ICv2 has obtained a copy of a letter from ADV to its customers indicating that 'ADV Films is no longer planning any sales, distribution or billing functions for Geneon Entertainment.'  The deal, which was announced on August 24th (see 'ADV to Sell Geneon Products'), represented the latest contraction in the American anime industry that saw the number of releases fall by 19% from 2005 to 2006 and drop even further in 2007.  With sales down at least 10% so far in 2007, the announcement of the collapse of the ADV/Geneon agreement does not appear to be good news for retailers, who may be stuck with returns, or for consumers, who may not get to enjoy the conclusion of their favorite Geneon anime series without, at the least, serious delays.

It is still possible that the giant Japanese advertising agency Dentsu, which owns 100% of Geneon USA, may still find a willing suitor for the company.   If not, it will be a major loss for the American anime market. Geneon has roots that stretch back to the very beginnings of the anime industry in America with the Pioneer LDC (Laser Disk Company), which was founded in the early 1980s.  Ad agency Dentsu acquired the anime arm of Pioneer in 2003 and renamed it Geneon.  In 2006 Geneon was the third largest company in the American market (among companies principally engaged in releasing anime).

Geneon has a large and potent backlist. Currently Geneon has four titles in ICv2's 'Top 25 Anime' including Hellsing Ultimate (#7), Ergo Proxy (#17), Black Lagoon (#22) and Fate/Stay Night (#25).  The fate of some of the series including Hellsing Ultimate is very much in doubt since Dentsu is planning to shut down Geneon's in-house production.