Tokyo (Reuters) - The artistic legacy of Hayao Miyazaki, the reclusive and bearded Oscar-winning director and animator sometimes called Japan's Walt Disney, has never been more certain.
Yet at the same time, the commercial future of Studio Ghibli, the privately held Tokyo studio he left behind in retirement, has never been more in doubt.
Under Miyazaki, Ghibli became famous for intricate, hand-drawn animation and imaginative coming-of-age storylines that made films like 1988's My Neighbor Totoro international hits. A dozen years later, he masterminded the Academy Award-winning Spirited Away. It remains Japan's highest grossing film.
In recognition, Hollywood is about to give Miyazaki, 73, a lifetime achievement Oscar.
But the animation studio is finding that life after the animator, who retired last year, is tough going. Ghibli's first release since Miyazaki's departure, When Marnie Was There, has failed to catch fire with Japanese moviegoers.
Besides the gaping hole left by Miyazaki, Ghibli, like Japanese companies in other industries, faces a range of challenges: high payroll costs, low productivity and the rise of new and cheaper hubs for production elsewhere in Asia.
In six weeks, Marnie, the story of an asthmatic high school girl sent off for what becomes a summer marked by an unexpected and mysterious friendship, has taken in just US$28 million (S$35 million) at Japanese theatres. The mediocre takings come as Ghibli's fans and critics debate how and whether the studio will survive without the commercial magic of its founder.
Senior producer Toshio Suzuki made waves last month when he said in a series of interviews that the studio might have to dismantle the expensive production system set up under Miyazaki, which included employing full-time animators in Japan. "We're going to spring clean and restructure," Suzuki, 66, said in an interview with broadcaster TBS.
He said the studio would take a break and could re-launch with a different and lower-cost business model that could shift production from Japan to South-east Asia or Taiwan. "Ideas will be formed in Japan and the animation could be made in another country," he said.
A spokesman for the studio said it had no further comment on its plans.
Famous for starting production without a complete script, Miyazaki insisted on working in pencil and spurned computer animation, resulting in intricately drawn frames and very long production spans. Some feature animation films consist of about 10,000 drawings, but Ghibli's sometimes exceed 80,000.
In fact, under Miyazaki, Ghibli made a virtue of its high-cost approach.
Ryusuke Hikawa, an expert on Japanese animation, estimates Ghibli was averaging just five minutes of animation production a month, given its recent pace of producing a feature every two years.
That was sustainable when the studio, with Miyazaki at the helm, was turning out consistent hits. The nine Ghibli films that he directed averaged box-office takings of US$115 million. Spirited Away, which came out in 2001, took nearly US$300 million at the box office.
Box-office takings are particularly important for Ghibli because of its limited spin-off merchandising, another break from the approach of Hollywood studios which long ago abandoned hand-drawn animation for computers.
As a result, Ghibli has a volatile earnings record, according to credit rating agency Tokyo Shoko Research. In the fiscal year that ended in March 2012, it earned US$9 million. That dropped to US$5 million last year and jumped to US$30 million this year, reflecting the success of Miyazaki's last film, The Wind Rises, released last year.
Fans are focusing on Marnie because it is the first Ghibli film shaped entirely without the involvement of Miyazaki, Suzuki or the other famed Ghibli director, Isao Takahata.
Movie critic Yuichi Maeda said the film's director, Hiromasa Yonebayashi, 41, had delivered brilliant animation, but without the energy of a Miyazaki movie. Maeda said he did not believe Ghibli could prosper without Miyazaki's guiding hand. "Ghibli's popularity, unlike Pixar or Disney, depends on who directs its movies," he said. "I don't think Ghibli without Miyazaki can succeed."