Japan’s online video sector will boost screen industry sales

Japan’s online video industry will grow at a compound annual growth rate of 7% over the next five years, according to a report on “The Future of Japan’s Video Industry” by Media Partners Asia (MPA).

This will account for 45% of total television revenue by 2029, including free TV, pay TV and cinema, up from 35% in 2024.

The report also found that the number of theatrical releases has recovered to pre-Covid levels and local films continue to dominate in Japan, accounting for around 70% of box office grosses.

In addition, the report predicts that the total revenue of the display industry in Japan will increase from $31.8 billion in 2024 to $34.1 billion in 2029.

The online video industry’s total revenue will reach $15.3 billion by 2029, with YouTube becoming the leader in user-generated content and social videos. Netflix, Prime Video and U-Next lead the subscription video-on-demand category, while TVer leads the ad-based video-on-demand space.

The report also predicts that Japan’s anime industry will remain dynamic. Anime content accounted for 36% of engagement in the premium VOD category in the first nine months of 2024.

MPA estimates that monetization of Japanese anime across television, streaming and cinema reached $2.5 billion in Japan in 2023, accounting for over 8% of the country’s total cinema industry revenue.

Streaming is the main distribution platform for Japanese anime and accounts for half of monetization. Television came in second, contributing 27% of the total monetization amount.

The report also found that in the first nine months of 2024, more than 20 studios were responsible for 70% of the top 200 titles on SVOD platforms.

Japanese anime continued to dominate with 117 titles, driven by franchises and long-running series from studios such as TMS Entertainment, TBS and Aniplex. US and UK titles are also contributing to SVOD demand, led by Warner Brothers Discovery, Paramount, Disney and Sony.

MPA chief executive Vivek Couto said Japan’s online VOD streaming market would continue to improve, with fiber broadband accounting for 82% of household penetration. He predicted that active penetration of connected TV will increase to 51% by 2029, and also explained that telecommunications companies KDDI and NTT have emerged as key partners for SVOD and freemium OTT services.

“Netflix, Prime Video and local giant U-Next will lead SVOD monetization going forward, while Disney+ will remain the fourth largest player; Max will emerge with a significant stake through its B2B partnership with U-Next and eventual D2C launch,” said Couto. “Tver, owned by the major FTA broadcasters, will continue to expand its share in the premium AVOD category through strong connected TV monetization.”