Today's Big Idea: Online Digital Distribution?

I've still been thinking heavily about the questions revolving around securing and selling anime classics here in the States. Longtime readers of Conversations on Ghibli know this is my mantra, but I've been working extra hard this weekend. In addition, I sent a long letter to Discotek Media this week about joining up and helping them.

I've no idea if they are hiring or what their future plans are, but that hasn't stopped me from trying to crack the nut and solve this mystery.

We're all aware of the challenges. Anime remains a small, if fervent, community. Greater success has eluded almost everyone, and issues such as budgets, dubbing, subtitles, broadcasting, and DVDs continue to be serious challenges. The problem is that the pond is too small for all these fishermen. We need a wider horizon.

So here's the big question of the day: what about digital distribution?

I've no doubts that DVD will remain as a format for many years, and the movement into the hi-def formats will continue to build momentum in 2008. But we also know what these are merely technological stopgaps. The future will involve online distribution. That's where the real money lies; this is why the Hollywood writers guilds are on strike. They need to be able to win compensation for television shows that will be broadcast and sold online.

As more and more programs embrace Apple's iTunes, where does this leave the animation community? What opportunities does this open up? Would this help broaden the horizon for a Future Boy Conan or a Heidi?

Is this merely an either-or situation? What should the mixture be, between online and DVD? Should DVD be considered more of a luxury market, reserved for the comprehensive treatment of Criterion and Warner Bros? I can't imagine anyone selling a bare-bones DVD in this day and age. If you don't have the budget to offer more than the movie and a trailer, why not just eschew the disc altogether and sell it online?

With online, you're saving a lot of money that would normally go into packaging and distribution. Shipping is not an issue. Supplies to retailers is not an issue. All the consumer needs is a few clicks on a mouse.

This is where the future lies. The notion of forced formats, sold in specific regions, with authorized hardware - this is prehistoric nonsense. You may as well go back into your cave and paint on the walls. The music industry is learning this lesson the hard way. Either they will realize that online subscriptions, free of any controls, are the way to go....or they will eventually go bankrupt, and their remains snapped up by the technology companies. Don't think for a minute that Steve Jobs hasn't been planning this for a decade.

So you can see the appeal. The goal is to have media - television, movies - that can be played anywhere. On your iPod. On your phone. On your laptop. On your Nintendo or Sony handheld. On your DVD or hi-def player. Many of us have been doing this for years already. The only real hurdle has been all these incompatible formats, and the difficulty in ripping and burning media. That will change. It will become easy and commonplace.

The question is...when? How soon?

For now, I say it's best for us to embrace as many markets as possible. We need to embrace as much media access as possible. This is why DVD region-coding is so backwards. Look at all the places you could sell to, if only you were able. Many of us can hack our players, so it's no longer an issue for us. But hacking should be unnecessary. Everyone should be free to search for what they want, on their terms.

A cause for concern: this may be an issue for Japanese anime, especially considering how horribly priced some DVD's are. The television shows are just awful. Do you know how much money you'd spend on the entire series' of Heidi or Conan? Hundreds of dollars. That's utter madness.

Now imagine that, instead of paying upwards of $400 for Anne of Green Gables, a young adult in Tokyo, New York, or Paris and just download it from iTunes or similar venues. The cost? Less than a tenth. Now you understand if the bosses in the Tokyo office are nervous.

I see that anime on iTunes is available only for specific markets, so this isn't an imminent crisis for the suits. But it will be. This is the nature of the internet; it's burned into the DNA of the internet itself. It's a medium that dissolves boundaries (this, btw, is why psychedelic hippies embrace the web so much). Sooner or later, everything's going to become global. We're just seeing the old order resist the tides. Someone will have to take those first steps in going global.

For me, I don't see a problem with this. I still like the idea of DVD's, especially when packed with extra features (documentaries, behind-the-scenes materials, interviews) that add to the experience. This is our film school. Digital downloads open the doors for everyone else.

When we're dealing with niche markets like anime, this makes perfect sense. We really need to move on this, and move fast.

Question for the readers: how much would you pay for an episode of Heidi or Marco or Anne? How much for Lupin III or Conan? How much for Horus or Animal Treasure Island? What will make you crack open that wallet?

Think of it just like music. Digital Distribution is the record single. DVD is the full-length LP.

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