Economic Analysis of the “Decline of Anime”

The anime industry is apparently in some sort of trouble. Declining sales were a problem before this whole crippling global recession became reality. At least it said so in a thread here.

At first, I thought this could be some sort of sick Malthusian trap which would see new anime production almost cease.

Join me after the jump for a look at some charts and my general analysis of the past, present and future of new production.

Five years seems like a rather small sample size to say sales are falling off a cliff, and that foreign income line seems pretty flat.
Five years seems like a rather small sample size to say sales are falling off a cliff, and that foreign income line seems pretty flat.

This graph shows sales of anime related goods from 2003 to 2007 split into domestic and foreign based sources of sales. It becomes quickly obvious that foreign markets make up a small fraction of global sales, maybe 10% at most, and definitely not worth looking at as a market equivalent to Japan’s.

Let’s have a look at another chart here:

The Nikkei 225 stock index chart from January 2004 to present.
The Nikkei 225 stock index chart from January 2004 to present.

The anime industry’s sales seem to match up pretty well through 2007, which would mean in 2008 there would have been a massive decline in sales which would likely be unprecedented in percentage terms. Unfortunately, that data is unavailable. What I do have is the number of new series, movies and OVAs which were made by year.

New anime production from 1997 through 2008
New anime production from 1997 through 2008

After looking at that, it seems obvious to me that new anime production in this decade has probably been a bubble that was always going to burst. The fact that it seems to be trailing indicator only tells us that the Japanese economy is struggling.

So where do I think the industry will go from here? I would expect new production to level out at around 200 per year perhaps going well below that in the process. There also seems to be a sense of abandoning foreign markets with new shows generally focusing on moé and heavy fan-service which will be less likely to be licensed abroad.

Foreign licensors will likely shrink in number and in size as they will have to deal with a smaller pool filled with less appealing anime. There should still be a market available should there be a recovery in the industry, however.

8 thoughts on “Economic Analysis of the “Decline of Anime””

  1. Where do the figures for number of new anime come from? I do a preview blog post each season, and I haven’t noticed any falling off. The opposite, if anything.

    If 2006 was a great year, that might be due to popular shows coming out that year: Suzumiya Haruhi and NANA, for example. NANA created a whole new female audience for anime, it seems to me.

    We got these same doom-laden stories all during the period from 2004 to 2006, when the graph says the market was expanding. Not saying it might not happen, but it hasn’t been proved to me yet.

  2. Isn’t it just a little disingenuous to compare anime production to a stock chart? That’s looking at apples and oranges and if you’re going to do that sort of analysis, at least you could do something more comparable like looking at the stock price of anime production companies and compare that to the Nikkei or maybe you can do a revenue comparison or something, but taking this kind of approach won’t give you any meaningful results.

    1. @ zzeroparticle
      One of the drawbacks of writing this post on a Sunday night, and limiting myself to one hour is something like this. It’s fair enough to say my comparison is off. Using the Nikkei index was probably the wrong comparison, using the Jasdaq and as far as stock prices for anime production companies I have Namco Bandai, Toei Animation, TMS Entertainment, DENTSU, Production I.G. and Index Holdings (Madhouse). The pattern seems pretty similar on all of those long-term charts, though companies which have a presence in the games industry seem to be doing better off than those who are not.

      @The Animanachronism
      I really wish I did have data going farther back, honestly. I guess all I’m really saying is that the industry is not all that immune from the recession, and that any downturn in sales should hardly be a shock.

      @hashi
      I was basically going off of ANN’s listing, if you know a better source I’d be happy to know what it is.

  3. I wish there were more up to date data. Please do post some more, more up to date, data on the economics of anime.

    By the way, manga fell off a cliff, or saw a sever reduction in sales due to changes in technology, particularly (according to one Koudansha publishing house worker) the availability of email and internet on mobile phones such that in many situations such as on busses and trains or while eating at canteens people would have taken our their manga, they now take out their mobile phone. This tendency is increasing and will continue to increase. Smart phones, “Mobagei” and “Guri-” and “Zinga” allow people to in a sense become part of an anime by playing a mobile, communicative game.

    I wonder to what extent (if at all) it can be said that anime is remaing popular but changing form, becoming more interactive.

    1. I think I could only really do conjecture at this point. I think physical media is on the way down as far as sales are concerned. I believe things like character goods were still selling better than they had at any point, perhaps because they can’t be replicated in a digital format.

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