ADV’s Ledford Updates His Classifications of Variable Marketabilities

The confirmation that ADV will distribute Clannad in North America as well as some previously unrescued Geneon titles in Tsukihime and Mahoromatic hit late Sunday night and is a big news item to begin the week with, but don’t forget that it was CEO John Ledford’s interview with ICv2 that spawned said news.

Long-time readers might remember that Ledford mentioned ranking titles as A, B, and C in a May 2007 interview with ANN and said that “most people buy their A titles and they download their B’s and C’s” due to the prevalence of fansubs. Now 17 months later and after overseeing his company’s strategy shift, he calls the high-profile content ‘anime events’ that still sell well and the former C’s are now classified as ‘super-niche’ titles that are reliable due to their core fanbases, their low upfront licensing cost, and the cumulative ‘long tail’ sales. Nozomi has been keen on with putting out sub-only sets of fan favorites including Marimite and Aria in recent months and doing well at it while Media Blasters has been producing hybrid releases with slightly broader appeal (e.g. Rurouni Kenshin, Berserk, Genshiken) for years. By the way, Chris Anderson’s original Wired article is four years old this month.

Unfortunately, the middle of the road titles (formerly in the B range) remain financial gambles for R1 licensors, according to Ledford:

Where things get tricky is in between the big hits and the smaller niche titles. Series that are strong but may not be world-beaters. Viewership is larger than ever, thanks to the Internet, but fans just aren’t buying DVDs like they used to. And when the costs stay the same, you’ve got a lot of solid, quality productions that end up running in the red.

That’s why right now the best business to be in are the hits and the ‘super-niche’ titles. Anything in between can kill you.

I tried to come up with some examples of such titles and found it a tad difficult. FLAG, Ergo Proxy, The Story of Saiunkoku and Kurau: Phantom Memory bubbled up first as quality ‘under the radar’ series released in the past 18 months but compiling a sizable list would require more thought. Any suggestions of what else might fall under this category?

One question later, Ledford called anime DVD sales “fairly recession proof”. I somewhat disagree with that as it would make fiscal sense of potential buyers to shift toward renting titles through a mail delivery service like Netflix or RentAnime. (Scott roughly calculated the per episode costs of using Netflix as part of his ‘living legit’ essay this August.) But if many of those buyers’ wallets were already weeping before, I guess a recession may not drastically change their purchasing habits.

Also:
- He teased that some big projects are in the works, ones that are “going to energize the core fanbase as well as the casual fan”. As long as they manage to get El Cazador over here and conclude the Bee Train girls-with-guns trilogy, I could care less about crossover projects.
- The possibility of subbed only releases are always on the table but all their upcoming titles are set to be dubbed through Amusement Park Media.
- Anime Network has a strong VOD viewership, happens to be profitable, and will have a lot revealed about it in the coming weeks.
- He said that ADV plans to issue its first Blu-ray releases in 2009 but that the frequency and timing of BD production relies heavily on the marketplace.