Why the bankruptcy of Manglobe is not the end of the anime industry

anime industry dyingLike this is the first bankruptcy ever.

The 1st of October was the day Manglobe filed for bankruptcy. Manglobe was founded in 2002 and was responsible for productions such as The World God only knows, Samurai Champloo and Gangsta.

I’m writing this article because The Anime Man has dedicated a video about this topic and concluded, that after having done research into respectively two whole articles, that the industry is dying. I thought it was my turn to break this down, since the video was mainly focused on physical sales and we know that’s not the whole story.

anime industry dyingPhysical sales aren’t the future as almost everything is stored in the cloud nowadays, at least that’s the trend. Your music is on Spotify, your personal files always accessible at Google Drive or Dropbox, your passport and movie tickets on your smartphone. The physical is disappearing, so no wonder those sales are dropping. You watch movies on Netflix, Hulu or Amazon Prime. Of course fully consuming media through digital distribution is still in its early stages, but the industry is maturing and so is the anime industry as well.

On March 26, 2013 Crunchyroll surpassed 200,000 premium subscribers. According to Crunchyroll the growth in subscribers grew by 100% annually. A premium package is approx. 5 dollars, so the revenue would be an easy number of 1m per month. This is not net-income of course and is only a needle in a haystack compared to the whole industry.

Crunchyroll is working hard in becoming a global anime content distributor with partners such as Sony, Samsung, Aniplex, Microsoft and Kadokawa Pictures and investors such as TV Tokyo. The content is becoming widely available on all sort of platforms such as Android, iOs, Playstation, Xbox and so on. It seems to me that Crunchyroll is gearing up to growing even further and becoming a big hub for anime content. Great partnerships, give great results.

The question remains why is the sentiment of a dying industry that prevalent within the community? Music sales have dropped to almost nothing, if we should believe the media companies themselves, and we still have multimillionaire artists and tons of new music?

anime industry dyngThere’s a very interesting theory called ‘The Long Tail’ that really changed the music industry. As I said streaming music became rapidly popular due to products such as iTunes and now Spotify. In the beginning(say ’30’s to late 50’s) music was a niche product, just like anime is today, and only catered to the wealthy. Labels sold small amounts of discs’ or vinyl at the time and made enough money to be profitable. But a storm came up in the industry, radio. Music became accessible to the masses who couldn’t all afford the high prices of the vinyl or go to a concert. The horror!

The music industry thought of new ways to promote their music, new technologies came up such as cassettes and CD’s. Making distribution even more cheaply and with the internet not being mainstream yet, sales and profits were up. With the digital age another shockwave went through the industry. The perception of how much money a song should cost became lower and lower, since downloading became easier with fast internet speeds. The growing number of computers that were connected with the internet rose to new heights. iTunes became the salvation for the dying industry and yet again put music back on the radar.

Newer initiatives such as YouTube’s Vevo and the ever more popular Spotify push the price perception even lower, but more accessible and on par with modern trends. It’s easier to reach massive audiences, and while making less money on music, due to the sheer size of the networks, music remains profitable. A company doesn’t have to sell a few thousand albums, a few million plays on Youtube and Spotify equals the amount. And first undiscovered music that is long of the shelves, gets a new life online. The industry is tapping into niches that were declared dead.

I’ve been hearing this “the industry is falling apart” for years now, yet the industry is still standing. I feel like those who propagate this sentiment, fail to see the big picture and pull it out of context, creating sensationalism only to become clickbait.

The anime industry is going through the same stages and it’s testing how well the industry is capable of adjusting to this new movement. As I stated in my previous article, new distribution platforms are rising and reaching new markets, but they have yet to reach their full potential. In the process weaker parties will perish, but those who survive will benefit from this. Consumers become ever more critical and pushing out garbage won’t make the cut. The choice is huge and you better stand out or you will fall.

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14 thoughts on “Why the bankruptcy of Manglobe is not the end of the anime industry

  1. Tallon says:

    Could have just said “because they were already an irrelevant studio”. You said a lot of stuff that would otherwise be interesting to read, but it’s completely irrelevant in this actual situation and there’s no correlation between what you’re saying and what actually happened which makes it read as a bunch of pointless fluff.

    Manglobe barely pushed out any content, they thus had practically no income, not to mention most of their already very limited number of productions were not well received. Anyone who – and I know you do not, but just saying – would think for a second that Manglobe of all companies going bankrupt MATTERS somehow knows absolutely nothing about the industry. If this was Sunrise, JC Staff, or many other actually large (in terms of amount of content) studios, it would actually mean something (even then, an arguable “something”). Manglobe was never a real player in the industry though, after 13 years they barely produced 22 things and about 5 of those were direct-to-dvd ovas or films – love them or hate them, they had no future because they made no effort to actually make any money in the first place. Them going bankrupt doesn’t mean the end of the anime industry for a much simpler reason than you went into – and, again, it’s because they were an irrelevant company that was doomed to fail for the past 10 years. They lacked quantity AND almost all of the time lacked quality as well.

    • ninetybeats says:

      It seems to me you fail to see the bigger picture. You say that they should’ve sold more, which is shortsighted rhetoric for not accepting the fact that the industry has to comply to a new economic reality and has to adjust their business model. That’s the point I’m trying to make. I wasn’t focusing on the productions themselves, since that wasn’t the framing of this article. It was about other consumption patterns, trends and a changing economic model.

      • Tallon says:

        Which is all correct, as I said I agree with, except for the fact that Manglobe itself did not fail for those reasons. Yes, the stuff you said is not untrue, but pretending it applies to absolutely everything that happens in the industry is incorrect. I see the bigger picture, but the bigger picture is not why Manglobe died off – it fucked itself over thanks to shitty management and bad financial decisions – not because of the business model and methods of distribution.

        I’m not having a problem understanding what your point was/is, I’m just saying you’re missing my point that while it’s all true it’s NOT the reason Manglobe ended up where they did. Could it have been if things were different? Will it be for others? Sure, it’s definitely a real issue, but it’s just not the right issue in this specific case. Manglobe’s failure came from poor management and lackadaisical work ethic which has no connection to everything you were saying.

        You were arguing a fine point for an “in general” case, but the wrong point for a post specifically about Manglobe.

      • ninetybeats says:

        I’ve included poor management choices as part of this article, but left them out as I referenced to it in an earlier more detailed post. I was trying to make a point of reference in this post and Manglobe became that point of reference.

    • miharusshi says:

      KyoAni is a fine example of how anime production companies (i.e., studios) can benefit from their own productions and not just strive and remain as subcontractors–which is barely a profitable situation. It’s only a matter of time the others will follow suit.

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