Bleach, and other popular Toonami-style shonen action series, along with their accompanying movie versions, abound in the store.

There are a few other movies, which makes iTunes the clear winner in that department (I think CR has… two?), but it’s not much of a win. You’d expect Disney properties like Ghibli flicks to be here, but not so. However, search a little and you’ll find Paprika, Tekkonkinkrit, and a few others.

Crowdsourcing

Most sites and stores feature user reviews. So can you trust them? In iTunes’ case, reviews vary depending on what you’re looking at. For the longest time, all any of them ever said was “Get Naruto! Vote Zero if you want Naruto!!!!!one!!” This is, as you can imagine, not super awesomely helpful. Now that iTunes HAS Naruto, these sorts of things have ironed themselves out a little, but reviews still tend toward the not-too-helpful. iTunes buyers also seem to be DVD buyers, and range from people just like my friends to the superior-otaku “I know lots about anime because I have 6 boxsets at home” attitude. If you’re not 12, and if you own more than 6 DVDs, you will see through that. And one of Macross Plus’s reviews talks about how these days it’s all computers, and things were much better back then without all the computers. Macross Plus. Look it up. Now who’s the superior fan? HUH?

Anyway, here’s the breakdown, in a format I’ll be using for the rest as well:

So… anyone here buy iTunes anime? What are your thoughts?

What if, amidst all the baiting and switching, R1 is actually their potential target? Author seems to think the numbers tell a disheartening story for that theory, but that’s not really a surprise. The sales of the first Haruhi series over here were nothing like the fansub-watching internet fandom naively imagined they would be. That doesn’t mean we’re not a potential market, even if we’re more likely to buy something like Black Lagoon. Besides, Kadokawa have become in/famous for milking the golden goose, or something like that. And you would too if you were responsible for H2O.

Anyway, it makes me wonder if they’re planning to stream the next (fictional?) Haruhi series on the internet, with Haruhi-chan and Churuya-san as a litmus test. [Edit: I realize this scenario only works if a real S2 broadcasts, since streaming the rerun would get confuzzled with Bandai owning the R1 license to the first season] In a beautiful, lovely, perfect and probably completely fictional world, we’ll get the second series over here zero-day.

That is, if it exists.

[More edit: Author weighs in again, and while he stops short of calling it a no-brainer, he mentions that "Chairman Kadokawa has gone on record with his international inclinations." Interesting times ahead, no doubt. Great to see different types experimentation from different companies on both sides of the Pacific.]

Gonzo’s been in the news a lot for its apparent rocky financial situation, even as it enjoys a philosophical victory for being the first Japanese company to get the worldwide streaming out there. But good news came Friday in the form of some investment from the firm Iwakaze Capital in Gonzo’s parent company GDH. GDH then in turn put about $2 mil into Crunchyroll. [Source: ANN]

I really enjoyed/still enjoy Druaga and Blassreiter’s run on YouTube, Crunchyroll, and BOST TV all at once, but I recognize that the YouTube availability was just a teaser. I assume that the CR model for Strike Witches (limited streaming, pay-to-own outside the time frame) is the way they’re going to go in the future for Kurogane No Linebarrel or whatever else they’re bringing to the rest of the world next season. So all the CR haters in the anime-blogosphere will probably have to put a sock in it or stop watching the Gonzo streams. Personally I’ve thought for a while now that CR’s (admittedly still-slow) transition from pure fansub-and-pirate hangout to legit service is going to tell us a lot about how digital distribution will go down in the future.

Incidentally, Linebarrel’s “Creative Producer” is listed as being Goro Taniguchi, so was he pulling our legs about leaving anime altogether?

Well, we waded through six posts where I barely talked about anime at all, wasn’t that boring? Then I pretended to know about economics, and so did some other people. I pissed off Scott again, this time really badly, and as I mentioned, we probably all looked like those old honkies sitting around drinking cheap beer on a Sunday and fixing the world’s problems after a round of golf. Except without the ethnic slurs and pink polo shirts. Good times were had by most.

Here’s what we’ve learned.

• The sky is not falling.
• Problems with “middleman” companies reflect globalization and internet-related growing pains, not just the easily-available fansubs and pirate copies that the internet provides. Japan will probably be OK, but companies like ADV are going to get worse before they get better.
• We should vote with our dollars, and even if new initiatives aren’t perfect, we should try to support them. Meaning, watch Blassreiter, like now.
• As a sort of inverse corollary, we shouldn’t feel obligated to support companies based entirely on good will. This is a capitalism, not a charity.
• Otaku will likely not stop buying DVDs altogether, because shiny objects and bright colors fascinate us.
• Anime bloggers can’t agree on whether teenagers have money, even if marketers seem to.
• Ad-supported content is good in theory, but there are plenty of potential kinks to work out first. Mostly, that it might not pay off. Let’s get on that.
• Many of my usual commenters couldn’t care less about this stuff, but some people who never comment showed up to provide some fantastic insight.

If it were in my power to instantly travel all around the country, I’d sit down and buy you all a beer right now (yes, you too, Scott). As it is, you’ll have to enjoy this less substantial beer with the queen of fanservice for the moment.

And here’s the post roundup:

1. Me: Eleventeen easy steps.
2. Kabitzin: Stop scapegoating fansubs and get with the solutions.
3. Baka-Raptor: The market will correct itself.
4. TheBigN: Respond to your customers.
5. CCY: Try a new ad-supported model.
6. OGT: Count on otaku to buy fetishize the physical.

Anything we didn’t quite cover? I fully expect the world to be completely righted by the time my next post goes live, at which time I’ll return to my regularly scheduled programming, which should wreck the world again since I’ll just be blogging about fansubbed anime.

EDIT: Thanks to omo as well for all the intelligent participation in the comments, here’s his take on things.

Are you sick of this yet? I know I am, and it was my idea. But I sent out a lot of requests, and was pleasantly surprised to find most of them got responses.

OGT runs Anime Wa Bakahatsu Da!, and contrary to its explosive-sounding name, it’s a place where I go for rational discussion and well-thought-out blog posts, not to mention the only place I know of where someone is as much of a fan of Real Drive and Itazura Na Kiss as I am right now. I love the site, and I know OGT is a big anime DVD buyer, so I was expecting to love this response:

The problem with the anime industry these days isn’t wholly dependent on the fact that people aren’t buying DVDs (I’m, frankly, surprised that you can still buy a “limited-edition” Haruhi DVD 1 + boxset when I was pretty sure that they wouldn’t be available after a month of sales. Unless the “limited edition” was a sales gimmick, but that’s kind of hard to believe), but a complex problem involving the economy in general, the companies’ own questionable spending ethics (over-saturating the market), and a few other Mysterious Economic Problems are partially to blame as well. I don’t think totally eliminating fansubs and forcing everyone to buy DVDs sight-unseen is the solution, and I still maintain that it’s 100% A-OK to watch fansubs, as long as you buy the series you enjoyed. Define “enjoy” however you feel like it, make decisions based on price point vs. how much you enjoyed it, make sure you have food to eat and a roof over your head, etc.–I own a ridiculous amount of anime DVDs, and question only a fraction of their purchases, but I’d never expect someone to buy more than a quarter of what I have over the years. The best thing R1 and Japan can do–and they’re testing the waters already, in a haphazard way–is to simply beat fansubbers at their own game, and give the audience legal, official digital subs with little or no turnaround and at a small price point. But that’s not going to work unless people actually buy things, digital, physical, or otherwise. Information is free, but to keep it that way, sometimes a system needs to be fed with specie.

I sometimes wonder if sales of anime DVDs are relatively well distributed or if about 5 people buy most of them. I own less than a hundred DVDs of any kind, anime or otherwise, and I generally only buy anything if it’s best-of-breed or I just feel like rewatching. Netflix, or in the past, a conveniently located video rental, is perfectly acceptable from me. But there are people like OGT (and some others I know that I can immediately think of) who buy DVDs like they’re going out of style.

That brings us back to that numbingly-repeatable question: has the current age of internet-distributed fansubs altered that pattern any? Well I, for one, am buying more anime DVDs because anime is in my face a little more, but I could also attribute that to my blogging, since that has definitely sped up my purchasing as well.

As mentioned in some of the earlier comments, we DVD-buying fans are probably not going anywhere anytime soon, and if anyone is attached to the sight of a brightly-colored shelf of DVDs, it’s otaku. But just like the changing music market of the past few years, a host of issues — whether practical, technological, or economic, may make those shelves expand a little slower than they used to.

Yes indeed, we’re up to part 5, and almost done. We’re starting to see some repeating themes in these answers and the comments, so I’m going to wrap everything up with what we’ve learned at the end. And then the whole world will be solid, right? Yeah, essentially what I’ve done is create that bunch of old men sitting around the garage in lawn chairs fixing the world’s problems while drinking Keystone out of a can. My latest virtual old fart, CCY, writes the site Mega Megane Moe (which is a surprisingly descriptive name) and was an early supporter of my corner of the internet.

In typical fashion, CCY’s response consists of a dam-break of ideas:

What I’ve seen so far from the responses is pretty much spot on one of my thoughts: the “FANSUBS BAD” attitude that the industry for the most part holds needs to change. True, there are some unscrupulous people out there, and illegal subs / torrents do damage sales, but limiting the amount of ways to get anime out there (or attempting to) by trying to be the sole provider won’t fix the problem.

I liken it to Whack-A-Mole. You slam the hammer down on one fansub group and two more pop up in different places. Perhaps it’s a bit mean of me to say this, but you’re not going to stop pirates, at least not without going Odex and alienating the entire fanbase. Just look at video games, movies, other TV shows; stopping a force like BitTorrent is something beyond the scope of any company today.

Rather, I think a focus on more positive solutions would work better than trying to crack down on the negatives, at least for the time being. People like fansubs because they’re fast and free, and dislike official releases because often they are neither.

Idealistically what I would love to see in effect, is some sort of ad-supported (but otherwise free) streaming or download mechanism, similar to the Anime Network online streaming from a few months ago. Bookend the videos with ads, place banners above or below the anime, whatever, as long as it’s not too intrusive. It seems to be a win-win situation, as long as it can generate enough revenue or even just any profit at all.

What some companies like Gonzo are doing right now with same-day paid downloads is a good stop-gap, but a majority of anime viewers can’t take advantage of this, if you consider that many are teenagers with little to no ability to pay for things online. Taking advantage of this massive audience will be the big challenge for the industry.

I love the idea of ad-supported content. As someone who works on the internet, I’m familiar with that (ad-supported content puts food in my mouth), and most of us are probably also familiar with the success of Hulu. But there are a couple things that are potentially problematic with that. The big one being, if there really are such a significant number of penniless teenagers watching, the CPM on those ads would be ridiculously small and advertisement could never compensate in the way Hulu’s network-backed system does.

Thing is, I’m not certain that’s true. Buyers of anime have been younger folks, the kind with no rent to pay, textbooks to buy, kids to feed, etc. who don’t have to budget 50 bucks for a DVD series out of all those other more “important” costs.

One problem here is that we’ve made a lot of assumptions in every installment without really having access to the kind of hard data that could drive real decisions. But I’m not sure if that data exists — there are no metrics on bittorrents, although someone like Crunchyroll may have some age metrics.

But CCY’s overarching point is the same as Kabitzin’s: finger-pointing isn’t constructive. Instead of trying to resist a changing market, roll with it and capitalize on it.

TheBigN is another American blogger whose work I love to read, although he updates somewhat infrequently. He’s one of the writers at the awesomely-named Drastic My Anime Blog (a great reference though I’m not a big Scryed fan), and though he seems to like Strike Witches, I value his opinion. TheBigN is in med school, so I assume he’s pretty smart, and I’ll choose my words carefully because he may be cupping my balls someday while I turn my head and cough.

What could I as a consumer actually do to fix it? I don’t think buying anime DVDs and merchandise by myself fixes the problems that the industry, no matter which one you’re talking about. It definitely wouldn’t hurt to do so (in fact, I regularly by DVDs, CDs and manga during the year. Enough that I’d probably cringe if I paid attention to what was coming out of my pocket), but at the same time, it wouldn’t necessarily help the situation at hand. And though you could say that’s better than downloading fansubs and that’s that (which I feel also help a little and hurt a little). One thing I can do as a consumer is complain that we’re not getting the best deal out of things, based on what you’ve already said about getting “good” stuff out of here (good in the eye of the beholder of course) as quickly as possible and with the best cost-benefit ratio possible. And trying to let the companies know that things could be better might help, but then I don’t necessarily know how.

I do think there needs to be a good, solid dialogue between the industry and the fans about the problems on both sides of the issue, and some consensus might be made. How to go about that though is another question though. Surveys? Panels? Calls to action? Either way, there needs to be a way for both sides to be able to communicate in order to learn things. Like how/why the industry is exactly in trouble. We see evidence like companies restructuring, and folding in the like, but coupling that with falling DVD sales, fansubs and torrents, etc. how does this mean that the industry is in trouble, for example? Are companies able to do things free samples and get feedback on whether or not these shows are what people would want to buy? How would fans be compelled to buy things instead of grabbing them for free if they present themselves well, like what GONZO’s trying to do? What are the incentives for both sides here, and can they coexist, or even better, work together?

It would be good to try and ask and answer questions like that from both sides, if just to get some bearings on this complex issue that’s not going to get simpler anytime soon. What we can’t do is lob bombs at each other, since that just ends up alienating both sides from each other and making the situation a lose-lose for all involved.

There may already be answers to some of these example questions, but in essence this is a great idea we can all get behind. Let’s open a dialog. Let’s get people on both sides of the equation — consumers and providers — talking.

How does that happen? I don’t know exactly, either; companies in various industries have made giant leaps by becoming more transparent thanks to the power of the Internet. Corporate blogs and the cluetrain style of marketing have made consumers feel like they’re being listened to. I think anime buyers, like any other consumer, would feel much better about supporting companies that they feel aren’t just faceless corporations, but groups made of people who actually want to provide them a good product.

I suppose as consumers we have our own responsibility if there is to be a conversation. Our desires are important, but let’s face it — getting everything for free is probably not a reasonable desire (although the Internet and its largely ad-supported content do make it theoretically possible). Perhaps omo’s insistence that we vote with our wallets is the first step in saying what we need to say.

Any thoughts on how to get the conversation flowing?

When I asked Kabitzin my survey question, I knew I’d probably get something short but well thought out, like most of his posts. When I asked this next blogger, I wasn’t quite sure what I was going to get. Baka-Raptor, known (since the day of his sell-out) by the same name as his Maddox-worshipping site Baka-Raptor.com, is in law school, and promises a blog post on international copyright law sometime in the next decade. He’s great at distilling his opinions down more concisely than just about anyone (see Kurenai: “The ending was terrible.”).  Here’s what he had to say:

I’d appoint myself overlord of the anime industry. All anime production would be under my control. Anime would be so good that everybody would want to buy it. Problem solved.

But if that can’t happen…

I believe in the free market. Anime is a desirable enough product that it’ll make it over here in some way, shape, or form. Whether it’s downloadable, streaming, DVD, dual audio, on TV, first episode free, all you can watch for a monthly fee, or some new business model nobody will see coming, things will work out in the long run. We just need to let business run its course.

I submit this as proof that all so-called Libertarians actually believe in dictatorships. Just leave your guns at home when you go vote for Ron Paul this November, ya fascist!

I kid.

I’ve never been one to think that the market corrects itself automatically, but I’m no economist. Frankly, it seems like someone’s got to actually do something while we sit around waiting for “business to run its course.” Fundamentally though, I am with the dinosaur. Boil it down, he’s saying the sky is not falling, and that the onus isn’t on the consumers to hold the sky back anyway.

Are you with BR, or do we as consumers have more responsibility to make something happen in the short run?

I had to ask Kabitzin of Sea Slug Team! his take on this “issue” because he’s been doing this forever, and because I’m a fan. It was only natural that he (and probably quite a few other people) would mention fansubbing. It turns out Kabitzin tackled the issue three years ago. I suggest everyone reads that post, because it’s typical Kabitzin: concise but meaty, and very thoughtful, skeptical instead of argumentative. That, however, was a direct reaction to the fansubbing issue, whereas I was hoping to be more forward-looking here. Three years later, we shouldn’t be in the same spot, and it appears that he agrees. So, on with his thoughts:

I have always felt that the industry needs to stop focusing on pointing fingers and start coming up with solutions.  I think what you have seen companies do recently with day-of streaming and official subs is a step in the right direction.  In America, fansubs built the anime consumer base and to target fansubs before you have a viable solution in place is counter-productive.  I think the music industry offers some hints about how to proceed.  Once you’ve got services with large selections, reasonable prices, and fast releases then you can really start cracking down on pirates and fansubbers.  Until then, all you are doing is decreasing your potential audience.

Well said. The music industry has been slow on the uptake though, and if it takes anime production and licensing companies just as long as the Big Four and the RIAA, we’re in for another few years of the same crap.

The main point I can take away from this is that there are two attitudes you could have.

1. “A fansub downloaded is a DVD sale lost.” That is both logically flawed and, frankly, whiny.
2. “A fansub downloader is a potential customer.” Now that’s the kind of attitude that makes money.

It’s also the same kind of pioneering thinking that got anime over here to begin with. As Kabitzin mentions, fansubbing created today’s market for anime in America. Music downloading led to the iTunes store. You get the idea.

Next up, that classic argument for the efficiency of a dictatorship.

Oh God, what am I doing now?

A lot has been made of the “industry” lately, even though most people don’t even know what they mean when they say the word. Does that mean the anime industry in Japan, a nebulous thing that’s constantly on the verge of not being able to sell enough Gundam figures to stay afloat? Or is it the R1 licensing industry, that most noble employer of California’s worst actors that is constantly begging us to prop it up with one side of its mouth while calling us criminals with the other? You know, like Metallica circa 2000.

Anime bloggers have a pretty strong opinion; after all, their primary hobby involves downloading fansubbed anime. Well, most anime bloggers. Some are in denial of their very bloggeritude, and prefer to insult other bloggers while pretending to be “real” journalists by writing infrequently and buddying up to the industry. Maybe that’s unfair, but tit for tat, I’ll trade one smack to the face for a million constant niggling insults. But noooo linky-link for obvious link bait. And, I digress…

Eleventeen easy steps

Idea one: Prosecute or litigate fans. I’m not sure for what crime exactly, but media companies love this kind of shit. It could recoup some money in settlements, but court fees always suck. This approach starts with “please support us,” as if that is in fact the consumers’ obligation, then grows more and more indignant until we end up in court. The RIAA tried this approach but found that milking cash out of grandmas and 12-year-olds ain’t all it’s cracked up to be, and the PR was… bad, I guess?

Idea two: Quick and dirty releases. Licensing anime is a gamble. The audience for anime in the west is not huge, outside of the Bleaches and Narutos. Yet companies like ADV pour tons of cash into dubbing, special features, fancy boxes etc. for each individual release, thus making time-to-market and price point really irritating for fans. Yes, licensing costs money in the first place, but can we please try the other end of the risk-reward spectrum? I love to cite Right Stuf’s soon-upcoming release of Aria’s first season, a niche show in subtitle-only release with minimal packaging. If they licensed with the speed of, say, Geass, a company could squish time drastically, and save money in paychecks written out to shitty “actors” whose voices I no longer listen to anyway, thanks to the magic of multi-channel DVDs. Which reminds me, I was in the basement during my move, and I saw some VHSes and realized I’ve never seen Nadesico in non-dub form. Sad. I bet Gai Daigoji sounds awesome in his native language.

Idea three: Legal downloads, done right. Obviously this is something that Japan hopes will work (Gonzo), and R1 is going for it too (we’ll see how that goes, DRM is bound to jack it up). Just like the music industry, they’re being slow in the tech department. Your aim is to beat the fansubbers? Time is on your side, that’s been proven — obviously a fansub can’t release faster than a simultaneous subtitled broadcast. But you need to fight using the same weapons. We want the same HD release over here that Japanese televisions are showing. You lack the bandwidth you say? Well, holy shit, guess what, so do the fansubbers. It’s called bittorrent, and it’s not just for piracy and fansubs.

Idea four: Good licenses. How do these people pick? Oh good, thanks Manga, I was really hoping to see that low-budget tits-n-guns OAV from 1992. I don’t know how constructive this point is, I’m pretty sure I just wanted to use the phrase “no one wants to watch your shitty anime.” Or make a Strike Witches reference.

But what do you think?

Though Japan’s anime industry is hurting right now, the USA is the central location for a lot of debate right now, thanks to a few things:

• The DMCA
• Americans think they are the entire world
• America apparently needs to prop Japan up
• American companies like ADV are hurting worse than Japan
• Greg Ayres

So I reached out to some animu bloggers in America — people you probably know — to get their takes on this issue that just doesn’t seem to want to go away. Check back all this week to see what they said!