When everyone’s favorite e-book company purchased everyone’s favorite e-comic book company, comics finally took the giant step forward we’ve been threatened with for years.
While comiXology and its competitors have tried their best to build a new revenue stream for the comics industry ever since digital comics first became viable four years ago, it’s been tough. Digital comics simply haven’t taken hold the way enthusiasts keep predicting, or at least with nothing close to the wild success we’ve seen in mainstream prose publishing where digital now accounts for roughly a third of all book sales. The reasons for this are many, including the fact that comics sales are still fueled by collectors like myself who enjoy owning physical things. But the biggest obstacles to overall category growth are still discoverability and consumer awareness. When I tell someone that I work in comics the most common reply is, “I didn’t know they still make those.” When people aren’t exposed to comics they don’t know they want comics, which means they won’t look for them or purchase them. Last week’s Amazon/comiXology team-up aims to turn this story around for good. Comics, a niche segment of an already niche publishing market, is on the verge of going mainstream again.
Most of the instant online reaction to the acquisition seems to come from two places: either “oh look, something tech was bought by something else tech, isn’t that techy?” or “oh geez, they’re going to take my comics away!” I’d like to instead explore what the purchase might mean from a book publishing perspective, and by “explore” I mean, “make wild unsubstantiated predictions.” So without further ado, behold my 100% guaranteed accurate predictions for the future of comiXology and the world:
First Of All, Your Digital Comics Collection Is Safe
The more mystified reactions to the announcement, particularly in the tech news outlets, stems from a misunderstanding of what exactly comiXology is, and what benefits it brings to a company like Amazon as opposed to, say, a media company or a patent house like Google. If comiXology were absorbed by some unrelated behemoth that didn’t know what to do with it, these alarm bells and ominous questions about the future of your comiXology collection would make more sense. But Amazon is a fellow e-reading company with strikingly similar assets to comiXology: a proprietary e-reader application, an online storefront for e-books, lucrative relationships with publishers, knowledgeable staff, and industry-leading customer service. In fact, I would say there’s nothing comiXology offers that Amazon doesn’t already have in some form, which means the sole benefit of acquiring it is to improve those assets; tweak them, add to them, multiply them.
Amazon didn’t just buy an app or a “digital store” as many outlets have framed it. Amazon bought technology (comiXology’s “Guided View” patent), satisfied customers, vendor relationships, and an ocean of content it didn’t have before. It simply wouldn’t benefit Amazon in any way to destroy comiXology and strip away all of the things that made it appealing in the first place. So, what can existing comiXology users expect as the dust settles? Our comics will still be there, our reading experience will still be awesome, and our selection will be just as great, if not better. How so? Well, for starters . . .
1. Amazon’s Comics Vendor List Just Blew Up
Pre-acquisition, Amazon certainly had a nice selection of digital comics in the Kindle Store, with enough content to run digital graphic novel promotions up front with the rest of their books. But it’s not easy to start a new and meaningful vendor relationship with Amazon, leading many of comiXology’s vendors (especially the smaller ones) to just give up on the idea or to go through a traditional book distributor – usually the same distributor who handles their print book sales to Amazon.
Now, I know book distribution isn’t a very sexy topic for a blog post, but forgive the hyperbole for a moment when I say this area is the one most ripe for shake-up, and the one to watch in coming months if you’re interested in following the acquisition story as it unfolds. ComiXology has over 75 suppliers, not including the self-published creators who currently sell over 1,000 titles through Submit, comiXology’s CreateSpace-like self-publishing portal. If they didn’t already, all of these cats now have the largest online retailer in the world (and someday, perhaps, the largest retailer, period) as one of their primary accounts. This influx of comics content to Amazon and instant audience expansion for small comics publishers and indie cartoonists is nothing short of revolutionary, and we can only begin to speculate on how it will improve the industry’s fortunes in coming years.
But what about those publishers who already had a separate selling arrangement with Amazon’s Kindle Store? Well, that’s where it gets even more interesting. In the pre-acquisition set-up, most publishers had direct relationships with comiXology but sold to Amazon through a third-party distributor. Presently, the situation is kind of tricky, with publishers supplying the same product (e-books) through two different streams (comiXology and Kindle proper) to the same retailer (Amazon) with wildly different sales terms. Which one will eventually win out, and will the redundancy cause publishers to ask uncomfortable questions about sharing revenue when they may no longer have to? My Magic 8-Ball says, “Ask again later,” but I’m intrigued. Comics sales are about to boom (more on that below), and who gets a piece of that boom is now a little more up in the air than it used to be.
Of course, there’s always a dark side to distribution shake-ups, and that’s the monster-under-the-bed called term renegotiations. Amazon obviously has much more leverage and much less affection for the health of publishers than comiXology has, and the acquisition could lead to a change for the negative in terms of percentages, promotions, and account management. (From personal experience, I can say that comiXology’s accounts team is a supreme pleasure to work with and Amazon’s is . . . not so much.) But at the same time, Amazon is in business to make money and that’s the tension that causes any business relationship to find its mutually profitable balance. New comics vendors brought to Amazon by comiXology may see some friction as the machinery changes over, but in the end, Amazon needs content to sell, including the content that partially made comiXology such a valuable purchase.
And one final point on this: where comiXology once offered a healthy alternative digital distribution stream for publishers, now there’s room for others, like iVerse, to step up and take its place. Consolidation isn’t always bad for competition; sometimes it opens the door a little further.
2. Kindle Will Eat ComiXology (And That’s OK)
I know it sounds scary, but given the list of benefits I mentioned above, there’s simply no practical reason why Amazon would maintain comiXology as a separately branded company like it did with Zappos or Audible. Remember, even though the comiXology brand has value, that value is mainly derived from what it offers: selection, reading experience, shopping experience, and customer service. All of these things still exist no matter what the app is called or which icon you have to press on your iPad to dive in, and they’re all things Amazon would naturally want to have associated with its home-brewed e-reading experience.
Zappos is a very different shoe store than Amazon proper – different buyers, different taste, different economies of scale, and different selection. ComiXology, on the other hand, offers you the same digital copy of Detective Comics #27 that you can buy in the Kindle Store, making a separate storefront and app kind of pointless. By absorbing the purchased e-reader tech and content selection into its already popular Kindle products (both devices and apps), Amazon would give Kindle an astounding upgrade, making it the absolute must-have for digital comics and shaming B&N’s Nook products away from the table entirely. For anyone still wavering over which e-reader to buy or which e-book ecosystem to commit to, Amazon’s comiXology-powered comics experience will tip the scales to Kindle for anyone who might care about comics.
Giving Kindle a “comiXology upgrade” will also shore up Kindle as an indispensable product for the already converted. Whether comiXology becomes a comics tab on Kindle’s start screen or is simply invisibly integrated into its existing e-book experience, Kindle’s current 20 million device users and countless app users will now have access to the only good way to read digital comics, in a smooth, barely noticeable transition on the device they already use. It’s pure comics magic, and Amazon will want to roll that out sooner than later.
Now, what this means for comiXology’s excellent in-app storefront is another matter. To say the Kindle Store needs improvement is a gross understatement, and Amazon would be smart to integrate this aspect of its new acquisition, as well. But that’s easier said than done when Amazon’s current in-app purchase scheme is, well, non-existent, and for reasons that are unlikely to change any time soon. If Amazon comes around to sharing 30% of its sales with Apple and whatever percentage they would have to share with Google Play on Android devices, there’s no reason why they wouldn’t simply import comiXology’s storefront to the Kindle app straight away. But if not, we may be relegated to discovering comics in the Kindle app through comiXology’s existing curation and promotions, but purchasing them from the Amazon website like we do now with e-books.
However it shakes out, the outward appearance of comiXology will soon be no more, but its more important “under the hood” attributes will live on in the super-Kindle of our comic book dreams.
3. Twenty Million People Are About To Discover Comics
One of the most important conversations we have in the comics industry today is about audience-building. As unit sales generally track downward (despite momentary uplifts from huge marketing events and outlier best-sellers), our Climate Change-level challenge is to get more readers. There are as many opinions on this as there are people, with some arguing for greater mass market penetration, others saying give up on that entirely, still others saying that we have nothing to worry about, and little old me standing here saying we should sell more comics on the newsstand.
Kindle’s core device-owner base (again, not including the Kindle app users) is not only larger than that of any other e-reading device, but they spend over $1,200 per year on all kinds of stuff, $400 more than the Kindle-less among us. Kindle users are engrossed in a commercial closed-loop that provides print books, e-books, movies, music, video games, and non-entertainment household consumer products. Amazon’s recommendation algorithms and addictively easy “One-Click” purchasing is surely the reason for this, with customers constantly led to other items they will most likely want, billed as “treats,” “gifts for yourself,” and other soothing, cozy-sounding terms that Amazon’s marketers come up with that day. At the moment, a best-selling comic book single issue tops out at around 100,000 units. We’re about to start showing our stuff to more than 20,000,000 people who are sitting there waiting for us with their wallets open.
Comics and graphic novels are already part of the Amazon ecosystem, of course, but as I mentioned, that experience is about to be turned up to 11. With the coming surge in selection pushed into Amazon’s algorithmic knowledge of what its customers like, Kindle users will soon discover comics for real. And if everything is integrated properly, when they start sampling and dipping their toes into purchasing, they’re going to find the fluid, Guided View pleasure we all know and love instead of the clunky, off-putting reading experience we have on the Kindle Store today; happy customers are repeat customers.
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If all this comes to pass, and we get a robust, efficient stream of new digital comics flowing through the Amazon ecosystem to its millions of customers on their immensely popular Kindle devices, the comics industry will have finally put a dent in the discoverability problem we’ve been trying to overcome for 15 years. As anyone who has worked with Amazon knows, a promoted title there tremendously lifts sales, and sales lead to recommendations for other titles (including print) that have a higher sell-through because the audience is now predisposed to wanting what you publish. And once that connection is made, that customer now knows that we still make comics, that they can be about anything, that they’re available for purchase in many formats, and that they’re sold in elaborately fun places called comic book stores. In other words, you’ve just created one of these “new comics readers” previously only whispered of in myths and legends. The world is about to rediscover comics exactly the way digital pundits have been telling us to expect for years. Who knew, in the end, that we needed digital to be a new bookstore, not a new newsstand?