ESPORTSREPORTER.COM / NICK HOROWITZ – STAFF WRITER / MARCH 28TH, 2021 /
Last year, Sony made headlines by spending well over a billion to acquire anime streaming giant Crunchyroll. However, their plans for further development with the service were stymied when the US Department of Justice announced a probe into their control of the two largest anime streaming platforms. Sony has owned a majority stake in Funimation, Crunchyroll’s largest competitor, since 2017.
This probe raises the question, does Sony really have a monopoly on the anime market? There seems to be valid reasons to support both sides of the argument. Legally speaking, it’ll be a relatively difficult question to answer.
Monopolies are typically determined by the courts based on the percent of the market controlled by the company in question. Generally, if a company is found to control more than 75% of a particular market, it’s considered a monopoly under the Sherman Antitrust Act. Passed in 1890, this piece of legislation guides most antitrust and corporate monopoly rulings.
But how do you determine market share in this case? Crunchyroll and Funimation have a number of competitors in the anime streaming business. HiDive is another similar platform, owned by Sentai, an anime publishing studio. HiDive provides its own alternative to the two streaming services in question, while combining with Crunchyroll on the VRV platform, which is owned by Crunchyroll. Netflix and Amazon have their own anime exclusives too, with shows like Great Pretender and Vinland Saga. Because of the plethora of options, many viewers choose to have multiple streaming services to get access to as much awesome anime as possible. This makes it incredibly difficult to put an actual number on the share of the anime market Sony now owns.
To further complicate matters, you also have to look at the current Justice Department’s willingness to litigate on antitrust issues in recent years. While the federal government sued Facebook for violating trust laws several months ago, the case has yet to bear a conclusion. Disney has also been buying up entertainment companies in recent years, to possibly disturbing ends, with no challenge from authorities in sight. Even more concerning has been the meteoric rise of Amazon, now the absolute leader in ecommerce with hands in nearly every other digital market and no sign of slowing down. Since the Microsoft antitrust case in the late 1990s, the government has been reticent to act on antitrust law, with the courts even more reticent to rule in their favor.
What does all this legal wrangling mean for the average anime consumer though? Certainly, Sony working to unite Funimation and Crunchyroll could have great benefits for the end user. Combining Crunchyroll’s actually functional app with Funimation’s production quality, and both platform’s libraries would make for a fantastic product. However, that also requires a number of decisions to be made by authorities at Funimation, Sony, and Crunchyroll, which may not bring that result. Further, that level of centralized control could lock production studios out of the US market and prevent stateside consumers from getting titles that Sony doesn’t approve of.
With all these questions at play, Justice Department officials will certainly have their work cut out for them in the coming months. Unlike many companies and industries previously accused of violating antitrust behavior, neither Crunchyroll nor Funimation has had much previous interaction with the federal government. This case will be historic in a number of regards. First, it will decide the way millions of anime fans receive their content, potentially for years to come. Second, it will set legal precedent for how viewership and market share is evaluated for streaming services, potentially important in future moves against other streaming giants. Finally, it will force the United States Federal Government to acknowledge anime, which may provide any number of potentially hilarious statements. Anime fans across the country should watch the following proceedings with bated breath.
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