TIFFCOM: Japan Animation Industry Sees Boom Driven by Exports

Overseas revenues of Japanese animation exceeded local consumption for only the second time last year. But the export-led boom is expected to continue, the Association of Japanese Animations said on Thursday at TIFFCOM, the rights market that accompanies the Tokyo International Film Festival.

Overseas revenues hit JPY17.2 trillion in 2023, compared to JPY16.2 trillion for Japanese revenues, an AJA spokesman, Masuda Hiromichi said. The only previous time overseas was bigger, in 2020, was attributed to a COVID-era aberration.

“We expect overseas to continue growing, he said, while the Japanese domestic market may make only slow progress due to a low birth rate and an aging population,” Masuda said. Anime earns the biggest share of its revenues in Japan from related products, with characters licensed to Pachinko gaming firms exceeding streaming revenues and far outstripping TV or theatrical revenues.

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Even if Pachinko is not a growth market, it is not clear that the gloomy prognosis is entirely justified, as exports are taking up the running and the overall sector has hit records in almost every year since 2012.
Overseas revenues are being driven by online distribution platforms and by the anime genre finding popularity in a wider array of countries and territories.

Masuda, who said that the Association’s full report on the sector will not be available until next month, explained that it is projecting export revenue received by Japanese companies to reach JPY20 trillion by 2033. That compares with JPY4.7 trillion in 2022.

“Even the Japanese government is calling animation a core industry along with steel and semiconductors,” Masuda said.

Other speakers said that Japanese animation companies are currently constrained by structural factors including the rising cost of labor, limited ability to increase the labor force and the continuing dominance of hand-drawn animation techniques.

To continue to increase exports, they offered a variety of solutions. These ranged from increasing quality of the content, through better sales contracts, improved distribution networks, to international co-production and increased localization that caters to religious, linguistic and taste differences in differing overseas markets.

Umezawa Michihiko, president of well-established producer Shin Ei Animation gave the example of “Ghost Cat Anzu,” which has been gathering international acclaim since its July debut. Based on an original story published by Kodansha, the film is a rare Franco-Japanese coproduction with a Japanese production committee on one side and French company Miyu (“Chicken for Linda”) on the other side.

Yoshikawa Kotaro, senior VP and MD of TMS Entertainment, a subsidiary of gaming firm Sega, said his company has expanded its overseas offices to include Los Angeles and Paris, and that it has also scored by working with global streaming platform Netflix.

Umezawa also explained how older series can still find new audiences, such as broadcast TV markets in India and China. YouTube also offers potential advertising revenue, and profits for shows that are already amortized.