While the anime industry has never been bigger, cracks in production are routinely highlighted, with Spy x Family producer Yuichi Fukushima recently stating that making longer anime series is becoming more challenging.

Via Business Insider, the recent Anime Connect event hosted STORY Inc. producer Wakana Okamura (Representative works: Your Name, Weathering With You, My Hero Academia, Haikyu!!), CloverWorks executive officer and producer Yuichi Fukushima (Spy x Family, Wind Breaker) and WIT Studio co-founder and producer Tetsuya Nakatake (Attack on Titan, Spy x Family), where they spoke about trends in the industry. Notably, Fukushima shared that producing a two-cour anime series (around 24 episodes) is becoming harder due to limitations in planning anime over the long term.

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Anime Industry Insider Says Producing 2-Cour Shows Is Becoming a Challenge

Sharing his goals for 2025, Fukushima said, “It is absolutely necessary to develop creators and improve the [production] environment, so we will continue to do so. Personally, I would like to create a system that allows us to properly plan and produce not just works that can be released next year, but works that can be released several years in advance. It is becoming difficult to make two-cour anime.” Previously cited reasons for this include declining skill levels, resulting in an increased number of retakes, and unfair contract terms where companies are forced to prioritize short-term survival and knowingly take losses on making anime since that’s their only form of revenue. Japanese Research Institute (JRI) data revealed that anime studios earn just 10% of the revenues that come from anime production, with the rest going to the rightsholders and those otherwise involved in fundraising, marketing and other activities (via Jitsugyo no Nippon).

The full interview explores the suspected turning point in the anime industry that allowed many films to surpass the 10 billion yen milestone in recent years, with Demon Slayer cited as the cause. A similar opinion was echoed by former Studio Pierrot (Naruto) president Michiyuki Honma earlier this year, who stepped down in August to become board chairman. Meanwhile, also this year, Toho Animation CEO Hiroyasu Matsuoka cited his company’s My Hero Academia as a turning point in increasing legal streaming overseas. This led to legal platforms like Netflix and Crunchyroll paying higher license fees, meaning more could be spent on production. On these rising production budgets, Fukushima and Nakatake agreed this enabled anime studios to pay higher retention fees to creators. Since most animators are freelancers or on short-term contracts, they’re usually booked for multiple projects simultaneously. Retention fees tie down creators to one or very few projects in exchange for often much greater and more reliable pay.

Higher Anime Licensing Fees Are Leading to Bigger Budgets But Not Necessarily Better Conditions

Regarding licensing fees, Okamura agreed that they were rising and that even seven or eight years ago, “depending on the work, the price [license fee] was already enough to cover the production costs of a series.” She also said it was important for production staff to know how much they could secure as a minimum guarantee (a minimum license fee paid to anime production committees irrespective of the later success of a work) or advance payments. Crunchyroll is known for paying minimum guarantees and adding royalties later, while Netflix is known for paying upfront and pre-decided amounts. The latter practice was criticized in a recent report by the Association of Japanese Animations (AJA), which all but pointed the finger at Netflix without explicitly naming it.

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The latter part of the interview highlighted the anime planning and production company JOEN, founded in 2022 by Fukushima through CloverWorks and Nakatake through WIT Studio. JOEN consists of both studios and is supported by Aniplex and Shueisha. It aims to increase returns to on-site staff by ensuring their involvement in the entire production process, rather than just serving as contractors for a production committee. “To give money back to the creators, we first need to create a system,” Fukushima said, adding, “We thought it would be better to negotiate together [with companies in production committees] rather than one by one, so we started a company together.” Business is currently proving successful, boasting profits of 16 million yen at the end of the 2023-24 fiscal year.

Earlier this year, the anime association NAFCA argued for another way of ensuring finances were properly returned to the people on the ground: a mandatory minimum percentage of a work’s copyright granted to the anime studio. Anime studios often don’t have the means to invest and so can’t take on the financial risk. This means they would be securing the rights to future profits without necessarily putting up any capital, which proves controversial given the current status quo. Studios like MAPPA are in the minority; it self-financed Chainsaw Man and Campfire Cooking in Another World with My Absurd Skill and is involved in anime overseas sales even for series it isn’t self-funding, e.g. Oblivion Battery. Former MAPPA producer Makoto Kimura (Chainsaw Man) explained the company’s approach to improving its self-sustainability earlier this year.

NAFCA has also highlighted the importance of government intervention to ensure sustainability for anime staff on the ground. Naturally, this requires accurate data provided to the government — a topic that resurfaced only this week. Via Namiten on Dec. 28, NAFCA publicly disputed a number of the AJA’s conclusions in its Dec. 24 report. NAFCA argued that the AJA was misrepresenting the severity of working hours and salary levels, of which NAFCA said the median animator salary level was below the Tokyo minimum wage. It also disputed the AJA’s assertions regarding improvements in anime staff wages.

Source: Business Insider