Three announcements in quick succession:

1) ADV Films is in deep financial trouble and has once again lost the rights to several of their current anime series (including, frustratingly, Kanon just days before they were scheduled to release the final DVD.)

2) FUNimation Entertainment has acquired the rights to all the series orphaned by Geneon when it abandoned the North American market last fall. I predicted something like this, but this seems to have worked out even better than I expected. They plan to finish the incomplete series like When They Cry, the second season of Rozen Maiden, and The Story of Saiunkoku.

3) FUNimation Entertainment has acquired the rights to the series lost by ADV.

So I offer my congratulations to FUNimation, and also my heartfelt thanks. A year ago FUNimation and ADV seemed roughly equal; now ADV looks doomed and FUNimation is the clearly the leading publisher of anime for the North American market.

Furthermore, by promising to finish the incomplete series they may have saved the market. It was starting to look very unwise to buy a DVD series before it was complete, yet publishers depend on these early sales to cover most of their costs. The whole industry had seemed poised to go into a death spiral.

Yet I still have a nagging worry: is FUNimation overextended? It seems to me that the only anime publishers who are likely to prosper are those who realize that the North American market is a small niche market, and will never be a mass market like Japan, and who control their costs accordingly.

Geneon and ADV got into trouble (I think) because they read too much into the rapid growth of the market (from a near-zero base) at the beginning of the 21st century, and assumed that it would continue to grow until it became a true mass market. They overextended themselves, building up a cost structure that could not be maintained.

Could FUNimation go the same way? FUNimation claims to be profitable, but I see possible danger signs. They now have licensed an incredible number of series (though I trust they got the latest ones at bargain-basement prices.) Like ADV, they continue to operate an anime cable-TV channel, a venture that probably loses vast amounts of money.

The danger, of course, is that if FUNimation goes down the North American anime market may never recover. All I can do is wish them the best and hope that they know what they are doing.