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Interview: Gen Fukunaga on the status of Funimation


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Daizo



Joined: 03 Feb 2009
Posts: 139
PostPosted: Sat May 29, 2010 7:52 am Reply with quote
Quote:
How has Bluray been performing?

Very good. It's a higher percentage of the total sales per title than Hollywood releases. There are some titles where we're just not releasing on Bluray right now. It's expensive, and some of the titles weren't in original HD. So it makes them pretty hard to release a lot of this stuff on Bluray unless we literally go through a very expensive process and digitally remaster them. If we deem a title profitable to go through that kind of expense to remaster, then we'll do it. But in general, yes, as a percentage of sales – meaning how many people are buying the bluray edition versus the standard edition - than any kind of traditional Hollywood release.


If FUNi's Claymore BDs are an example of this "very expensive digital remastering" then I should really get into the business. I'd be filthy rich and I wouldn't have to do much work either since the Claymore BDs look identical to the DVDs ran through bicubic resize to 1920x1080.
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ZenErik



Joined: 22 Nov 2009
Posts: 392
Location: Boston
PostPosted: Sat May 29, 2010 8:00 am Reply with quote
Upscales can be worth it for those who are looking for higher quality audio and/or those who don't have a DVD or Blu Ray player that upscales DVDs well.
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crilix



Joined: 16 Nov 2005
Posts: 208
PostPosted: Sat May 29, 2010 9:09 am Reply with quote
jsevakis wrote:
BTW guys, this information on both Funi's cashflow and revenues, though fairly general, is really easy to get (we even post news stories about it), so everyone postulating as if they KNOW that Funi is really doing bank/failing/about to die, you can either do your research or be called out as a TROLL (*coughCRILLIXcough*.
Call someone a troll and be done with it? That sure is effective!

You know what? I find it extremely hilarious that just because a company is publically traded we should all blindly believe in the sanctity of their quarterly reports. Not only is it hilarious to do so, it is extremely naive. I'm just saddened to see ANN, an independent news site, going out of their way to clear the space before speculation (s)hits the fan. Get used to it, it's your Frankenstein's monster.

The simple fact of the matter is the industry has been on a declining tangent for so long now and pretty much every announced change in business strategy has been accompanied with the-industry-isn't-dying-you-idiots badge from sites like yours, yet we're being greeted with disappointments a year or less down the road. Geneon USA was hitting their targets, we all know what happened to them. ADV Films announced a wonderful new partnership with Sojitz, I don't need to go into that, do I? Now FUNimation is looking for a business partner more suited for them. Seriously? Even Navarre knows they can't be greedy in this economy, yet they need capital for new projects? More like capital to stay in business, so they are selling their non-essentials. If you ask me though, IF FUNimation is performing as reported, then that's one idiotic business move they're making. I have faith that people are smarter than how they sometimes present themselves, so Navarre probably isn't in any state right now to do facial surgery. It needs drugs to stay alive, that's why they're selling.
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Tempest
I Run this place.
ANN Publisher


Joined: 29 Dec 2001
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PostPosted: Sat May 29, 2010 9:31 am Reply with quote
[quote="crilix"I'm just saddened to see ANN, an independent news site, going out of their way to clear the space before speculation (s)hits the fan.[/quote]

This doesn't make sense. Good journalists and news organizations hate speculation. Speculation is pretty much the antithesis of proper journalism.

"Clearing the air" is exactly what we do, and we're always going to try to do it before wild speculation runs rampant.

Of course people are still going to speculate, we do it ourselves (without printing it) But for the most part, speculation should be about filling in the blanks. Sometimes people lie in interviews, press releases etc... and of course there is always the spin where every situation is a good situation, but there's no reason for speculation to go against known facts or proper logic.

Quote:
You know what? I find it extremely hilarious that just because a company is publically traded we should all blindly believe in the sanctity of their quarterly reports. Not only is it hilarious to do so, it is extremely naive.


Because a company is publicly traded, we accept their financial reports as being fairly accurate until we are given reason to think otherwise.

Re: Navarre - There's no secret that corporation is doing badly. I question the logic of selling one of their most profitable subsidiaries, but it makes sense if they want to re-invest that money in their core business areas.

-t
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zrdb





PostPosted: Sat May 29, 2010 10:10 am Reply with quote
Teriyaki Terrier-you remind me of Chicken Little-your sky is falling. I didn't get any idea-faint or otherwise-that "Funimation is going out of business" from perusing this informative article. I'ts like Fukunaga says-a stragetic business move-nothing more-nothing less. The sky is falling my ass.
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captaincrunch



Joined: 04 Nov 2009
Posts: 5
PostPosted: Sat May 29, 2010 10:24 am Reply with quote
Quote:
There are some titles where we're just not releasing on Bluray right now. It's expensive, and some of the titles weren't in original HD. So it makes them pretty hard to release a lot of this stuff on Bluray unless we literally go through a very expensive process and digitally remaster them.


The content doesn't have to be in HD to have a title on Bluray. You can fit 10x as many episodes on a disc than DVD, which either means complete series on 1 or 2 discs or lots of added content (OVA's etc).

I really hate that excuse.
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hissatsu01



Joined: 08 May 2006
Posts: 963
Location: NYC
PostPosted: Sat May 29, 2010 10:42 am Reply with quote
captaincrunch wrote:
The content doesn't have to be in HD to have a title on Bluray. You can fit 10x as many episodes on a disc than DVD, which either means complete series on 1 or 2 discs or lots of added content (OVA's etc).


Hasn't happened, won't happen. Turning blu-ray ray into a budget extra long playing DVD is not exactly conducive to getting people to switch over to HD. Not to mention the rather lacking upscaling abilities of most blu-ray players when playing SD video from a blu-ray (not a DVD).
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crilix



Joined: 16 Nov 2005
Posts: 208
PostPosted: Sat May 29, 2010 10:46 am Reply with quote
tempest wrote:
This doesn't make sense. Good journalists and news organizations hate speculation. Speculation is pretty much the antithesis of proper journalism.
To be completely frank with you, journalism is what Egan Loo does on your site, your article read more like listening to Jim Kramer on Mad Money, chatting up a CEO from Goldman Sachs.
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agila61



Joined: 22 Feb 2009
Posts: 3213
Location: NE Ohio
PostPosted: Sat May 29, 2010 10:48 am Reply with quote
ximpalullaorg wrote:
Despite all the people being optimistic, I read the first reply (the sale) as "Funimation hasn't been doing as well as Navarre has been expecting, hence they have to sell to appease shareholders", which wouldn't surprise me in the slightest if true.


What it said was, Navarre and Funimation are not a very good fit. Everything Navarre does for Funimation, Funimation can get from Navarre on a pure fee for service basis, and Navarre has abandoned its efforts to get into media creation to focus on software.

How that can be read as "Funimation is not doing as well as Navarre has been expecting" is silly.

Indeed, the only way to avoid taking a one-off loss on the book value of Funimation is to sell it above book value. Indeed, the sale will only really make shareholders happy if it allows Navarre to report a one-off gain from the sale. That only works if Funimation is doing well enough to justify a high purchase price.
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Zac
ANN Executive Editor


Joined: 05 Jan 2002
Posts: 7912
Location: Anime News Network Technodrome
PostPosted: Sat May 29, 2010 11:04 am Reply with quote
crilix wrote:
To be completely frank with you, journalism is what Egan Loo does on your site, your article read more like listening to Jim Kramer on Mad Money, chatting up a CEO from Goldman Sachs.


You're a hater who dumps on us every chance he gets. Your criticisms can't be trusted at face value.

It's a guy who hates the Dodgers criticizing their outfield game.
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agila61



Joined: 22 Feb 2009
Posts: 3213
Location: NE Ohio
PostPosted: Sat May 29, 2010 11:13 am Reply with quote
-kf wrote:
Uh, what? He didn't say they have given up on anime, what he said is "that's a great little business there, but it's not selling a million units per release." In other words there is still money to be made in anime, just not piles of it. Even if their focus does shift a bit, it doesn't mean they are going to leave anime behind, there is still enough money to be made for it to be worth their while.


Bingo! Note the reference to tentpoles ... what tentpoles do is hold up the tent ... raise its profile. Bring in the punters, as they say in Oz.

Japan cannot be relied on to provide the tentpoles for the R1 audience ... but on the other hand, there are a lot of animation production companies looking for work, and a lot of work out there with an already established audience that just does not have a large enough audience to justify the live action production that will do it justice.

The complement to the tentpoles is the long tail ... the larger number of smaller audience titles that can be relied on to draw in their own audiences, where the risk of some being flops is offset by the high likelihood that some will outperform expectations. Funimation already has the long tail, and they obviously believe they know how to commercialize it.

The long tail benefits from the tentpoles, as the punter brought in by the tentpoles get exposed to the whole range of things available, and some of them get interested in some of the niches.

The example that comes to my mind is the Earthsea series, which easily has the content to be done as a 13 episode series per book, and which was absolutely butchered down to make the lame live action 3 hour show by SyFy, and which Studio Ghibli tried as well with results that disappointed fans of the series (though for those who have never read the series, Studio Ghibli's work beats the SyFy live action butchering with a stick).

Whether Earthsea in particular or that kind of established fantasy series in general, getting the author on board and happy with the work is critical for tapping into whatever social networks that existing fans of the work use to spread buzz for the work.
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PetrifiedJello



Joined: 11 Mar 2009
Posts: 3782
PostPosted: Sat May 29, 2010 11:16 am Reply with quote
crilix wrote:
If you ask me though, IF FUNimation is performing as reported, then that's one idiotic business move they're making.

I'd like to know why you think this. If "business as usual" isn't going to work between Navarre and FUNimation, it actually makes sense for the sale.

With a little rewording, it can be read like this: "FUNimation's now into producing anime, and with this comes a need for higher capital, which Navarre isn't in the position to give us. Therefore, we're looking for someone who doesn't mind taking chances for a possible increase in revenue."

That's exactly what I read and, to me, makes perfect sense. Navarre may very well be happy with FUNimation with things as they've been, but FUNimation is changing. Therefore, "things as they've been" is no longer applicable.

FUNimation is also tied a relationship with a toy maker, to help expand its line of business, not for Navarre. I seriously doubt Navarre has any interest in potato-looking plastic figures.

In other words, FUNimation is adapting to a market it sees is shrinking if things stayed as they were. If FUNimation, as a business, remained stagnant, then I can see why people will make the speculation the company's losing money.

Everyone knows the digital age has put a significant dent into the distribution side of anime, but whining about it serves no good if a company needs to pay Clarine Harp to produce a DVD.

Personally, I'm very glad FUNimation's looking to broaden its horizons and this news certainly wasn't a surprise. Hell, if I had the cash lying about, I'd buy them without hesitation. Gen's got a good head on his shoulders, and it's crystal clear he's thinking about the company, not just the anime line of business.

To read FUNimation was completely surprised by the sales of live action content was a surprise to me. I didn't think people would be all over live action Japanese movies, but this line will certainly help FUNimation's business.

Call it crap if you want to, but it's rather ridiculous to do so. This is great news and I certainly hope there's a buyer out there who understands anime and can help broaden its horizons. Of course, there's always the possibility a buyer knows nothing about anime and takes measures to change how FUNimation's been doing things up to now. That's my only fear with this news, so I'm keeping my fingers crossed the investor is smart and can work well with Gen and his team.
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agila61



Joined: 22 Feb 2009
Posts: 3213
Location: NE Ohio
PostPosted: Sat May 29, 2010 11:21 am Reply with quote
tempest wrote:
Re: Navarre - There's no secret that corporation is doing badly. I question the logic of selling one of their most profitable subsidiaries, but it makes sense if they want to re-invest that money in their core business areas.

-t


Long term, I don't see where they go unless they get into the casual smartphone / cloud apps in a solid and self sustaining way, flipping their hard media distribution into a means for breaking those out of the silicon cage and into the supermarket aisles.

And while at first glance, digital distribution of AV media and commercialization of web apps would seem to be similar skill sets, they are more like opposite ends of a spectrum.
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edzieba



Joined: 13 Dec 2006
Posts: 704
PostPosted: Sat May 29, 2010 11:27 am Reply with quote
Daizo wrote:
If FUNi's Claymore BDs are an example of this "very expensive digital remastering" then I should really get into the business. I'd be filthy rich and I wouldn't have to do much work either since the Claymore BDs look identical to the DVDs ran through bicubic resize to 1920x1080.
The Claymore BDs are at the good end of the scale with just a bicubic resize. Funi's upscaled BDs usually get coated with so much DVNR that they have less fine detail the the R2 DVDs! Somebody at Funi can't tell the difference between noise and grain, so blurs everything into mush.

I have no problems buying upscales, given they are clearly labelled as such, from a source that benefits from the increased bitrate, e.g. digibeta (NOT laserdisc. I'm looking at you Mangle Ent, and your horrific Ghost in the Shell release), and a simple resize is performed with no pointless filtering applied.
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agila61



Joined: 22 Feb 2009
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Location: NE Ohio
PostPosted: Sat May 29, 2010 11:38 am Reply with quote
-kf wrote:
The way things are, Funimation can't really afford much of a sales risk. If however they start making piles of money they might be willing to look at it, and decide that there is enough quality to take a risk on it.


Definitely, if Funimation can afford to finance twenty releases in a period, it can take more risks on individual titles than if it can only afford to finance five releases, because the odds of all releases underperforming expectations goes down.

Its the same reason why the pharmaceutical market rewards size - a company that can only put one drug through FDA approvals at a time is gambling the company when it picks which drug to trial. A company that can afford to put twenty through FDA trials at a time has far greater likelihood that there is something to sell at the end of the process that will recover the cost of the trials.

Also, if Funimation has some real draws in terms of online streams, that brings more views of its more niche streams. The more views of its niche streams, the easier it is to determine which will justify the cost of a dub ... and, indeed, the more of the cost of the dub will be returned by the legit ad streams and digital downloads, and the less of the weight of the dub has to be carried by physical media sales alone.

Quote:
Again, I don't think Funimation is willing to risk so much on these co-productions that it would greatly affect their business if they fail.


And the Japanese production committee system is well suited to distributing risk. Funimation puts in some of the production budget in return for universal R1 rights. Everyone else then has to put in less than they normally would for Japanese broadcast rights, Japanese distribution rights, merchandising rights, manga publication rights, etc. So Funimation goes to Tokyo, says, "here are five established titles we would be happy to co-product as anime", say three of them get enough interest to get up and running ... Funimation has a seat at the table in the production committee and has full R1 rights to three series that in their view are market-builders, for less than the full production costs of a single series.
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