Streaming platforms are currently engaged in a fierce battle for supremacy in the highly lucrative medium of Anime, which spans everything from R-rated science fiction to teen biker gang adventures. The popularity of these Japanese cartoons has created a veritable gold mine for streaming giants such as Amazon Prime, Disney+, and Netflix, fuelled in part by the pandemic. According to Grand View Research, the global anime market was worth $28.6 billion (approximately Rs. 2,34,825 crore) in 2022, with industry specialists Parrot Analytics reporting a 35% increase in demand for anime worldwide from 2020 to 2021. Anime’s future is predicted to be bright with an estimated doubling in value by 2030, says Aya Umezu, CEO of Tokyo-based entertainment consulting firm GEM Partners, who also states that the competition in anime shows no signs of slowing down soon.

To keep up with the surging interest that anime has generated, international streaming platforms are constantly seeking ways to capitalize on the trend. Recent years have seen Disney+ enter the anime arena with offerings that include Demon Slayer, Spy x Family, and Jujutsu Kaisen. However, it takes much more to hold the attention of anime fans who now have a wider selection than ever before. Platforms must either secure exclusive rights to content or co-produce original anime that distinguishes them from the pack.

Breaking open the market

Disney+ has already acquired exclusive streaming rights to the second season of Tokyo Revengers, codifying a lucrative partnership with publishing firm Kodansha. Amazon Prime is also attempting to monopolize anime blockbusters, according to anime specialist Tadashi Sudo, with films like One Piece Film: Red, which was Japan’s highest-grossing movie in 2021. Netflix, on the other hand, stands out in this market, having moved beyond purchasing existing hits to working directly with animation studios and even granting them an unusual amount of creative freedom to develop new stories.

For years, Japanese anime arose out of production committees made up of publishers, TV broadcasters, toy makers, and other industry experts. These production committees have played a critical role in increasing revenue possibilities for a series, such as expanding into character merchandising and gaming. When Netflix partnered with Tokyo-based animation studio Production I.G in 2018, bypassing the established system, it ruffled some feathers within the anime industry. Production I.G president Mitsuhisa Ishikawa likened Netflix to the 19th-century US vessels, the “Black Ships,” which forced Japan’s opening after hundreds of years of trade isolation. The partnership with Netflix has borne fruit, with its original content becoming the “platform that drove the largest increase in global demand for anime in 2021,” according to Christofer Hamilton of US-based Parrot Analytics.

‘Experimental’ push

While streaming giants are on the rise, they still have a smaller audience in Japan, causing concern for industry players, especially publishers who want maximum exposure for anime adaptations of their manga titles. These publishers are apprehensive that exclusive streaming deals will limit their reach in Japan. Hence there is a “clash of two opposing interests” between streaming platforms that want more exclusives and production committees that want “as little of a monopoly (for streaming services) as possible,” suggests anime specialist Tadashi Sudo. Experts say Netflix original deals tend to be based on works that are less likely to become national sensations like Demon Slayer, which reflects this conflict.

Netflix’s original anime, according to GEM Partners’ senior data analyst Shota Ito, did not make their top-20 most-watched list for Japanese users in 2022. However, the streaming platform is an attractive option for studios with more commercially challenging projects than the traditional market may find too “niche.” This is evident in early original content on Netflix, which was heavy on shows that reminded critics of hardcore sci-fi anime from a few decades ago, such as Devilman Crybaby, which featured plenty of violence and nudity. Netflix chief anime producer Taiki Sakurai told AFP that creators wanted to try something new with Netflix that they couldn’t do under the existing system. Netflix’s initial ‘experimental’ push has now given way to a broader range of genres, including comedy, traditional “shonen” targeting young boys and stop-motion animation projects featuring teddy bears. Fans can also look to dedicated anime libraries such as Crunchyroll.

According to Netflix content director Yuji Yamano, the anime market still has room for growth despite its massive global appeal, and competition can only make the industry more exciting. “Globally, I only see more room for growth in anime.”