Independent scanlation groups, many of whom have members who have never met face to face, with participants in a single group spread as far as China and Germany from each other, made their work available to the public a host sites like One Manga, MangaFox, an several others. The sites had some advertising, but that kind of advertising barely pays for the hosting costs of the bandwidth intensive sites. Some had several hundred titles.
The structure of the scanlation world parallels that of the manga industry itself, in which an author with a few less skilled apprentices pitch their titles to publishers whose editors work with a variety of manga writing groups in serialized anthology formats that often reprint into bound one author reprints.
This had been quitely tolerated by Manga publishers for more than a decade. When they weren't trying to market translations abroad, it didn't cut into their profits anyway, it generated a trickle of orders for print copies from abroad (some to do the scanlations from, and as a result of enthusiasm generated by the scanlations), and the scanlators made it an ethical standard in their obsession to be polite and respectful, to not claim rights in the material, to urge readers not to commercialize their products, and to respect the material with quality translations (often better quality, at least in the early days, than publisher provided versions).
Eventually, however, publishers started imprints like Viz Media, Tokoyo Pop, Vertical, Inc., and Yen Press, capitalized on the market the scanlation sites had proved existed and developed. They started to market translated versions of their titles in American comic book and book stores, and scanlations were now impacting their bottom line by offering for free what they were trying to sell in stores for hefty per volume prices.
This summer, that came to a head. The 36 publishers organized a coordinated cease and desist effort this summer. One Manga shut down all of its scanlation content, reducing it to a Manga discussion forum, at the end of the day on August 1, 2010. Other sites shut down as well:
Manga Traders shut down in mid-June. MangaHelpers announced their mid-June shut-down and their plans to create a new legal alternative OpenManga. Other reports have mentioned that Manga Toshokan is also winding down operations.
MangaFox, which is a China based, ad funded, for profit site, took down several hundred titles that were the subject of cease and desist requests, essentially all of the American marketed titles of the complaining publishers, but have kept many hundreds more titles that were not specifically identified, apparently titles that have not been big enough to be translated commercially. More coverage of the crackdown in the blogosphere can be found here.
As a user of these sites, it sucks, although it is hard to say that the publishers weren't within their legal rights. The legal issues were widely understood before the crack down took place. A translation is the prototypical derivative work covered by copyright law, and complete works were translated. Getting something for nothing too good to be true.
On the other hand, it is worth noting that the scanlation community has been extremely cooperating. Characterizing what they were doing as "piracy" is inapt. The fact of the matter is that the they did their work for years with the full knowledge of the industry, did it without complaint, did it without making meaningful personal gains, and promptly shut down their sites without requiring publishers to resort to litigation when publishers complained. This also wasn't simply a matter of a squeeze put on hosting sites (who may have had some Section 230 immunity from liability) forcing scanlation groups to cooperate. Scanlation groups that received cease and desist notices themselves promptly told their hosting groups to take their titles down.
It is hard to see non-profit activity that publishers knew about and didn't complain about as IP piracy, in the conventional sense of the world. Scanlation was done by a much more humble and straight laced crowd than movie and music file sharing by the Napster crowd (which, notably, was engaged in straight copying, not in the creation and marketing of derivative works involving new, fan created creative content).
Scanlation groups are like small scale marijuana dealers who grown their own weed. They aren't making huge profits. It takes a labor of love, and considerable personal time and expense, to make what they are offering. They long to be legitimate. They are willing to share their profits with legitimate authorities, follow rules and play fair. They don't believe that they are doing any harm and indeed are aware that they are providing a valuable service that the market has failed to provide. It just so happens that there has been no workable legal framework for them provide this service. They just want a deal that is fair for everyone that includes some kind of fair recognition for their work.
Every one of the hosting sites would be happy to enter into licensing arrangements. But, the barriers to getting those licensing agreements negotiated and agreed to have been insurmountable. The people with the monopoly power to enter into the contracts needed to legitimatize their products simply haven't been bothered to even try to discuss terms that would make available works for which there is a large demand that they haven't been filling.
The other point that is worth recognizing is that the pie that is out there to be split isn't as big as it seems. The law allows libraries to buy books one and systemically market them to as many readers as they can. People who buy manga and anime in the United States don't hoard they collections; they lend them to fellow fans, trade books they've already bought, and have parties often organized by fan clubs, to watch movies that aren't available on big screens together.
For every ten mass market best seller titles sold, perhaps five or six people actually read them. For every ten manga or anime titles sold in English, hundreds of people read them. Anime companies with a handful of notable exceptions, for whatever reason, have chosen a straight to video delivery system and often don't even distribute their titles through storefront video rental outlets, despite the fact that their movies produce huge box office returns in the manga heartland.
I have no doubt that most major metropolitan areas in the United States, Denver included, could support at least one movie theater that does nothing but show dubbed or subtitled anime movies and run an associate manga and anime bookstore on a for profit basis. If teens could see these titles as a "date night" event on a big screen, the market for the entire genre in the United States would explode.
This wouldn't be simply the art house crowd of high culture intellectuals that go to the Landmark Theater chain's foreign film offerings in Denver, either, nor would it be an audience of mostly first and 1.5 generation Japanese and Korean immigrant kids. These titled were crafted to have the mass appeal that summer blockbuster films do in the United States and would have similar appeal in the U.S.
Manga and anime have different story telling conventions, values, and assumptions than Hollywood, New York or Nashville do. But, those would be easily digested and a refreshing change of pace for most audiences. Honestly, the cultural milieu of manga is more familiar to me, an American white guy who grew up in a small college town, than the world Melissa Wyatt describes in her semi-autobiographical 2009 novel, "Funny How Things Change," a recent local color novel about a boy coming of age and deciding if he wants to stay in a rural West Virginia town, or the world hard core country western musicians croon about. Stock manga tropes like anxiety over exams, extra-curricular activities, office workers with bosses from hell, efforts to appease unhappy parents, and panic over loans that are hard to repay are more familiar facts of life for most young middle class Americans than repairing cars, hunting deer, getting arrested by a sheriff's deputy who is also your cousin, or being left with nothing but your dog when you come home on day to find a vengeful wife gone.
Scanlation thrived in part because it was a way that someone could make a little contribution to people without being too exceptional, a bit like the contribution that someone with a little knowledge of something obscure can make on wikipedia.
Somebody in the group does have to be able to have a working ability to translate from Korean or Japanese to English (the translations of Korean or more obscure titles, in particular, can often be pretty rough). But, lots of the jobs take nothing more than a good eye for copy edits, the ability to buy a book, run a scanner and upload files, good handwriting to letter translations in speech bubbles, or a sense of idiomatic English to smooth out rough spots in an initial translation of the short manga script into conversational contemporary English. It is work, but it takes more commitment than genius. There are more people with computer skills or a working bilingual fluency than there are people who are inspired story tellers and graphic artists, despite the fact that almost every school kid is require to at least try their hand at writing stories and drawing pictures in school and praised if they can do it well.
Scanlation was one of the last really blatant examples for full work copyright violations that had been thriving on the web. Publishers in other genres went after almost everything else first. The looming question is whether this initiative will go any further.
Manga publishers appear to have been relatively restrained in their initiative, so far. They didn't start out asking for huge damage awards against ordinary uncompensated users, and they didn't even send out cease and desist requests for large numbers of titles that aren't available in translation commercially. They would be within their rights to ask for more take downs, and there is a lot of non-commercial "fan fiction" that while not so directly constituting derivative works, could certainly be considered to be and probably would draw lawsuits if it was marketed commercially.
The publishers are also taking a risk in their approach. They have shut down a lot of timid, loyal fans who only did their work with tacit acceptance from those with the right to shut them down. It could be that in a few months, if a licensed alternative to the old, unlicensed scanlation regime isn't established, that a new generation of scanlators who make a greater effort to be hard to shut down and aren't so timid come onto the scene.
Probably the only reason that illegal online music downloading isn't a hundred times more pervasive than it is today is that low cost licensed alternatives like iTunes made songs available at a dollar per title in most cases. Unless manga publishers make available a reasonably affordable legal way to access their content online (perhaps along the line of the eBooks downloading services offered by libraries right now), a black market will spring up to replace the gray market that they have shut down.