OPINION: Sony’s Monopoly in Anime is Hurting the Industry

Last Updated on by SilverAbsolutionII

Over the past few years, the entire anime industry has seen quite a few major shake ups, and with streaming becoming more prevalent, anime has exploded in popularity farther than it’s ever been in years prior. Anime, along with most animated content, has become some of the most consumed media on the most popular streaming services, including Netflix investing heavily into anime offerings while Disney has thrown their hat back into the anime licensing game, with the conglomerate licensing titles like Black Rock Shooter Downfall and Yojohan Time Machine Blues for its Disney+ service. Warner Brothers also seems to be making similar moves of their own with a Lord of the Rings anime film expected to hit sometime in 2024, alongside Adult Swim’s continuing efforts to fund anime projects such as FLCL Grunge/Shoegaze on the late-night Toonami TV block. Of course, the biggest change the anime industry has seen over the past several years was Crunchyroll being sold by former parent company AT&T to Sony Pictures Television Group for the low, low cost of 1.175 billion dollars. On top of that, earlier this year, Sony Pictures has gone on to dissolve the Funimation brand, which they obtained in 2017, rolling the two companies into a single entity, retaining the Crunchyroll brand moving forward. 

If you are a fan of Toonami, it is no secret that the block has been struggling greatly this year to acquire new content. At the start of the year, they had to rely on tripling up Naruto Shippuden for a few weeks, doubling up on episodes of Assassination Classroom, and finally, having an hour of One Piece fill up two slots for what seems to now be a permanent fixture on the block. Even now, the most recent schedule update has very little for fans to get excited about and it doesn’t seem as if much is on the way now. A lot of those issues stem back to Sony’s Crunchyroll purchase alongside other issues, such as budget and availability of titles to license. It may be too early to tell what the future holds for the block, but while it may be able to rely on original productions and perhaps the occasional license from Sentai or Viz Media, if we are entering into another few months without new content to fill the lineup, it’s time to call out Sony for their disinterest in coming to the table for TV deals and accept that they seem to want to make the anime licenses they hold exclusive to Crunchyroll. Obviously, no statement between either company has been made to the public, but it’s not hard to imagine why Sony would not bother doing business with linear TV networks when they hold all the cards.

Going back to 2017 when Sony made the announcement that they would acquire a 95% stake in Funimation (with then-CEO Gen Fukunaga holding the remaining 5%), Sony spent $143 million dollars to acquire the company, although it’s unclear if that was purely a cash deal or if it was a cash-stock hybrid deal. At the time, Funimation were engaged in a content sharing partnership with Crunchyroll, who wouldn’t be completely controlled by AT&T until Otter Media, the AT&T subsidiary that owned controlling interest in the service, purchased the remaining outstanding shares in 2018. Despite this, Funimation likely couldn’t expect the Sony buyout to grow them further, even while the Crunchyroll-Funimation partnership was proving to be fairly strong, combining the strengths of both brands. However, it wouldn’t amount to much if competitors like Netflix and even Amazon could easily outbid them for the hottest of hot shows coming out of Japan each season. Funimation would need to grow to compete with the giants trying to get a foothold in the door of the anime industry. Basically, if you can’t beat them, join them. Selling to Sony was probably the smart move at the time for Funimation, especially with the appeal of Sony’s ability to grow the company at an accelerated rate, not only within the North American market, but also to become a truly global brand that had the power of a big conglomerate backing it. Alongside this would be access to much greater funding to acquire the hottest shows while also tapping bigger resources in-studio to produce higher quality simuldubs. While Sony already had the boutique Aniplex brand under the umbrella of Sony Music, Aniplex had carved out a niche of extremely high-quality releases, with equally high price tags attached, limiting the market growth potential of that brand. The Sony buyout did eventually mean that toward the end of 2018, Funimation would effectively leave their existing partnership with Crunchyroll to focus on growing its brand, while some content sharing contracts remained in place on a longer-term basis. This wouldn’t see the complete end though, as AT&T completed their merger with TimeWarner, with Otter Media, Crunchyroll’s parent company, coming along in the merger. At this point, both Crunchyroll and Funimation enjoyed relative independence for a few years until late 2020. 

In December of 2020, Sony Pictures Entertainment Inc. announced that it would acquire Crunchyroll under the Funimation Global Group banner through an all-cash deal amounting to 1.175 billion dollars. The deal’s announcement wasn’t completely out of left field, as many rumors were swirling around the anime industry at the time suggesting that Crunchyroll’s parent company, AT&T, was looking to shed brands to offset the heavy amount of debt it accrued from the TimeWarner acquisition. The original asking price for Crunchyroll was quite a bit higher than the eventual selling price, with a two-billion-dollar price tag during initial efforts to sell the brand. It seems obvious that the debt AT&T gained during the TimeWarner merger was too much for it to handle, leading them to the decision to wipe their hands clean and focus less on the entertainment brand they wanted to create. However, looking long-term, the sale of Crunchyroll to another entity that already had two separate anime divisions was and, even now, is a bad call. The fact that the courts never challenged this is baffling as the market is now primarily dominated by Sony. Crunchyroll, the company formerly known as Funimation Entertainment, and Aniplex of America already made up a large chunk of the North American anime licensing industry, and once Funimation was acquired, Sony had gained a significant slice of the anime business due to Funimation’s already-large presence in the space. Gobbling up Crunchyroll means they control a sizable percentage of the market, especially since Crunchyroll is also an anime licensee, with license deals such as the popular anime series Food Wars, starting with season three, a title that previously had been directly licensed by Sentai Filmworks. They also have master licenses for titles like Ascendance of a Bookworm and Haikyu!! (again starting with the third season). They also handle the simulcasting for a large number of seasonal shows and while other parties still exist, such as the aforementioned Sentai Filmworks along with Viz Media, both are much smaller entities in the market and struggle to effectively compete with Sony’s near monopoly on the anime market. Along with that, Sony has basically killed off the Funimation brand and shifted everything under the Crunchyroll corporate umbrella. The house that made shows like Dragon Ball and Fullmetal Alchemist household names in North America, and who single handedly popularized the simuldub craze we know today, killed without a second thought. 


Senior Editorial Writer for Toonami Squad and former writer for Swim Squad. Host for Toonami Squad Sessions Podcast.