For some inexplicable reason, Todd Allen has agreed to another interview with The Outhouse to talk about the release of The Economics of Digital Comics!

Last summer, legitimate comics journalist and guy who's probably too good to appear on The Outhouse, Todd Allen, stopped by to talk about the Kickstarter for his book, The Economics of Digital Comics. Here's an exerpt from the press release for the book that sums up what it's about:

The new book Economics of Digital Comics explores how the comics business has changed in recent years, including digital distribution and the increasing popularity of webcomics. It breaks down the industry into Four sectors: print publishing, print comic strips, webcomics and eBooks/digital downloads. Distribution channels, revenues and readership levels are compared with an eye on determining what readerships levels are necessary for income benchmarks and how feasible that really is.

Read the full press release here.

Basically, if you're an aspiring comic book creator looking to start making comics and maybe, eventually, make a living doing it, or if you're an established creator or publisher looking to better understand the business and potential areas for growth, this is the book you want to read. Don't take it from me - just ask comics mogul and noted curmudgeon Mark Waid.

Now, despite the fact that he really should know better, Todd is back to promote the book's release. We took the opportunity to talk to him about some of the issues facing the industry today, and he offered some great insight into the kinds of things we talk about here all the time, only less professionally. Check it out, and get a copy of The Economics of Digital Comics. It's the third edition of the book, and, as Dungeons and Dragons players can attest, that means its the best edition.

Hello Todd, nice to see you again, and I'm glad your career managed to somehow survive being featured on our site. What could possibly possess you to come back to this dump?

It's the best way to get the word out that while Stephen Colbert looks like me and went to the same college, he's not actually me. It's disturbing how often we get mixed up.

So just to catch readers up, way back in the summer of 2014, you successfully Kickstarted a book called "The Economics of Digital Comics," which was actually the third edition of a book you first published in 2007 called "The Economics of Web Comics." Now, the book is out, but a lot of time has passed since the Kickstarter. Do you feel like it's time to update it again? Digital comics are so 2014.

I figure I can leave things alone until Marvel's SXSW announcements in March. It's surprising how quiet they're able to keep their digital announcements.



Let's face it, people aren't exactly getting rich off digital comics. Couldn't the entire book be summed up with the sentence "don't quit your day job?"

Depends on what the day job is, really. I certainly wouldn't quit it for the first couple of years, but there's plenty of people who can build a webcomic into a small business in 2 or 3 years. If you're trying to replace a management job, that's a bit harder to do and takes a little longer. The name of the game is building an audience and contact list you can tap, be it social network(s) or e-mail. It's a bit more of an open question on the digital download side. Brian K. Vaughan's doing quite well for himself, but I'm not seeing enough evidence of that many people making good bank there.

I was reading your press release, and I have to ask: does the US State Department really have a "Comics Ambassador?" You totally made "Josh Elder" up, right?

https://conx.state.gov/event/reading-with-pictures-an-evening-with-josh-elder/

http://www.berlinglobal.org/index.php?us-embassy-presents-comics-ambassador-josh-elder

http://dai-heidelberg.de/de/veranstaltungen/heidelberg-comics-days-2-9624/

I don't want you to spoil too much of the book, but how does the recent collapse of the ruble affect the economy of digital comics?

Haven't seen Red Star in Teen Titans lately, have you? I can't officially confirm that it killed a DC digital-first weekly, but... you know...

Will digital comics be at all affected by the recent opening of diplomatic ties with Cuba?

It depends if the Miami-based attempt to split Florida into two states is successful.



Do you think that the digital comics will at all be impacted by the SEC's decline as the premier conference in college football?

The Big 10 has always produced more readers, so no.

How important do you think the Cavs trade for JR Smith and Iman Shumpert will be for the future of digital comics?

If JR Smith has a meltdown, and that's the assumed risk, Cavs fans will be spending more time on basketball-related message boards and less time reading digital comics. The bigger risk for more time on message boards is the addition of Timothy Mozgov at center. He played for Cavs coach Blatt in Russia (when their currency was more stable) and provides a lane filler and rim protector they were completely missing. A healthy Shumpert is a good wing defender. An in-control Smith is good for points off the bench. On paper, that's a serious team. Now, there are chemistry questions plaguing that team, but a deep playoff run could also divert eyeballs away from webcomics. It's all about the eyeballs.

I have a saved jpeg copy of "Mr. T Ate My Balls," which is like the first webcomic ever published. This has got to be worth something. I've seen Action Comics #1 sell for over a million bucks. Can I at least get like ten grand for this on ebay?

Assuming you've got the right licensing deal with the original artist, you're probably best off with a numbered lithograph on that one. The beauty of eBay is the crowd will determine the price for you.

Let's talk for a moment about the price of mainstream superhero comics. This is a big issue for me. I've been writing on The Outhouse a lot lately about the trend toward single issue print comics costing five dollars an issue. My theory is that Marvel, and to a lesser extent DC, is testing the waters by selling a lot of number one issues or annuals or comics with special covers or extra pages or some vague notion of being important because they're connected to a "universe-altering super-mega-crossover event" at this new price point to get people used to paying it, and then eventually, maybe even this year, that will slowly start to become the regular price point for issues that have nothing special about them at all.

I write a column about it every week urging people not to buy any comics that cost more than four bucks, and just anecdotally from doing that and looking at the prices of every book, it seems like Marvel has at least one or two $4.99 books out each week. I can tell you for a fact that they only publish one regular universe ongoing title that isn't already canceled, Ms. Marvel, at the $2.99 price point.

Am I on to something here, or am I talking out of my ass? And do you look at me trying to talk about this in the same way I look at my six year old when he explains to me how he ties his shoes? Can I possibly make this question any longer? I just did. Did it again. Todd, comment?

I think we need to refer to the wisdom of Dan DiDio here. Right before the New 52 relaunch, he told the LA Times:

“The truth is people are leaving anyway, they’re just doing it quietly, and we have been papering it over with increased prices,” DiDio said. “We didn’t want to wake up one day and find we had a bunch of $20 books that 10,000 people are buying.”

(That quote appears in the book, by the way.)

You've seen the sales charts. The big hits aren't what they were a few years ago. Take Spidey and the Events off the table and Marvel doesn't have that many books hitting the DM estimates at over 60. DC has a big drop-off after Batman. They both have quarterly estimates they're trying to meet. Raising the price is a tool. If they raise the price 25% and only lose 10% of the sales, that's a net gain. Marvel did the experiment with $3.99 5 years ago and the math worked out:

http://www.publishersweekly.com/pw/by-topic/industry-news/comics/article/45112-buckley-s-pricing-gambit-at-marvel-pays-off.html

So yes, if $4.99 sells consistently, its their fiduciary responsibility to take your money. The risk, as Dan put it, is that you chase off too much of the audience with the price increases and end up with a small audience paying exorbitant prices.

I know prices for everything go up all the time, but it seems like comics have gone up a lot compared to what you paid for them a decade or three ago. I remember Nintendo cartridges used to cost about fifty bucks, and today brand new video games still cost fifty or sixty bucks. A CD in the eighties and nineties cost between ten and twenty bucks and a digital album costs the same, or less, today. Movie tickets have gone up, but Blu Rays aren't any more expensive really than DVDs or VHS tapes were. Why has the modern comic quadrupled in price while these other forms of entertainment haven't? Is it really justifiable?



You've got a couple things contributing here.

1) Comics used to sell hundreds of thousands of copies per issue. Now we have a party when they cross the 100K line, because outside of stunts, that's really only Batman and sometimes Spider-Man. In terms of regular continuing titles, there's slim pickings between the 90K and 70K sales bands. With the indie comics, printing is more expensive and the audience is even smaller. So you're trying to balance print costs with audience size on the low end of the market. I've got some print cost vs. pricing charts in the book and you can see for yourself why those books selling around 5K copies want to be $3.99, not $2.99.

2) DC and Marvel are publicly traded, or rather part of publicly traded organizations. On top of everything else, they need to make estimates and its vastly preferable if all facets of the corporation show growth. And that goes back to the fiduciary responsibility. Art and commerce can be strange bedfellows.

Why aren't digital comics significantly cheaper than print comics, despite not having to deal with the same production and distribution costs? Is there any reason beyond not wanting to undercut print comics?

Not wanting to undercut print is the big one. Specifically channel conflict with the Direct Market.

To an extent, there's also the issue of how much of the list price you're keeping. Depending on platforms and partners, you could see as little as 35% of the list price come back to you or as much as 70%. Now, if you're selling off your own site, it's going to be more like 90-95% depending on the exact transaction fees and your price.

How many $0.99 comics that you get $0.35 of net revenue from do you need to sell to make it worth your time? Instead of print costs and audience, over here it's price after discount and audience that you're playing with.

Dark Horse keeps the vast majority of the money off their site and should Marvel take digital in-house, that will be why they do it.

The story I've seen in the media lately is that the growth of ebook sales has slowed, with ebook sales making up about a quarter of the overall books market. Is the situation similar for comics? How do you see it changing in the coming years?

Yes and no. Everyone I've talked to says that Comixology growth stopped dead in its tracks when Amazon bought them and they went off in-app purchases with Apple. There was still some growth in the online bookstores, including Amazon proper, ironically enough. Comixology was such a large player it was a major slowdown. That seems to be more platform related than a maturing market, so I don't think its the same thing.

Remember, pure text eBooks are a lot older than the comics eBooks movement that Comixology and iVerse were the early drivers for.

What I haven't heard yet is how much traction iVerse is getting after adding DC to their ComicsPlus app, since they're the big dog for monthly comics on the iTunes/App Store system. It's possible adding DC would even that out and bring back some overall growth. Should Marvel decide to expand the digital versions of their monthly titles outside of Comixology, suddenly people who really prefer staying inside Apple's ecosystem have an equivalent shopping choice. And the way growth just stopped, there would seem to be some serious value in that platform.

I also think when Amazon completely integrates Comixology with their main site, you'll see the Comixology-related growth return. Will it be as fast? Perhaps not, but it's also exposing a better browser to a wider audience compared to how Amazon's in-house comics display works. There is a reason they bought Comixology, after all.

After years of relative stagnation, all of a sudden we're starting to see comics sell 500,000 or even a million copies. Is this all because of Loot Crate? Does it represent real opportunity for growth, or is it kind of like a special power move companies can only use on one book a month that will see diminishing returns?

Loot Crate-class companies and Marvel testing the boundaries of variant covers. Star Wars *might* sell very well if they're really placing it in some outside venues as I've heard rumored, but I don't see that kind of growth native to the Direct Market. The danger, of course, is running the variants into the ground. Variants are another way to paper over low core sales and you certainly see a lot of variants these days, don't you?

When it comes to mainstream comics, does anyone really know how many people buy them? It seems like Marvel and DC basically sell comics to retailers based on arcane tactics like variant cover incentives or gimmicks, and then they brag about sell outs, but I see a a lot of these comics sitting on the shelves for months, so I don't know how meaningful the numbers Diamond puts out are. Is there anyone in the industry secretly keeping track of this stuff?

If you look at the monthly sales roundups at The Beat, you'll frequently see an attempt to quantify the variance between variant cover and non-variant cover issues. And sometimes you'll find a comment about Event-related bumps.

Really, the people with the hard data on this are the publishers themselves. They should be keeping track of that. I'd love to see a Bookscan-style sell-through chart, but nobody's ready to put that together.

Do you think the current business and pricing model for comics is sustainable? Will the monthly format ever die or go completely digital?

I'm a little concerned about how the Spring Events are going to go down. Convergence is an obvious jump-off point from DC. Yes, it's clear they're going to relaunch maybe half the line, if not the whole thing after Convergence, but they run the risk of a significant portion of the audience having walked away two months prior. The retailers aren't even keeping that concern to themselves. I'm sure you've heard the complaints.

What you don't hear as many complaints about publicly, but I've heard some privately, is that Secret Wars is essentially a continuation of Hickman's Avengers opus. Was Infinity accessible if you hadn't been reading both of Hickman's Avengers books? Not really. It was a third Avengers book for its run more than anything else. There's concern Secret Wars is going to be the same thing and not be a big seller, much like Marvel's Events have underwhelmed of late (after the variants and ordering incentives on the #1 issues).

Now, Marvel still has a reboot card left to play. DC's used theirs and it could be hard to sell relaunches with the same people planning them. I don't envy shops that are 90% DC and Marvel stock when Spring rolls around. If they've got two duds on their hands at the same time, that could be ugly and there are more shops like that than you might think. You take out 10-20% of the small shops, 90s-implosion-style, then you worry about DC or Marvel going digital-only or outsourcing the comics license to another publisher. But you need a chain reaction for something like that to occur. Not impossible, but hopefully not likely.

If one or the other goes over well, things should still be somewhat stable. Let's face it, the growth has been in independent publishers for the last couple years and they're dependent on a subset of shops. The DM would be more stable if there was a little more diversification of stock industry-wide.

So I'm an aspiring comic book creator. I buy your book. I read it. I learn your secrets and master them. I publish a comic. Next thing I know, I'm the next Robert Kirkman. I'm a bajillionaire. I'm selling TV shows out the wazoo. I become a Kentucky land baron and conduct all my business from a palatial river barge. That's how this works, right?

I would be very careful placing paper assets in the middle of a river. Leaks and paper are BAD. Kirkman leads a charmed life. The only person even close to reproducing what he's done is Mark Millar and his multiple movie sales. Is Kirkman aspirational? Absolutely. Is he reproducible? Not yet.

I'm just gonna come out and say it. If someone is trying to break into making comics, and they don't buy your book, they're basically flushing their career down the toilet. I mean, what an idiot, right? You don't have to say anything. Just wink if you agree.

What can seasoned industry veterans learn from reading The Economics of Digital Comics?

An overview of how the various pieces of the modern industry fit together. Where the money goes and what rough percentage to which players, which might be useful if your royalty contract involved net proceeds, especially with how different the digital revenues can be from platform to platform. A look at where the digital is trending and some metrics for what you're looking at if you decide to have a go on your own.

You gave Rich Johnston the intro to your book, which is written by Mark Waid, to publish on Bleeding Cool. Did you do this because you feel bad for Rich after Bleeding Cool's horrific site redesign? The poor bloke.

I don't for a minute believe Rich designed that layout! Are you starting rumours about Rich?!?

No one deserves pity more than The Outhousers. What kind of exclusive can you give us, right here, right now?

When I see those stories about Dark Knight 3, I get the impression it's going to be rolled out as multiple titles with multiple teams, similar to Before Watchmen. I could be wrong, but that's the impression I get.

If you could offer one piece of advice to a person who wants to start making their own comics, what would it be?

Start collecting a contact list. Social media. E-mails. Whatever you can get. You need to be able to drive traffic on your own.

Todd, you should have said "buy my book" there. I was setting you up for that.

Thanoscopter would have done that, but I am not Thanoscopter.

So you claim, but I've yet to see convincing proof.

The Economics of Digital Comics: Dawn of Justice is in stores now. Find out more at this link. Todd Allen, it's a pleasure as always!