January 9, 2008

The Death of Newtype


Yet another setback to the anime industry in North America, first with the stoppage of distribution for Geneon's anime in North America, and now with the death of Newtype USA. Does this really mean that anime is stagnating in the States? or is it something else? How much of an effect do fansubs and fanscan translations really have on the sales of North American anime and manga? Seeing as how this is the second move by ADV in the last six months to cut down on their investment into the North American market for anime and manga, could it be indicative that free, illegal translations are having an adverse effect on the anime market?

Let's take a quick look at the numbers. A quick search in Google provided the following results:

First, anime DVD sales revenue declined from USD $500 million to USD $400 million between 2003 and 2006, with new releases also declining from 600 titles in 2006 to 500 in 2007 (source: New Report Finds Manga Sales Up; Anime DVDs Down in '07 - 12/7/2007). For the same period of time, U.S. domestic DVD sales dropped by 3.6% (source: U.S. DVD Sales Slip 3.6% in 2007). Given these figures, its fairly obvious that the slowdown in anime DVD sales is faster than the corresponding industry-wide slowdown in DVD sales, although the root cause of this disparity between the anime market and the general market as a whole remains unclear.

The numbers may in fact be more ominous than those presented above. In his letter to the North American anime fan base, Arthur Smith stated that anime sales were off by more than 50% in 2007 from their peak sales year in 2005 (Source: An Open Letter to the American Anime Community). In the same letter, Smith suggested that the corresponding slowdown in movie industry and music industry sales exceeded no more than 15-20%, a stark contrast to the sharp decline seen in the anime industry.

Even more paradoxically, interest in anime is suggested to have increased, rather than decreased, in those years in North America. So people must be getting their anime from somewhere. More ominous is that given an increase in interest, and a decrease in sales, it can be concluded (rather simply, but concluded nonetheless) that not only are the new viewers utilizing alternative (legal and illegal) means of obtaining their anime other than DVDs, but old viewers, who previously were a member of the DVD purchasing audience, have also switched to alternate means. Couple this with the suggested figure of six million anime downloads per week from BitTorrent alone (Source: Six Million Anime Downloads Per Week), and you can get a fair idea of where a lot of the lost potential sales are going.

So while the blossoming fansub market may be good for viewers such as myself and other readers of this blog, is it healthy for the anime industry as a whole, both in North America, as well as its creative and distributive home, Japan? The loss of Geneon, and now of Newtype USA, are both unlikely to really alter the amount of anime or manga available to North American anime fans, especially if the piracy numbers quoted above are truly indicative of the state of the anime fan base here. But what are its ultimate effects? Will anime studios begin to crack down more on fansub groups in an attempt to shut them down at the source? Will distribution be more closely monitored, perhaps resulting in the debacle seen with Comcast sending DMCA notices to American users of its internet service who were noticed downloading fansubbed anime? Overall, will it contribute to declining anime interest in North America if fansub groups do become the target of further attention and scrutiny by Japanese anime studios? As such, will it actually come around full circle and have a tangible effect on the availability, both legal and illegal, of anime in North America and Europe?

As for my opinion, consider myself cautiously pessimistic. I do think that the death of Newtype is indicative of a dying legal industry in North America, and that the slow death it is facing may effect more stringent regulations put out by the anime studios themselves onto fansub groups, and perhaps a decline in fansubbing in the near future. I suppose only time can tell.


Iknight said...

According to ANN (!) ADV 'is planning to replace Newtype USA with another magazine'.

Unfortunately I'm really not qualified to talk about the US market for anime.

Xerxes4158 said...

I think the full effects of the "re-structuring" of Newtype USA remains to be seen. However, at this point I believe that it is indicative of some type of slowdown, since typically most companies do not decide to stop offering a product for no reason. Most likely, licensing fees or something of the sort for Newtype USA were getting excessively expensive given the expected revenue generated, although that is pure speculation at the moment on my part.