ADV Seeks Out More Capital

Well, the title itself is a little misleading. All anime licensors and their Japanese producers are always looking for more capital. After all, capital funding is what gets new projects made in Japan and here in the US, capital gets us new licenses.

However, the "traditional" model of a independent US-based companies seeking out local distribution and translation licensing is seemingly on the downturn.

An announcement reported on ANN on Tuesday (2006.6.27) that ADV has formed a partnership with a Japanese company, Sojitz, with Sojitz and other members of the Japan Content Investments, an investor group, buying equity in ADV for capital funding. In return, ADV will assist Sojitz and other JCI companies in aquiring North American and European properties for export to Japan. Even though there is a buy-in from a Japanese company, ADV's CEO and Founder still remains majority shareholder and the company remains in US/North American hands.

ADV's partnership is only the latest in a growing number of deals between US licensors and Japanese production companies outside of the normal licensing procedure. Earlier this month we saw Dentsu, with an anime investment fund purchasing equity in Generon Entertainment USA. Last year, Bandai Visual of Japan opened the doors to Bandai Visual USA, BVUSA being completely independent of Bandai Entertainment Inc, who most fans are referring to when talking about "Bandai Licesnes", especially those of the Mobile Suit Gundam 『機動戦士ガンダム』 franchise. VIZ Media's book line has had a long standing partnership with Japanese publisher Shogakukan when it comes to publishing their manga in the US. One even begins to think about Toei Douga in Japan; how it has made licenses expiring in the US hard to re-new so that it can hope to release them in North America themselves. While many fans may welcome the idea of a Japanese company directly releasing their own anime in the US, Toei's dismal performance with their SLAM DUNK DVDs (which, ironically, no one remembers) is creating a deadlock with many Toei properties.

And to think, it wasn't until a few years ago that fans were amazed company like ADV, Urban Vision, and Geneon were financing productions in Japan and getting distribution rights before shows even aired.

This latest evolution in the North American industry, making stronger ties with Japan, isn't something that I don't think many of us thought we would see happen. While I don't think partnerships that Viz, Geneon, and ADV are adverse partnerships, but there is, like in all business actions, a fine line to walk here. What do I mean by this? Let's look at the example of Toei Douga I mentioned earlier.

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They were looking at breaking into the Region 1 market and did so with their basketball title SLAM DUNK, which garnered a great deal of popularity in Japan. Toei, seeming to sense speed was the key to a successful release, quickly released the TV series on DVD. The DVDs released had low quality translations and were widely criticized by fans. The release flopped. What Toei hadn't noticed were trends in the Region 1 Market. Sports anime, which are few and far between here, typically do not test well. In fact, a small handful of them are fansubbed and even fewer gain praise and wide viewership. Most often, the sports anime that do well in fansubs are those that have an added appeal rather than just the sports action. Series like Touch 『タッチ』 and YAWARA!, both nostalgic classics in Japan as well, much like SLAM DUNK, have received some fansub praise and I personally think are fantastic series, but very much the draw for many people are the romantic/slice of life elements and not always the sports action of the two. Touch as a baseball anime has gained support in the fansub community but I've not seen people as anxious about H2 (by the same author, Adachi Mitsuru, focuses more on baseball earlier in the story, too), nor do I see groups coming out of the woodwork to subtitle Kyojin no Hoshi 『巨人の星』, another classic baseball series that was very popular in Japan.

With a growth of equity stakes being taken on by Japanese production companies in North American licensors, will the quality of the Region 1 market look like Toei's SLAM DUNK release? I'll go on record to say that I don't believe so. To say that more Japanese partnership will lead to poor and uneducated releases is liken to comparing all anime licensors in North America to 4Kids Productions. ADV, Geneon, and Viz have all been successful companies in their own right; the fans know them and they know the fans - knowing your customers is part of knowing the market. In each of their respective partnerships they hold majority share of equity.

The news of these partnerships has also lately been coupled with license losses and predictions of bankruptcy from Manga Entertainment and Central Park Media/US Manga Corps, respectively, and the general absence of AnimEigo from the licensing race, one must wonder if these companies are looking at what their competition is doing and not contemplating what similar agreements might hold for them? AnimEigo has said that anime licenses since the 2003 Licensing Boom have went from expensive to astronomical and that it is barely pulling in enough from their anime line to break even. After all, Akihabara Renditions is all about the classic anime and we support the licensing of all classic anime for release in the US. While to expect every classic to be licensed and released is unrealistic, we do stand behind the companies that do make classic licenses. While many companies have classics in their library, I cannot think of a single company that has made classics their mainstay and market recognition the same way AnimEigo has. If AnimEigo has not looked into pairing with Japanese companies for more initial capital, I think perhaps they should.

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