Home Channels Anime Your Management Was Bad, And You Should Feel Bad

Your Management Was Bad, And You Should Feel Bad


You know, the anime and manga industry
has been pretty beat up over the past few years. It’s probably not an
over-exaggeration at this point to say there are probably more dead
companies than active ones in the translation and distribution game
in the U.S. at this point, and even if it’s not, it’s certainly been a
downward trend.

However, with the recent announcement
that Tokyopop will be shuttered at the end of May, and with
4Kids’ recent bankruptcy filing, we’re suddenly back to 2009, an era
where, in the wake of the financial meltdown, we saw a number of
iconic companies critical to the popularization of anime in the U.S. go
under, or get reformed under various new names at a greatly reduced

Now, both 4Kids and Tokyopop faced
similar external problems their respective business models had
difficulty dealing with. In 4Kids case, Saturday morning cartoons are
all but dead, and the cable networks are leaning away from
acquisition and back towards total property ownership again. Bad news
for any localization house, but worse if you’re basically counting on
that exposure to sell tie-in merchandise. Similarly, Tokyopop saw
it’s key venues for exposing new titles to readers disappear as well
as Borders shut down countless store fronts, and as more and more
readers move to digital readers.

The thing is, this is stuff anyone
paying attention would’ve seen from a mile away. Both companies have
been run poorly since before the 2009 fall out as such. They were
intensely avoidable outcomes. So much so that while it’s sad for the
rank and file employees of these companies, their management needs to
held up as examples of how you do it wrong, especially in an industry
where a quick look over your shoulder at your competitors would’ve
saved the day.

Lesson 1: Know Your Base and Cater
To It.

4Kids always sucked at this in a long
term sense. If they’d talked to any Pokemon or Yu-Gi-Oh! fan that had continued to be interested in the show into their
teens, 4Kids would have quickly learned that they could have kept
monetizing the audience they’d already built by providing uncut
product at a good price and without any
unnecessary wait. They could have even looked at a FUNimation-style
transformation where TV is the icing on the cake, and catering to the
life-long otaku is the bread and butter. However, in spite of
countless opportunities to make that shift, or to at least use the
otaku audience to supplement their bottom line, they dumped
money into comically bad and undoubtedly expensive edits and
home video releases that neither their core demographic of children nor
the untapped otaku market thirsted for.

Tokyopop understood how to cater to a
core audience pretty well for a while after some initial missteps.
They locked the cover price into a affordable price point,
established a consistent, convenient size for their releases, pushed
unflipped manga with unaltered artwork, released titles on a very
regular schedule, and dramatically reduced the amount of localization
for awhile. They pushed hard into shoujo titles when most of their
contemporaries were still mostly looking for the most stereotypical
content to aim at 20-something male comic readers: violence and
fanservice-driven titles. They even insisted on getting artbooks
printed in Japan so that that the image quality would match the
original Japanese editions. With all the initiatives they made,
Tokyopop pretty much built the template for success in the modern U.S.
manga industry. Before they entered in, you were lucky if you found
manga at your local comic book store, let alone throughout national
bookstore chains.

However, they seemed to forget a lot of
those lessons as time wore on. They created a generation of teenage
otaku in the 00’s, yet gave them few if any titles to grow into. 
Meanwhile Dark Horse, Del-Rey and Viz proactively locked down some of the
best titles for older readers while securing new gateway titles.
While no manga publisher has managed to hold down a perfect record on
edits, quality control and localization, Tokyopop managed to
infuriate key fandoms with inconsistencies, outright rewriting and
artwork edits. Gundam fans are otaku lifers, but they are also tight
knit enough that when you screw up, every one knows. In fact, that’s
a general aspect of the internet – your errors are known to
everyone who cares, but the anime fandom is particularly savvy. As a
regular convention attendee, Tokyopop should have known that about
the fandom, and thus known the consequences of these mistakes. However, instead of doubling down on their core audience
as their competition became serious, Tokyopop ignored the fans’
pleas for many of things they popularized. This was an attitude
perhaps best summarized by the exploitative, otaku-antagonistic America’s Greatest Otaku reality program that Tokyopop produced. Rather than
spend money keeping their manga division afloat, they blew it on a
webshow that at best unintentionally makes a mockery of the people
who kept them afloat. At worst, it might as well be an advertisement
that says “don’t buy anything from us – ever.”

Lesson 2: Look Around You, Then

When you see multi-national publishers
and the people you used to buy titles from enter your localization
space, this is not the time to reduce quality control and think
you’re going to squeak by to better days, especially if there are
already companies in your space giving a hard time. Yet this is
pretty much what happened at both Tokyopop and 4kids.

4Kids saw FUNimation get bought up by a
distribution company (albeit one that has sold FUNimation
off as it’s grown in scope so much,) start a cable channel, turn a
profit on that cable channel, and start a streaming site before it
began to click that maybe 4Kids should get in on some of that by
finally starting their own streaming site. FUNi was arguably late to
the game at that given Crunchyroll’s activity if not the massive
audience for fansubs, but they quickly ran hard and worked on making
up lost ground. That could have been 4Kids with a little leadership.
Instead, 4Kids is closing up shop while Japanese companies are
directly entering the market (sometimes poorly, but that’s another
editorial.) This is a pretty obvious template for vertical
integration (manufacturing, distribution and marketing under one roof)
in general, and 4Kids was at points fantastically positioned to take
this on, yet it dropped the ball. A little observation of the their
peers would’ve gone a long way.

Tokyopop had the same sorts of
gauntlets laid down. Their competitors all too quickly picked up on
Tokyopop’s ideas and ran with them, and most of the larger companies
had other elements that gave them a structural stability thay Tokyopop
lacked. Tokyopop often used contracted translators, and they often
had different editors and localization workers on different volumes
of a title. Meanwhile, their larger competitors kept most if not all
of the production work in-house and consistent, quickly beating
Tokyopop in the quality control arena. Even their their smaller
competitors, who often used contracted translation work, paid their
translators better to encourage quality control. This is stuff
Tokyopop easily could have chased after if they made that decision
when they were top dog in the industry, but instead they further
reduced those structural strengths. Editors were cut in favor of
passing that job to the contracted translators, and the type-setting
became a contracted job as well.

Similarly, for all of Tokyopop’s
attempts at moving manga into the digital age with website revamps that
no one ever liked, and cellphone manga that never took off, they
completely missed the boat on e-books as a whole. To be fair, the
whole manga industry in the U.S. is being painfully slow about this, in
part because the technology isn’t perfect for manga yet. But to wait
is to concede the space to piracy. Viz at least sort of gets this
with their manga app, but again, this is something Tokyopop, for all
of the hype they put into their website, could have jumped on. If
they had ditched the web developers for app developers, maybe they’d
still have a company, albeit perhaps a digital only one. Maybe they could have afford that if they didn’t make America’s Greatest Otaku.

Lesson 3: Treat Your Partners Right.

4Kids gamed their books and lost shows
because of it. This may even be the case for more shows than we know.
Such antics are amateur hour stuff, and that behavior, if nothing
else, cost them the company. If they had not essentially driven away
great partners with their possibly fraudulent practices, let alone
the general incompetence they displayed, they simply wouldn’t be in
the fix they are now. Yes, they wouldn’t have made as much money at
their peak, but they’d have a company today. Instead they have no Toei
titles (besides broadcast rights forDragon Ball Z Kai), no Yu-Gi-Oh and no Pokemon. They don’t even
have the U.S. entertainment holdings they once had.

Similarly, Tokyopop managed to lose the
entirety of their licenses from Kodansha by not treating them with
due respect if industry rumors are to be believed. Their poor
behavior likely not only played some what of a role in Kodansha’s
partnership with Del-Rey over Tokyopop (something, mind you, that
occurred before Tokyopop’s ego lost them licenses, so really, they
should have already come into that deal begging for Kodansha to stick
around,) but eventually cost them key perennial titles from CLAMP amongst other top-sellers.
Those CLAMP titles are now being released by Dark Horse instead, and if anything,
Dark Horse’s immaculate treatment underlined the other problems at
Tokyopop. CLAMP’s works often received the best treatment of anything from Tokyopop, and even in that case, there was apparently room to do better. Those deficiencies might not have been so obvious to the fandom
if they’d just kept Kodansha on board. If nothing else, those
perennials would’ve paid the bills while they looked for their
successors, and they would’ve had better relations to find said


Truthfully, I suppose some of this is
hindsight. It’s really easy now to see just how wrong these two companies
were with some of their moves, but at the same time, it’s hard to cut
them the same slack as other companies that were blind-sided by
essentially the same market forces two years earlier. Bandai
Visual died for not catering to American otaku too, and Central Park
Media, ADV, SynchPoint and Geneon all took one on the chin from the
chain bankruptcy (especially the Suncoast bankruptcy.)

However, these deaths should outline to
the remaining players what the game plan is if they didn’t respond to
the previous ones. Manga companies need to get into the digital age,
effectively in anticipation of the market if not to build it out
directly. They need digital rights yesterday, and they need to
carefully get their Japanese partners on board as soon as possible
without antagonizing them. The price points need to be irresistible,
and the software convenient and preferably industry standard. It’s
spending that may look bad for a few quarters, but most of these
companies aren’t publicly traded anyway – make some investments that are
aimed at long-term returns. Similarly, the rest of the anime industry
needs to follow in FUNimation’s footsteps, even if that means cozying up to them in some ways. Keeping a foothold in linear-television
and on-demand platforms is critical, and Viz and RightStuf were wise
to partner with FUNimation in this regard, even though it meant
strengthening the FUNimation Channel as a profitable entity. Vertical
integration of FUNimation’s sort also needs to be considered to
smooth both production delays and distribution delays at certain
companies, and streaming and digital downloads need to be as much a part of
the game plan as Blu-Ray and DVDs. Mimicking FUNi’s fantastic prices,
even if it mean regular re-releases to recoup costs, might be
essential or at least recommended as well.

In short, it’s 2011, and the blueprints
are publicly available to any competitor. If you don’t follow them,
feel free to join Tokyopop and 4Kids as chapters in anime history.