The state of the industry had pretty much been covered in every panel we attended this weekend, but there was still enough left unsaid or unelaborated on to make the industry panel well worth attending.

The Industry Panel took place in the same venue as the MVM panel, and featured Tony Allen from MVM, Andrew Partridge from Beez, Hugh David from ADV Films and Andrew Osmond, author of a recent BFI book about Spirited Away.  To start with each of the three company representatives gave a brief lowdown on their current position and how the market was affecting them.  Tony from MVM started off, saying that the company was in good health and still licensing titles, but that the closure of US distributor Geneon had affected them.  However, he was most concerned about FUNimation's license monopoly, they are currently sitting on a lot of unreleased titles and this has led him to look into live-action Asian film to plug any potential gap in future releases.  Hugh came next, giving a potted history of the end of ADV UK.  Their UK office closed in March 2008 with the loss of all staff, and their warehouse - which was originally opened in 1996 - closed in February 2008.  He blamed the impact of piracy and fansubs combined with poor financial management for ADV's worldwide plight.  Andrew from Beez ended the roundup in quite a positive way, citing the company's simultaneous worldwide Blu-Ray releases and online distribution plans as signs of a strong future.  He said that the company was currently doing well, and benefited from being part of Japanese giant Bandai.

   The overwhelming opinion of all on the panel was that anime companies had to adapt or die, there's more turmoil in the immediate future but things should recover if they can get through it.  Hugh talked a bit more about ADV's mistakes, commenting on how they over-diversified without the financial resources to support their growth.  The credit crunch in America hit them particularly hard as they had funded new divisions on credit and not cash resources.  It was because of these mistakes that they lost a license deal with Sojitz, a huge Japanese license holder that has since switched its licenses from ADV to FUNimation.  However, everyone was agreed that Japanese

companies being directly involved in the UK market was not a bad thing, and it's something that will happen more and more in future.  The general consensus was that you needed Japanese support to do well, ADV had it but lost it, MVM dealt on a personal level with Japanese companies and built close relationships which helps them survive as an independent, and Beez are part of a Japanese company (Bandai) so their knowledge of Japanese business gives them an edge in licensing.  Bandai's direct involvement in Western markets is a sign of things to come, and not only will this affect the market heavily but UK buying habits will have a direct impact on the anime industry.

The panellists then went on to talk more about Japan and the differences between their market and ours.  One of the principle differences is TV, in Japan companies generally have to pay to get anime on TV, which is why most Japanese TV screenings are heavily sponsored.  In the West TV channels pay for the programming, and are very selective over what they will pay for.  Hugh mentioned that a music channel said that they would show the anime series Hellsing, but only if they were given the rights for free.  Not only did this go against the UK standard, but ADV would have had to pay for the TV rights from Japan and then give them away for nothing.  In Japan TV is the main advertising tool for anime, but over here the risk without a guaranteed return is too great.  The conversation then moved onto alternative distribution, such as HD and digital.  Everyone agreed that 'upscaling' old anime into high definition was not really worth it, as the animation hadn't been made for it and there would be barely any improvement.  Companies may just take advantage of the storage capacity of Blu-Ray and pack older anime series on to one or two discs as cut-price sets.  Andrew re-iterated Beez's forthcoming Blu-Ray and digital plans (see Beez Panel, page 1) and Tony said how MVM had stepped back due to the additional costs involved.  Hugh talked about the future of DVD, which he thought had another 10 years or so before Blu-Ray took over completely, and also about the impact of digital.  He thought that even though digital will take over, there will always be a demand for physical product and that you may end up with many series coming out digitally with a few premium titles on Blu-Ray.  Apparently this already happens in Taiwan where many titles come out on VCD or are pirated and the market sustains itself with deluxe special edition releases.

They rounded off with a realistic look at the anime market in the UK, which all agreed will not collapse but may cause companies some more problems before it stabilises.  The fan base will ensure that anime will continue to be released in the UK, but many companies work to such tight margins that fansubbing and piracy is a real issue.  It was commented that the BBFC charge around £1300 for each volume of anime that goes through them, and this coupled with licensing, marketing, production and trade prices means that they have to sell around 500 discs just to cover their costs.  Because of this each release is a risk, and most companies won't make a decent return on something until around 1000 copies are sold.  Releasing something that sells below 500 copies is the equivalent of 'bending over for the soap in the prison showers' as one panellist succinctly put it.  To put it into context Hugh mentioned that volume 1 of Red Garden sold around 250 copies and volume 2 sold less than 100 copies.  People don't realise the financial risk that's taken when releasing a title.  For a while the number of titles released here every month was not sustainable, and now its shrunk back to a more manageable amount.  The general opinion is that the long term future is good, but there's still some choppy seas to navigate.

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