Year In Review: The Business of Comics

Wed, December 31st, 2008 at 1:18pm PST | Updated: December 31st, 2008 at 1:59pm

Comic Books
CBR News Team, Editor

We’re back with more of our discussion about the trends and events of 2008. If you missed our previous Year In Review discussions, check them out:

The four CBR reporters doing the “discussing” – Tim Callahan, Kiel Phegley, Dave Richards, and George Tramountanas – got a bit cantankerous about the topics raised during their last gabfest. Will sparks fly again? It’s hard to say, especially considering the somber subject they begin with this time…

BELT-TIGHTENING: THE U.S. ECONOMY AND THE COMICS INDUSTRY

Kiel Phegley: With the current economy, everyone’s been hit pretty hard. And publishing has been just as hit hard, if not harder, than anyone else. In the newspaper world, staffers are being laid off left and right. In the book world, there was a major reorganization at Random House and a “no new submissions” policy at Houghton Mifflin Harcourt. So what about comics?

Virgin Comics went out of business this year. I was one of several staffers let go by Wizard. God only knows who's left at TOKYOPOP. And Devil's Due just announced a handful of layoffs and cutbacks in printing for awhile. Are comics really recession-proof? Is this a minor course correction in business tactics, or is this the start of a bigger snowball that can feed another comics crash? Okay, maybe that last point is a bit melodramatic, but the worst is probably far from over. Right?

George Tramountanas:  I’ve heard several folks try to claim that comics are recession-proof, but I believe that’s only true to a certain degree.  The comics market has been struggling for a while now.  Look at all the difficulty publishers have launching new books nowadays – even Marvel and DC.  Granted, sales are up at the Big Two, but take away the events we discussed earlier and the picture isn’t as pretty.

As Kiel said, most of the difficulties are hitting the smaller publishers first.  This can even be seen in Diamond changing its relist procedures.  Marvel and DC will survive, but they will still be affected. When huge movie studios in Los Angeles are having to lay off hundreds of employees, it shouldn’t come as a surprise if (or when) our little source of entertainment gets hit.

Tim Callahan: I don't think the worst is over.  I think the reduction in the price of oil might help a bit, but I wouldn't be surprised to see major restructuring or the outright bankruptcy of a few significant players in the comic book industry over the next twelve months.  I think Marvel and DC are probably safe, and Image should be okay since their stuff is mostly backend anyway.  But how about the mid-range publishers or the manga publishers?  I think we'll see things get worse before they get better.

Dave Richards: I think the biggest publishers affected by this will be the indies. The bigger companies and the bigger characters will take a hit, but in tough times the need for escapism doesn't diminish. In the ‘20s and ‘30s, the pulp magazine (the parent of the comic book) was hit by the Great Depression and the number of pulps on the stands drastically shrunk.  The bigger name titles featuring characters like The Shadow and Doc Savage survived. So I think if you love an indie book, now is the time to show it as much love as possible.

RISING PRICES: THE $3.99 STANDARD

Tim Callahan: $3.99 is kind of inevitable now, isn't it?  The wheels are surely in motion if we look at the Marvel and DC output on the horizon.  But is it really that big of a deal?  Will it make anyone think twice about picking up their favorite titles?  Yes and no.

I can't imagine it will affect sales on the big name stuff all that much, if at all.  Your event books, your top-notch creative teams, your hot commodities – those will still sell at a dollar more per issue.  But the smaller-scale stuff, the idiosyncratic miniseries, the “kind of irrelevant” spin-off, or the newly launched title with an unproven creative team – those will push people away at $3.99 and turn more Wednesday addicts into trade-waiters.  And if my experience is anything like the rest of the comics-buying public, when I start trade-waiting, I start forgetting about why I wanted to read certain comics in the first place.

I'm a much more conservative buyer of trades than I am of single issues, and when the long wait makes you think more deeply about your buying choices, a lot of those middle-of-the-road choices just end up never getting bought.  So, in other words, I can imagine that the overall increase to $3.99 will have some pretty serious repercussions. I buy a lot of comics each week, but a 33% price increase will force me to cut back, and it's already done so this year.

Dave Richards: Yep, $3.99 is going to be the death knell for certain books. I can see this only slightly affecting the sales of some of the higher profile books that tie heavily into mainstream superhero universes, but niche books and interesting little minis? This could be the kiss of death. It should be interesting to see what a price increase means for Marvel's online comics service, though.

George Tramountanas:  I agree with everything said so far, although I think there are aspects of Tim and Dave’s statements that we need to examine further.

Tim and the rest of us CBR reporters can be viewed as some of the biggest fans and supporters of the comics industry.  Therefore, when a price increase forces us to cut back on our purchases, you know there is a good chance that the price rise will affect comic readers of every interest level. For comics’ biggest fans, they will probably drop books with “lesser” characters or creative teams.  However, adding on to Dave’s assessment, I think this revenue can still be recaptured by comic companies either by those fans purchasing the eventual trade or reading those comics digitally if they have a system in place, such as Marvel.

For the casual readers, though, I think the increase in price will be an additional barrier to them joining comic fandom.  When they have the choice between a 22-page comic book written by Greg Rucka for $3.99 and a 416-page novel written by Greg Rucka for $6.99 (like “Patriot Acts”), suffice it to say, they may think twice.  Then again, if it’s only 16-pages of content for $3.99, they may not even experience second thoughts.

Casual readers also have cheap manga, DVDs and video games vying for their dollars in a difficult economic climate.  On top of that, if all the comics they find are overly continuity-laden (i.e. not new reader-friendly), it may seem to them (true or not) that the comics industry isn’t really set up for them to come aboard.

One question that I haven’t heard asked yet is why raise prices now?  During times of economic hardship, doesn’t the industry want to keep the prices down?  I understand the excuse of increased costs, but then I read an article in Fortune which contained this interesting fact:

Here's a secret about comics that has been hiding in plain view amid all the cinematic hoopla: At Marvel Entertainment (MVL), the industry's largest player, revenues for its print wares have been growing in double digits for the past three years and profit margins have been running at close to 40%. Plenty of magazine, book or newspaper publishers would put on a mask, cape or even giant bunny ears if that's what it took to generate those kinds of numbers – especially right now.

So why raise prices now?

Kiel Phegley: I don't think anyone can argue that this is a good idea, but how much of an issue has it really been for most of 2008? I don't buy Marvel books in floppy form since they put out trades so damn quick, but haven’t they priced a bunch of their regular 22-page comics at this price already? If so, I think we need to spell out which series have gone up in price and talk a little bit about the practical side of the equation before discussing the negatives of the idea in general. If a move to $3.99 has only been taken slightly in the past few months, then to me this is more of a possible trend of 2009 thing.

THE DIGITAL (R)EVOLUTION: MAKE MINE BINARY!

Kiel Phegley: Marvel finally crossed the line in 2008 in terms of putting original content online, starring recognizable superhero properties (not the big names, but still…), and it looks like they won't be stopping that program anytime soon. DC has paid lip service to the idea of superheroes online while sticking by Zuda pretty strongly. Dark Horse made great moves in bringing digital cartoonists to the print side from their MySpace Dark Horse Presents initiative. So 2008 finally seemed to be the tipping point for the digital takeover of print comics -- or at least the first flags were planted. What does it all mean for the industry here and now, and what's next?

Tim Callahan: Within five to eight years, digital delivery will be the norm and not the exception.  I don't know how it will happen, and I suspect it won't look like what Marvel is doing right now – though it's a start.  It might end up more along the Zuda model, really, although perhaps without the competitive element.  Just original content provided in a new format, and the best stuff eventually collected into print form.  But I think both the Marvel and DC interfaces are not that strong just yet, and that's a problem that will be fixed in a couple of years, I'm sure.  As much as I like reading physical comic books, I just can't imagine that they will survive for much longer.

People liked to read scrolls once upon a time, too.

George Tramountanas:  I agree with Tim: digital comics are our future.  I love paper collections and holding a book in my hands, but the truth is that we need to prepare ourselves for the inevitable.  At least Marvel is keeping this in mind, as evidenced by their $10 million investment in digital media.  If publishers don’t get ready, they will find themselves experiencing the same pains the music industry went through when MP3s were suddenly made available.

Certain fans are worried about the collectability factor disappearing from a print format, but I think we need to look at the comic book’s origins.  Comics were originally published on newsprint because they were deemed disposable media.  They were inexpensive, entertaining, and temporary.  The beauty of digital is that those first two elements can make a resurgence, and the temporary nature will be gone because comics will live forever as digital files (and trade paperbacks for those who need them).  Comic books used to be swapped around between readers; they weren’t bagged and boarded.  With digital comics, this can happen again and allow our industry to grow once more.

Granted, there will be a need to alter the mindsets of creators and publishers with regards to what they can expect profit-wise, but there are profits to be had.  As a matter of fact, this is question #8 of Tom Spurgeon’s “Ten Questions For Which I Have No Answer.” Webcomics like “Achewood” and “The Perry Bible Fellowship” – while free on the web – are doing gangbusters in merchandising and as trade paperbacks for Dark Horse.  This is something Scott Kurtz of “PVP” seems to advocate as well as he is moving to webcomics and trades only for his strip.

Geez, with these examples in mind, some might even say the digital revolution has already made its way to comics.  I hope all the publishers are ready to climb onboard!

Dave Richards: I'm one of those people who just enjoy reading the paper comics. There's something about the concrete feel of holding it in my hand that draws me more into the story. Sitting in front of my computer just sort of detaches me from things. I suppose I'm going to have to change my mindset, though, because it does seem like digital comics are the future. Right now, my biggest problem with current systems like Marvel’s is that they need to go one way or the other. When they do books that premiere online first, it feels like a punishment to those of us who are in the stores every week.  But if I just go ahead and subscribe, I won't have all the access to the comics I buy in the stores. Having to subscribe and hit the stores is too big a hit for my wallet to take.

Now if a company's digital subscription service gave you access to all of their titles in publication, I would immediately change my tune on digital comics because of one big factor – space! My closets are bursting with the remnants of buying comics for twenty-four years. If I could maintain a collection digitally and clear up the clutter in my home, I would be very happy. Another advantage to digital comics could be portability. Imagine if someone came up with a device for comics like Amazon.com's portable Kindle reader? If you were going on a long plane ride, you could entertain yourself with things like Bendis and Maleev's entire “Daredevil” run and still have all your baggage fit in the overhead compartment. That’s a future I’m looking forward to!

Our reporters will be back again soon to chat about the coming publications and events of 2009 they are eagerly anticipating. Until that time, though, be sure to stop by CBR’s forum to add your own thoughts to the discussion started here.

TAGS:  year in review

 
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