Happy New Year!

For those who are interested, I started a new blog over at AnimeVice.com.

I’m not gonna call it Industry Babble 3.0, but it’ll cover similar topics & such.

So I talked a bit about how the business model of the Japanese anime industry needs to change.

From the general consensus I’ve heard (of course I haven’t talked to everyone in the industry, so please take this as my own personal impression), the core issue seems to be how late-night TV anime are produced in Japan.

The concept is a decades-old idea that “anime is made for TV first, and DVD sales are secondary.”

For those who don’t know how the late-night TV anime gets on air in Japan, anime studios BUY air time from TV stations. Late-night hours are cheaper than “golden time” (around 7pm), so if anime studios/production companies wanted to air a non-mass market anime show, they just bought time slots & looked for sponsors themselves.

The sponsors are what became the “animation production committee” that you see on copyrights. Of course there are non-production committee sponsors who just buy commercial time during the show, but that’s a whole different thing. Production committees are the initial investors of producing the anime show. They include DVD distributors, merchandise makers, CD publishers, financial institutions, licensing agency companies or occasionally foreign investors (for overseas license).

Anyhoo, for a decade, this model worked. Because there was enough fan base in Japan that bought DVDs & the production committee was able to recoup the cost of buying the time slot by DVD sales.

Then the digital age finally caught up to video media. And DVD sales started declining. And to top it all off, US companies who used to pay MG that amounted to over half of the production cost (at one time) couldn’t do that anymore. And anime production became harder and harder to recoup.

And they tried everything in Japan. Decreasing production costs by going overseas. Raising prices. Adding bonus items. Raising prices & adding bonus items. Making limited editions. Adding bonus content not seen on TV. Everything you’ve seen in the books.

So what’s the problem?
There’s lots of things that can be brought up… lack of initial revenue (no revenue when it’s aired on TV). Decrease in consumer’s value towards video. Too many titles for the demand. Lack of top notch creators.

And the solution?
That’ll be for tomorrow…

Folks from The Japan Research Institute came by to our office today.
They’re a think tank / consulting company, and they formed a group to do research on the anime/manga global market.

It seems like they already did a ton of research & interviews in Japan, and they are now gathering data from the US and Europe.

Of course they needed to start somewhere, so they had read VIZ president Horibuchi-san’s book “Moeru America” and asked us how our business fits or is different from the distribution & market data that was in the book. So Broccoli USA president Kaname and I gave them our data for anime & manga, although the anime data we have is from many many many years ago.

They’re spending a week in LA talking to various companies & visiting retailers, so other industry folks should be seeing them around for the rest of this week.

JRI’s impression of the anime/manga market so far seems to be that there needs to be a change in the business model for how anime is made & sold in Japan. It’s definitely something that the industry-side has been talking about for a while, but there seems to be a lot of issues with making changes from “how it’s been done.”

More on that tomorrow.

We’re hoping that JRI continues their study of the anime/manga market. They’re in the unique position of assembling anime companies together, AND have the influence of government agencies & officials. The Japanese government has dabbled in the anime/manga industry in bits and pieces, but it hasn’t made a big impact yet. And the trade association (and there are many of them)… I just don’t know what they really do, but you don’t really hear about them outside of Japan.

Of course our company is dissolving at the end of this month… so whatever JRI can do won’t help us directly, but I think it can help the US companies in the future too.

Today, we had three visitors come by our office.

First, Robotech.com webmaster Steve came by to pick up some IKEA Billy bookshelves. We had a lot of them in our warehouse when AnimeGamers.com sold import books. But we broke them down two years ago b/c we stopped selling import manga online and they’ve been sitting in our warehouse ever since. I decided to get rid of them, so he took four of them.

We still have lots more (maybe 10-15?), so hopefully we’ll get more people to come by and pick them up.

Then former Broccoli USA sales staffer Mark came by.
He had wanted couple of the “bought for Anime Expo, used it once & need to get rid of” thingies we have lying around in the office. We tend to have a lot of these… speaker sets, walkie talkies, lighting equipment, etc.

Since it’s Thursday, there’s a Farmer’s Market just a block away. We always eat a chicken wrap from a vendor called Carbon Grill. The chicken wraps are really good! Anyway, Mark had come by to get a wrap w/ Broccoli USA staffer Dennis & freelance staffer Dee.

Before Mark left, I gave him a goodie bag full of promo goods from the marketing room. He likes Galaxy Angel, so I tried to grab as many Galaxy Angel related stuff… and he asked for the Galaxy Angel game samples we had received from Broccoli Japan. I didn’t think anyone would want those, so I was getting ready to throw it away. Good thing he wanted to give them a new home!

And voice actor Stephanie came by to pick up some audio equipment. We had a bunch of equipment back when we had a sound studio (in 2000-2001), and I never had a chance to sell them off. The equipment needed to go, so they’re going to their new home too. Something about giving them to ImaginAsian staffer Justin…

Anyway, none of them had heard about the dissolution… since I haven’t had time to contact people yet. But I’ve been getting lots of phone calls & emails. I’ll respond to each of you, I promise!

Today was the final day of meetings w/ Bushi Road.

We went to NISA & had lunch w/ them.
I’ll have to go back to their office next month, since we just informed them of our dissolution and we’ve been doing a lot of co-promo with Disgaea among other things.

Next, we headed over to Atlus USA.
We’ve been meeting them for many many years now, but this was the first time I actually went to their office. I was never part of the entourage that visited their office whenever our upper management from Japan came to the US.

And then we headed over to Bandai America & Bandai Entertainment.
I noticed that they had a bigger Power Ranger figure in the main lobby… although they might have had that figure there for a while & I just never noticed it.

By the time we left Bandai offices, it was 5:30pm… and there was horrible traffic heading back to West Los Angeles.

Thank goodness for the carpool lane!

Too bad it doesn’t go all the way up the 405.
Boo!

And then we went to The Chart House in Redondo Beach for dinner w/ SEI sales managers Futami-san & Tashiro-san.

It’s been a schedule-packed three days, but I learned a lot of things about the trading card game industry & the video game industry. I hope I’ll be able to share these types of information one of these days… but I only have 40 days until this blog ends (for the second time).

Maybe someone will pick up this blog & give it a new home.
Like Gia…?

I spent most of the day driving today.

We had a meeting w/ trading card game company AEG in Ontario (about 1-1/2 hours from West Los Angeles). Then we had a meeting w/ video game company Square Enix, towards West Los Angeles.

Freelancer S@ki told me that there was a Toki-Kake (The Girl Who Leapt Thru Time) event at Anime Jungle today, so we decided to go visit after the meeting w/ Square Enix.

The staffers of Bandai Entertainment were there setting up.
We decided not to get in their way & went over to Kinokuniya to see if the store manager was there. He asked us to restock some merchandise at the Costa Mesa store, so Kaname and I will be heading over there on the 26th.

We went back for the Toki-Kake event.

They had a pudding eating contest

I forgot to take a photo of the actual contest, so I only have a photo of BEI director of marketing Robert prepping.

Afterwards we went to eat at Ebisu restaurant.
No photos of the food today.

Japanese trading card maker Bushi Road president Kidani-san & VP Kurokawa-san are in town this week.

Guests are visiting LA left and right!
But it’s all good, since it’s fun to get out of the office every once in a while. I just wish it wasn’t two weeks in a row.

Anyway, I picked them up at the airport & after a brief meeting at our office, we went to different retail stores for information gathering.

We first went to Toys R Us to see what kind of card games they sell in a major retail chain. Of course it’s the typical stuff like Pokemon, Yu-Gi-Oh and Star Wars. Kidani-san’s assistant was wondering why they don’t sell plastic models in the US Toys R Us… I gave him my analysis, but if you guys have your own thoughts, let me know.

Then we visited three different types of hobby stores that carry trading cards.
One was a sports card shop that also sold trading cards. The second one was a tabletop gaming store, which was interesting since it’s a world I’m not that familiar with. The third was a comic book store that also carried Magic, Yu-Gi-Oh & Pokemon cards.

We also stopped by Best Buy, where Kidani-san bought a bunch of wrestling DVDs. I was happy to present my point card at Best Buy to accumulate points for a free gift card. Best Buy hasn’t sent one to me yet… but I have a good amount of points, since I earn all the points from my guests. Hmmm… I should look it up online.

Oh, we ate ToGo’s for lunch (we ate salad wraps, which they said were too big). And we ate at Torafuku for dinner.

We stopped by Power Anime after dinner & talked to store owner Reggie for a long time. Kidani-san’s assistant will be stopping by tomorrow to ask Reggie a bunch of questions about the anime market. So if you’re in the LA area, go to the Power Anime store between 12pm - 4pm to give your input on the anime market. It’ll be included in his master’s dissertation (I have no idea what he’s getting a master’s degree for).

We also plan on going to Anime Jungle tomorrow for The Girl Who Leapt Through Time release party. See you all there!