Short answers, pulled from the story.
An anime music video, or AMV, is a fan-made video that sets clips from one or more Japanese anime shows or films to an audio track, usually a song or promotional trailer audio. It is not an official music video, since no musician or record label authorizes it.
A 21-year-old named Jim Kaposztas made the first AMV in 1982 by wiring two videocassette recorders together. He cut violent scenes from the anime series Star Blazers to the Beatles song "All You Need Is Love" for comic effect.
AMVs are most often posted and shared through the site AnimeMusicVideos.org, direct video downloads, and YouTube. Anime conventions also run AMV contests that screen the finalists and the winning entries.
AnimeNation's John Oppliger argues Western fans rely more on visuals since most cannot follow the original Japanese dialogue. He also points to social pressure that pushes Westerners to give up cartoons and comics in adolescence, unlike Japanese fans who grow up treating animation as a constant companion.
AMV editors use styles including raw editing (basic zooms and simple transitions), FX editing (heavy visual effects via software like Sony Vegas or Adobe After Effects), timing editing (syncing clips to lyrics or beats), and flow editing, animation editing, and masking. Related styles include 3D editing along with MMV, HMV, and GMV, which are based on manga, hentai, and video game footage.
Yes. In November 2005, Wind-up Records contacted AnimeMusicVideos.org administrator Phade to demand the removal of AMVs using music by Creed, Evanescence, and Seether, part of a broader record-industry push against AMVs on YouTube and AnimeMusicVideos.org.