The Diamond Comic Reader – Now Digital Really Is a Distribution War

By Todd Allen

Digital comic downloads are a bit of a strange market.  (Note: I’m talking about paid/legal downloads.)  The big thrust, thus far, has been the battle of proprietary formats.  Comixology has their own format.  iVerse has a format.  Graphic.ly has a format.  Apple has a format.  Amazon has a format.  If you’re from New Jersey, you’ll probably want to tell me my mother has a format.  Well, as of the ComicsPro meeting, the focus has changed a little, because now Diamond officially has a comics app.

Let’s step back from the old issues of file rental vs. file ownership and proprietary format.  When iVerse rebrands a browser as the Diamond browser, we’re taking a cognitive move back towards the distribution issue.  Who is going to be distributing comics to consumers?  It breaks down into two types of storefronts: publishers and stores.

At this point, most of the major publishers have an app or storefront of their own.  For DC and Marvel, Comixology is their vendor, but the consumer may not be immediately aware of the connection.  Particularly if the consumer is more of a casual reader, than an active hobbyist.  (If you want to argue there aren’t any casual readers left, let’s save that for another thread.)  Dark Horse and Slave Labor run their own store front.  In all these cases, and a few I didn’t mention, the consumer goes to the publisher’s app and effectively buys from the publisher.

The second category is the store.  Comixology’s website and main app is a store.  Ditto Graphic.ly and Panelfly.  In these cases, the stores are run under their own tech and formats.  For Diamond, they’re also doing a store and iVerse becomes their vendor.  Now, if you’re a physical store running an affiliate program from Comixology, your website will fall into this category.  Presumably, Diamond will be rolling out a more robust affiliate program.  At least that’s what I’m reading into the following comment:

As iVerse’s CEO Michael Murphey put it: “By adding the Digital Reader App into the Diamond Digital program, we’re completely removing our own digital store.  This is a much cleaner solution for retailers and will give them the same kind of tools companies like Amazon and Barnes & Noble are using to sell digital on these devices.”

This is opening up a whole new can of worms.  In recent years, we started out with textbook channel conflict (retailers enraged that publishers sell directly to the customers, be it subscriptions or digital — even if the digital is really through a third party), now we’re seeing the last major print distributor standing emerge as a competitor to the retailers in a digital setting.

Am I over-reacting?  Look at it this way: if the iVerse app (Comics+) is rebranded as the Diamond Digital Comics Reader, then Diamond is now selling directly to the consumer.  If the consumer downloads that off the iStore or Android Market, will they have to set a default retailer for an affiliate program/payment?  Yes, you can make an argument that the average comic retailer is going to need a technology partner for digital comics (although most of this is due to proprietary viewing formats).  Still, this is getting murkier by the minute.

I guess we’ll have to wait and see what percentages are involved with this theoretical new affiliate program, but the pure _distribution_ side of digital just heated up.

Comments

  1. You’re misreading it.

    The app actually gets branded AS THE STORE — not Diamond, not iVerse.

    Further, they’ve just told me that you, the retailer, completely control the price, etc, and you’re selling UNDER YOUR DIAMOND TERMS OF SALES (discount etc)

    What’s NOT clear (yet) is if store apps are interchangable in terms of your purchases showing up or not. If you buy one at Joe’s and one at Sam’s, do they show up equally in either app?

    Diamond IS NOT selling to the consumer — the retailer will be the seller — and Diamond insists that they won’t even be able to SEE the consumer information; and iVerse only will be able to insofar as completing the transaction goes.

    I don’t know, I’m sure there’s some weird problem I’ve not thought of, but it does sound like a fairly sane way of handling it to me…

    -B

  2. There are a lot of things that are incorrect about this post that need to be addressed:

    1 – The iVerse Comics + reader isn’t rebranding as anything – and Diamond has NO part of it. It will continue to operate as is.

    2 – Diamond is NOT selling direct to the consumer – EVER. Diamond has no interest in this, and it is not happening.

    3 – the Diamond Digital program is not an affiliate program. Retailers can control what they do and do not sell, and retailers can set the prices in their stores for digital goods. The program also pays far more than most affiliate programs. Plus, retailers receive their money at the time of the transaction, not through an affiliate system that cuts them a check. There is no minimum dollar amount that has to be hit like you would find in an affiliate program.

    The Digital Comics Reader is a viewer Application, just like the Kindle app or the NOOK app on the iPad. Retailers will be able to sell digital comics in-store and online through their websites.

    Once that sale has been made, customers can read the digital comic on the retailers website, or in the Digital Comics Reader App, giving them a way to download the comic for offline viewing, and have a native reading experience.

    My quote in the above article is referring to completely removing our store from the application, so retailers don’t have to be concerned about sending their customers to a competing store just so they can read the items they have purchased.

    I’m happy to talk about this at length with anyone that would like details on the program.

  3. Matthew Southworth says:

    For me the question is:

    Does it simplify the process of buying comics to an interested–but not expert–customer? Can a mother who’s taken her ten-year-old to THE AVENGERS go online and buy him some Avengers comics, and while she’s there, pick up LOVE AND ROCKETS (or whatever) for herself without having to browse through a complex series of tunnels to get there?

    I worry that the huge publishers will be able to dominate exposure in this digital “store” even more than they can in a brick-and-mortar store, where at the very least a consumer can literally bump into material that doesn’t have marketing media saturation.

  4. Mario Boon says:

    Why don’t Diamond and brick-and-mortar stores just sell coupon cards for digital comics just like Apple does with their iTunes gift cards?
    So easy.

  5. Mario – it’s not something most of the retailers we’ve talked to want to sell, and I can see why.

    When you sell an iTunes gift card, you’re essentially telling that customer to go somewhere else and buy the thing they want — effectively taking yourself out of the loop.

    Gift cards have their place, but without a program in place that won’t cannibalize their customers, there is legitimate concern from some retailers about participating in something like that, and I can understand why.

  6. My hunch is that folks like http://www.pvponline.com and http://ratfist.com and http://www.abominable.cc has a better digital distribution model.

  7. Why do i need ANOTHER comics app? I’d really need to see a test drive that puts this thing leaps and bounds above the competition. This is really late to the digital party. I’ve already got more comic reader/store apps than i need.

    Also, i kinda don’t want to support Diamond with this. They’re a monopoly and i’d rather support other companies that can cause Diamond to stay competitive. There is a lot of potential on the UX side of things that could do interesting things with a digital comics medium, and my fear is that if one company controls the show “good enough” will become the standard. New ideas and innovation die that way.

    I like the idea of retailers getting a “franchise” or whatever they’re calling it. Thats a cool way to support your LCS…but what if you have 2 or 3 local ones in the same program? How does that work…who’s app is it?

  8. AndyG says:

    How does iVerse monetize this relationship? Take a piece of every sale? One time set up fees? A license fee from Diamond? Curious. I assume they will continue to develop branded one off apps.

  9. Joey – one BIG difference between this app and others, is that this app supports your local comic shop in a way no one else is currently doing. And yes, Diamond is a very big part of this, but please remember you’re also supporting iVerse and, most importantly, your local comic shop.

    We’re also providing things no one else is – like dvd-like extra features in the back of the books. We’re open to doing all kinds of things with digital comics, and as creators come along that want to push those envelopes, we will be right there with them.

    The App is a generic reader app that you can read any comic purchased in the Diamond Digital eco-system in. So if you want to support more than one local retailer you can.

    The websites are iPad and tablet compatible, and the retailers have a great deal of customization options, which can even give you discounts for buying print and digital at the same time.

    It’s the same concept as Amazon’s Kindle App, but we’re giving the independent retailers the same types of tools Amazon uses to be able to do this. We have a plug-n-play simple option, and a full API for developers to play with.

    AndyG – iVerse and Diamond share a percentage of the sale. Retailers and Publishers make more than we do off of everything, and there are no set up or hosting costs to the retailer or the publisher (or the customer, who can redownload the books as many times as they want) to participate in this program.

  10. Torsten Adair says:

    So what’s to keep a retailer from pulling an Amazon?

    You know… sell digital comics for below cost (just like those $9.99 Kindle e-books) to drive customers to visit the website, meanwhile subsidizing that loss with sales from other parts of the website.

    How does a local store compete with a nationally known comics shop? Or a website with a memorable name that ranks high in Google results?

    Here’s another question: where do the actual comics reside? Is it like e-books, where the reader accesses a central locker to access the title?

    Joey, I suspect the reader is generic. It’s like a Walkman… it doesn’t care where you buy your cassettes/comics, as long as it can play the format you’ve chosen. You buy a comic from Alpha Games, another from Beta Collectibles, and a third from Gamma Comics and Cheese. The app notes all your titles, stores that information with your account, and the reader app accesses whatever comic you wish to read.

  11. Torsten – at least for now, the web prices are pulled directly from us, and the retailer can’t change them online, but in-store they can better control the price of the digital goods. Later in the year they’ll be able to have more control over prices on the digital comics, and we’ll have more info about how that works as we roll it out.

    As for competing with other shops, it’ll be the same way it is right now with digital goods instead of physical ones.

    The comics reside on iVerse servers if you’re viewing them on the web — but they are read on the retailers website. They are accessed via our API, so the customer doesn’t actually have to leave the retailer’s site and go to something branded as ours.

    They can be downloaded into the app, where they then reside on the user’s device. If they need to redownload them in the future, their purchase history is in the app so they can do so. Once downloaded, they can be backed up via iTunes as part of the entire app back up process.

  12. Matthew Southworth says:

    Michael–will the Diamond minimums (for books it’s required to be $2500, I believe) also apply to digital titles?

    Let’s say a title is not pre-ordered enough to reach the minimum to be distributed to book-and-mortar shops by Diamond–will it be available through the Diamond digital app? Or will the requirements somehow be different?

    For example: I go to my local store and say “do you guys have the new issue of RUMBLEFISH, the black and white version, and they say no, we’ve never heard of it”. Will they then be able to say “But you can buy it through our Diamond app right here!”?

  13. Matthew – Diamond minimums will apply to this program at all. One of the assets of digital is that books that might not reach a minimum could still have an outlet to be sold.

  14. “will NOT apply to this program at all”…damnable phone!

  15. It’s also important to note we believe there are ways this can be used to help hit those minimums too.

    An example scenario might be as follows:

    Indie creator wants to encentivise retailers to buy print copies of the book, but adding bonus features and variant covers and the like really increase upfront printing costs.

    With the Print PLUS version of the comic, a creator could offer the full script for the book, sketches, even digital video special features, and some of those could be limited to ONLY the Print PLUS digital copy.

    The Print PLUS copies are sold along with their print counterparts at a discounted price from buying just the digital, so in that specific case those particular special features would only be available if a print copy was purchased.

  16. Matthew Southworth says:

    Thanks, Michael–those sound like good ideas, and I’m pleased to hear that the minimums won’t be in place. Some of my favorite books are a little “off-the-beaten-path”, and so it’s nice to know that those will be available.

  17. Al™ says:

    While I appreciate that the industry and its stakeholders are experimenting with content delivery and business revenue models, the whole “cloud comic” (your comic resides with us, and you have purchased the right to read it but not own it)thing just does not appeal to me. It’s a deal breaker.

  18. Al – we’re not a “cloud comic” company. You can download the book in the app, and back that comic up. The comics are available in the cloud for you to redownload should you choose. You do own it.

  19. @Michael Murphy : I’m ready to publish my comic digitally, where do I go, what do I to upload such a thing?

    Also, you say it’s free for publishers? That’s much better than Graphicly’s $150 per issue setup fee.

    Also, what is the percentage of the cover price paid to the publisher? Doesn’t Apple get a third?

  20. Citizen Cliff – If you already work with Diamond you can get into Diamond Digital through them.

    If not, head on over to http://comicspl.us/submissions/ – and someone will be in touch who can give you all the details, and help get you set up with Diamond as well.

  21. Just want to say thanks for clearing this up @Michael Murphey. Sounds like a positive move and a good middle ground for the independent publishers and retailers alike.

  22. Monty – No problem. I’m glad to hear the positive feedback. I believe we can do something very cool with this, and I’m excited to be able to finally share a clear vision of what it is with everyone.

  23. Comic2read says:

    While I like Digital Comics with Guided View, they will only succeed if released before paper comics.

    I am annoyed when a comic is available digitally and the online place holds it back.

  24. Torsten Adair says:

    Can I subscribe via this app to receive automatic purchases of the latest issue?

    Do you have a pull list? Is this linked to Previews so I can pre-order the digital comics each month?

    Can I be notified when one of my favorite creators (Gaiman, Dorkin, Moore) has a new title available?

  25. still waiting for these apps to kill each other till a victor(s) and corners the market.

  26. As a small press publisher, I know the main issue I run into, with all of the digital providers, is pipeline or bandwidth for content… Finding most of the larger ones are too consumed with the bigger publishers to provide an outlet for the smaller tier (for instance, ComiXology had a proposed DIY setup to address this, that never panned out, to my knowledge). I hear you talking about Diamond publishers having access to this, and I am one, but I’ll be curious to see how this plays out (and all around for that matter). So I guess my first/main concern is whether there is an infrastructure in place to handle something of this scope? It’s all fine and good to have a theoretical structure for it, but not so much if the manpower (or systems) aren’t there to support it (well beyond the big 2).

    Something that gives the smaller publishers more ability to compete could be a good step for all (more product for retailers in this case, and certainly more options for consumers… not to mention creators)… Of course, until we understand this offering more fully, as others have pointed out, it could contain more pitfalls in that regards (or a myriad of others in different areas).

    Looking forward to hearing more.

  27. Mario Boon says:

    “Michael Murphey

    Mario – it’s not something most of the retailers we’ve talked to want to sell, and I can see why.

    When you sell an iTunes gift card, you’re essentially telling that customer to go somewhere else and buy the thing they want — effectively taking yourself out of the loop.”

    So, what’s the difference with buying digital comics from comixverse, etc now? I can buy all the comics I want and never support a retailer.

    With gift cards at least the retailer get a percentage of the sale of the card.

  28. From Michael Murphy’s comment to Al about being able to download the books this definitely might get me back into comics. I recently started looking to start reading again after 12 years or so away from the comic book market.

    I don’t like the current digital distribution model and that is holding me back from jumping in again. I want to buy my comics like I buy my MP3s. Any store, any app, one format and I can play them on any device just like I can with my MP3s.

    Assuming the prices are realistic for a digital copy especially for older books I could see myself diving in and building a nice collection quickly. Of course if old digital books are still stuck at a $.99 sale price, my enthusiasm would drop since price would still be a barrier for entry. Discounts should be offered for buying a complete run just like it is cheaper to buy a season rather than individual tracks.

  29. Torsten – everyone of those features you mentioned would be awesome, and some of them are already on the drawing board for later in the year. Right now we’re in phase one of getting every one going, and we’ll be adding features at regular intervals.

    Jason – I can appreciate your concerns. In the beginning, iVerse was staffed by a handful of dedicated people, but we definitely had the problem you’re talking about in regards to being able to accommodate all levels of publishers.

    Thankfully, that’s different now. There are over 30 people at iVerse, and a good number more dedicated to this program at Diamond as well. We feel we have enough people to handle the scope of this thing, and are prepared to add more as necessary. We recently received some VC funding and are putting a good portion of that money towards this effort.

    Over the last year, as our initial concept came out, we discovered some pitfall to it via feedback from the public, and our own internal discussions. We revised, and eliminated many of those. We will continue to do this and evolve the program. Our goal is to make something that is unique and that benefits publishers and retailers of all sizes.

    Mario – the difference with the program we’re offering is the the retailer makes a percentage off of every sale, and gives the customer a way to enjoy the product without sending them to a competing store.

    If someone else wants to offer gift cards, though, they certainly can, and the market can decide what works better.

    Brennok – Individual issues rarely go below $0.99 — but there are some very inexpensive digital trades out there — and I’m all for the idea of selling a comic series like an album at a discounted rate. Be on the lookout for options like that SOON!

  30. Well, whaddya know — iVerse sent me a very fair contract. Thank you Mr. Murphey!

  31. CitizenCliff — Not a problem! Glad you feel that way.

  32. Brennok says:

    Michael–Hopefully “SOON” is actually soon, I have 12+ years of reading to do and I don’t have the physical space to rebuild my collection. My local library has a very limited selection.

    I have come to find that unfortunately you are correct that $.99 seems to be the bottom price currently. Hopefully this will change in the future and we might see some Steam like sales. Again my focus is primarily on older titles and wouldn’t have a problem with the $.99 pricepoint for new issues assuming a discount for preordering an arc or series.

    I think digital pricing will always be a tricky decision and something that needs to be open for discussion.

    I look forward to hearing more details in the future like filetype, accessibility, limitations, etc.

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