By Todd Allen
Dave Castelnuovo had a few words about the state of digital comics and the old arguments are coming up again. Pricing, retailing and formatting are still points of contention.
The interesting dynamic here is the extent to which retailers are driving the digital process. Yes, this sounds backwards, but publishers have been bending over backwards trying not to upset the retailers since the dawn of digital. I’m sure there are a lot of retailers who don’t feel that way, but I’ve had multiple publishers tell me they were holding back progress to pacify the retail channel for years.
If you go back to music, it was Apple that really set the pricing. Apple ran a few pricing experiments and settled on $0.99. They controlled the main store and hardware, so they told the music companies how it was going to be and Big Music had to take it. They were kicking as screaming as they took it, and there’s been a (small) amount of give and take since, but that’s basically how it went down.
In comics, if anybody wants do discount the digital price, they end up with the retail channel screaming bloody murder and threatening not to order the publisher’s books. Or not to order for the shelf. [Mind you, if the store is a pull-box driven establishment, the publisher might well ask themselves how many of the copies being ordered are actually for the shelf.]
The comic book distribution network is possibly the best example of channel conflict you’ll ever see. Comic retailers are probably the most militant retail segment when it comes to a manufacturer (in this case, a publisher) selling directly to the consumer. You see them protest against subscriptions. It wouldn’t surprise me if a few of them are mad that libraries carry graphic novels. But that’s just how this market is currently working.
The thing about Pocket God is that Castelnuovo (and by extension, Ape Entertainment) has embraced that the DM retailers could care less about his print product and just moved on. The more print you sell, the more you’re going to care about what the retailers think. Would Dark Horse take a big hit on their print orders if they discounted their digital? Maybe. DC and Marvel are important enough to the retailers that they could lower digital prices and the retailers would just have to deal with it. Neither is ready to do that yet.
There’s an argument breaking out about whether music is the digital market to look to when discussing comics. At this point the eBook market is probably the closer comparison. The iPod blazed the way for higher consumption of digital music. On the eBook side, the Kindle is what blew the door off the barn and the proliferation of tablets is fueling growth. Comics are somewhat stunted in this market by three main factors:
- Color/Size – Most U.S. comics are in color and have a larger footprint that the current selection of tablets. The regular Kindle and Kindle Fire are a little smaller than you’d like for reading comics, though the rumored larger Kindle Fire that’s supposed to come out in the Spring may be better. Digital comics growth has been stunted by a lack of color alternatives to the iPad, but this situation will eventually resolve itself and comics should then start to behave a little more like eBooks. Is iPad to comics what iPod was to music? Possibly, but I can get a cheap off-brand digital music player or put the music on my smartphone. I have less tablet alternatives and I personally find the smartphone screen too small.
- Formats – With eBooks, you pretty much have the open source ePub format that can be read anywhere or you’ve got Amazon’s Mobi format. (Amazon being unlikely to go out of business any time soon and you can read ePub books on a Kindle.) With comics, you have a multitude of proprietary formats. Not all comics are available in all formats. It’s a flipping mess and in many cases you don’t actually own the file. This is not acceptable to collectors who want to retain their library. It also causes comic publishers problems if they want to sell directly, without having to retain a comics app provider for their proprietary format.
- Pricing – If you want to play in the Kindle eBook space, you have to get an agency agreement with Amazon or the data transfer fees will kill a publisher’s profit margins for color comics. And agency agreements appear to be an invite-only affair, so independent creators may be left out in the cold. On the flip side, independent novelists tend to agree that $2.99-$3.99 is the best revenue-generating price for an eBook novel. So, for $2.99-$3.99, the consumer can choose between a single issue of a comic or an entire novel? And you wonder why a lot of the current digital market is driven by existing/lapsed fans. (Yes, I know the larger book publishers are charging $9.99+ for eBooks, but the Justice Department is also investigating price fixing, so let’s wait on that investigation before getting too emotionally involved in discussing that aspect.) You have to think about this as price vs. volume. The only time price vs. volume has really been a factor in the print world has been Marvel bumping the price to $3.99 on their more popular titles. The current comics market has print as the realm of collectors and digital competing for the casual readership. Upping the price leave you with more sales from the collector demographic than the casual demographic. That’s what a lot of people aren’t processing.
As to whether more CDs or downloads are sold in the music category, let me offer this: from 2005 – 2010, I taught eBusiness at Columbia College Chicago. Depending on the semester, I’d have 20-75 students rolling by each semester and let me assure you, they were not buying more CDs than digital downloads. By 2010, it’s entirely possible more vinyl was being bought than CD – I had a lot of music business majors in my courses and it was at the point, if physical media was being bought, it was for DJ purposes. Which is to say, last year very few college students I encountered were buying much physically distributed music.
Pricing will sort itself out at some point. Color eReaders/tablets will sort themselves out at some point. (Although I still think that monitor-based browsing is criminally neglected as a sales channels.) Format is a touchier subject, but you’ve seen Amazon, Apple and Barnes & Noble all taking baby steps towards having their own formats… which need work, but if the sales are there, the product will be improved.
The real question is how long this will take to sort itself out.
Todd Allen wears a lot of hats. At various times he’s been (alphabetically), a bouncer, college professor, humor columnist, Internet producer and an NBA/WNBA Beat Writer, among other things. He’s the author of Economics of Digital Comics. You should probably read it.