When I started reviewing Japanese films for The Japan Times in 1989, many of the people making and distributing them were convinced that the Hollywood juggernaut was slowly crushing them. How could they hope to compete against superior Hollywood technology and vastly larger Hollywood budgets?

In the past decade, however, Japan’s film industry has not only survived but thrived. In the 10 years from 1999 to 2008, the number of local films released soared from 270 to 418, while their market share rose from 31.9 percent to 59.5 percent.

First among the reasons for this flowering is that the TV networks and Toho — the top distributor and exhibitor — have produced a strong, steady flow of hits during the past decade. The leader is Fuji TV, whose “Odoru Daisosasen” (“Bayside Shakedown”) films, spun from a cult hit Fuji series about a cheeky detective’s battles with crooks and the police bureaucracy, have consistently topped the box-office charts since the first in 1998.

Japanese commercial films typically begin life as a popular TV series, manga, novel or game. The rights owner, be it a network or publisher, joins with other media companies to produce and publicize a film. This “production committee”(seisaku iinkai) system is not new; Fuji TV pioneered it nearly three decades ago. It is also hardly either infallible or ideal; committee group-think has produced many flops over the years, while filtering originality out of even successful films.

But production committees, with their wide media reach, can publicize films with a thoroughness and tenacity that Hollywood film distributors, who fly in their stars for brief media blitzes, are hard put to match.

Also, audience preferences have shifted away from Hollywood films, once considered the last word in cool, to local franchises. The animation of Hayao Miyazaki — including his fantasy masterpiece “Sen to Chihiro no Kamikakushi” (“Spirited Away,” 2001), whose ¥30.4 billion gross is an all-time record in Japan — has been thumping Disney and Pixar at the box office regularly for two decades.

But of the 400 plus Japanese films released every year, fewer than 30 make ¥1 billion — considered the mark of a mainstream hit. Most play in only a handful of theaters and struggle to recoup their production costs. But these smaller films also account for nearly all the major festival invitations and prizes that have gone to Japan in the past decade.

Many of their directors are veterans of the 1990s New Wave, including Takeshi Kitano, Hirokazu Kore’eda, Kiyoshi Kurosawa and Shinya Tsukamoto. At the same time, directors who were indie stalwarts in the previous decade have gone mainstream in this one, such as Isao Yukisada with his smash melodrama “Sekkai no Chushin de Ai o Sakebu” (“Crying Out Love, In the Center of the World,” 2004), which started a cycle of films about tragic teenage love.

The veteran making the biggest leap to fame and fortune, however, was Yojiro Takita, a former porn director who evolved into a mainstream journeyman. But Takita’s 2008 funeral-business drama “Okuribito” (“Departures”) won 98 prizes around the world (at last count), including an Oscar for Best Foreign- Language Film. while grossing ¥6.5 billion.

Many talented new directors have also emerged in this decade, including numerous women. Among the most successful is Naoko Ogigami, maker of the 2006 indie smash “Kamome Shokudo” (“Kamome Diner”), a heart-warming, mouth-watering drama about three women who run a Japanese-style restaurant in Helsinki.

Another is Mika Ninagawa, a photographer-turned-director whose 2006 debut “Sakuran,” a period drama set in the world of oiran (feudal-era courtesans) was a hit among young women for its flamboyant sense of design and color and its blithe disregard for period-drama conventions, exemplified by Sheena Ringo’s jazz/pop/cabaret soundtrack.

Still another fast-rising woman director is Miwa Nishikawa, a protege of Hirokazu Kore’eda. She won a slew of accolades and awards for “Yureru” (“Sway”), a twisty drama of deadly brotherly rivalry, including the Japanese Professional Movie Awards’ Best Director prize.

Despite the strong flow of new talent, and the upsurge in production, the current state of the Japanese film business is hardly all sunshine and roses. The increase in screens, from 2,221 in 1999 to 3,359 in 2008, has not kept pace with demand — and dozens of films have ended up on shelves instead of in theaters. Also, the sharp decline in the DVD market — store sales of DVDs fell by 11.2 percent in 2008 alone — has made it harder to turn a profit, driving many smaller distributors to the edge and beyond.

Finally, the drift of audiences away from the traditional art-house film has forced the once thriving “mini theater” (i.e., art house) sector to program more populist fare, from the sort of cult and genre items once found only in video bins to commercial films starring dogs and cats.

This change in audience tastes has impacted the careers of up-and-coming directors, who are more and more following in the footsteps of, not indie auteurs, but international cult favorite Takashi Miike, who regards his genre works-for-hire as, not violations of his artistic integrity, but occasions to explore the wilder, darker, funnier reaches of his imagination.

At the same time, falling cost of production, from digicams to editing equipment, has encouraged more young filmmakers to experiment in every direction and medium, from documentary to animation. Their zero-budget films, released in maybe one small Tokyo theater, are often little more than glorified film-school exercises, but others, such as Tetsuaki Matsue’s “Live Tape” (2009), a live-performance docudrama in one 74-minute take, are brilliantly risk-taking and convention-challenging in the best indie tradition.

Far from withering and dying, the Japanese film industry has become, in the past decade, one of the most vital and interesting on the planet. How long the current box-office bonanza will last is anyone’s guess. One thing is certain, though: Japanese filmmakers will continue to entertain, inspire, baffle and outrage, come hell or Hollywood.

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