Japanese Anime Studio Embraces YouTube Pirates

(page 2 of 2)

But its efforts show how Japan's anime industry might use the Net to reach beyond its own borders. Though Hayao Miyazaki (whose Spirited Away won the Academy Award for best animated feature in 2002) and a few others are well known overseas, most studios make movies, TV shows, games, and toys exclusively for the $20 billion Japanese anime market.

For many, cashing in overseas isn't easy. Often, by the time Japanese studios and distributors get around to signing overseas licensing deals, their anime productions are already available on video-sharing sites for free. And combating online piracy has its share of problems: Fans are just as likely as copyright violators to upload videos without permission.

Casual About Copyright

Not long after a regional Japanese TV station broadcast the first episodes of Haruhi Suzumiya in 2006, YouTube users started uploading clips of the show. Japanese sites, such as Dwango's popular Nico Nico Douga, quickly picked up the clips as well, and the anime soon won a national audience. When unofficial subtitled versions appeared, its popularity spread overseas. Soon, fans were filming themselves dressed up in short-skirt-and-sailor-top schoolgirl uniforms, like the show's characters, and dancing in pairs or groups to the theme song.

Some content-rights owners, like the Japanese Society for Rights of Authors, Composers & Publishers (JASRAC), blame YouTube for the surge in piracy and have demanded that YouTube remove every breach of their copyrights. Others have taken a different tack. In March, Tokyo-based GDH started releasing anime clips on YouTube, video site Crunchyroll, and others the day its content is broadcast on Japanese TV.

But most have opted to do nothing. During a scouting trip to Japan, Los Angeles-based movie producer David Alpert met with Japanese studio executives and expressed his interest in buying the overseas distribution or remake rights for their anime. But when he asked for a private screening, "they would say, 'We don't have subtitles,'" says Alpert, a partner at film and TV production and management company Circle of Confusion. "They'd look at us, look around, and then say, 'Check out the fan subtitles on YouTube.'"

Mashups Get Messy

Kadokawa's online approach is partly rooted in its past dealings with underground Japanese manga artists. The best of the artists sell their works at Tokyo's Comiket convention, held in August and December annually. For years, publishers looked the other way as these artists sold parodies of popular manga. "There are many contents in Comiket which may be illegal under Japanese law," says Etsuo Doi, an intellectual-property attorney with Paul, Hastings, Janofsky & Walker in Tokyo.

Two decades ago, Kadokawa was among the first to recruit new artists from these ranks. That's something the company hopes to repeat with its YouTube collaboration. It's finding, though, that dealing in homemade anime mashups can get complicated. These mashups, called MAD movies in Japanese (anime music videos, or AMVs, in English), tend to draw on anime and music from several sources.

Kadokawa has asked for permission from other original content-rights owners and studios to post the videos on its YouTube channel. Most say no. And while YouTube is one of the most popular video-sharing sites, there are others, and new ones are popping up. "We're starting with YouTube to show that it can be done," says Fukuda. Later, he hopes to negotiate a similar arrangement with Japanese and Chinese video-sharing sites.

What's the reaction from YouTube users so far? In late June, a 23-year-old Japanese college student received an e-mail from Kadokawa about his video, which mixed the Haruhi Suzumiya intro with the soundtrack from an erotic video game. It had been viewed 600,000 times. "It was nice to be recognized," says the student, who asked to be identified by his YouTube user name, c0ldcup. "But I made my videos because I wanted to be a part of an anime lovers' community, not because I wanted recognition from the rights holder. So I have mixed feelings."

Hall is BusinessWeek's technology correspondent in Tokyo .