Over on Sakuga Blog there’s an interesting article on the financials of the anime industry. It appears to be based primarily on sales and so forth in Japan, with one chart on international revenues. The recent trends seem to be up, which is encouraging. The trends in home video, however, are down, and likely to continue that way. Which is sad.
Home video refers to physical purchase of DVDs and BDs, as opposed to streaming. The big differences are, of course, instant customer gratification and zero inventory requirements for streaming, with production delays and inventory risks for disk production.
I prefer physical disks for my favorite shows. Streaming is a problematical solution, because of licensing restrictions and changes in business models and marketing strategies. If I have a disk, I own it forever. If I have a streaming subscription, I ‘own’ the anime until it ages out.
In terms of packaging and delivery, the Japanese model has been to release disks with only a few episodes on them, at what Americans used to consider exorbitant prices. For example, right now on amazon.co.jp, volume 1 of Shirobako (three episodes, roughly 72minutes of programming) costs ¥5400 (a reduction from the original ¥8400), or about $0.64/minute. The article talks about how this is slowly changing, to a business model with more episodes per disk. What the article doesn’t address is the transfer of Japanese program packaging and pricing into the North American market.
For example, in the U.S., as recently as 2008, highly rated shows like Neon Genesis Evangelion or Mushishi would sell as full series boxed sets for about $50 for 650 minutes, or $0.08 per minute. Now, Nekomonogatari White is selling what equates to less than half a season (5 episodes, 125min) for $80 for the BD version. That’s also $0.64 per minute. And the much less highly rated Saekano (How to raise a boring girlfriend) is selling in single episode sets at about a dollar a minute in Japan, with the first six episodes on BD in the U.S. going for $0.64/minute.
My forecast is that sales of physical disks in the U.S. market are likely to drop much more than in Japan, given both the increased availability of streaming and the higher price per minute of the disks. I guess the anime sales departments right now are testing the price elasticity of demand, and will have to learn through experience if the increased revenue per disk will offset the decline in unit sales.