Monday, March 07, 2011

Borders Troubles Hit TokyoPop Hard

I've been talking about this a lot recently in our newsletter and blog posts, and have been doing a lot of speculation as to how the Borders failure would effect the US Manga industry (i.e. how hard the publishers would be hit). I think this is a bigger deal than most people realize, but now I'm wondering if perhaps I've been under estimating the impact.

Today Stuart Levy, the CEO of TokyoPop, made this statement to ICv2:

“The facts are simple. Borders—our biggest customer—went bankrupt, owed us a lot money, which they didn’t pay us, and as a result we are in a very challenging situation, and have had to react quickly to the situation. We did need to let a few people go—and it’s horrible for everyone involved to ever have to let people go. We will continue to do everything we can to evolve the manga business and we very much appreciate the support of our fans, our partners, our creators, and out retail customers.”

Borders, believe it or not, once represented about 40% of total US manga sales, but that share has fallen to around 20% last year. Shojo was one of key demographics that helped move the manga market along in recent years at the bookstore level, but this audience is now aging, and many former shojo fans are not graduating to josei (comics for older women), instead seeking out other forms of entertainment. Also, over the last couple of years, new series have failed to replicate the success of older shounen titles such as Naruto and Bleach.

It looks like several of the key people TokyoPop picked up last summer when CMX closed down have now lost their jobs again, plus a few others. The most disconcerting thing in DJ Milky's statement is "we are in a very challenging situation". That's CEO speak for "things are looking pretty bad". TokyoPop is already having enough problems keeping their back catalog in print as well as keeping their front end output up. Actually, that's an understatement, as they have 'already' pretty much given up keeping their back catalog in print. I imagine they are in a situation that will require further cuts to their current release schedule of only 10-12 new issues a month.

Former powerhouses CMX and Del Rey are now gone from the manga market. Dark Horse has already seriously curtailed their manga genre output, which is down to only 1-2 volumes per month now. They are focusing on more US based series now. And Viz will ultimately find themselves in the same position of having to eliminate any 'marginal' series (that they already haven't) from their release schedule and only focus on the things that are the most profitable. This would explain their sudden cancellation of Inubaka, which has left fans of the series (like me) scratching their heads as to why they would do away with a series only 5 volumes short of the end (not to mention that it sets such a bad precedent). I hope this sudden change in the market does not persuade Kodansha to change their plans about their summer release ramp up either, as they are the only hope for the continuation of many of those former Del Rey licenses that dropped out of print last year.

The reality of Border's troubles is that there will probably be more such cancellations in the coming months as the publishers try to reorientate their business models to adjust to a 20% smaller distribution network. US Manga output has already fallen from 1513 in 2007, to 1115 in 2009, to about 850 last year. The worst part of all this is that we will never know about the great licenses that now get passed on that might have been picked up in a better market. And given the current environment, we might end up down in the range of 500-600 new issues this year. At that rate there will be many more weeks that go by with few or no new manga arrivals here at RACS. That hasn't been the case for at least 8 or 9 years. ~sigh~


SFF said...

This is really bad news and I am very sorry to hear this will impact your business. I am very sorry to hear that.

It's stunning to see these things happening and cutting series short. I really hope things turn around, but man, it's one piece of bad news after another lately in anime & manga. Fingers crossed for RACS!

Robert said...

Fingers crossed for RACS!

No worries, we decided long ago we will either make it to our destination or go down with the ship! This thing will eventually resolve itself one way or another. :-)

D2M said...

Stupid Borders. Ugh.

I love manga. Looooove it, way more than anime. It makes me super sad to see that the market has been shrinking so much over the last few years. And I know it's not doing very well in Japan either.

It really sucks to be a niche market during a depression. D:

Robert said...

It really sucks to be a niche market during a depression. D:

You can say that again.

Ben said...

On Anime News Network's ANNCast, Ed Sizemore (from and Deb Aoki ('s manga guru) predicted there would be a "mangapocalypse" in 2011. That podcast was from January 27th, and they've been spot-on about the negative impact Borders's implosion would have on the manga industry (that podcast is still worth listening to, by the way).

You know, I nearly bought Stu Levy's line that Borders is entirely to blame for all of Tokyopop's financial problems (and subsequent layoffs). Then I realized this is Stu Levy talking. This link (and the attached link to Brigid Alverson's blog) pretty much sums up the Real situation better:

Now, I know were in for some rough times on the manga front, but still, I'm not going to stop petitioning to see "Mamoru The Shadow Protector", "Ninin Ga Shinobuden" and "Lunar Legend Tsukihime" license-rescued and completed (even if the odds are slim to next-to-nil, the fact that each series is only 4, 6 and 10 volumes long, respectively, should make it a better bet than, say, "Those Who Hunt Elves", which has 22 volumes in all).

Apologies for the long rant, but Viz sidelining Inubaka and Stu Levy's ego reaching critical mass (minus the "m", bordering on Charlie Sheen-level delusional) forced my hand.

Robert said...

Stu Levy's massive ego reached epic proportions long before Charlie Sheen's nose was wide open... -_^

nhat said...

I didn't even knew there was a genre call "josei" before reading this. maybe this genre should be advertised more.

Robert said...

Josei mean 'ladies' manga. It's the genre that is targeted to older girls and young women read that is not Yaoi, though some Yaoi are considered sub-genre of josei.

Examples would be Honey and Clover, Suppli, Paradise Kiss, Nodame Cantabile, Tramps Like Us, Walkin Butterfly, Happy Mania and many others. Off the top of my head, the best selling josei series we've ever carried would probably be Nana, though I may be wrong as Erica Sakurazawa was always a big hit as well.

The irony that we label Nana as 'Shojo' and then give it a 16+ age rating does not escape me.

In the biz, in general, josei or manga for adult women has gotten the least amount of attention from US manga publishers. It's the last thing they think of in the morning, and the first thing they forget when they leave the office, and that's really ashamed. Instead the US manga publishers focused so much time and effort on Shojo, and then gave young women nowhere to go once they started to get older. Tell this to product manager at 'any Manga company USA' and you'll get a nice smile and a 'what the fuck do you know' blow off. To his credit, Stu Levy did give the genre some attention back during the boom, but then TokyoPop utterly failed to follow through with more material to properly develop the market and keep the audience interested.

Vincent O. Moh said...

Technically Kodansha USA had picked up Del Rey's titles, so Del Rey wasn't a failed division.

Robert said...

#Vincent - Del Rey was publishing licenses from Kodansha in the US, and Kodansha had to shift gears and self publish rather than loose the entire market when Del Rey nixed their manga division. But Kodansha is only continuing to self publish a small portion of Del Rey's former catalog. That smells like a failed division in my kitchen... -_^