Piracy Wars: The Customer is Wrong! (or "How Dare You Want Something Other Than What We Graciously Give You?")

Piracy Wars: The Customer is Wrong! (or “How Dare You Want Something Other Than What We Graciously Give You?”)

Those who cannot remember the past are condemned to repeat it. –George Santayana

This quote has been on my mind of late. It seems that folks in the anime and manga business cannot remember the failures of the MPAA and the RIAA in combating piracy and have chosen to repeat those same mistakes rather than listen to their customers and make lemonade of the scanlation issue. Considering how the entire entertainment field has always fought against their consumer base, I suppose I should not be surprised.

Nearly a year ago, I wrote a piece on consumer choice. There is this attitude among some in the fan community that states that we the consumer should sacrifice what we want and just purchase anime and manga products that may not live up to our expectations. I reject that notion and yet am dismayed to see that there are some still proclaiming that this is the only way to save the anime and manga industry (I won’t mention names ’cause that’s not the point). Really?

Six months ago, I wrote an article on “freemium,” which is a business model that FUNimation has embraced in which anime (or manga in the case of some other company) is distributed online for no cost to the consumer but for which the companies providing this content still get paid. To my dismay, there are still company heads who are screaming about the loss of their traditional business model and deride fans for wanting content in a different manner. Why?

The other day, I read that Japanese and American publishers are getting together to attempt to stop the problem of scanlations. Their first course of action is to legally go after thirty scanlation sites. Huh? Well, that is their right to do so but clearly they have forgotten the past seeing how well that course of action worked out for the music, TV, and movie industries.

For the sake of discussion, let’s say that this coalition manages to shut down all scanlation sites they have targeted. What happens then? Well, if history is a guide, that vacuum will quickly be filled with other sites providing the same services and from places much more difficult for this coalition to get at. Thus the problem continues and the coalition wins a victory but continues to lose the war.

My question to these publishers is simple — why don’t you listen to your customers and find a way to give them what they want?


The issue of “piracy” has been around my entire life and the arguments against it and battles to stop it have been going on for years, all because technology advances beyond what entertainment publishers are currently producing; the customer base goes with the advancing technology, the entertainment business then screams and wastes tons of money and energy fighting this change. Many times, the entertainment industry loses in court and thus bribes congress to pass laws to change the playing field. Eventually finds a way to make a huge profit off it it and then entrench themselves again to repeat the process.

Let’s look at some examples of various parts of the entertainment industry running into issues and what they did as a result.

  • In the early 1900’s, the music industry fought the piano roll industry (makers of scrolls that cause automated piano players to play the tune recorded thereon without the need of a person to play the piano) due to the growing popularity of automated piano players and lost in court. So the music industry got Congress to change the copyright laws to accommodate their business.
  • In the 1920’s, the music industry fights the birth of commercial (AM) radio but fail as radio technology improves sound quality. Faced with declining record sales, the music industry decides to fight technology with technology and thus high fidelity recordings are born as a result.
  • The Great Depression causes record sales to slump but in 1933, FM radio is born. However, this threatens RCA’s AM radio business and though it took years and some costly court battles, RCA manage to get the Federal government (Federal Communications Commission) to impose regulations on FM radio that stifled that market including forcing FM frequencies to change, thus making all existing FM radio’s worthless. The FM radio stations that survived ended up simulcasting their AM programs, thus not allowing FM radio to show off its superiority.
  • The advent of TV has the radio industry up in arms. With no legal recourse against television, the radio industry is forced to change or die. Thus, radio stations began to have certain demographics in mind during certain times of the day and played stuff to that demographic (called dayparting, which still exists to this day). The introduction of rock music caused FM stations to rise above the squelching they took in the 30’s. Further to that end, FM stations would begin to specialize in what they played — country, rock, R&B, classical, Christian, etc.
  • The mid-1960’s saw the introduction of the audio tape cassette and the music industry went after that market. By the early 70’s, the music industry got Congress to expand copyright laws to audio recordings. The music industry decries the loss of revenues do to rampant piracy as kids recorded music from the FM stereo radio, copied records and tapes and traded those to each other. The RIAA eventually gets Congress in the 1980’s to pass legislation to require a portion of the sale of blank tapes to go to the music industry, whether the tape was used to record music or not.
  • In the mid-1970’s, Sony introduced the video cassette recorder (Betamax) and advertises it as the way for you to record your favorite TV show and watch it when you want to watch it. The entertainment industry immediately screams of copyright infringement, piracy, and loss of business. The case makes it all the way to the Supreme Court and the entertainment industry loses.
  • With the 1980’s, the video tape was becoming more common place and naturally video rental stores started springing up. The entertainment industry attempted to claim this was piracy. With the loss of the Betamax case, the entertainment industry went to Congress to get the law changed but failed. Having been foiled, the industry developed a 2-tier release system for video tapes of movies. Tapes were first sold for a price that would be cost prohibitive for the general consumer base (my memory says for $80+ a tape, and this in 1980’s dollars) and those were sold to video retailers. Six months later, the entertainment industry would re-release the title but at a cheaper price (~$30).
  • By the mid-1980’s, AM stations were on their way to extinction and there was nothing they could do about it legally in the courts, nor in Congress. Former DJ Rush Limbaugh saw an untapped market for conservative voices on the radio. As such, he took advantage of the removal of the “Fairness Doctrine” imposed on radio in the late 40’s to cause a rebirth of the AM radio format in the late 80’s. Today, there’s no talk of AM radio dying as it has become the home for sports, news, and talk radio programming of all sorts.
  • In the 1990’s, the growing popularity of the compact disc (CD) lead to the creation of the Digital Audio Tape (DAT, seen in the Neon Genesis Evangelion TV series and most recently the first Evangelion movie). The music industry immediately went out to crush this new technology for fears of piracy and though the DAT had success in Japan, the RIAA successfully kept it from being established in the U.S. The RIAA successfully got Congress to pass legislation to impose a 2% royalty on all digital recording devices. Further, these devices were to be installed with limiters to try to stop piracy.
  • Also in the 1990’s, the MP3 format was created. With the growth of the Internet, the demand for music from online grew, stemmed in large part by consumer desire to get the music they wanted without having to buy an entire CD full of stuff they didn’t want and for an outrageous price. By the late 90’s, online music file sharing was growing and in 1999, Shawn Fanning developed Napster. The RIAA sued Napster and turned down a $1-billion dollar settlement in 2001.
  • In the 2000’s, RIAA won the battle against Napster but that simply spawns countless clones. The RIAA went after the clones which spawned BitTorrent and its decentralized file sharing format. In 2001, iTunes is officially launched as a legal music download source but with restrictions (Digital Rights Media). It ends up proving far more successful than first projected. In 2002, the RIAA is successfully sued for price fixing though the record labels sued admit no wrongdoing (how many of you knew that?). Instead, they double their efforts to go after file sharers after being slapped down. They also get Congress to pass legislation to obtain royalties off CD-R sales (because people making compilation CD’s of their favorite music is just plain stealing just like it was when people were doing it with cassette tapes).
  • On the video side, the growth of the DIVX video codec meant that video files could be compressed to smaller sizes while retaining video quality. The further growth of high-speed Internet access gave rise to video file sharing. As the RIAA had done before, the MPAA went after video file sharers. One of their big targets was The Pirate Bay, which they managed to shut down for three days in 2006 before it came back bigger and more popular than ever. The guys behind Pirate Bay began their ridicule campaign against those who would sue them. The Swedish government was pressured to change their copyright laws and the founders of Pirate Bay were then arrested and convicted in 2009, but only on some charges. They won’t have to serve prison time until all appeals have been exhausted and Priate Bay continues to function.

Do you see a pattern? There are actually two. The first is the typical knee-jerk reaction whereby Big Entertainment tries to legally quash any changes to the established means of distributing their product by declaring new customer demands to in fact be piracy. The other pattern involves those who see an opportunity and turn it into gold (the high fidelity response, Sony and the Betamax, Rush and AM radio, Steve Jobs and iTunes).

I think back to Napster. Had the RIAA taken the $1-billion offer and made Napster legal then, they would have nipped the rise of the countless clones in the bud and BitTorrent’s creation may not have happened at all. Instead, RIAA had to win their battle with Napster and send a message to the (stupid) consumer about who was king. Then MPAA followed suit on the video end and has had no success in stopping piracy either.

So now we have that manga publishing coalition stepping into the same failed ring. Can someone tell me what makes them think that they’ll have any more success in stopping online piracy?

What do I propose as a solution?

Simple — give the customers what they want, period!

It is irritatingly frustrating at how Japan’s Digital Comic Association has only given lip service to legal, online manga distribution. It is so freaking clear that there is a massive demand for online manga and yet where is it? Viz made some tiny forays into this field with RIN-NE by publishing the comic online shortly after it appeared in Japan. They even went a step further and decided to take a more “otaku” approach to their adaptation and not force it into a western perspective. Unfortunately, once they release a volume in print, they remove it from their website, no doubt out of fear of lost book sales. I think that’s a mistake.

Seriously, once you have your initial Internet infrastructure costs done, the costs of maintaining that network of servers, firewalls, etc. shouldn’t be that much. Load-balanced servers insure that the loss of a server won’t impact the site and your customers could view all of your manga at any time and that legal content could be ad-sponsored. Further, this form of distribution is MUCH cheaper than printing but since many of us (myself included) like books, run special promos from time-to-time to help encourage sales of said books. The online distribution would help promote your book sales or digital sales (more on that in a bit).

Next is the adaptation. Clearly, there is a great hunger amongst the consumers of both fansubs and scanlations for simple things like honorifics in the adaptation, which is why almost all such groups include them. Therefore, give the customer base what it wants there. On the manga front, TokyoPop got things started (no doubt that Adam Arnold played a role in that) by allowing honorifics to start appearing in their unflipped manga titles. Del Rey took it to a whole other level by instituting all of their titles have honorifics included (though that was trashed in more recent years with Pumpkin Scissors). Yen Press is on board as is Seven Seas (from what I know). Though it took a long while, industry elders Dark Horse and Viz have even gotten on board with more recent acquisitions. That needs to continue.

On the anime side, I can’t understand why in 2010, the subtitles don’t include honorifics. AnimEigo would include the odd honorific here or there when they started. Pioneer (later Geneon) had the occasional title that would make full use of Japanese honorifics (both Ai Yori Aoshi titles, I My Me Strawberry Eggs, and Bottle Fairies spring to mind), but they had numerous titles that would allow the term “sensei” to survive in both the dub and subtitle. ADV decided long ago to keep the “chan” honorific, but that seems to have been for both the subs and dubs.

Only FUNimation went full otaku with 100% of their releases having dual subtitle tracks, one being a subtitle of the English dub and one being the “Japanese” subtitle which used honorifics, Japanese attack terms, and even fun terms like “youkai.” I think that helped them rise to the top of the heap because they showed they understood there was two anime fandom markets (dubs and subs). Unfortunately, FUNimation’s purchase by Navarre has lead to them mostly abandoning honorifics in their subtitles, which I think is the wrong tact to take. FUNimation has told me that they do honorifics today on a case by case basis but I say that it doesn’t cost that much to have two subtitle tracks to appease those who want them and those who don’t (why someone would want to watch an anime in Japanese but with western-oriented subtitles doesn’t make any sense to me, but whatever).

By being “otaku” in the anime subtitles or manga adaptation, you remove an objection by so many hardcore supporters of scanlations/fansubs who claim companies don’t do things right. Further, you force the “you must support anime and manga no matter what” crowd to put their money where their mouth is. Yes, I know that there will still be those who won’t buy, but those people have been around for years. Why do you think we have public libraries for?

Finally, there are e-readers like Kindle or even the new iPad (which is more than just a reader, I know). While there needs to be a standardization of formats there so that books can be read on any reader, there also needs to be a push to get manga onto this format. I hear the Japanese are resistant to this but lets face it, more manga titles could be licensed if both e-readers and online distribution were allowed. As a publisher, those who still wanted a physical book could still buy them from you “on demand.” I’m told that on-demand publishing isn’t too bad.

As I’ve shown, the consumers of audio, video, and print entertainment are constantly demanding shifts to newer methods of obtaining the goods they want. Instead of fighting their customers and declaring any method of distribution that has not been pre-approved to be piracy, Japanese and American publishers should simply make legal versions of scanlation sites, provide “otaku” adaptations of Japanese manga on the same day that it is released in Japan, and thus would kill most of the traffic to scanlation sites (providing there weren’t hideous country restrictions in place, but that’s another article). In doing so, you also improve customer relations and you save a bundle in legal costs to go after sites that even if killed will simply spawn clones.

Some sources:
http://www.pbs.org/wgbh/pages/frontline/shows/music/inside/cron.html
http://www.cybercollege.com/frtv/frtv020.htm
http://www.techdirt.com/articles/20070110/004225.shtml
http://www.museum.tv/eotvsection.php?entrycode=betamaxcase
http://elr.lls.edu/issues/v29-issue3/documents/07.Davis.pdf

RIAA Sued for Price Fixing – 6 Years Later


http://www.entmerch.org/industry_history.html
http://www.hollywood.com/news/Napster_timeline/471671
http://www.associatedcontent.com/article/20644/a_brief_history_of_filesharing_from.html
http://news.bbc.co.uk/2/hi/business/2289224.stm
http://blogs.computerworld.com/ria_gives_up_on_suing_customers_drm
http://brainz.org/14-most-ridiculous-lawsuits-filed-riaa-and-mpaa/
http://thepiratebay.org/legal

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35 Responses to “Piracy Wars: The Customer is Wrong! (or "How Dare You Want Something Other Than What We Graciously Give You?")”

  1. JTP says:

    Bravo. Great article, was quite informing and fun to read.

  2. I have to agree with you Astronerdboy just going after the scanlation sites without having some form of legal alternative in place is short sighted. While it may for a short time stop the problem all that will happen for the more popular manga’s is that people will download the scans off torrents or file sharing sites instead until replacement scanlations sites are set up. It is also likely some of the existing scanlation sites will survive due to being established in countries where it is difficult to take legal action.

    A better approach would be to set up a legal scanlation site perhaps using a crunchroll like mixed ad and subscription model and if possible try to get some of the scanlation groups and translators on board to only work for them. This would then allow the legal site to have the advantage of being first to publish though the illegal scanlation sites would much like the anime ones quickly obtain copies of it. A legal scanlation site could also allow companies to make money out of otherwise out of print (and not likely to be reprinted) titles by pointing people reading a manga to older manga by the same author or in a similar style e.g. direct people reading Negima to Love Hina and AI Love you

    Sadly this is unlikely to happen though as the entertainment industry in general seems to take the approach that it is better to complain about money it has theoretically lost due to various forms of competition or copyright theft, rather than trying to take advantage of the new innovation and make money out of it themselves.

  3. Anonymous says:

    I have read your full post and I must say I agree 100% with you. If you can’t give your customers what they want than you deserve to die

  4. 5yewy5r says:

    This is a really well-thought out article. I’ve always hated the RIAA and the MIAA’s efforts to squish pirating. Now that I think about it, they both eerily remind me of the Roman Catholic Church back then, how they called heresy on literally anything new.

    I think it’d be great if they started online manga services, like making manga magazines like Jump available for download online if you pay a subscription fee, or allowing manga volumes to be downloaded. Sorta like how Valve uses Steam to distribute their games online.

  5. Charred Knight says:

    streaming earns almost nothing, the only anime that makes any money are the major releases like FMA Brotherhood, and One Piece, and those dollars are chump change.

    Simply put why would pirates dump their anime files for streaming? They won’t nor would streaming cover the cost of the liscense. Frankly anime is most likely doomed because not many people want to support it. Pretty much every company in america is in a dire situation, and several anime studios such as Madhouse are close to closing.

  6. Kota-kun says:

    Thank you Lord for this post!!
    You are completely right, they should just make an online legal scan site, or leave the current scanning and fansubbing communities alone. When it comes to something like this the big companies usually lose. You know whats also good, if they recruit people who edit the scans such as translators, editors, etc into this! They do a better job than VIZ. TokyoPop, DelRey anyways!

  7. junior says:

    A few points…

    – You mention iTunes, but even iTunes still has corporate-inspired restrictions. Let’s assume, just for the sake of argument, that you decide that you want to get a copy of (to pick a tune at random) ‘Anna ni Issho Datta no ni’. It’s the original closing theme for Gundam SEED, and due to the fact that it was well-liked it ran for longer than any of the other OP or ED songs used in that series (26 episodes, as opposed to the usual 13). Unfortunately, you’re not going to find it on iTunes unless your copy of iTunes believes you to be located in Japan. That’s actually easy enough to do – except for needing a Japanese credit card to pay for things (doable as people actually offer this sort of service, though something that I’ve never personally bothered to do). So IP restrictions once again get in the way of selling the consumer what he or she wants. And the end result is either music downloads or more business for counterfeiters like Sonmay (who – the last time I went to an anime convention, which was a very long time ago – had their product available at pretty much every single vendor at the anime cons).

    – I can think of one good reason to go with ‘westernized’ sub-titles – there are probably some who aren’t particularly interested in the honorifics and such, but at the same time would prefer to avoid the ADV-style profanity-laced dubs. But that’s an issue with the dubs and how some of the companies insisted on “spicing them up” as opposed to a genuine need for westernized sub-titles. I’ll add that it’s always amusing on the rare occasions that I actually watch an ADV dub (as opposed to the sub) and see the lengths that ADV went to put that stuff into the dub.

    /sigh

    – From what I’ve seen/heard, most of the groups that release or make available downloads would actually be quite happy to have some sort of affiliation with the owning companies. And as a result they’d probably be willing to provide at least minimal compensation to the owning companies. But since there’s no arrangement in place they don’t. Of course, any arrangement that was set up would have to factor in that the scanlator, etc… don’t actually make any real money off of this as things currently stand.

  8. Philip says:

    Just hearing the names of the entertainment industry stresses my rear end…

    This seems similar to the Prohibition era. Haven’t they ever learned what happened during that time? I mean if you really think you can eliminate something of what you perceive as a bane to society’s existence entirely, you risk alienating a lot more people. Enforcement becomes unsustainable.

  9. Kind of related to the current crackdown is news that a 14 year old student in Japan has been arrested for distributing manga via youtube.

    http://www.animenewsnetwork.com/news/2010-06-14/14-year-old-arrested-for-leaking-manga-on-youtube

    Ignoring the issue of whose side you are on in this, what annoys me is if true the “estimate of damages” given in the 5th update which equates 8 million youtube views to a loss of around $20 million.

    This is because in these views there will be

    1) People who view the same video multiple times

    2) People who buy the manga but like spoilers

    3) People who would never buy the manga for whatever reason

    While undoubtedly uploading of scans and raws will cause some losses to companies, I doubt very much that 1 download = 1 lost purchase which is the typical figure reported in media for this type of issue.

  10. Anonymous says:

    Why am I not surprised that AstroNerdBoy sees his precious honorifics as the solution to everything…

  11. Derek Bown says:

    Nice to see a reasonable plan. I can’t figure out why online distribution of manga is such a taboo in the industry. Just because I read manga online doesn’t mean I don’t buy the volumes when they are available/I can afford them.

  12. Manuel says:

    This was a very good article. I have to add that piracy is born out of need too. For instance in my country Peru, it is imposible (if not very VERY expensive) to get original anime or manga (the latter is almost impossible), even movies or video games are out of our reach. I mean I do have some original manga tittles but I got them with a lot of effort and saving a crap lot of money. So piracy is the only way we can get a bit of entertainment without having to starve to death (that was a joke, but seriously) If they ever make an easy, cheap and legal way of getting the stuff I want sign me in captain! But it looks like the corporations are very shortsighted, sigh, We can only hope…..

  13. Spencer says:

    Hello fellow otaku
    First off I want to thank ANB for this awesome article. I full heatedly agree that the industry is wasting their money trying to fight this legal battle. If we can learn anything from the past is the industry cannot control the internet. It is just far too big and vast. But I believe that creating a legal alternative to scanlations is going to be very difficult. What the community has in place right now is the desired result that a company should aim for, LOTS and LOTS of titles. Let’s take MangaToshokan for example (my favorite site) they have over 3800 titles. That is impressive, and nearly impossible to accomplish legally.

    Some of you might know of the incident with MangaHelpers that occurred back in the fall.
    Here is a link to their press release http://mangahelpers.com/news/details/255.
    The article in question is the MangaHelpers Business plan. I know they claim it to be a draft; however it is an idea of how they were thinking. Here is a link http://foolrulez.org/manga/index.php?manga=Manga%20Helpers&chapter=Business%20plan
    . The basic premise behind their idea was to use the work that scanlation groups where doing for free and sell them at a subscription cost. Many groups dislike the idea of their work that they do for free would be sold for profit, and voiced their opinion. Other groups were open to the idea of being hired out to do work but I don’t know much more than this.
    Now I am not the type of person to go around and pointing out flaws or problems without providing some type of solution. I think it is very possible for a legal site to possibly survive. The most important key for its success is the involvement of the community. This site will need to be the brain child of community because it will be made for the community. Without the community being able to voice their opinions the site is doomed to fail. I also personally believe that a 3rd party company will need to run and operate the site. If one of the major companies from the industry try and create a site it will most likely fail. The major titles among the companies are to split up. And having to view multiple sites for your titles is a hindrance, and will deter most people. Also this site would almost need to be a mutual agreement between publishers, allowing for their titles to be on the site. I also believe that the site itself would nearly be a non-profit site, at least till enough customers are acquired. A possible Idea with advertisements is that the funds acquired from ads that are viewed while reading the manga are given to the respective company. Let’s say I am viewing the latest chapter of negima and the ads that I see pay money to the site, then the site will then pay a percentage of that to Del Ray, or the license holder for that region. The money from subscriptions will go towards the bottom line for the site. And any other will go to the respective companies. An alternative would be similar to crunchy roll were you would pay a flat rate and view the manga you like. And I know that not many companies would invest in a site that would be nearly non-profit. But logically it is the only way I can think a site can start.
    Another issue would be harmful pirating of the content from the site. It will happen, and the options are to try and prevent it (using flash based product) or just let it happen and save the money it would cost in prevention and use it to better the site.
    All in all I support a legal alternative.
    Veron.
    veron05@gmail.com

  14. Jayce says:

    I agree with this post whole heartedly, sometime ago I posted a comment on a website claiming that the anime industry is going to die out because of the consumers. My retaliation to this was to state the fact that Japan’s anime industry was and is still booming, they cant stop the power of otakus!!! Well I didnt add the the otaku part but I think the manga industry is just the same.

    Manga is going to die because of the consumers, that quote there is the sound of company giants whinning. For anime I pointed out the fact, in my other comment, that the consumers must be unhappy about something if theyre turning to the Internet rather than their stores, and lets face it theyre not very up to date with anything at all. For example Angel Beats right now would probably be released in America 6 months after its been aired in Japan. I live in Australia and I know here that there is only one company that licences anime over here and thats Madman Entertainment, and they dont only do anime so I wouldnt see how they would die out. Its practically the same story for Manga over here in Australia, Kinokuniya, based in Sydney, is the about the only store in the state that has a decent collection of manga and theyre not struggling cause they sell other novels as well. I dont get why they cant invest in soemthing else while theyre at it, and if they dont want to invest at least show the consumers some respect.

  15. I have to agree with the subtitling part. There are those fans that cannot understand the otaku adaptations, but there should be subbing that includes honorifics – or even subbing with romanji/Kanji-Kana (for those that ACTUALLY wanna learn). Sure, the price might be hiked up a couple of bucks, but that demand for anime with certain aspects in the adaptations are quite high. After all, is there not french/spanish dubs and subs available in the movie industry?

    There is one problem that I still see in that little comment… the Japanese language version for the anime and manga will have to be somehow regulated. Sure, the scanlators can get a hold of the original text, but how about the distribution to those that know Japanese people. If the first language happens to be Japanese, then the people will understand. So I think that the point of scanlating has become more than meets the eye.

  16. AstroNerdBoy says:

    Naturally, I’d write an article that generates tons of responses and I can only do a drive-by posting. Hopefully, Thursday I can take the time to make some responses. ^_^ Thanks everyone for writing.

  17. I forgot to mention about sites like MangaHelpers. That kind of site would only exist if people were not willing to pay more to keep the book and instead read the book (in the case of college texts.) Now, as an avid manga reader, I would have to cringe on the idea that MangaHelpers is doing us a favor by taxing people what the public can get for free just by downloading. And downloading would only create more piracy within the anime/manga industry. However, if another well known site is competing against MH, (i.e. One Manga and MangaFox), the the influx of internet traffic would dramatically shift, forcing hosts on the other two sites to increase the load of traffic; therefore the hosts on the 2 other websites would be strained, slowing down the rate that an average person reads at.

  18. Charred Knight says:

    Jayce: The anime industry in Japan is almost as bad as in America. Why do you think the number of anime being made has dropped drastically? While about 10 shows do reach the 10,000 copies needed for profit, most shows do less with some that have sold for less than 1,000 per DVD. Now your obviously going to get the insane hit but generally speaking those are coming from certain studios like Bones, Sunrise, and Kyoani. So while those studios are safe, studios like Madhouse are on the verge of collapse much like Gonzo.

    The anime boom in Japan was heavily based on the American boom with liscenses sometimes going for 100,000 dollars per episode. Anime DVDs went from needing 6,000 DVDs to break even to 30,000 DVDs to break even. Now the anime are back down to about 6,000 DVDs to break even and possibly less.

    My problem with the online distribution is the fact that it’s a mainstream option being used to try to save a niche market. As I stated, check out the view counts on Funimation’s youtube channel. You can’t make any money off of that.

    As far as I can see right now manga is safe in Japan, but anime definitly is on the verge of collapse as the sales continue to fall, and anime world wide is in a state of collapse.

  19. Anonymous says:

    FUNimation doesn’t just do anime on YouTube. The majority of their video traffic is to their own site and then there’s the overflow to other sites.

  20. Anonymous says:

    The unified assault is aimed more at aggregators such as onemanga, mangafox and mangahelpers. For instance, onemanga stands in the top 1000 of visited sites, way ahead of most other sites related to anime and manga which are unlisted even.

  21. Krono says:

    I have to disagree with you on several fronts.

    If you read the initial Publisher Weekly article, rather than the ANN summary of it, it makes it rather clear that scanlations themselves aren’t the main target of this. Rather the “scanlation aggregator” sites are.

    http://www.publishersweekly.com/pw/by-topic/digital/copyright/article/43437-japanese-u-s-manga-publishers-unite-to-fight-scanlations.html

    This is perfectly understandable when you consider that sites like One Manga, and Mangafox have unique IP address traffic into the millions, and One Manga even has an iPhone app (most functions of which aren’t free). Mangafox also doesn’t just host scanlations, but also some scans of official translations, or english original series(outright piracy).

    https://www.google.com/adplanner/planning/site_profile#siteDetails?identifier=www.onemanga.com&lp=true
    https://www.google.com/adplanner/planning/site_profile#siteDetails?identifier=www.mangafox.com&lp=true

    That’s the kind of infringement they pretty much can’t ignore.

    Furthermore, it’s not like creating ebooks of manga are something publishers are disinterested in.

    http://manga.about.com/b/2010/02/01/manga-publishers-comics-creators-react-to-the-apple-ipad.htm

    Unfortunately it’s not necessarily that simple:

    http://prismcomics.org/display.php?id=1858
    http://mangahelpers.com/news/details/369

    Some of the comment here provide a bit more clarification as to the Kodansha thing:

    http://apps.ycombinator.com/item?id=1352144

    So in addition to their own internal oppositions, they also run into problems related to the fact that unlike online reader websites, they have to work within the law and licensing agreements. Which means that even when they overcome inertia and look to take some risks on new technology, they run into problems.

    Furthermore this is far from comparable to the RIAA and MPAA situations. The publishing companies in question have known about scanlations for years. They largely ignored them as they and fansubs were largely harmless, and usually allowed official licenses to replace them.

    The rise of behemoths like OM and Raw Paradise changed things, and started impacting their profits, leading up to this. It’s not a matter of “Something new and different! KILL KILL KILL!” It’s a matter of “Wow Raw Paradise is in the top 500 sites in Japan with a readership of a million or so mostly from Japan? One Manga is in the top 1000 for the world and has a readership of 4 million or so? This is actually becoming a problem.”

    Yes if they are shut down, they’ll be replaced. However replacement takes time. Raw Paradise and Mangahelpers heeded the warning shot in Jump a few months back, and early Japanese language scans are still difficult to come by, as opposed to being as easy to get as checking the morning news. That’s probably their immediate goal, to push the convenience down to a point that the piracy is background noise again. Sure others will spring up, and then get big, but the same is true of weeds, and that doesn’t stop people from weeding their garden every once in a while.

    “Make a legal online reader site” isn’t a viable option for them either. In addition to what I previously mentioned about them needing to follow laws and so forth, quality control would be a nightmare. They’d effectively be endorsing every half-ass translation, and poorly cleaned scanlation that someone posted to the website, to their detriment. If they’re going to be sitting around and monitoring for quality, they might as well just do everything themselves, similar to what Viz has been doing with Rinne.

  22. Anonymous says:

    @Krono

    Great post. I was going to say some of the same things but you did it much more exhaustively than I could have managed.

  23. M. says:

    “Piracy” and each “new” distribution model of the past involved a new thing (from the first punched paper roll to chunks of plastic) that had to be made and sold. Each copy had a physicality to it, it took time to produce, it took time to move around.

    Broadcast “piracy”, the accusation levelled at radio in its infancy, was that companies that made records asserted you couldn’t just play music on air (making thousands of virtual copies, the exact number depending on how many radios are out there and how many are tuned in to the station) without some compensation — the solution was to sell the best archival copy available, since radio was limiting and a taped copy of a broadcast (when those became available for the customers to make themselves) always had drawbacks (annoying DJs, loss of fidelity)

    Digital piracy is unique, in that the distribution system is the production system — and each copy handed off results in the instant creation of a new copy:

    There was no ‘thing’ that I give to you; because it’s the internet, we *both* have a copy now.

    There was no broadcast, no conversion to a different format, because it is digital we both have *perfect* copies.

    And P2P means we are both now vendors, and as soon as someone asks us, there are then 4 copies out there, then 8, then however many until demand is completely sated.

    There is no pirate selling bootlegs anymore: there is a very efficient system that preserves all fidelity while turning customers into pirates.

    (We don’t want to be pirates — well, some of us don’t want to be pirates — but it’s just so… convenient)

    I’m not saying the points in your post are wrong, but I feel digital piracy is different from past technological changes in the manufacture and distribution of content. Maybe we need a new word for it.

  24. Krono says:

    @Anon

    Thanks.

    Another thing worth mentioning. Google “manga”. The first hit is One Manga, and most of the first page of hits is online reader sites. Not websites for people that scanlate the works. Not official license publisher websites, not links to places where you can buy manga. Places that host hundreds or thousands of series, translated by others, for people to read for free.

    Google Bleach, or Naruto, or One Piece, or Fairy Tail, or Negima, or Detective Conan. For most of them the first hit is for Wikipedia, and the second or third hit is One Manga. For slightly less popular series, the hit is fifth or sixth.

    It lands that high because not only is it site #935 for google’s adplanner; it’s Alexa traffic ranking is 324.

    http://www.alexa.com/siteinfo/onemanga.com

    So by any account, a behemoth as far as web traffic goes. And that’s merely the biggest one. The lower ranking ones aren’t exactly something to sneer at either. Especially not for this business where 10,000 more first week sales of a volume can make or break the difference between survival and cancellation for less popular series.

    Do you really expect publishers to ignore that? To pretend it has absolutely no impact on them, or that the positive impact outweighs the negative impact? To start trying to individually compete with it? It’s copyright infringement they’ve allowed to grow to a scale that they have no choice but to put a stop to it. They have to put an end to it, or any attempts they make at updating their business models for the web will be crushed by inertia as they themselves slowly strangle.

  25. arimareiji says:

    Sankaku Complex, for all its wildly-NSFW glory, raises an interesting point: Who are the periodical publishers (like Shounen Jump) in this alliance really afraid of?

    It’s utterly reasonable for them to be afraid of early full raw posters. But do they really believe MangaFox et al hosting archives of issues they no longer sell hits their bottom line?

    Or are they afraid of the writers cluing in to the fact online repositories demonstrate that they don’t need the publishers anymore, and that they can probably get much better tankoubon sales by posting chapters online themselves (instead of relying on periodicals to provide paper advertisement)? I know of at least one who does that already, and the article calls it a growing trend.

    (Link here. Turn off images before you go, unless you won’t be bothered by sometimes-eye-poppingly-NSFW sidebar images from other articles.)

  26. Charred Knight says:

    arimareiji: The problem is that the digital stuff is also not selling. For example, Funimation releases on X-Box 360, or PS3 have no skyrocketed to 100,000 downloads.

    These people don’t want to get rid of some old medium they don’t want to pay for it period.

    To these people entertainment should be free, free entertainment is a right to them much like the right of free speech. The result is that the anime industry is dying in Japan.

  27. arimareiji says:

    Just a random thought while reading back over the post: Has anyone else experienced the mild irritation of watching an anime that claims to give you the choice of an honorifics / no honorifics subtitle track, but then there are hardly any honorifics and sometimes they even get those wrong?

    I’ve just trained myself to listen for them at this point, because they’re so often not included. So it’s jarring to hear “XYZ-kun” and see “XYZ-chan” because they’re “correcting” the speaker about the person’s gender. Or to hear “XYZ-chan” and see “XYZ-san”, maybe because they think the person’s level of speech is so polite that it justifies “correcting” their honorifics. And so on.

    Okay, I think I’m done ranting for now. (^_~)

  28. Krono says:

    @arimareiji

    I’m fairly certain that the tankobons of their most popular series are still selling. Sure the magazine issues themselves aren’t, but plenty of scanlations eventually use the volume releases.

    It’s also still problematic in general, as someone is getting paid for work that the publishers and authors own, and it isn’t the publisher or the author. Yes people are getting money for One Manga. The host gets paid by the site owners, the site owners get money from advertising to cover the hosting costs, and get the rest for themselves.

    That’s money that should be flowing towards the author, but isn’t. Sure it might be a relatively small amount once you start breaking it up between all the people it should be going to, but I’m sure that everyone here can think of something to do with an extra 20 or 200 bucks a month or year.

    As for Sankaku’s idea that the publishers are just afraid of the idea of being thrown to the wolves, it’s not that simple.

    http://www.antipope.org/charlie/blog-static/2010/02/common-misconceptions-about-pu.html

    http://www.antipope.org/charlie/blog-static/2010/02/cmap-2-how-books-are-made.html

    http://www.antipope.org/charlie/blog-static/2010/02/cmap-3-how-books-are-sold.html

    http://www.antipope.org/charlie/blog-static/2010/03/cmap-4-territories-translation.html

    http://whatever.scalzi.com/2010/02/03/why-in-fact-publishing-will-not-go-away-anytime-soon-a-deeply-slanted-play-in-three-acts/

    Those are a few links, that while more relevant to the english novel industry, should give you a good idea of what publishers do for the authors, at the publisher’s expense.

    To address the “They can just post their work online and get better exposure that way.” idea though; consider that there are thousands, if not tens of thousands of webcomics in existence. A very small number of them are profitable enough that it’s the creator’s day job. Breaking into that is not an easy task.

    It’s similar for manga artists. Plenty of people are interested in taking a shot at it. How many do you think would get the kind of exposure they get in Shounen Jump, or Magazine, or Sunday if they were publishing themselves online?

    A one shot in any of the big magazines has a high probability of being read by at least a quarter to a half a million people. If they get a shot at a series, it’s close to that, per week plus a few months to build a following to justify their continued placement.

    Take Hiro Mashima for example. He skipped the whole “become an assistant for a successful manga-ka” thing that many get their start by doing, because an editor at Shounen Magazine had a good feeling about him and his work. He has since gone on to have, to his name, roughly 60 volumes of manga, 80 episodes of anime, and one assistant that has gone on to become a successful manga artist in her own right.

    What do you think his chances would have been if he was competing with hundreds or thousands of series at the start instead a dozen? With no one to give him a leg up on the competition?

    The bottom line is that while publishers do need to get cracking on new business models that incorporate new technologies, the purpose they serve has not gone away, nor is it likely to any time soon.

  29. Anonymous says:

    Awesome article! I am not a starnger to leeching, but I also buy manga…but it’s true, some translations are just not what i’ve come to expect….for example, Bleach and Naruto have very good scanlations released, and I’ve read the Shonen Jump editions of them and to be honest I don’t like them. Ans then there’s also another issue, at least for me, space. Bleach is already on it’s 40+ volume? That’s a lot of space needed, online reading makes that issue obsolete…

    I like Shonen Sunday’s idea of posting the chapter online for reading as it comes out, I read Rinne, but knowing Rumiko’s history i’m holding back on buying the books because I fear a long winded series….

    On the other hand, I much prefer reading a book, but it’s annoying when publishers just drop a series because it didn’t sell well, because even so there are some people reading them!

    It happened with Zig*Zag, Tokyopop decided to drop it after 3 volumes, and now I had to finish buying it from Chuang Yi, luckily they published it, so maybe if the books aren’t selling move it to an online format? I’d be cheaper and people that read certain series will still be able to read them, or the books by demand sounds like a good idea too…just print as you go….there are options but companies are either to lazy, stupid, or stubborn to try and look for alternatives….

    I mean I go to great lengths to acquire books that I wish were licensed, I bought myself Honey Bitter from Italy as well as Kiss and Never Cry even though i’m not anywhere near fluent in Italian, and I also bought the Singaporean version of Zig Zag and am seriously debating on whether or not to buy Hoshi wa Utau from Singapore too…

    My point being, importing all these titles are expensive, but sometimes the American market seems to be lacking….

  30. @arimareiji’s post

    Oh, you are a bit late on that idea that people can ship the publishing giants. It has already begun!

    http://mangahelpers.com/news/details/377
    http://openmanga.org/

  31. arimareiji says:

    @yakitatefreak: Actually, they’re a bit late on that one. (^_~)

    Futabasha (better known for Kodomo no Jikan and Crayon Shin-chan) has been putting Oniichan no Koto Nanka Zenzen Suki ja Nai n da kara ne online, better known as Oniichan no Koto Nanka or “that ecchi pseudo-incest comedy which the Karin manga-ka is doing a cover/parody of with Oniichan Control”. They periodically take down older chapters as they put out the tankoubons. I can’t confirm it, but it seems likely that they’re doing this with other titles.

    So it might be more accurate to speculate that it’s not the writers who the periodical publishers are afraid of, it’s the tankoubon publishers. (Frequently, they’re one and the same – but not invariably. And even when they’re under the same umbrella, companies do cut unprofitable departments when they’re no longer needed.)

  32. ejaz14357 says:

    It is also likely some of the existing scanlation sites will survive due to being established in countries where it is difficult to take legal action.

  33. arimareiji says:

    It’s very belated, but I ran across this piece by Matt Thorn today. Its main focus is shoujo manga, but what it’s saying bears directly on this present “battle”:

    (quote)
    For more than thirty years, the manga industry has been structured around a model that seemed unshakable. Magazine editors solicit work from manga artists for a modest page rate. The manga is then serialized in cheap magazines with few advertisements that are essentially sold at cost. Serials that prove unpopular are cut short. Those that prove even marginally popular are republished in paperbacks. Ten percent of the cover price of each copy sold is paid to the artist as royalties, and the rest of the profit goes to the publisher. The magazines, in other words, are extravagant advertisements for the paperbacks, which are the primary source of profit.

    The quandary for publishers is that, in this digital age, Japanese consumers are no longer inclined to buy a large paper object that they will eventually discard anyway. Since the magazines themselves are not a direct source of profit, on the surface this would not seem to be a problem, but the fact is that these magazines are the pivot, the fulcrum, the center of gravity of the entire manga industry. The extinction of the printed magazine is inevitable: not a matter of “if” but “when.” The implications of its extinction are both devastating and exciting, but that is a subject for another talk…

    One metamorphosis, though, never occurred, and that is the corporate metamorphosis in which women would take over editorial control of the magazines from stodgy, middle-aged men with outdated and sexist notions of who their readers are and what those readers want. I waited for that metamorphosis for fifteen years, and even tried to help bring it about by arguing for it in my writings and public lectures in Japan.

    But the death of the magazine will render that metamorphosis moot. Even those who work in the giant manga publishing houses–Shueisha, Shogakukan, Kodansha–acknowledge that those corporations are dinosaurs, massive and slow, unable to turn quickly or adapt to sudden changes in environment. That is why the glass ceiling against which female employees bump their heads remains firmly in place, and that is why these publishers will follow the printed magazine to extinction…

    But I think it is safe to say two things: one, the shōjo manga artists in that new world will not be answering to middle-aged men in neckties; and, two, those artists will show us new worlds of sequential art we have never dreamed of.
    (/quote)

  34. Mattcgw says:

    Could you do an updated versionat some point?

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