The anime industry has expanded globally both in scale and relevance. In Japan, it has grown from $15.1 bn in 2015 to $25.3 bn in 2024 at a 10-yr CAGR of about 6%. What makes this growth particularly interesting is where it is generated.Anime is no longer driven primarily by domestic demand. Global markets account for 56% of total revenues for the sector, contributing $14.25 bn in 2024, compared to 44% from Japan at $10.97 bn. Interestingly, international demand is growing at a much faster pace - 26% y-o-y, while domestic revenues grew a modest 2.8%.At first glance, one may look at the industry and think of only anime content as part of the marketplace. Actually, it spans over a much wider ecosystem that includes streaming, merchandising, music, gaming and live entertainment. In 2024, the biggest revenue-contributing segment was global, followed closely by merchandising, reflecting how anime has evolved into a global IP-led business rather than just an anime content industry.Streaming platforms like Crunchyroll, which has the largest collection of anime, and Netflix and Amazon Prime with limited editions and choices, have made anime more accessible than ever, bringing vast libraries of content to global audiences on demand. Nearly half of Netflix's subscriber base engages with anime content, highlighting its mainstream appeal even though it has limited collection. At the same time, Sony's bet on the category is paying off. Its paid subscriber base has more than tripled since acquiring Crunchyroll in 2021.This surge in popularity isn't limited to viewership alone. It is converting into visible commercial returns for brands as well. Limited-edition drops and collaborations are seeing the butterfly effect of catering to wants of the loyal customers as well as the intrigue of the potential consumers. Certain brands are taking this move in the right direction.Adidas' Evangelion-themed sneakers sold out globally in minutes, while collections from Uniqlo (Demon Slayer) and Bershka (My Hero Academia) disappeared within hours of launch. These aren't isolated or one-off successes but reflect the deep emotional connect fans have with anime as well as the interest it piques for some.Luxury and lifestyle brands are also hopping on the bandwagon to stay culturally relevant. Gucci's Doraemon collaboration for China and Dolce & Gabbana's Jujutsu Kaisen line highlight how anime is influencing even premium aspirational segments. Meanwhile, watchmakers like Seiko and Casio G-Shock are tapping into the fandoms through character-inspired collections, further demonstrating anime's growing influence across industries.TV broadcasting remains a core revenue stream, but has a shrinking share due to popularity of streaming services. Collaborations between anime studios and gaming companies are making gaming a major monetisation pillar. Live events have become an excellent medium for ancillary revenue growth.If one thought of anime movies creating a new category and, therefore, taking its own time to reach the popularity levels of already established categories, then anime movies are now competing head-to-head with major global titles. Demon Slayer: Infinity Castle (2025) stands out as a defining example, establishing itself as the highest-grossing Japanese film worldwide, with global earnings surpassing $800 mn. Strong fan anticipation was evident, with most tickets sold in advance. Premium formats such as IMAX and PLF accounted for about 44% of the total box-office revenue.The momentum isn't limited to a single franchise. 2025 action horror film Chainsaw Man: Reze Arc has also delivered impressive performance, with worldwide earnings of $191.4 mn, making it one of the highest-grossing Japanese films of all time. These releases signal a clear shift from fan-driven to global blockbusters.Anime production isn't limited to Japan any more. South Korea's manhwa and China's donghua animation industries are gaining popularity worldwide. The 2016-21 'webtoon' manhwa series Solo Leveling witnessed huge success globally and has swept anime awards. Donghua hits like Lord of the Mysteries have earned praise for its cinematic storytelling and gameplay-like animation.But despite its rapid growth, the anime industry faces deep structural challenges. A significant portion of the workforce remains underpaid, with nearly 40% of professionals earning less than $15,400 annually, far below Japan's average salary of around $49,000. Animators are facing strain due to long working hours and intense production schedules. This has led to studios facing backlash over working conditions.This situation is further compounded by a serious talent shortage, as rising global demand has led to more anime projects than studios can realistically handle. Many studios have gone bankrupt due to thin margins and severe manpower shortage.AI can help in mitigating these constraints. It can help to automate repetitive tasks like background art and colouring, thus assisting with storyboarding. This will help in significantly reducing production time, thus allowing creators to focus more on storytelling and character development that is the true essence of anime.Toei Animation has launched an AI-assisted background studio using tools like Midjourney and Stable Diffusion for filler episodes to reduce burden on animators. AI has the potential to ease capacity constraints and bring much-needed efficiency to an overstretched industry. India, too, should seriously consider tapping this huge, growing, animated AVGC (animation, visual effects, gaming and comics) market as part of its renewed focus on the orange economy.(Disclaimer: The opinions expressed in this column are that of the writer. The facts and opinions expressed here do not reflect the views of www.economictimes.com.)