Who started DC Comics

The comic market in upheaval : Clearcut in the Superman publishing house

The news came unannounced, as always: The American media giant TimeWarner is laying off 600, according to some sources even 800 employees, almost all of the upper echelons of management. In addition to the film studio Warner Bros. and the payment channel HBO, Time Warner also owns the comic book publisher DC - a third of the publishing house employees have to vacate their jobs there within the next 90 days.

The editor-in-chief Bob Harras, who has worked his way up at the publishing house since 2001, is affected by DC. Another prominent victim is the editor Mark Doyle, who headed the adult division Black Label at DC and was previously the last editor-in-chief of the DC label Vertigo.

First warning signs since 2019

The latter was discontinued in December 2019 after the closure was announced in June 2019. DC classics such as Neil Gaiman's "Sandman" and Garth Ennis' "Preacher" were released by Vertigo.

The Vertigo closure was the first signal of a comprehensive restructuring of the publishing house, apparently pushed through from above. In 2018, WarnerBros merged with the telephony company AT&T. The merger cost $ 85 billion. Since then, savings have been made in all departments of the media giant in order to plug the billion hole.

Another sign of the frenzy was the conversion of the humor magazine "MAD" into a kind of zombie magazine in July 2019, which from then on only contained reprints of older articles and was almost exclusively delivered to the 100,000 remaining subscribers. The kiosk sales were discontinued. Unlike many German media reports, including the Tagesspiegel, the magazine itself was not discontinued.
And finally, in February 2020, the previous co-publisher Dan Didio was sacked. Didio had been instrumental in restarting the entire DC universe under the title New52, which turned out to be extremely profitable commercially. In the end, however, his plans were rather dangerous for the publisher: Didio wanted to replace all of the publisher's heroes with new characters. Batman should no longer be Bruce Wayne, Clark Kent no longer Superman ...

Under the cryptic abbreviation 5G, work has been going on since 2019 on the plan, which should have come into force in summer 2020. With Didio's termination, 5G was called off at the last minute. The entire edition of an already printed prologue booklet was destroyed.

A dangerous undertaking

Didio's project was particularly dangerous for the owners of DC, who are also the owners of the figures. Because the American comic market has long since shrunk to a dwarf. In 2018, the entire North American comics market had sales of $ 1 billion, a number that has been relatively stable since 2015. That corresponds to the same amount that "Avengers: Endgame" has made in US cinemas alone. A single film was as successful as an entire industry.

And "Avengers: Endgame" doesn't stand alone. Of the 41 films that exceeded the billion mark in cinemas from 2008 to 2019, 13 were comic book adaptations by Marvel and DC.

The real money - and thus the real value for the owner - is in the characters that can be milked in the cinema, in re-use and in merchandising. Especially since Corona.

Last but not least, the pandemic dealt a severe blow to the US comic industry, with comic shops closed for months and new releases being suspended. Publishers like DC, which rely heavily on the comic shop system for their income, have hardly had any income for months.

Probably because of this, the most expensive employees were fired first, those with the highest salaries and the highest pension claims. Tasks have also been merged. Previously there were separate editors for the publication of the magazine and for the secondary use in book form, now the magazine editors also have to take care of the book publication.

Nevertheless, it is clear that the abruptly reduced staffing levels no longer make a program like the current one possible. Before Corona, DC published up to 100 titles per month. While some of these titles, especially those from the "Batman" environment, were profitable with sales of 50,000 to 100,000 copies per issue, this was hardly the case for a large number of issues. So the layoffs suggest that DC will visibly slash its program.

That leads to two easily visible consequences of the layoffs. Both are symbolic of the radical restructuring of the US entertainment complex, which was accelerated by the corona pandemic but has been going on for years.

1. The end of the comic book shop?

Although relatively dwarfed, there is still a huge industry behind the comics market. There are around 2000 comic shops in the USA, they live almost exclusively from the sale of the Marvel and DC magazines, which together have a market share of 75% in the comic shops. That is, three out of four comic books sold come from one of the two publishers. DC for itself recently had a market share of 30 percent in comic shops.

It looks very different in the book trade. In 2018, for the first time in the United States, sales of comics in bookstores were slightly higher than sales of comics in comic shops: almost $ 500 million each.

However, DC and Marvel play an extremely small violin in the book trade, with a market share of eight percent (DC) and seven percent (Marvel), respectively. Comics for young readers and teenagers are indeed successful; the most successful comic book publisher in the US book trade is Scholastic. Their bestselling author Dav Pilkey regularly sells two handfuls of his books in book stores than DC and Marvel with their entire backlist of thousands of titles there.

In addition, the book trade, which is mostly operated by large chains, is more stable than the often small, privately operated comic shops. Mail order companies like Amazon, who do not have any notebooks, exacerbate the picture. Of the nearly 10,000 bookstores in the United States, a relatively larger number of them will survive the pandemic than of the nearly 2,000 comic book shops.

Especially when DC cuts down its stapling program. Already halving the booklet program would mean a sales loss of 15 percent, in some cases even more, for the comic book shops. In the already tense situation, for many the sure way to bankruptcy. Only a few larger comic book shops would survive then.

It has been clear that DC is increasingly focusing its attention on the book trade and young readers since the publisher announced the establishment of a young adult label - in 2019, just a few weeks after the announcement of the end of the adult label Vertigo.

2. From cinema to streaming giant

Two top managers from WarnerMedia left the group before last weekend. In a letter from the only remaining top manager Jason Kilar that was circulated afterwards, it was emphasized that the future of Warner lies with the streaming portal HBOMax.

The portal only started relatively late this summer in the USA. Despite the misleading name, it not only draws on the libraries of HBO ("Game of Thrones"), but on the entire Warner back catalog, from "Gone with the Wind" to last year's Oscar winner "Joker". In times of the almost complete death of the cinema industry, the start proved to be a last-minute escape.

The DC characters play a central role in the plans. While Marvel currently still relies heavily on movies, Warner has produced a huge number of TV series from the DC environment in recent years. More are announced, as well as a streaming-exclusive Director's Cut of Zack Snyder's "Justice League" film.

The comics sector is being degraded even more than it is now to the music accompanying these digital efforts. In some cases, DC is forced to publish: the publisher would lose the rights to both "Wonder Woman" and Alan Moore's "Watchmen" as soon as it ceases to publish them, even if for a short period of time. Both titles were recently very successfully adapted for cinema and TV, and "Watchmen" recently played a major role in the further development of the DC comic universe.

In addition, "Watchmen", and indeed all of Alan Moore's comics at DC, play a major role in a possible stronger orientation of the publisher towards the book trade. "Watchmen" has been the best-selling DC book in the book trade for years. In 2019, three different editions of the same comic were in the top 10 best-selling DC books in bookshops. Two other editions were a bit lower in the charts. In addition, with "V for Vendetta" and "The Killing Joke" Moore occupied five of the ten top 10 ranks of the best-selling DC comics in the book trade.

It is obvious that the publisher will focus even more on synergy effects and further cross-media evaluation instead of saying goodbye to money cows like "Watchmen" by no longer publishing them.

Viewed cynically: WarnerMedia is leaving two sinking ships, the comic book trade and the cinema, which have been hit hard by media upheavals and the raging pandemic in the USA. And it saves itself on two channels with a strong or extensive digital component - the book trade including online book trade and the streaming portals. A complete end of the DC publishing house would be commercially nonsensical - but the publishing house is being realigned, realigned to new distribution channels and degraded to a supplier.

And the comics?

Of course, one can only speculate here. It will probably take months before the current decisions are reflected in concrete publications. At least one way out could be the Disney model. Disney has not published any comics itself for decades, not even in the USA, but has licensed them to small publishers who publish them in small numbers and with high circulation for collectors. Publishers such as Fantagraphics and IDW have also been publishing material, especially classic comic strips, under license from Disney, Marvel or DC for years.

So it is conceivable that DC will also license some less profitable characters to other publishers. Another, no less probable model, however, is to put unprofitable characters, in whom one holds the rights, into a deep sleep until they become commercially interesting again in the course of a retro wave or redefinition.

A detailed analysis of the US comic market by the same author can be found in the "ICOM Comic-Jahrbuch 2020".

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