This is the second instalment of a three-part series on the transition of business models of the music, manga and other entertainment industries. The focus of this instalment is the manga industry's efforts to make the best use of online manga distribution.
Manga artist Torako Hidaka, 38, is the author of "Tawara neko to machigai jinsei" (The bale-shaped cat and the erroneous life), which is carried and updated once a week on MangaBox, an online manga magazine.
The manga comically portrays the lives of a girl and a stray cat she adopts.
In Hidaka's workroom, there are few ink bottles and sheets of paper in sight. She draws her manga on a large graphics tablet using a special pen.
MangaBox was launched in December last year by the major social media game producer DeNA Co. and three publishers, including Kodansha Co. Users can read each manga for free for a fixed period by using smartphone and tablet apps.
At the moment, the magazine carries about 40 manga, which are read by more than 1 million people every week.
"I was feeling a bit blue because there have been fewer people reading print manga magazines on trains," Hidaka said. "I feel grateful that now there is a place on the web to publish my manga."
The circulation figures of print manga magazines are declining and there is no end in sight.
For example, Shukan Shonen Magazine, a pioneering weekly manga serial for boys published by Kodansha, had a weekly circulation of more than 4 million in the 1990s.
The figure is now 1.25 million. According to the Research Institute for Publications, annual sales of manga magazines in this country peaked in 1995 at ¥335.7 billion (S$397.5million) and dropped to ¥143.8 billion in 2013.
On the other hand, a succession of free online services like MangaBox have been launched. These allow people to read manga with some restrictions - within a limited period or with limits on the amount they can read.
In March, a website called ComicWalker was launched by publishing house Kadokawa Corp., which has since integrated business with Dwango Corp. On the website, people can read about 200 manga for free, including such popular works as "Shinseiki Evangelion" (Neon Genesis Evangelion). The service provider's goal is to gain a monthly readership of about 1 million.
There are also moves for major publishers to carry some manga on their websites, such as the first volume of a multivolume work, and offer them for free.
How is it possible for companies to offer manga for free?
As an increasing number of people have been known to buy printed manga publications after reading some of the contents online for free, publishers believe this is a big business opportunity.
According to the research institute, the sales figure of manga publications other than magazines last year was ¥223.1 billion, up 1 per cent from the previous year. The increase is in marked contrast with the decline of manga magazine sales. Online browsing appears to have been effective to some extent.
Kadokawa's business integration earlier this month with Dwango Co., a network entertainment content planners and developer, saw the foundation of Kadokawa Dwango Corp.
"We'd like to think about starting manga-related businesses across multiple media, including streaming services, an area Dwango specializes in," said Hiroyuki Watanabe, 45, ComicWalker Manager of Kadokawa Corp.'s New Business Development Headquarters.
However, running free online manga distribution services comes at a price. There do not appear to be many examples of companies making steady profits from the service and sales of individual manga publications.
"Companies that offer free online manga distribution services need to try harder, such as by stocking manga works that suit users' preferences," said Haruyuki Nakano, a visiting professor of Kyoto Seika University, who is well-versed in the manga industry.