The Association of Japanese Animations (AJA) released the Anime Industry Report 2019 back in December last year, but the English and Japanese summary of the report for the public to consume were not made available till later this year. The report summarizes the industry’s performance on a year-to-year basis taking into account several aspects such as market size based on estimated revenues divided into a number of categories. The report is the most comprehensive you can get, if you are keen on knowing more about the industry’s growth and performance, be sure to check The Association of Japanese Animation’s website here.
First of, do take note that this is based on revenues generated by players of the said industry. Profits have not been considered, therefore while the report can suggest that the Anime industry is indeed growing, it is still unsure whether producers or studios responsible for Anime productions are making increased or decreased profits.
The industry finally breached the ¥2 trillion (~$18 billion) mark in the year 2017, up 7.46% from the year 2016, but the market only saw a 0.87% increase in the year 2018 suggesting that it may be entering what the report suggests, “negative territory”. Still, the size has more than double the figure it had in 2002. The almost stagnated growth the industry projected is in part due to mainly strict regulation imposed by the Chinese government in 2017 on Internet media causing demands for Anime related products to drop in the country (read CNBC).
Though the new rules put in place by China may have caused the growth of the market to almost flatten for the year between 2017 and 2018 (it grew 30% in 2016 and 2017), the industry has seen the overseas market exceeding ¥1 trillion (~$9 billion) for the first time where it takes up 46.3% of the total Japanese animation market. The slight increase is a result of the growth of Video On Demand (VOD) seen in North America and the expansion of Anime related smartphone games outside of Japan.
Nevertheless, the industry reported an increase in production minutes compared to the year 2018, the second highest ever since the survey started in 2002. The industry recorded a jump of new animation works, but it is uncertain if this is due to a growing appetite for Anime related products or productivity improvement brought about digitalization. Surprisingly, despite the increase in the number of works and production minutes, the report mentioned that no deteriorations were found in the quality of Anime for the said year.
With Anime being more accessible via a myriad of platforms (in particular VOD), things are not looking so well for the Videogram market. Sales volume have slumped in the year 2018 with the section indicating a negative growth of about ¥17.8 billion (~$166 million) for the year. It recorded ¥76.5 billion (~$716 million) for 2017, but the amount dropped 23.27% to ¥58.7 billion (~$549 million) in 2018. To make matters worse, the decline has been ongoing since the year 2014.
Thankfully, growth of Anime related products and merchandise via Internet distribution has been on a steady inclined trajectory. It finally took over the Videogram market due to the rise in VOD. The sector was only worth ¥200 million (~$1.8 million) in 2002, it is now valued 300 times more than the amount.
The report stresses that the climate may soon change with the emergence of animation titles for adults such as Spider-Man: Into the Spider-Verse. This signals Hollywood’s entrance into the adult animation market – which is still dominated mostly by Japan – and the report cautions that it could see a change of hands in the near future, if Japan does not buckle up for the ride. This is not only the case. It is undetermined how China’s censorship on media content would affect the industry, but Japan has not only China’s regulation to worry about. For some time now, China’s very own animation industry has been gaining traction. The report acknowledges that China has the know-how and talent it needs to grow the industry. Chinese creators, like the director of a hit Chinese theatrical animation Ne Zha, were both heavily influenced by Japanese Manga, Anime and video games. It is likely that as China masters the process of Anime production it could move away from Japanese animation, because if they could do so themselves, why the need to collaborate?