Mayu Iizuka sheds her soft-spoken personality and starts cackling, screaming and waving wildly in a makeshift studio in Tokyo as her avatar appears on a livestream before hundreds of fans. Virtual YouTubers such as Iizuka, who voices and animates a character called Yume Kotobuki, have transformed a niche Japanese subculture into a thriving industry where top accounts can rake in more than US$1 million a year. The videos are designed to make fans feel they are interacting directly with their favorite animated idols — with viewers sometimes paying hundreds of US dollars to have a single commen...