When it came to the actual logistics of delivering the final product, things worked pretty much the same way in 2006 as it did in 1986: the lab assembled the final show onto a broadcast quality videotape. That went to the TV network, and then the lab cut out all the commercial breaks and sent it the duplication plant for home video. And then, when all that was done, the licensor made up some presentation materials and a crappy looking VHS screener copy for overseas publishers to peruse. If they wanted it, the licensor negotiated a deal with them, signed a contract, and then called up the lab again. The lab made a copy of the masters and FedEx-ed them to the publisher. The end.
This system was reliable, but extremely expensive and slow -- two things that online streaming, with its razor thin margins and gotta-have-it-now delivery schedule, make completely unacceptable. With episodes sometimes being finished only hours before they air, the only way to do a simulcast is to send the finished video to the streaming service digitally, as a file. But adjusting to a new, all-digital way of doing things has been a steep learning curve for licensors... and an expensive one.
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The last year has seen a lot of changes. While tape is still used for backup and archival, many licensors are now quite capable of sending a broadcast quality file over the internet. But they still occasionally need to use professional video gear or bring in outside people to help with technical things, and every time they do, it costs money.
How much money? Most anime these days is mastered on a tape format called HD-CAM. The price of a single recorder starts at US$45,000.
To a Westerner, the Japanese DVD market seems horribly overpriced. With the average disc running over ¥7,000 (US$92) and only containing 2-4 episodes of a series, the cost of collecting a single show can easily run several hundred dollars -- more than many American fans spend in a single year.
The prices actually stem from a business practice we used to have in America, too: rental pricing. Basically, back in the dawn of the home video business, the industry was constructed in a way where "niche" releases were only meant to sell a few thousand copies, mostly to video rental shops. Prices were high (typically $89.95 in America), but video shops benefited from having a wide and semi-exclusive selection of movies that normal people would never pay for. At those prices, only a few thousand sales could mean over a million dollars of revenue. Initially, video industry people didn't think there was much of a market in selling to collectors.
Once again, the information in this series is outstanding and makes it a must read!But the fans proved them wrong. Otaku of all kinds (not just anime fans) started buying the videotapes and laserdiscs, and they bought them at those high prices that were intended just for video stores. There was no reason to lower it. In fact, there were a few experiments to drop the price to a more affordable amount, but that usually resulted in a slight increase in sales -- not enough to make up for the drop in revenue.
