Netflix Animation logo. Made by ArcticDog96 under a CC BY-SA 4.0 license.
Netflix Animation logo. Made by ArcticDog96 under a CC BY-SA 4.0 license.

Can Netflix save Japanese anime?

In 2020, COVID-19 suddenly hit almost all industries in the world. Despite this, there is a company that surprisingly thrived throughout this time of global recession. It perfectly avoided the impact of the pandemic, and even unbelievably drew out a large number of new customers. It is the content streaming platform: Netflix.

According to statistics released by Statista, as of the fourth quarter of 2020, Netflix has 204 million paying subscribers worldwide.

Being that most viewers have been staying at home, this platform has continuously garnered an increasingly large userbase, especially for those viewers who like Japanese anime, “Netflix Investment” and “Netflix Exclusive Broadcasting” have also become the taglines of those new shows in the past two years. Since Netflix officially announced its entry into Japan in 2015, it has gradually penetrated into the production core of the Japanese animation industry. Now, it seems that Netflix has brought something to Japanese anime. The positive effects and negative issues of this need to be examined carefully.

Anime Japan 2019. Photo by Dennis A. Amith under a CC BY-NC 2.0 license.
Anime Japan 2019. Photo by Dennis A. Amith under a CC BY-NC 2.0 license.

It is well known that the CGI industry is one of Japan’s pillar industries, but on the contrary, the animation production industry has actually been in a difficult position ever since. The production committee system has been the mainstream mode of commercial animation production in Japan since 1995. This system uses multi-party investment, which results in profit sharing. Although it effectively reduces the risk of investors, the creative freedom and income of animation companies are greatly reduced due to profit considerations. This is also one of the main reasons why the Japanese animation industry has been rumored to fall in the next few years.

It can be said that stable and sufficient investments from Netflix have brought vitality to the Japanese animation industry. Hideki Shinohara believes that the two key steps for Japanese animation to maintain sustained growth are to obtain more value from animation characters and intellectual property, and attract animation talents. Netflix can help in these two areas. Simple cooperation methods and long-term contracts focusing on copyright have given animation companies great creative space and stability. Indeed, many leading Japanese animation studios have successively made deals with Netflix to continuously expand their animation creation platforms.

Ask Our Tokyo Colleagues | Bringing Anime from Japan to the World. Produced by WeAreNetflix.


According to this, Netflix seems to be saving the Japanese animation industry, but what is the truth?

“We were forced to accelerate efforts on all three fronts of digitalization, global expansion and streaming services. It became now or never,” George Wada, senior vice president of Production IG, producer of “Ghost in the Shell” and “Attack on Titan” said.

In addition, some employees of animation studios are not satisfied with the current situation. Their salaries have not increased. Although Netflix has indeed increased the company’s income, due to the structure of the Japanese corporate system, the animators at the bottom do not benefit from it.

First of all, in their contracts, Netflix bought the rights to play these animations without a provision for royalties. This means that no matter how many people love these animations, it will not generate additional income for the studio. Secondly, the data obtained by Netflix’s big data algorithm will not be shared with the creative company. This prevents them from getting the most direct evaluation and feedback, and instead they simply become an animation outsourcing company of Netflix. The most important point is that animators who have mastered incorporating Japanese stories and values into their work cannot fully utilize their advantages on a global platform, but instead fear that their work might not fit the appetite of global consumers.

The pure existence of Netflix will not save anime in Japan. If the Japanese animation industry does not carry out structural reforms, the actual frontliners will never see any improvement. In addition, producers or exhibitors should try more initiatives in new partnerships with studios, which may bring more practical changes and healthier production models.

Today, each of us bear witness to the transformation of the Japanese animation industry.

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