Why are anime producers losing faith in Netflix?

Why are anime producers losing faith in Netflix?

Recently popular Japanese magazine Weekly Toyo Keizai – a business and financial magazine published in Tokyo, Japan – interviewed several producers of anime in Japan about Netflix and the future of anime. One of the anonymous producers gave the publication a startling quote:


In 2022, [Netflix] plans for original anime have failed completely.

Considering how much money Netflix has poured into the co-production and original anime industry in recent years, the quote may come as a bit of a shock. Wasn’t Netflix a key member of funding new anime these days? Haven’t they become one of the biggest producers of anime? Isn’t it constantly mentioned how big anime is on streaming, and that Netflix’s involvement in the field is one of the main reasons why Sony decided to buckle down and buy Crunchyroll and Funimation? What gives? Take a closer look at what’s going on, and many anime producers’ concerns may carry more weight than you think.

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Netflix is ​​pouring less money into anime

While this is more of a general problem Netflix has, it should be noted that the company has confirmed that it would cut spending after first reporting subscriber losses earlier this year. This has resulted in various changes in the company to increase revenue (this is why cracking down on password sharing, testing theatrical releases and creating a new ad-supported tier have become top priorities for the company this year). Aside from creating new forms of revenue, Netflix CEO Ted Sarandos also announced a corporate restructuring to cut costs.

In particular, animation took a big hit, and several high-profile projects (including the long-awaited film adaptation of Jeff Smith’s Leg) was cancelled. It is natural that some of the money spent on anime productions has also taken a hit. While anime is a relatively small part of Netflix’s annual budget of $1.1 billion a year, reports that every department of the company is getting cutbacks means that even the anime budget is being cut a bit.

It may be a small part of Netflix’s budget, but for an anime production whose entire existence depends on that budget… well, let’s just say there are at least a few shows that were probably delayed or canceled outright as a result of this restructuring, and that must make some producers nervous about the future of Netflix co-productions.

Netflix hasn’t produced a hit like TV has

While Netflix was able to turn the Korean drama around Octopus game to a surprise international hit, they haven’t done it with anime. Sure, established properties like Shaman King and Cyberpunk 2077 have thrived on the service, there is no anime (as of this writing) that premiered exclusively on Netflix that you could say is a huge hit. Some of their biggest anime that have appeared on the platform include Death Note, Pokemonand Cowboy Bebop (which produced high enough numbers to convince Netflix to invest in the live-action series).

The thing is, these series were either not Netflix productions or (in the case of Pokemon and Sailor Moon) were huge hits before Netflix made deals to continue producing them. This is prompting Japanese producers to revise their strategy and offer Netflix small, experimental series while saving their “franchise potential” shows for mainstream TV, where they have good reason to feel they are a better fit.

Japanese viewers still prefer TV

The problem here is twofold. On the one hand, while Netflix may be gaining serious ground overseas, most Japanese viewers still watch their anime on TV (heck, it’s Japanese viewers who record the new Urusei Yatsura reboot on VHS and watch them on outdated TVs). What may be more worrying is that while Netflix’s binging model may be great for longer series with established storylines, it’s not necessarily the ideal way to introduce viewers to a new series. When Netflix drops a series all at once, it risks getting buried under all the other content pretty quickly.

This is not only a concern for anime producers, but showrunners in general, who feel that weekly releases on Disney+ and HBO Max do more to help shows get discovered and talked about by audiences. There may even be some anecdotal evidence of this, as one of the few anime that recently became a sleeper hit on Netflix was Komi cannot communicate. Sure, the manga had caught the reader’s attention beforehand, but this is one of the few series they’ve released on a weekly basis, giving the series time to build word of mouth.

This is also not normal for the Netflix model, and until weekly releases become the norm, anime producers are more likely to submit a 13-episode one-off to Netflix while series intended to be long and continuous are shopped around to TV stations first.

The future

Readers shouldn’t be too nervous about the future of anime on Netflix, because rest assured: it’s not going anywhere. Anime isn’t just good business for Netflix, it’s good business for streaming in general. Considers that Netflix can potentially get 50 full series for what HBO spends on one season Game of Thrones: House of Dragons, anime is an economical way for the company to get content at a huge discount. Also shows as One Piece, Pokemonand Sailor Moon have become such big hits for the platform, it’s inspired Netflix to put more money into these productions (and even start a live-action series based on the pirated theme).

Anime WILL continue to have a presence on Netflix! What seems to be changing is anime producers’ attitudes towards Netflix, as they want to move franchise-potential shows to TV while giving Netflix special anime that were unlikely to be big hits in the first place. There’s nothing to say that Netflix can’t pick up these series later, just that some companies might not offer them first. By the way, this could also change if Netflix decides to embrace weekly episode releases in the future (which they’re experimenting with right now).

If Netflix embraces weekly releases more in the future, maybe some of these anime companies wouldn’t mind selling a franchise-potential anime to Netflix, and maybe that release strategy could give Netflix the worldwide anime hit it deserves. Who knows? For now, anime is doing well for Netflix, and the company is going to keep pouring money into it. The problem comes with the fact that anime production companies want more from Netflix, and that could be a big problem if the streamer wants the next One Piece. For now, enjoy the anime available (Home is pretty good according to most fans).

Source: CartoonBrew

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