The Fall of Geneon
By James D. Deaux IV and Kellen Scrivens
15 November 2007 — "On August 24, 2007, it had been announced by ICV2 that ADV Films would handle distribution, marketing and sales of Geneon properties on October 1 and that Geneon would still be able to acquire, license and produce anime in North America, but that everything else would be handled by ADV. However, on September 20, 2007, the Anime News Network broke news that the distribution deal between ADV and Geneon had been canceled.
"Dentsu confirmed the distribution deal as canceled through a press release on September 21, 2007; no details were given other than Geneon and ADV were 'unable to reach a mutual agreement,' and that 'From October 1, 2007, Geneon USA will focus mainly on management of its works portfolio.'"
Kellen: When Geneon's deal with ADV was announced, many believed that it meant Geneon was in dire financial straits, as had been rumored for a long time. However, when the deal fell through and Geneon USA announced they would only manage its work portfolio, it left many titles which Geneon held the rights to out in the cold for a North American release — as well as fans asking if any other Region 1 anime companies may be on the verge of collapsing.
James: To say that this is a bombshell is putting it very mildly. Geneon is one of the biggest anime distributors in the world, and for them to be ceasing these activities is a huge blow to the industry. Especially as relates to more mature, adult-oriented shows (since Geneon has quite a few of those). For me, there are two questions I need to start with. One: Does this mean that all Geneon DVDs are going to be pulled from shelves? Two: Which company, if any, will grab the titles that are still in production?
Kellen: To the best of my knowledge (and I asked a few local shopkeepers) they will sell what remaining stock they have left — though the prices may go up since it will all be out of print. As far as who will pick up the titles, that's the big question. They sought the deal with ADV for that exact reason, but because of it falling through they are currently a mystery. Rights may need to expire from Geneon, and / or Geneon may sublicense shows individually. But as it stands right now, there are a lot of popular shows, many which have only partially completed runs that are up in the air.
James: Personally, I am most concerned about the Hellsing OVA, but since that is such a lucrative series, I have to think someone would pick that up soon. You are one of the few people I know whom I believe knows more things anime than I do. What series are you most worried about?
Kellen: To be perfectly honest, the Hellsing OVA is the biggest of the bunch. As you said, it is a very lucrative series. However, once again it needs to be asked how the rights would change from Geneon to an ADV, Funimation, etc. I would assume Geneon would charge a lot to sublicense it (if they legally can), and the fact that Geneon wants to cover all the losses it has accrued. Furthermore, while Hellsing OVA is the biggest case, there are plenty of shows with large cult followings that are being cutoff. For example, Higurashi / When They Cry will be finished after less than half the series has been released in English. This begs several questions. If the series is picked up by another company, how will it be treated? Will the new company use different voice actors? Will the volumes which have already been released be rereleased with a new box and extras? Will they be rereleased in the same packaging, but with a new logo on the box? While these may seem petty, it does matter to a lot of fans.
James: Myself included. When They Cry is one of my favorite new series. It's incredibly dark, and it has a very Quentin Tarantino-like storytelling structure. As for the DVDs themselves, I hope beyond hope that they keep them all as they are now. What I want to know is, why did the ADV deal fall through? ADV is a very big player in the anime industry. How could they turn down the opportunity to gain a library as impressive as Geneon's? Where does the fault lay, Kellen? Have any information that I don't?
Kellen: I only have speculation, but from what I read from the Answerman on Anime News Network it would probably involve ADV taking on a lot of the debt that Geneon acquired. That is the big problem; general consensus says that Geneon was mismanaged. For every series that had huge crossover appeal (RE: Hellsing OVA) and was promoted to reach that crossover audience, there were many more series with limited appeal and virtually no promotion. And let's not forget that Geneon's prices were quite steep.
James: That's true. ADV, Viz and Funimation's DVDs are vastly cheaper than your average Geneon DVD. I really had no clue that Geneon was so far in debt and was so poorly managed. That's actually quite depressing to hear, especially given the number of high-quality shows they produced.
Kellen: For anyone that may be thinking that any of those other aforementioned companies are in trouble, it appears that they are not; they are all in good shape. For the most part the sky is not falling on the Region 1 industry, despite a lot of panic on the part of many fans (myself included). That said, one other thing crossed my mind in regards to this and the state of the Region 1 industry. At Ai-Kon this past summer I attended a panel put on by voice actor Greg Ayres which debated the ethics and legality of fansubbing and downloading; he presented a large case for not fansubbing anything. He brought up points on how much the North American market meant for anime and how people will watch a show via fansubs and not buy DVDs, and that the true anime fans are the ones that support the companies by waiting and watching the shows on DVDs they legally purchased. Now I don't agree entirely with everything he said, however, I'm sure there are plenty out there. If I waited to watch Higurashi and the rug gets pulled out from under it, I would be very tempted to go to fansubs. Do you not agree?
James: I agree that it would be tempting, but I do not agree that it should be done. Fansubbing hurts the industry. Period. When you just download a fansub instead of supporting the company that produces, say, lesser-known animes, those lesser-known animes in question are likely to have their legs cut out from under them because it just isn't profitable enough for the company to continue producing them. Greg Ayers represents everything that is good in the North American anime industry, at least in my humble opinion. I am with him on that. If you wait, that's too bad. I know that sounds like a cold thing for me to say, but I want anime companies to be profitable. They bring us these shows.
Kellen: I'll admit that I do still occasionally fansub, though not nearly as often as I used to. However, I make a point to buy the DVDs of any show I have completely watched through fansubs. That said, a lot of people are quick to jump on the fansubs; they're simply not willing to spend upwards of $150 to own an entire series on DVD.
James: Which is the inherent problem with anime: the hardcore anime fanboys and fangirls will beg to have an anime released in North America, but they'll download it if it takes too long to be released over here. When that happens, chances are the DVDs won't be profitable. Anime isn't Hollywood; it will never appeal to everyone, and, thus, it's always questionable if an anime will be successful in the Western world. And downloading doesn't help that.
Kellen: So to sum everything up: Geneon entertainment, the Region 1 anime company which holds license to and provides English dubs for many popular Japanese anime, will no longer be releasing titles — including ones already in development. All currently released titles will go out of print. Shows under license to Geneon are in limbo. And it is believed a crippling debt brought them to this point, which also might have prevented a business relationship with ADV. To finish this up, James, how bad for the industry is Geneon USA's collapse?
James: It's not the end of the world, but it's very bad. For every Trigun and Hellsing OVA produced by Geneon, there are plenty of mediocre shows like Beyblade and Tenjho Tenge to throw in there, as well. However, I would be remiss to try and downplay all of this. It is going to hurt the industry, at least in the short-term. Hopefully, though, their library will be picked up — preferably by one company. There are so many great animes in Geneon's library that it would be criminal to allow them to go by the wayside.
Kellen: I think you have it pretty much right there. In the short-term it is a very bad thing. As we have stated, there are plenty of great shows that may be forever (and badly) altered, or may not see the light of day at all. We'll have to wait and see how this plays out.