Let me get this out of the way first, I’m not any sort of Business Mind. This is just something I want to explore “out loud”.

Having said that, there’s been a lot of talk around the UK anime fandom over the past few months with regards to streaming services. We don’t really have a UK-based streaming solution for anime simulcasts over here. Over the recent years, we’ve had:

• Crunchyroll: Probably the strongest option available so far but they’re an American company and are not always able to acquire English-speaking rights for areas outside of the US and Canada. Plus, as we’re not their primary audience, trying to get the UK rights isn’t exactly a priority for them.
• Animax UK: A UK-focused arm and Sony-backed, theoretically Animax should be able to do well over here. So far, they’ve not quite seemed to grab the fandom the way that Crunchyroll has. And, despite being a UK arm, they’re still part of a multinational brand.
• Viewster: A European-based streaming video platform that branched out to really embrace Anime. However, after a really strong start at treating the UK market better than it’s been treated in a while, they also branched out to really embrace the American market. Or, to be fair, a more global market from a US subsidiary. Then when the OMAKASE experiment failed, the American arm closed and it was back to only having an ad-supported SD-only offering.
• Wakanim UK: Short-lived venture from a French VOD platform. Website and social media presences now defunct.
• Daisuki: Japanese operation streaming anime globally. Obviously, not a strong contender to full a UK-focused niche but having a Japanese company trying to provide a worldwide legal method of online distribution is not bad thing.
• Funimation: A formerly American-only streaming service, and home video distributor, who brought their newly-revamped “Funimation Now” to the UK earlier this year.

So, long story short, we do seem to have a fair few alternatives that either offer a really strong service or who at least have the unrealised potential to do so. None of them have a real UK focus, though.

UK-based

What we don’t have is a streaming solution with a strong UK focus and a desire to really provide a service that is comparable to that provided by Crunchyroll. So, I’ve found myself wondering what would be needed to put one together.

There are several factors that would have to be considered. The impact of these, and the solutions to them, would vary depending on whether it was a brand new venture or, otherwise, what kind of company it originated from. As a whole, however, these are the things that (as a viewer) I suspect would need to be dealt with.

Content

So, yeah, an anime streaming service would require anime to stream. That would probably make a good start.

Joking aside, though, content is key to a streaming video service. The natural starting place for this would probably be to work alongside the current UK-based home distributors, where they hold the streaming rights.
For simulcasts, this would be a case of making the service known to the companies, such as Anime Limited, who pick up streaming rights but don’t have a streaming platform of their own.

Going forward, there would also be the option to bid for the rights directly from Japan. I get the feeling, however, that this would probably require deeper pockets and/or a proven track record, both of which would be easier after getting some successful seasons under your belt.

For back-catalogue titles, these would probably always come directly from whoever already held the UK rights. This would then depend on whether they thought a streaming outlet would raise awareness of the show or cannibalise potential sales.

One important factor here would be to ensure that any deal is mutually beneficial. Yes, UK distributors are going to be happy if people are watching through legal means as opposed to illegal ones, but they’re still going to be concerned if people stream their shows instead of buying the DVD or Blu-ray. Having any deal make it financially worthwhile would be important, obviously. Cross-promotion would probably help, too. Also/Soon-to-be Available From __ on Home Video on a show page could be useful. Possibly even with affiliate links to various online retailers.

Exclusivity Not (Necessarily) Required

This may sound backwards to business-minded people but, from a viewer’s perspective, having exclusive rights to a title runs the risk of annoying/alienating the fanbase. Permanent exclusivity does, anyway.

It’s the flip-side of the coin regarding monopolies. Competition is good but, when combined with exclusivity, fragmentation is bad. People resent feeling forced to subscribe to multiple different services for what is basically the same content. Especially if other regions have the same shows all available in one place. Even putting the costs aside, having to switch apps or websites (or even hardware platforms, more on that below) just because you want to watch a different show can be very off-putting. Complementing current services will get people wanting your operation to grow and improve. Competing with an inferior or untried service, however, risks people wanting you to pack up and leave.

A useful service over here would be one that shared rights with other platforms. In the beginning, at least. When trying to build up a user base, you want to get some credibility behind you before even thinking of becoming the Only Place To Go for too many titles.

Obviously, having some sort of must-watch show would be useful and there will always be titles that simply don’t/won’t/can’t get picked up for the UK by one of the current platforms. Where possible, these would be a good starting place. “Sniping” the local rights for something that an existing service like Crunchyroll has (or is likely to have) in another region doesn’t usually go down well. Bringing over a show that CR would almost definitely have no chance of bringing to the UK, though, tends to leave people with a more favourable opinion of your operation.

Taking this further, picking up catalogue rights to a show you couldn’t simulcast can still be useful. Even if a show has a very limited first-run somewhere else, adding it to your back catalogue later will likely prove useful. More accurately, not doing so could prove problematics as people may ask “Why would I want to subscribe to a service that doesn’t even carry Titanic Ninja Deathgods as back catalogue?”

If you can’t pick up a show as a simulcast, try to get the rights later. It will help. Similarly, if you have the main license rights to a show and want to be the exclusive simulcast, offer out the sublicense to other services once the season run is complete.

Website and Apps

This is probably the first visible technical hurdle to overcome. People don’t see your data centre, content delivery network or traffic stats. They do see your website and any apps you have. It’s not that the infrastructure side of things isn’t important (see below) but it’s all wasted if your site looks amateur and your apps are either buggy or missing on key platforms.

Look at other legal streaming sites. Don’t rip of their designs, that would clearly be a bad thing. However, try to aim for a similar level of polish where possible. Also, look at illegal streaming sites. Try to look more professional than them, otherwise people may not realise you’re a legit service at first. I have seen “The site looks a bit dodgy, so I didn’t realise they were legal” a few times about more than one service.

Basic things like a queue, decent listings pages and a competent search function are a must. They may not seem like much but, for a user perspective, convenience and ease-of-use is key. Legal streams haven’t totally eliminated illegal downloads but there are many people who now favour sites like Crunchyroll or Netflix over torrenting shows because it’s just so much easier. If the illegal streaming sites, or competitor’s legal sites, are more convenient than your then people aren’t going to use your service.

Make sure your website’s video player works well. Chances are that contractual obligations will lumber you with having to rely on Flash, to enforce content restrictions, so try not to make it any more of a hassle than it has to be. users these days really don’t like Flash. Also, browser developers seem to be making slow but constant progress away from using it. If trying to get it to work for your site is too much of a ballot, people won’t use your site.

Regarding apps, trying to hit the main hardware platforms fairly quickly would be a good move. AppleTV and Roku would probably be your best starting place for streaming-player apps. iOS and Android, for mobile viewing, are also pretty much compulsory. Similarly, games consoles are very important platforms to target, although these do seem to take longer to get released. Especially on Sony consoles. Despite this, though, they’re pretty common media-capable devices, and there is a fair bit of crossover between gamers and anime fans so a chunk of your potential audience already has them. And, really, who wants to sit at their computer desk to watch a half-hour show when their Playstation or Xbox is connected to the TV in form of their armchair or sofa?

A Windows 10 universal app would also be really useful. Not only does this target another mobile platform but it would also work on a Windows 10 Desktop/Laptop. Perfect for those people who really hate Flash. Also useful for those who have a Windows-based HTPC.

My personal thoughts would be to have apps for at least one streaming box, one mobile platform and one games console at launch, with the others already in late development or testing. Although some people are fine with streaming things directly to their computers, there are many people who really like to watch TV shows on a TV screen, or on the go. A lack of apps can be a real dealbreaker for some.

After that, things getting Kindle Fire, Chromecast and Smart TV apps would help round things out. These may be less popular than the other options, hence a lower priority, but they are still important platforms. Fire TV and Chromecast have very affordable options and some TV or Blu-ray players have Smart TV app support built in. Meaning that some people already have multimedia capability on their existing equipment. Buying extra gear sounds like an easy enough solution but people don’t always have the money, HDMI socket or space available to add to their AV setup. Being asked to spend money on this additional hardware as well as a potential subscription fee isn’t always going to go down well. Yes, it will involve additional development time and costs but it’s certainly worth looking into.

Now, obviously, any brand new service wouldn’t be able to get an app out on every platform immediately. However, any service that doesn’t seem to have many apps out, or even in the pipeline, will probably get ignored by armchair or mobile viewers.

Infrastructure

This is going to be the next important thing. How your site and service looks is the most important factor, how well is actually works is a very close second. Having your videos load up quickly and in a consistently good quality is essential to the experience. Delays, buffering and constant quality shifts tend to go down badly with viewers. Make sure that the CDN offering you use is up to the job. If you have a lot of simulcasts, making sure that the episodes propagate through the network (especially at the higher qualities) quickly is going to be key. Not everybody is going to want to watch the episodes at the exact moment of release but having them viewable and at good quality very shortly after your go-live time is going to matter to some. If nothing else, failure to do so tends to result in negative word-of-mouth. This will sour sour offering even to those who aren’t quite so bothered about immediacy.

Geographical Restrictions

This is something that comes with both pros and cons. Being a UK (and probably Ireland, going by most licensing bundles) specific service makes this a lot easier to deal with. If all of your members are supposed to be in the same region, you only need to set a single restriction. You won’t ave any problems trying to juggle which shows can be viewed in which regions. you can either show them or you can’t.

Another advantage is that if you’re only offering to a single region, your infrastructure (see above) only needs to be geared towards that area. It doesn’t matter how well your CDN operates on a global scale, just that it works really well at a national level.

There are still drawbacks. For one, you still need to lock it down to only work in the UK (and Ireland). Geographical filtering isn’t an exact science. Misidentification, although rare, isn’t impossible. Oh, and these things can be faked. So you’ll need try not to have people affected by false positives, as well as not wanting to sink too much time and resource into a solution that can never be 100% effective, all whilst doing enough to satisfy your contractual obligations from the licensor.

Not having to worry about multiple regions and differing restrictions across many different titles will make it a lot less of a headache, though.

Advertising and Subscription Tiers

Having an ad-supported “free” option is going to be essential for any anime streaming platform. It’s pretty much the standard operating procedure at this point. Both using advertising on the site and some sort of inline video adverts during the episodes. Although, in that latter point, trying to make sure they’re not too frequent or too repetitive is probably a good idea.

It doesn’t matter how much your free offering can’t survive without advertising, inflicting the same, single advert on your viewers, every show, every day is just going to piss them off. This is best avoided.

When it comes to what is available to free users and what is limited to paid subscribers, finding the right balance is going to be key. I don’t think there’s any one correct way to go about it but there are a few things to keep in mind.

Simulcasts

You’ll probably want some sort of limit on simulcasts for your free viewers but not something too restrictive. There has to be a some advantage for paid users, yet there’s still got to an incentive to favour the free streams over less legal solutions. Personally, I think Crunchyroll has the best idea i’ve seen. There’s a one week delay before free users can watch a current show but then once it’s up, it’s up. So if you miss a few weeks, there’s not locked out entirely like with the services that only have free episodes up for a few weeks.

It’s a bit different in Canada, where free users only get access to simulcasts and not catalogue shows. Even then, though, each episode is available for 13 weeks. Meaning that you can catch up at pretty much any time during a season.

Catalogue

This is a bit trickier to work out. Having the full back catalogue being an incentive for paid subscriptions is no bad thing. If nothing else, having most of the catalogue only being visible to paid subscribers means that your level of paid subscribers can help inform how much to spend on older licenses.

I’d say that having some of the catalogue available to ad-supported members will help draw interest in the service as a whole. People often need to try out something before knowing if they want to put money into it. And being able to marathon a few older shows may just be enough to hook people in.

At what point you limit it really depends on a combination of your costs, your income and how you want your offering to come across. Having some shows rotate in and out of the free library may be one way of doing it.

Marketing and PR

Being visible to the fandom is be pretty damned essential. Show up at events, even fairly small one-day conventions. Be visible on Anime forums. Do press releases and interviews with fandom websites. Be friendly, don’t come over as spamming, and be prepared to give honest answers to some pretty tough questions and criticism. The fandom tongue is sharp at times but there is often useful feedback if you’re able to tough it out.

Last, But Not Least, Money

Ultimately, this is the most important factor. It goes last on the list, though, because it is dependant on the previously identified factors. Once you have all of these identified, you can then figure out your expected costs versus income. This will probably then require shuffling around the priorities of those factors but you need to know what they are before you can start to figure this part out.

You’d also need to then figure out your initial investment. This will vary, depending on some other deciding factors, but there will be some up-front costs that need to be covered. This is also going to affect the priorities of what gets implemented when.

Variables

Many of the previously listed factors will depend on the nature of the company trying to build such a service.

New Entry

Whether it’s a brand new company or a subsidiary of a company who hasn’t branched into media distribution before, this is probably going to have the highest hurdles to overcome.

It is likely (although not certain) that you will have a lower level of starting resources than a company that is already involved in media distribution. You’re also likely to have fewer relevant professional connections. This doesn’t make things a complete non-starter but it will require starting smaller. Fewer platforms at launch. Fewer shows at launch. Few, if any, exclusives.

In some ways this could be the hardest sell to the fandom. An unknown name, a small catalogue. Not too many people would want to put down money for something like that. This would be where trying to grow connections and reputation would be essential.

Try to work alongside existing distributors, getting them on-side. As a general rule, the UK Anime Industry tends to be fairly close. Sure, thee are disagreements, different viewpoints and a certain level of mostly-friendly rivalry. On the whole, though, they’re all part of a fairly small niche market. What’s good for the market as a whole is going to benefit the specific companies. So if you can make a decent case for being a positive force father UK industry, you’ll likely be able to work with them.

Existing Company

Of course, if a UK-based service was to grow out of an existing VOD or physical distribution company, they may already have right level of funding or connections. They may even have some rights already. Unlike a brand new entry into the market, who would need to build all of these up.

Media Industry (general)

Whether or not a company specialises in anime or streaming video, already being in media creation or distribution would give them a decent headstart. They’d already have a decent amount of general knowledge about how things work. Also their legal and business mindsets would already be somewhat aligned to how things needed to be done. They’d also probably have some level of reputation attached to the company name that would help whilst getting set up.

Similarly, they’d already be likely to be using technology specific to the industry general. This would mean that they’d already have working relationships with and/or knowledge of companies that deal in the infrastructure and technology. Even when branching into something new, being able to already trust your suppliers to give you sound advice and decent service is pretty essential.

Anime Distributor

If one of the existing UK distributors were to step into the streaming ring, they’d already have a good grip on how anime licensing and marketing works. Also, as Japanese licensors seem to be more interested in trying to bundle the home and streaming rights together, being able to pick up both and already have something to do with them will be quite useful.

Besides, viewing habits are changing. For things like anime that don’t tend get onto traditional broadcast TV over here very often, the home release was as likely to be picked up by the “Watch Once” crowd, as opposed to those who wanted to watch repeatedly or who like physical copies/extras. Streaming takes a lot of that away, so why not benefit from it yourself? Keep your customers coming to you, regardless of how they consume media.

The other obvious advantage to an existing anime company going into streaming would be already have the relevant business contacts and probably already having the rights to some older shows. Or at least a good chance of being able to acquire them if they were still available.

One potential drawback to this route would be that such a company would probably be restricted to only being able to show “their” titles. There’s no guarantee that one of their rival companies in the home space would want to hand over the rights to stream a show. A the very least, I’d expect it to be the exception and not the rule. So we’d still end up with a UK service that was potentially limited in scope.

VOD Platform

If a UK-based company were already involved in streaming video on demand, whether already operating a general video service or being more involved in the backend/infrastructure side of things, a streaming company branching out into anime would also already have a good head-start over a complete new service.

They would already have a good grip on the technology involved and how to actually go about streaming video content. Even if they were a newcomer to the anime industry, they’d have a proven track record of video distribution which would certainly help with credibility.

In some ways, this would perhaps be the most likely way of making a successful entry. As long as they can get used to how anime licensing and fandom works, they’d already have a general knowledge of dealing with licensing agreements and customer feedback.

Conclusion

I think something like this is necessary. Yes, it’s nice that the international streaming companies seem to be taking the Uk seriously at the moment but they’re still going to be focused primarily elsewhere.

Besides, as streaming increasingly becomes the way to initially or primarily consume content, the UK-based companies are going to be increasingly restricted to the more collector-oriented side of the fandom. The more casual shopper just isn’t going to be quite as bothered as they were a decade or so ago.

If the UK anime industry is to continue to be a strong presence alongside the fandom, I think it is going to have to break into streaming. Otherwise, most of the custom from the casual viewers is going to head out via America.