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Business trends

Pirate sites loot Japanese publishers' manga sales

Industry's last bastion crumbles as readers access illegally distributed content

Free Books was shut down in May for distributing pirated manga at no cost.

TOKYO -- Internet piracy dropped a bombshell on the last stronghold of Japan's publishing market in 2017, driving the first double-digit decline in manga sales while the overall industry shrank for the 13th straight year.

The domestic market for stand-alone manga books, known as tankobon, contracted by 13%, nearly twice the industry's 7% decrease to 1.37 trillion yen ($12.5 billion), the All Japan Magazine and Book Publisher's and Editor's Association said on Jan. 25.

Manga sales in the half through September sank 18% on the year, distributor Tohan said.

The season around New Year's is usually brisk for wholesaler Nippon Shuppan Hanbai, but its sales fell nearly 20% this time. "These are shocking numbers," exclaimed Hirokazu Anzai, a senior managing director at the company.

Although the publishing market has shriveled to half its 1996 peak, tankobon were one of the few genres still selling well. Starting in 2005, tankobon have outsold comic magazines such as publisher Shueisha's Weekly Shonen Jump, which had been on a prolonged dive, with comic book sales even growing in some years.

But the comic market's sluggishness became conspicuous three years ago. Sales dipped under 200 billion yen in 2016 and slid to about 170 billion yen last year.

Though digitization has contributed to the disappointing results, publishers mainly point their fingers at online piracy. Over 5,000 titles like "One Piece," "Dragon Ball" and "The Seven Deadly Sins" are available on the largest of these websites.

After a sudden drop in manga sales last autumn, one publisher discovered that many of its readers were now using a website that pirated titles from several companies to read for free. The damages were estimated at 400 million yen to 500 million yen a month.

Websites with pirated content have spread in the blink of an eye thanks to the proliferation of smartphones and word of mouth on the internet.

These sites are illegal, yet even identifying website operators is difficult because they use servers outside Japan, among other methods. It took three months to locate the server for Free Books, a popular website for pirated manga that was shut down in May.

"Pirate site operators get revenue from ads," said Kensaku Fukui, a copyright lawyer. "There are probably many consumers who do not realize they are supporting crime."

Major websites have methods to prevent piracy. Copyright holders can register videos and music with YouTube, for instance, and the website will detect other users who have posted the same material. Content owners also can block access or collect revenue from ads, in addition to other features.

Messaging app Line is developing an artificial intelligence-based system to spot unauthorized use of pictures and other media that it will test on content aggregation websites. But even if caught, contact information for most of these pirates remains unknown.

Manga is a cash cow for publishers. Tankobon can be produced at low cost because the content has already been published in comic magazines, and popular titles are sure to sell in large volumes as soon as they are released. One major publisher generates several billion yen in profit from manga alone, but that plunges over 80% when combined with magazines and other loss-making publications.

Manga also makes up 19% of bookstores' total sales, according to Tohan. If the genre stops selling, it will be a major blow to these stores, which already run slim operating margins just under 0.3%.

The industry has long said that times are tough, but the decline of a major moneymaker has created a do-or-die moment for many publishers.

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