Streaming for Profit: Crunchyroll vs. GOMtv.net

In the age of streaming media, entertainment companies of all varieties are wracking themselves trying to figure out ways to monetize internet video, or at least to recoup the expenses required to run a stream. While the most common method is to utilize some sort of ad system, some sites come out with paid subscriptions. The content is free, up to a certain point, but if you want more you have to shell out some cash. Among these sites are the anime/j-drama/k-drama resource, Crunchyroll, and the center of the Korean Starcraft II scene, GOMtv.net. Both sites use ads, and both sites have subscription services which can remove those ads, as well as give access to higher-quality video, but Crunchyroll and Gomtv.net take two very different, almost opposing approaches to their subscription services.

When you pay for a Crunchyroll subscription, you're paying for speed. Crunchyroll's game is simulcasting. Shows that air in Japan are on Crunchyroll mere hours later. However, in order to see the shows as soon as possible, you have to pay for it. The content eventually becomes available for the non-paying viewers, but it requires a 7-day wait, and for those who thrive on discussing the latest, greatest(?) anime with their friends, that waiting period can become a death sentence for their social life among fellow fans by forcing them out of the loop. Crunchyroll provides a service for those who can't simply can't wait for even fansubs to appear online, drawing power from the "I want it right here, right now" attitude common to anime fandom.

But when it comes to GOMtv.net, you're paying for flexibility. Showing primarily competitive Starcraft II with both English and Korean casts, the stream during the live broadcasts of matches are free. Anyone can tune in around the world, provided they've also downloaded the proprietary "GOM Player," which could be much more of a hassle if it weren't for the fact that the Gom Player is designed much like VLC to be an all-in-one media player. However, once the matches for the day are over, they now become paid content, aside from a handful of previews. GOMtv's subscription gives you the ability to view recordings of the matches after they've happened, which allows you to watch them at your own leisure, rather than having to watch its tournaments during their designated times, which due to varying time zones can be as bad as 4am in the morning or at 10am in the middle of a busy work day.

 

One area that I think is worth analyzing is the value of an instance of the product put out over time, that is, given a single unit, either an episode of a show or a full set between two players, what happens when someone sees it the day it's out, then a week later, then a month or year later, and so on. By value I don't necessarily mean monetary value, but just more generally, how willing are people to watch older instances of a product as more and more time passes? What I am about to present is just my own conjecture, so feel free to correct me if any actual information has proven me wrong.
While Crunchyroll and GOMtv.net differ in that the former provides a wide variety of entertainment choices (dozens of shows are available) and the latter has essentially one long-running show in the form of Starcraft II tournaments (or two, if you want to count the Team League as a separate thing), but to make comparison easier I'm going to say that there's a Single Entertainment Product X, which has the primary trait of being designed to go on for years and is a serial product, so the results of older "episodes" directly affect newer ones (which also creates the possibility of spoilers). For the sake of convenience you can think of it as either Naruto (which is by far the most popular show on Crunchyroll) or the Global Starcraft II League (GSL). I'm also going to simplify the Crunchyroll and GOMtv models to just "starts off costing money, becomes free later" and vice versa, and not deal with the nuanced differences between the fact that "new" in Crunchyroll terms means watching it the first week and for GOM it means watching it live as well as ignore the difference in actual cost of subscriptions.

 

So let's say that the very first episode of Product X has hit Crunchyroll, and that there's already a fanbase for it, due to whatever reason such as anticipation or hype. Crunchyroll banks on the fact that people want to see it as soon as possible and charges them money for it. The people who pay to watch it are essentially saying that Product X, brand new and delivered as quickly as possible, is valuable. Once the episode is over, it becomes background knowledge for the next new episode, which also carries the same viewership value. In time, for those who have already seen these episodes, any value in them would come from how much they are worth rewatching. But while Crunchyroll decides that money is to be had in being first, this concept of "rewatch value" appears to have more cache with the GOMtv.net system. By asking you nothing for the initial viewing but putting a price tag on subsequent viewings, GOMtv.net prioritizes not just convenience and flexibility to watch it at your own leisure, but that returning to past instances of the product is also very important.

But not everyone is already a fan. For people completely new to the product, it doesn't necessarily matter that Crunchyroll gets it faster than anyone else, and over time it matters less and less when exactly a given episode was made. There is nothing necessarily stopping someone from paying for the Crunchyroll subscription, but they would probably need a reason to do so, and while it is certainly possible to ignore the previous content, the fact that Product X builds upon past events means that it engenders a potential feeling of "missing out" unless one watches the back catalog. For Crunchyroll, because the entirety of this back catalog is free (ignoring instances where streaming rights fade), it becomes easier for someone who is not interested in watching to start watching. GOMtv.net and its free initial stream can attract people, but for those unfamiliar with the product being put out, it requires the idea that, while what happened in the past is important, it's not vital to enjoying it. At the same time, it does not offer much reason outright to subscribe to someone who isn't already a fan, and the preview it provides is rather sparse. If they do become a fan however, those older episodes may rise in value, as they help explain how the product arrived at its current, presumably enjoyable point. Here, GOMtv.net would have the edge, provided that accessing that history is considered worthwhile. However, deciding to watch the new material despite having not seen what came prior does not necessarily guarantee that the older episodes will be visited in retrospect, especially if the viewer prioritizes "what happened" over "how it happened."

Of course, despite the fact that I actively ignored the subtleties in each model to give a rough idea of how a product is handled, the difference between solvency and net loss or moderate and high success is probably in the details. Going back to the difference between "new" as defined by Crunchyroll and GOMtv.net, I think that GOMtv.net's model could be better served by having the live broadcast re-streamed two or three times that day or perhaps even re-run for 24 hours to compensate for the enormous time zone differences that can exist between Korea and the rest of the world. I also think GOM's system might be more attractive to old-fashioned companies who may feel afraid to just give the viewer total control of their entertainment product. In time, I think things will shift closer to the Crunchyroll model, but that method also makes it difficult to make a profit off of older material. While perhaps it gains value in becoming a free resource to entice new customers, it does leave the impression that these products are not inherently valuable but rather have value applied to them through their consumers.

Otaku-culture on public display

Last week, subculture made news in Japan, when an exhibition of subculture art at the Seibu department store in Shibuya (Tokyo) was suddenly cancelled in reaction to claims from customers. According to NHK and JCAST, several visitors found the displayed artworks to be improper for a department store. Although the organizers have not made the claims public, it seems that they were not related to any particular works. Since the problem could not be identified, Seibu decided to cancel the exhibition, which was originally scheduled to be on display until the 6th of February, on February 1st.
This seems odd, as Japanese subculture, especially the so-called otaku-culture, which is associated with the works displayed in the exhibition, is more popular than ever before. During the past years, Japanese manga, anime, videogames, etc. have gained increasing attention around the world and especially in Japan itself, where today, their global popularity attracts the economy, politicians, and academics.
According to Nihon University professor and subculture expert Nakagawa Hideki, who is quoted in the JCAST article, the otaku-culture is not a subculture any more, but rather part of the mainstream. He argues that the claims are motivated by an understanding of subculture, that is shaped by the experience of "anti-social elements" in the 1960s. This seems to suggest that it was not the content of the exhibition itself, that caused the problem, but a general caution against everything that is associated with subculture.
While acknowledging the strong impact the aftermath of 1968 had in Japan, I would still suggest that this is only part of the problem, the other part of which is hidden by the terms mainstream and subculture. I do not want to get into discussions about the various definitions of these concepts, but I think that the example above shows that the acceptance of art forms and contents is not only a question of popularity or economic success within a society (as mainstream vs. subculture might easily suggest). Rather, it might be helpful to think about the situation in the old-fashioned terms of high culture and low culture and their hierarchical relation in specific spaces. While the case of the Seibu exhibition indicates that the otaku-culture moves towards public awareness and maybe even partial acceptance, it also suggests that figures, cosplay fashion, and the wide variety of illustrations, amateur manga and other elements of the otaku-culture are still the "uncanny" in the sense of the German word "das Unheimliche" introduced by Freud, literaly meaning something that is not homely. In other words, I would argue that the reaction to the exhibition can be read as an indicator of the anxiety such artworks trigger in some people (with a certain power or status that allows them to speak up in this environment) due to their difference from the familiar in a particular environment, in this case a prestigious department store that has a long history as host for cultural exhibitions.
While the otaku-culture may be one mainstream or part of a certain mainstream in Japan (I have doubts about the analytic viability of these concepts today), it seems striking that, given the volume of this culture today, it’s display is still strongly confined to certain areas (like Akihabara and Ikebukuro, the private spaces at home, rental video stores, pachinko and slot machines) and temporal events. One might argue that this is partly the source of its attractiveness (individuality, temporal, non-binding engagements). But it also means that such “mainstream” culture can go unnoticed if one chooses to stay away, or at least be received very selectively - until it "goes public". It might be interesting to look at these processes of private and public selection and their effects more closely and to understand the power relations and evaluations at work in the case of manga, anime, and the otaku-culture in general.