Netflix Inc. will almost double its number of anime releases this year, stepping up its fight against AT&T Inc. and Sony Corp. for original content that appeals to Asian viewers.
The world’s largest paid-streaming service will launch 40 new anime titles this year, it said in a statement Saturday during a virtual animation expo from Japan — where half of Netflix’s 5 million subscribing households watch an average of five hours of the shows each month.
The move is part of a push for original content to appeal to audiences in Asia, one of the world’s fastest-growing streaming markets, as its home market of North America reaches the point of saturation. Following the success of anime movie “Demon Slayer” — last year’s fourth highest-grossing film globally and Japan’s best-selling title ever — entertainment companies are increasingly vying for a slice of the $23 billion (¥2.5 trillion) industry.
“We want to be able to pride ourselves as being the top entertainment destination with good quality content,” Taiki Sakurai, Netflix’s chief anime producer, said in an interview. “The growth of our business is directly connected to the growth of our anime.”
Adding customers in Asia is also crucial if Netflix is to sustain its recent growth amid increasing competition in the region from rivals such as Disney+ and Amazon Prime, which are also spending more on producing content.
“One of Netflix’s biggest advantages over its competitors is generating local, original content based on its extensive user data,” said Pooh Chuang, an analyst at Taiwan-based President Capital Management Corp. “Doubling down on original anime will help this localization campaign and strengthen its users’ attachment to Netflix.”
Global viewing of anime shows has been rising about 50% a year, Sakurai said. Half of Netflix’s 200 million global subscribers watched at least one anime show in recent months, he said. When Sakurai joined the company four years ago he was the only employee working on anime; the team has now expanded to 12 members, demonstrating the firm’s dedication to the format, he said.
Some of Netflix’s anime series have become its most-popular titles. “Blood of Zeus,” launched last year, is among the platform’s 10 most-watched series in about 80 countries. Among the series Netflix will release this year are “Yasuke,” about a legendary African samurai in feudal Japan, and “Resident Evil: Infinite Darkness,” based on the horror video game franchise created by Osaka-based Capcom Co.
The global market for anime, including box office takings, merchandise and TV fees, almost doubled over the decade to 2019, reaching $23 billion, according to a report last year by the Association of Japanese Animations. That’s estimated to grow to more than $36 billion by 2025, driven by increasing penetration of streaming platforms and the rising popularity of Japanese smartphone games, India-based research firm Million Insights said in a report last year.
The lucrative outlook is driving video giants to spend big to secure content. Sony, the company behind “Demon Slayer” and a TV series based on the same franchise, in December agreed to buy AT&T’s anime-streaming unit Crunchyroll for $1.2 billion. Meanwhile, AT&T’s HBO Max landed the North American rights to legendary director Hayao Miyazaki’s Studio Ghibli, which produced hits like “Spirited Away.” Netflix streams Studio Ghibli productions globally, excluding in the U.S., Canada and Japan.
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