Wednesday, January 14, 2015

A Short History of the Comic Book Industry

A couple of years back, the company I work for was kicking around some ideas, and one of the things that came up was an idea that would eventually end up being Hero Analytics. Not everyone in the company was as familiar with comic books and the industry as I am, so I made up a little document to act as a primer on the history of the industry and its current state. This is that document, with a few edits. Please keep in mind that this was made in early 2013. I've updated it a little bit, but there are a few dated references in here. If you need to give someone a relatively short document that explains the history of the industry and why things are how they are, well, here you go.


Terminology

This document assumes only a passing familiarity with comic books, so I'll begin with some terms:

Marvel - One of the “big two” of comics publishing, these are the guys we'll be trying to reach first.  They've had a string of successful movies leveraging a number of their properties: Iron Man, Thor, Captain America, Guardians of the Galaxy, and the Avengers have all been produced in house, while Sony and Fox have made successful franchises out of their Spider-Man and X-Men comics.  Agents of SHIELD, their first live-action TV show since the late 70s is in the middle of its second season, and a companion show called Agent Carter is currently running as well.

DC - The other of the big two.  Marvel and DC spend long periods being first and second in the industry, in terms of monthly market share; currently, Marvel is slightly more dominant. They are beginning to see continual success in their live-action TV and movie franchises with the Arrow and Flash TV shows, as well as their new cinematic universe that was kicked off with Man of Steel.

Image, Dark Horse, IDW, Valiant - the independent publishers, roughly in order of their size. There are some others, but these are the biggest indies.

Diamond Comic Distributors - the distribution company that more or less has a monopoly on the distribution of print comics. They buy the comics from the publishers, then distribute them to the shops.  Independents below the size of Dark Horse or Image end up getting about 40% of the cover price of their comics from Diamond; Marvel and DC don't publish their numbers (from what I can find), but it's estimated Diamond pays them between 50% and 60% of cover price.  Diamond's monopoly has had a number of bad effects on the comics industry that I'll go into later.

Singles / Floppies - These two terms are used fairly interchangeably to refer to single issues of a comic book; for example, Captain America #1 would be a single issue.

Trade Paperback (TPB) - Collections of single issues; for example, Captain America #1 - #6.  Usually published by Marvel within a couple of months of the final issue in a TPB, e.g., the TPB for Cap 1-6 usually comes out somewhere between the time that Cap 7, 8, or 9 comes out.  Particularly successful comics will see a hardcover TPB come out first, then about 6 months later, a softcover that's ~$5 cheaper.

Local Comics Shop (LCS) - This is pretty much where all single-issue comics sales are made.  They also sell TPBs, but they aren't the only place; both publishers in the last 15 years have made very good in-roads in getting their TPBs in stores like Barnes & Noble.  Amazon and other online distributors also sell singles and TPBs, often with deep discounts compared to brick and mortar stores.

Marvel Unlimited - Marvel's subscription service, it currently gives generally good but kind of spotty access to Marvel's massive back catalog, but no access to anything more recent than 6 months ago.  In some cases, titles can lag up to a year behind.  It was launched in 2007, but it's only in the last couple of years that they even have an Android or iOS version of the application.  DC does not have a competing service, but they do have an even larger back catalog than Marvel that they could bring to bear.

Comixology - All of the major and most minor publishers make their digital comics available through Comixology, but unlike the Marvel Unlimited service, digital comics are bought much like single issues at an LCS.  It's often referred to as "iTunes for comics."  Self-publishers and small indies split sales 50/50 with Comixology.  Marvel and the others don't make public the amount that they pay, but Comixology probably takes 30-40% of their sales.

Comics Ages - There's a lot more to the ages than just their publication dates, but they're not terribly important to most of our discussion; a broad understanding of their start and end points are sufficient for now, but I'll be touching on each of the ages as I go on.  Interestingly, while the differentiation between the ages usually focuses largely on their content, each of them also has a pretty strong correlation with changes in the industry that occur near their starting and ending points, which I'll be discussing somewhat in section detailing the problems facing the industry as a whole.  The years and stories listed are generally correct, but there is some overlap, most notably in the end of the bronze age and beginning of the dark and the end of the dark and the beginning of the modern ages.

Golden Age - The period roughly from the first appearance of Superman in 1938 until the mid-1950s.

Silver Age - The period roughly from the second Flash's appearance in 1956 until the early 1970s.

Bronze Age - The period roughly from the death of Spider-Man's first love interest, Gwen Stacy, in 1973 until the mid-late 1980s.

Dark Age - The period roughly from the publications of Watchmen and The Dark Knight Returns in 1986 until the early 2000s.  Also called the Iron Age.

Modern Age - The period from the publication of JLA #1 and Kingdom Come in the late 1990s until the current day. Sometimes called the Platinum Age or (sarcastically) the Diamond Age.

Digital Age - Some people posit that we're entering this one.

History of the Industry and Its Current Strengths and Weaknesses

So that's a lot of terms, but they should give you some basic grounding in how the industry operates.  Back in the Golden Age and up into the Silver Age, comics were almost entirely distributed through newsstands and corner stores; there were some LCS, but they were basically just part of the same distribution system as the newsstands.  The general tone of stories in the Golden Age was whimsical, but also pretty violent; Batman carried a gun, Superman would sometimes kill criminals, etc.  Near the middle of the silver age, Superman comics were selling a million copies a month by themselves, and had a successful imitator in Captain Marvel, who sold around that much.  Batman wasn't very far behind.

Around the beginning of the Silver Age, a book called The Seduction of the Innocent came out that decried a lot of the comics at the time as being too violent or of corrupting minors; beyond its attacks on horror and true crime comics were its claims that Batman and Robin were homosexuals and a lot of other nonsense.  A congressional hearing happened in the mid-50s, largely on the back of the panic that Seduction of the Innocent caused.  The industry, hoping to avoid a McCarthy-esque witchhunt, and following in the footsteps of the MPAA, created the Comics Code Authority (CCA), a self-regulatory group that would make sure that comics were wholesome enough for children to read, with long laundry lists of criteria.

In the mid-Silver Age, Marvel Comics started making its own superhero comics again, starting with the Fantastic Four, Thor, Hulk, and Spider-Man, shortly followed by the Avengers, Captain America, and a number of other titles.  The new characters from Marvel were generally more approachable and human than the characters at DC: Spider-Man was an unpopular teenager, the Fantastic Four was a family that often argued, Hulk had his uncontrollable anger and so on.  Comics started being picked up by college students, and as older readers embraced the books, the stories became more complex, which leads us to the Bronze Age.

Bronze Age stories tended to be a touch heavier than Silver Age stories, which were usually pretty light.  They began to tackle issues like race and gender discrimination, poverty, drug addiction, cancer, and similar fare.  The main characters in them regularly had failures that they didn't recover from.  For example, the story that is considered to have opened the Bronze Age concerned Spider-Man's failure to prevent the death of his girlfriend at the hands of a supervillain, while the Green Arrow's sidekick developed a crippling addiction to heroin.  It's worth noting that this was the first time that comics started to intentionally choose to not have the CCA stamp of approval, albeit for a few issues at a time.  Also noteworthy is that stories began to get split from single issues into longer two and three issue story arcs, and even issues that were "done-in-ones" tended to have a narrative thread running through them.  For example, an 18 issue run on Captain America in the late 80s had him forced to set aside his Captain America identity and become just "the Captain," rather than take orders from a corrupt group inside the government.  As stories became longer, newsstands began to get pushed out in favor of the direct market and LCS; after all, if you can only get the middle issue of a three part story, that's not very helpful, is it?

The Dark Age is named that for several reasons.  The Watchmen and The Dark Knight Returns showed that mature themes could be freely and skillfully addressed by comics, but, unfortunately, less talented groups than those working on the aforementioned titles tended to translate that into "we can put swears and blood in our comics now!"  Violent anti-heroes like the murderous Punisher, bloodthirsty Wolverine and demonic Ghost Rider became extremely popular.  To be fair, a number of truly great titles came about in this era, too, and it was also the first time since the CCA that non-superhero comics did well, primarily with a more mature market, with DC's Vertigo publishing imprint.  By the end of the Dark Age, the CCA stamp of approval was gone across the board at the two major publishers.

This era was also the final nail in the coffin of the newsstand as a major distribution point, as a multi-company grudge match between the publishers and the three major distributors ended in the closing of two of those distributors and all of the publishers' distribution going through Diamond.  An anti-trust suit was brought, but it was ultimately determined that, while they had a monopoly in the comics industry, they didn't have it in the larger periodical or book distribution markets, and Diamond was left intact.

The other "dark" part of this age was the spectacular rise and fall of the speculator market.  When old comics started being auctioned off for hundreds of thousands of dollars in the late 80s and early 90s, people began to buy new ones in the deluded hope that, by socking the right comics away, they could later sell them for enough money to pay for their retirement or college.  Marvel and DC encouraged this rampant speculation by adding new, flashy features to drive speculators to buy multiple copies of a single comic:  multiple covers for an issue, for example, or holograms, metallic ink, rare "chase" covers, and the like.  Around the mid-1990s, the speculator market collapsed and almost took Marvel and DC with it.  Marvel declared bankruptcy in 1996; DC did better, as it had been purchased by Time Inc. in 1989, giving them a larger corporate structure to fall back on.  At the height of the speculator craze, a few comics had single-issue circulations in the millions, most notably the Death of Superman at ~2 million and X-Men #1 at ~1.5 million; however, issues other than these "event" issues, without gimmicks had much lower numbers, and after the speculator craze, circulations across the lines cratered.

The Modern Age reined in a number of the excesses of the Dark Age, both in terms of storytelling and in terms of business practices.  The best stories tend to mix the wonder and playfulness of the Silver Age stories with a more mature sense of pacing, art, and storytelling.  However, with the crash and burn of the speculator market, and the ascendance of Diamond in the mid-90s, the business has shifted wholly to the direct market.  This has ended up being a self-reinforcing cycle, to an extent: because the companies know that they're mostly selling to fans, they end up doing things like 6 issue story arcs and massive, companywide crossover events that involve every book the company publishes, which allows them to capitalize on their fanbase, but also makes it much harder to bring in new readers.  They try to mitigate this by releasing trade paperbacks in bookstores, but that results in them writing specifically for trade paperbacks, with "decompressed" storytelling that means that very little tends to happen in a single issue; while a book published in the 1980s might have roughly the equivalent of a single episode of a TV show's worth of story, a 6 issue arc in 2013 has 1-2 episodes’ worth.

Six issues of a comic in 1983 would have cost somewhere between $4.50 and $6 and given  6 TV episodes' worth of stories; 6 issues in 2013 costs $24 and gives 1-2 TV episodes' worth.  Between the 1950s and now, the real price of a single, adjusted for inflation, has more than doubled, while the amount of story has more than halved.  Diamond takes an increasingly large chunk of the pie, but the materials used to print are better quality now as well, increasing the costs.  Digital distribution is making some inroads into this problem, but neither house has their own single-issue digital distribution system, meaning that they both have to pay Comixology a cut, albeit a smaller one than they pay to Diamond, for every digital issue that they sell.

One other thing is worth noting:  as each age passed, more and more of the writers, artists, and editors were fans themselves.  While in the Golden Age, comics were seen as something that you worked on while you were waiting for something better to come along, by the Bronze Age the staff was transitioning to people who were comics fans and intended to do all or almost all of their work in the industry.  At this point, almost everyone in the creative side of the industry is someone who has been a comics fan all their lives and has their own collection at home, with their favorite characters, etc. This is often true of the business side as well.  This isn’t inherently bad, but it leads to an echo chamber effect, where there are story and business decisions made that, albeit mostly unintentionally, tend to discourage new readers. The pricing of comics and reliance on the direct market is one example, but another would be an overreliance on continuity of the universe as a storytelling hook. What that means is that they generally expect a Captain America fan, for example, to recognize the Red Skull, and know some of the major stories that he’s been in, and his relationships, and to know that Cap is a member of the Avengers, and what his supporting cast is and has been, all without explaining a lot to the new readers.  New readers are expected to go hunt down old issues or browse through the Marvel comics wiki to learn more about the characters, instead of having their hands held.

It’s not all bleak, of course.  Marvel is doing gangbusters with Marvel Studios and has recently been bought by Disney, meaning that they have deep pockets.  While DC continues to struggle with getting good live action movies other than the recent Batman trilogy made (edit for the folks in 2015: add Man of Steel to the list of goo... well, successful movies), it makes excellent animated direct-to-video ones, and it’s been having some luck with the Smallville and Arrow TV series.  Unfortunately, this success in other media hasn’t been helping that much with circulation; a marginally successful book is one which ships 22K copies a month, and the very best book of February 2013 (which is the most recent sales data I have at this point) only sold ~300k copies, and was also a #1 issue of Justice League of America, a popular franchise that was being rebooted; the next most popular was a Marvel book, Uncanny X-Men #1, at 177K copies.  By the time you get to the bottom of the top 20 across all publishers, including the independents, circulations are down to 62K; at the top 100, it’s 22K.  However, Marvel and DC both make a lot of their money on merchandising, with everything from lunchboxes and backpacks to costumes to collectible statues of characters.

So that's where the industry is now:  it's an industry by fans, for fans, that’s having trouble attracting new readers despite its literally billion dollar successes in other media.  It’s doing well enough to stay afloat, but if you compare the number of readers decade by decade, it’s not coming even close to staying with the population growth of the United States.  They are stuck under the thumb of a single print distributor and are about to place themselves in a very similar position in the digital realm.

Some additional notes from 2015: Comixology is still the dominant digital provider, and they've since been bought by Amazon. Marvel is pushing Marvel Unlimited hard these days and filling in the gaps in its back catalog rapidly. There has been a small but noticeable uptick in readership, and Marvel is starting to rein in some of its excesses in their crossovers, restricting them to 3 months instead of taking up half a year or more. Overall, though, the future is still cloudy for the comics industry, even if other forms of media are very successfully using ideas, stories, and characters from comics to fuel new franchises.
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