rec.arts.comics.misc

RAC/RACM FAQ

Part 3: Inside the Comic Book Industry

by Carl Henderson
carl.henderson@airmail.net
Based on original FAQs by Francis Uy, Tom Galloway, Paul Estin, et al. 


3-1: WHAT IS THE DIRECT MARKET? HOW IS IT DIFFERENT FROM THE NEWSSTAND MARKET?

Simply put, the direct market is comic book shops and independent
subscription services. The direct market is only one venue for comic book
sales. Others include: newsstand sales, subscription sales, and bookstore
sales of trade paperbacks. For most publishers (except Archie--who alone in
the American comics industry sells the majority of its books on the
newsstand), the direct market is by far the largest and most profitable of
these markets. 

The direct market offers substantial advantages to a publisher. When
selling through newsstand distributors (often called "independent
distributors"), publishers agree to accept returns of unsold, or damaged,
product. Such returns can run has high as two copies returned for every
copy sold. To make matters worse, comics returned from the newsstand market
can not be resold--they are usually "stripped." 

"Stripping" means that the covers of unsold/damaged comics are torn off,
and returned for credit, while the rest of the comic is thrown away--or
sometimes fraudulently resold, minus the cover. Books sold to the trade
paperback market in bookstores are also sold on a returnable basis,
however, trade paperback returns are not stripped, allowing the returned
books to be remaindered (resold at a discount).

In most cases, books sold in the direct market are not returnable, although
there are some exceptions to this rule. As a general rule, comics that are
significantly different from what was solicited, or are shipped over 30
days late, may be returned for credit. Sometimes publishers offer partial
returnablity (usually through overship programs) on comics that the
publishers want to promote, in order to encourage higher orders. 

Today the term, "Direct market," is a misnomer. But in the early days of
the direct market, comic book publishers sold directly (hence the name) to
store owners (beginning with Phil Seuling and Bud Plant). Some these stores
went on to resell comics to smaller stores, and became the first direct
market distributors. Over time, most of these stores either got out of the
distribution business, or out of the retail business. 

As the direct sales market grew, new direct market distribution companies
were formed--some arising out of the smaller distributors that had been
dealing mostly in "underground" comics. By the early 1990s, there were only
a handful of direct market distributors. Then Marvel triggered the era of
exclusive arrangements with distributors, leading indirectly to the current
dominance of Diamond as the sole distributor of all of the major
publishers, and the majority of the comic books sold in North America (see
section 3-9).

The rise of the direct market is often credited with saving Marvel and DC's
comic lines back in the mid-70s, and allowing for the growth of numerous
independent publishers. However, as the economics of running a comic book
shop have tightened in the latter part of the 1990s, retailers have
increasingly called for the major publishers to institute some partial
level of returnablity in the direct market. 

For more detailed information on the beginnings of the direct market, see
"Secret Origins Of The Direct Market", by Robert Beerbohm in COMIC BOOK
ARTIST #6 (published by TwoMorrows Publishing-- http://twomorrows.com/)


3-2: HOW DID DIAMOND END UP CONTROLLING THE DIRECT MARKET?

During the Perelman-era, Marvel purchased a mid-sized local distributor
called Heroes World. Within a few months of the Heroes World purchase (July
1995), Marvel announced that Heroes World would be their exclusive
distributor. Now comic book shops that had been served by one distributor
(usually Diamond, or its principal competitor Capital City), would also
have to deal with Heroes World, or not have access to Marvel product. 

Since not being able to stock Marvel comics would bankrupt most any comic
book shop (at least it would have in 1995), practically every comic
retailer in the nation also signed up with Heroes World. At the same time,
retailer discounts were reduced. This was just what Marvel management had
wished for. Vertical integration uber alles!

Like many people who got what they wished for, Marvel came to regret it.
Heroes World Distribution proceeded to screw up royally. Remember that
Heroes World was a mid-sized regional distributor. Now it was trying to
serve clients all over North America. Even though Marvel added warm bodies,
the experience and infrastructure that they needed wasn't there. Complaints
from retailers rose. Even worse for Marvel, orders fell. Many comic shop
managers felt reduced discounts through Heroes World were not worth the
hassles they had to put up with, and began to steer customers to competing
companies.

The other major distributors saw the writing on the wall. At one stroke,
they were cut out of ~30-40% of the market. An exclusive deal for the
competition with another major publisher (such as DC, Image, Dark Horse, or
Valiant) could bankrupt them. Capital City and Diamond began a bidding war
to sign publishers to exclusive distribution contracts.

Diamond won. In August 1995, DC Comics agreed to an exclusive distribution
deal with Diamond. Several other major publishers followed suit--Image,
Valiant, and Dark Horse. Capital City only managed to sign up Kitchen Sink
and Viz. Every comic book store now had to deal with both Diamond and
Heroes World. Few wanted the extra paperwork associated with yet a third
distributor. Capital City quickly went bankrupt, and in July 1996, sold its
assets to Diamond.

There were now two national comic book distributors--Diamond and Heroes
World. However, problems at Heroes World continued. Even worse for
cash-starved Marvel, Heroes World bled money. In February 1997, Marvel shut
down Heroes World and returned to Diamond. 


3-3: IS DIAMOND A MONOPOLY?

For most comic stores and publishers, Diamond IS the direct market. If
Steve Geppi doesn't want to distribute a comic, most American retailers
won't receive it. So is it a monopoly? 

Spurred by complaints from comics retailers (especially Chuck Rozanski of
Mile High Comics), the Department of Justice is considering the matter.
Diamond argues that while they dominate the comic book direct market,
comics are merely a subset of the vastly larger periodical magazine market,
in which Diamond is a small fish. Diamond's critics contend that many of
Diamond's practices are anti-competitive, and serve only to enrich Diamond
at the expense of a captive retailer population.


3-4: IS THE DIRECT MARKET DYING?

Maybe. The numbers below are derived from the sales graphs published over
the past several years in Krause Publication's COMICS RETAILER. (All
figures are stated in millions of dollars.)

Month        Market Size     Market Size
            Comics Alone    Comics & TPBs
------      -------------   --------------

May-00          16.27          18.5
Apr-00          15.42          17.2
Mar-00          15.36          17.4
Feb-00          14.45          16.3
Jan-00          14.28          15.7
                    
1999 Average    16.88          19.18

Dec-99          17.52          20.3
Nov-99          17.50          20.1
Oct-99          17.34          20.3
Sep-99          18.47          20.4
Aug-99          17.72          20.0
Jul-99          17.07          19.0
Jun-99          16.66          18.7
May-99          16.95          18.6
Apr-99          16.18          19.2
Mar-99          16.23          18.4
Feb-99          15.17          17.4
Jan-99          15.73          17.8
                    
1998 Average    17.55          20.08

Dec-98          18.54          20.8
Nov-98          16.76          21.4
Oct-98          18.70          21.2
Sep-98          18.18          20.1
Aug-98          18.49          21.3
Jul-98          17.61          20.1
Jun-98          17.97          20.2
May-98          16.97          19.4
Apr-98          17.56          19.7
Mar-98          17.47          19.6
Feb-98          15.71          18.4
Jan-98          16.66          18.8
                    
1997 Average    20.38          23.12
                   
Dec-97          22.90          25.2
Nov-97          19.78          23.7
Oct-97          21.83          24.5
Sep-97          19.31          21.7
Aug-97          20.85          23.6
Jul-97          20.28          22.6
Jun-97          18.93          21.6
May-97          18.96          22.1
Apr-97          20.69          22.4
Mar-97          20.03          22.9
Feb-97          19.12          21.9
Jan-97          21.83          25.2

Dec-96          25.78          29.3
Nov-96          28.24          33.9
Oct-96          25.18          29.0
Sep-96          26.39          29.7

Unfortunately, looking at the yearly averages, there is a clear and steady
pattern of decline. For comics alone, average monthly sales declined from
20.38 million dollars in 1997 down to 16.88 million dollars in 1999--a
decline of about 17% over that three year period (with the bulk of the
sales loss taking place from 1997 through 1998) for both comic books alone,
and comic books and comic trade paperbacks combined.

However, these numbers only represent pre-order sales in Diamond's segment
of the direct market. COMICS RETAILER figures do NOT reflect sales of comic
book trade paperbacks in bookstores. And these sales are going up. In a
June 2000 CSN/Newsarama interview, DC publisher Paul Levitz commented,
"Certain areas of the business are showing some real promise; the backlist
side of the business--the whole trade paperback side--is growing."

Nor do these figures reflect sales though non-Diamond distributors (a
significant percentage of non-Diamond exclusive publishers). These figures
also leave out subscription sales and newsstand sales.

Most importantly, COMICS RETAILER's figures include do not re-orders and
advance re-orders. As comics retailers have become more cautious about
over-ordering, they have tended to order less up front, and re-order more.
Thus, over the past few years re-order sales have been steadily rising.

Note: In my answer to this question in the beta and 1.0 version of this FAQ
I was very skeptical of the conventional wisdom of the decline in direct
market sales. I said:

    According to direct market statistics compiled by COMICS RETAILER 
    (from Diamond pre-orders)the low point for direct market for comic
    books (both in pamphlet and trade paperback format) was 17.4 million 
    dollars (January 1998). By the end of 1999, direct market size had 
    grown to about 20.3 million dollars--a growth rate of about 7% a year.

My original answer was VERY wrong. Unfortunately, on average, overall
direct market pre-order sales have been--and still are--declining. 

I made a really dumb mathematical error in my original calculations. By
basing my estimate on only two data points, I completely failed to account
for the seasonal nature of the direct market. By comparing sales in January
(the traditional low point of the comics sales year) with sales at a
November-December (a period that recently has seen the peak sales for a
given year), I got an upward sales curve that just wasn't there. BTW--I
also read the numbers for January 1998 wrong; making my results even more
screwed up. 


3-5: WHAT IS THIS "STATEMENT OF OWNERSHIP, MANAGEMENT, AND CIRCULATION"
THAT SHOWS UP ON COMIC BOOK LETTER PAGES FROM TIME TO TIME?

US law (39 USC Sec. 3685) requires annual publication of a "Statement of
Ownership, Management, and Circulation" for all publications using
periodical (second-class) mail rates to mail out subscription copies. These
statements usually appear on letters pages around October of every year.

While once, every title could be depended upon to publish an annual
"Statement of Ownership, Management, and Circulation," only Marvel and
Archie still send out subscriptions via second class mail, and are thus
required to publish them. 

Too bad. You can learn some really interesting thing by reading that fine
print. The "Statement of Ownership, Management, and Circulation" requires
that the publisher disclose (paraphrased from the US Code): 

   * The identity of the editor, managing editor, publishers, and owners;

   * The identity of the corporation and stockholders thereof (holding 
     more than 1% of the stock), if the publication is owned by a 
     corporation;

   * The identity of known bondholders, mortgagees, and other security 
     holders (owning more than 1 percent of the total securities);

   * The extent and nature of the circulation of the publication, 
     including, the number of copies distributed, the methods of 
     distribution, and the extent to which such circulation is 
     paid in whole or in part.

For information on how to extract sales information from a "Statement of
Ownership, Management, and Circulation," see the next section.


3-6: WHERE CAN I FIND SALES FIGURES FOR COMICS?

DIAMOND FIGURES

The Diamond's "Top 100 List" published every month in PREVIEWS, and is
online at:
     http://www.diamondcomics.com/previews/editorial/tophundred.html

Diamond publishes more detailed sales information in DIAMOND DIALOGUE (a
monthly magazine available only to comics retailers) including rank,
publisher, and "order index" of the top 300 direct market comics. A
transcription of the top 300 list from DIAMOND DIALOGUE is available online
at the Genesis Comics website:
     http://www.genesiscomics.com/Downloads/

Diamond's "order index" is a tool designed to help retailer decide how many
of each comic to order. The "order index" number is set using the direct
market sales of BATMAN as 100. Sales on all titles are then listed as a
percentage of BATMAN sales. If you know the actual direct market sales of a
title, and the "order index" number for that title, you can then work
backwards and estimate direct market sales on all titles with "order index"
numbers.

DIALOGUE also offers market share statistics (by publisher for all
products, for comics and magazines by dollar share, and comics and
magazines by unit share), and "Top 10" or "Top 25" lists for all products,
graphic novels (trade paperbacks), magazines, books, cards, toys, games,
videos, apparel, posters, and misc. items.

COMICS RETAILER (Krause Publications) prints a monthly estimate of direct
market total sales (both by units and dollar amount) for both comics and
trade paperbacks, as well graphs as showing sales trends over the last two
and a half years. These figures are derived from Diamond's pre-order data.

COMICS RETAILER's "Market Beat" section also includes a variety of
information gathered from comic dealers who fill out COMICS RETAILER's
monthly survey. This information includes individual reports from stores,
market share information by publisher, and average unit sales on the top
fifty comics.

ESTIMATED SALES FIGURES POSTED TO RAC.MISC AND RAC.INFO

Every month, Michael Burns (mburns35@hotmail.com) posts a list of estimated
sales for the 100 top-selling comics, comics-related magazines, and graphic
novels. These sales figures are approximations based on Diamonds "order
index" numbers, and the known sales of a few comic books. 

Michael Burns (and Matt High before him) does a tremendous job, and
provides a valuable service to the RAC community.  These sales charts are
very useful and provide a fascinating look into the business side of the
industry-but they don't tell the whole story. They can not take into
account these important factors:

REORDERS: Reorder activity (either advance reorders or regular reorders)
can significantly affect the total sales of a book-sometimes even prompting
publishers to send a comic back to the press. As retailers tend to order
more conservatively, reorders are becoming more and more a significant
percentage of the direct market sales. 

Scheduling of Diamond's order cut-off dates can also play havoc with these
figures. In a post to RAC.misc, Stuart Moore (former DC/Vertigo editor)
noted: 

     There also seem to be some months when Diamond sets the order deadline
     early--usually major holiday months--which results in a number of
     stores missing the initial solicitation deadline.  Their orders are
     then added in as advance reorders at a later date.  (Whenever this
     happened at DC, I'd panic at the low numbers, and then things would go
     back to normal--i.e., a mildly depressing decrease--next month. 
     Better a slide down the hill than a drop off a cliff.)

NEWSSTAND SALES: Newsstand sales-which are not distributed by Diamond--and
can be a significant source of sales for some comics (mostly for
high-profile titles from DC, Marvel, and Dark Horse--and all of the Archie
Comics titles). 

TRADE PAPERBACK SALES: While making money on marginal titles via later
collection into trade paperback isn't part of every comic publisher's
business model, trade paperback sales can be a significant source of
revenue for some comics. 

SALES VIA NON-DIAMOND DIRECT MARKET DISTRIBUTORS: There are non-Diamond
distributors in the direct market (Cold Cut, for example). Non-Diamond
sales are not a factor for Diamond-exclusive publishers (such as Marvel,
DC, Image, and Dark Horse) but sales though other distributors can be
significant for many independent comics.

SUBSCRIPTION SALES: Sales figures posted to Usenet can not take into
account subscription sales. Such sales can be important-especially on some
marginal "cult favorite" titles. Relatively small levels of subscription
sales can have a disproportionate impact on a comic's profitability. A
comic publisher makes significantly more money off a comic sold via
subscription (even after subscription discounts and shipping costs) than
they do off of a comic sold through the direct market, because the
distributor and the retailer don't take their "cuts" of the cover price.

The discrepancy between the sales approximations posted to Usenet and the
actual sales of a comic book can be significant. For example, Michael
Burns' June 1999 sales figures show DC/Vertigo's TRANSMETROPOLITAN as
selling 17,400 copies. However, TRANSMET's creator Warren Ellis has stated
on Usenet that actual sales were around 20,000 copies-a difference of about
13%.

STATEMENTS OF OWNERSHIP, MANAGEMENT, AND CIRCULATION 

As noted above, only Marvel and Archie still publish a "Statement of
Ownership, Management, and Circulation" (SOM&C) for their titles sold via
subscription. 

To look for sales information in a SOM&C, look for Section 15 ("Extent and
Nature of Circulation") about halfway down the box of text. There are a
number of subsections under Section 15 (e.g.: Total Copies Printed, Paid
and/or Requested Circulation, Total Paid Circulation). In each of these
subsections, both the average number of copies for the previous year, and
the number of copies for the issue closest to the filing date are listed.
Each of these subsections, tells a piece of the story:

Total Number of Copies Printed: This tells you the print run of a comic
book. This is the number of copies printed before paid distribution, free
distribution, damages, and returns.

Paid and/or Requested Circulation: This subsection further breaks
circulation down into "sales through dealers and carriers, street vendors,
and counter sales" (sum of the direct market and newsstand market sales),
and "paid or requested mail subscriptions." Subscription sales are
important. Remember that a comic that has a comparatively higher rate of
subscription sales will remain profitable far longer than its total
circulation numbers might indicate.

Total Paid Circulation: This is the total of all sales under the previous
subsection. The Total Paid Circulation number is ALL the sales for a
particular comic.

Free Distribution by Mail: This subsection accounts for a company's "comp
list"--comics that are sent out free to employees, freelances, and reviewers. 

Free Distribution Outside the Mail: This subsection accounts for copies
given away as convention samples or to schools and charities.

Total Free Distribution: This is simply the total of the previous two
subsections.

Total Distribution: Sum of "Total Paid Circulation" and "Total Free
Distribution."

Copies Not Distributed: This subsection breaks down copies not distributed
into "office use, leftovers, spoiled" (usually less than a hundred copies)
and "returns from news agents." 

With a little bit of math and research, the "returns from news agents" line
can help you approximate what a title's sell-through on the newsstand is.
Take the "sales through dealers and carriers, street vendors, and counter
sales" number from the "Paid and/or Requested Circulation" subsection. Then
go find that comic's sales figures for the direct market from Michael
Burns' monthly posts. Subtract the direct sales estimate from the "sales
through dealers and carriers, street vendors, and counter sales" number.
Your result is the total number of copies that were offered for sale
outside the direct market. Then using the "returns from news agents" number
you can easily calculate the newsstand sell-through percentage.

Remember that from time to time, very late ship dates or special promotions
can make direct market books returnable. Such returns would show up under
"returns from news agents," and can skew your results.


3-7: HOW CAN A COMIC MOVE UP THE SALES CHARTS AND STILL BE SELLING LESS?

If you follow the Top 100 sales charts published in WIZARD or PREVIEWS, you
may notice that a title's rank on such charts can move substantially up (or
down) from month to month--even though the publisher claims that sales are
falling all the while. How can this be? Marvel editor Tom Breevort answers
this common question:

     A book's ranking on a top-100 chart is not a true indication of how 
     well it's selling--only how well it's selling in relation to whatever 
     other titles are on sale that month. A book can actually lose sales 
     (copies that are paid for and sold) and gain positions on the chart 
     if, say, fewer books are published that month. The opposite is also 
     true.

You can avoid some of the illusionary ups and downs of "Top 100" sales
charts by paying close attention to the sales lists posted monthly to
RAC.misc by Michael Burns. Using data from DIAMOND DIALOGUE and various
publishers, Micheal Burns is able to estimate total copies sold in the
direct market.

Just keep in mind that his figures are ESTIMATES--and a number of factors
can affect final sales that those figures do not take into account (see
section 3-7).


3-8: WHAT IS THE "LINE OF DEATH" FOR COMICS FROM VARIOUS PUBLISHERS?

There is no hard and fast "line of death." Many factors determine what
sales level a particular comic series will be cancelled at--price per unit,
company policies, creator costs, possible movie/TV sales, foreign reprint
sales (German sales kept LOBO alive an embarrassingly long time),
subscription levels, licensing and trademark considerations, trade
paperback sales, etc. However, some general trends can be discerned by
looking at the sales figures posted to Usenet, over time.

Marvel's LoD--previously set around 35,000--has recently dropped
significantly as a result of increased prices, and now runs around 20,000
to 21,000 copies sold.

DC Universe and DC-Wildstorm books have a LoD around 20,000. DC-Vertigo
(which makes a significant portion of its money on trade paperback sales)
has an even lower line of death, around 15,000. 

It is very hard to judge the LoD for most independent comics. Expenses and
cost structures differ dramatically. Many self-published comics are even
run at a loss, and the LoD is set by how much money the creator(s) are
willing to lose.


3-9: I'VE HEARD THAT MARVEL CANCELS ANY COMIC BOOK THAT DOESN'T MAKE AT
LEAST $10,000 PER ISSUE. IS THIS TRUE?

No. Tom Brevoort (Marvel editor of books like AVENGERS, THUNDERBOLTS, and
HULK) explains the origin of this persistent rumor:  

     Marvel's basic overhead analysis of a title's financial viability 
     plugs in a standard figure for art & editorial costs (A&E). This 
     figure had not been updated in a few years, and was consequently quite 
     a bit out of date, particularly on titles wherein the creators have 
     special deals with Marvel. 

     What this meant was that books which looked at first glance to be 
     profitable were in fact losing money, because of the increased A & E   
     costs. In order to avoid this problem in the future, Marvel's bumped 
     up the A & E figure by $10,000-which means that the books still have 
     to break even, but the tally sheet's been adjusted up by $10,000 in 
     order to better reflect reality. That's where the $10,000 figure 
     comes from.


3-10: WHERE DOES THE MONEY GO FROM BUYING A COMIC?

This rough guide was provided Matt High of Antarctic Press:

     Out of the cover price of our books ($2.75/2.95 usually): 

     * 40-45% goes to the retailer 
     * 20-25% goes to the distributor 
     * 13% goes to the printer 
     * 7-8% goes to the creators/artists 
     * 2% goes to shipping (UPS/USPS) 
     * The remainder (10-12%) goes to the publisher (salaries, rent, 
       utilities, supplies, advertising, etc). 

     Antarctic Press is at the second-highest discount level. We sell 
     distributors books at 65% off cover price, they turn around and resell 
     them for 35-50% off. Marvel and DC sell their books to the 
     distributors at 59-62% off, and they turn around and resell them to 
     the stores at 40-57.5% off.

Keep in mind that the information above is based on Matt High's experience
at Antarctic Press. Other publishers may have different costs in various
areas. Also other factors such as the price of a book, the format (size,
printing, paper, binding, etc), the pay scale of the creators involved, and
the specific deals a publisher has with their distributors can
substantially affect the percentages above.


3-11: WHERE ARE COMICS PRINTED?

The majority of American color comics from the large publishers are printed
at Quebecor Printing in Canada. Some (usually those on lower-grade paper)
are printed at World Color Press in Sparta, Illinois. In September 1999,
Quebecor Printing finalized their purchase of World Color Press, making
both World Color and Quebecor divisions of the same company.

Brenner Printing (in San Antonio, Texas) and Morgan Printing (in Grafton,
North Dakota) print many black and white independent comics (as well as
some color ones).

For comic book printer contact information, see section 4-2.


3-12: WHAT ARE SOME MAJOR COMICS INDUSTRY AWARDS?

Aardy R. DeVarque maintains a web page that archives the winners of
numerous industry awards at:
     http://www.enteract.com/~aardy/comics/awards/

WIZARD FAN AWARDS: Administered by WIZARD MAGAZINE, the Wizard Fan Awards
are open to anyone who sends in a copy of the ballot (published in Wizard
and many other comic books). The WIZARD staff selects four nominees in each
category (although write-in votes are allowed). The Wizard Fan Awards are
handed out at Wizard World-Chicago.

CBG FAN AWARDS: The CBG (COMICS BUYERS GUIDE) Fan Awards are open-ballot
awards (as long as you buy a copy of the issue of the CBG with the ballot
in it). Administered by the staff of the COMICS BUYERS GUIDE. The CBG Fan
Awards are the oldest still-running industry awards, having been awarded
every year since 1982.

DON THOMPSON AWARDS: The Don Thompson Awards (named for the longtime
co-editor of CBG) have been awarded every year since 1993 by members of
CompuServe Comics and Animation forum. (They were renamed in honor of Don
Thompson after his death in 1994.)

EISNERS: The Eisners (named for Will Eisner) are a juried award, given out
every year at the San Diego Comicon. The Eisners are generally considered
the most prestigious of all comic industry awards. They have been awarded
since 1988.

HARVEYS: Properly the "Harvey Kurtzman Awards" the Harveys are handed out
every year at WonderCon. They are voted upon by "creative professionals in
the comic book field." The Harveys have been handed out annually since
1988. They rival the Eisners in industry prestige.

IGNATZs: The Ignatz Awards (named for the Ignatz mouse from "Krazy Kat")
are been awarded every year at the Small Press Expo. The Ignatzes are
intended to honor "outstanding achievement in comics and cartooning"
(usually in the small press). Ignatz nominees are selected by a panel of
cartoonists and are voted upon by all interested Small Press Expo attendees.

SQUIDDIES: RAC's annual awards are properly known as the "rec.arts.comics.*
Squiddy Awards." Voting is open to anyone who submits a properly completed
electronic ballot. Johanna Draper Carlson, Bryan Harris, Carl Henderson,
and Todd VerBeek currently administer the Squiddies.

Except for the CBG awards, no still-existing industry award is older. The
Squiddies been around since at least 1986 (originally as Great Usenet
Comics Poll, then as the R.A.C Comics Awards, before finally being renamed
for Suicide Squid in 1992). 

Names of Squiddy winners for previous years are archieved at:
     http://www.squiddies.org/


3-13: WHAT IS AN "INDICIA"?

According to Merriam-Webster's "WWWebster Dictionary," "indicia" means
"postal markings often imprinted on mail or on labels to be affixed to
mail." In the world of comics, that translates into the block of fine print
(usually placed on the splash page or inside front cover) that details
information such as: the title, volume, and issue number, ISSN, publisher
information, subscription information, copyright and trademark claims, and
legal disclaimers.


3-14: HOW DOES IMAGE WORK?

Lea Hernandez (who has published CATHEDRAL CHILD and CLOCKWORK ANGELS
through Image) explains how Image works, and why it is different from most
other comics publishers: 

     First, you have to understand that Image is a collective of 
     studios/imprints, publishing under the name Image. Publishing a book 
     through Image is very nearly self-publishing: Image traffics the art, 
     pays up-front for printing and advertising, and solicits the books. 
     The creator is responsible for everything else: meeting deadlines, 
     assembling teams, writing ad copy, etc. If there's something you don't 
     like about Image, your ire is best directed at that studio, book or 
     person in particular, not Image in general. Insofar as being a creator 
     at Image goes: it's a good place to be if you want a lot of say in 
     what happens with/to your book(s). There's no other comic company in 
     the U.S. that offers their combination of publisher recognition with 
     creative control.


3-15: IS MARVEL STILL BANKRUPT? WHO OWNS THEM NOW?

Under the control of Ron Perelman, Marvel went on a feeding frenzy of
expansion purchasing companies like Toy Biz, Panini, Malibu, and
Fleer/Skybox. Ron Perelman apparently had ambitions of turning Marvel into
a multi-media conglomerate. But his purchases were fueled by massive junk
bond debts--debts that Marvel could never realistically repay. In December
1996 Marvel Entertainment Group defaulted on $650 million in loan payments
and filed for bankruptcy. 

Then began a complicated legal struggle for control of the company between
Ron Perelman and fellow corporate raider, Carl Ichan (who had purchased a
substantial portion of Marvel's debt). In April 1997, Ron Perelman
abandoned his attempts to to retain control of Marvel and agreed to hand
the company Ichan and allies among Marvel's bondholders. But the fight was
far from over. The directors of Toy Biz (a Marvel subsidiary) entered the
arena, putting together their own competing reorganization proposals for
Marvel.

Throughout the next year, the Marvel bankruptcy went on and on. Deals were
announced. Deals were scuttled. Motions and lawsuits were filed. Press
releases were issued. Management shifted with the wind; employees twisted
in the wind--hundreds were laid off. At one point it looked as if Marvel
might end up being liquidated. Things got so bad, that in December 1997,
the bankruptcy court took the unusual step of appointing an outside trustee
to run Marvel during the bankruptcy. By April 1998 the New York Stock
Exchange de-listed Marvel's public stock. It had fallen to $1 from a high
of $30 in 1994.

Finally, in July 1998, the bankruptcy court awarded control of Marvel to
Toy Biz, approving a reorganization plan proposed by Toy Biz and Marvel's
Senior Secured Lenders. This plan combined Marvel and Toy Biz by merging
Marvel into a newly formed subsidiary of Toy Biz. In other words, Toy
Biz--once a subsidiary of the Marvel--took control of the whole thing. This
put Marvel under the control of Issac Perlmutter and Avi Arad who,
together, owned a controlling interest in Toy Biz.

Reorganized as Marvel Enterprises by the bankruptcy court--with Perlmutter
and Arad firmly in control--Marvel was able raise cash by divesting itself
of several of Perelman's ill-conceived acquisitions (often at a loss), and
to roll over nearly $250,000,000 of interim bankruptcy financing debt into
long term securities.

Marvel Enterprises, Inc. is currently listed as "MVL" on the New York Stock
Exchange. 


3-16: DO MARVEL AND DC REALLY CO-OWN THE TRADEMARK ON "SUPER-HERO"?

According to the US Patents and Trademarks Office Trademark database
(http://trademarks.uspto.gov/access/search-mark.html), Marvel and DC do
share a trademark on "Super Hero" (along with Ben Cooper, Inc.)--for goods
in class 025, specifically, "Masquerade Costumes"--nothing to do with comic
books (or movies, or novels, or TV shows...)

In other words, there is no federally registered trademark on term
"Superhero" (by itself)--or any permutation of it--for comic books. In
other words, DC and Marvel don't have a legitimate claim if you publish a
comic book and call your character a "superhero," "super-hero," or "super
hero."

Marvel does, however, own the trademark on "Marvel Super-Heroes," and DC
owns the trademark on "Legion of Super-Heroes."

There is also no federally registerd trademark on "Super-Villain." However,
the "Supervillain Music Group Brad McCray (USA) Kevin Lawerance (USA)" has
filed an application for a trademark on "Supervillian" under Class 041 for
"Entertainment services in the nature of musical performance."


3-17: WHAT ARE THE COLORED BARS ON TOP OF SOME COMIC BOOK PAGES FOR?

These bars comprise a color code that tells newsstands and bookstores how
long to leave a comic book on the stands. Each week's group of comics has a
different colored bar. There are five different colors of bar used: Cyan
(Blue), Black, Purple, Green, and Magenta (Red). When stocking new comics,
old comics with the same color bar as that week's new comics are pulled and
returned to the publisher for credit.

These bar only appear on comics that are distributed both to the direct and
newsstand/bookstore markets. If a comic is sold only through the direct
market, it will not have color-code bar.


3-18: HOW MUCH DO COMIC CREATORS GET PAID?

The vast majority of comic book creators work freelance (though a number of
colorists and letterers work as salaried employees for studios, and one
newer comic book company--CrossGen--directly employees most of their
artists and writers, as well.) Freelance creators are almost always paid by
the page for their work, and their pay scale is stated as a "page rate." 

The pay rates listed below assume a major work-for-hire publisher (i.e.,
Marvel, DC, Top Cow, TMP, Dark Horse). Smaller publishers often offer
substantially lower rates.

SCRIPT (per page)
Beginning Rates: $40 to $60
High End Rates:  $80 to $100

PENCILS (per page)	
Beginning Rates: $80 to $120
High End Rates:  $180 to $200
	
INKS (per page)
Beginning Rates: $40 to $60
High End Rates:  $100 to $140

COLORING (per page)
Beginning Rates: $20 to $25
High End Rates:  $35 to $40

LETTERS (per page)
Beginning Rates: $20 to $25
High End Rates:  $35 to $40

Some page rate notes:

BREAKDOWNS VS. FULL PENCILS: Artists who do breakdowns/layouts (loose, less
complete pencil art) are generally paid from $20-$25 dollars less than
their normal page rate. Inkers who "finish" such artwork (doing substantial
more drawing work than normal) are paid correspondingly more.

COVERS (STANDARD): Artists are normally paid more for covers than for
interior pages--anywhere from 20% to 50% higher. Covers normally take more
time, receive more editorial attention, and require more changes. Exact
cover rates are impacted by a number of factors, and are harder to pin down
than interior page rates.

COVERS (PAINTED): Depending on the popularity and skill of the artist,
rates for painted covers can run from the several hundred dollars on up
into the low four figures.

CONTINUITY BONUSES: In the past--when money was less tight--many of the
major publishers offered "continuity bonuses" to artists. These were bonus
payments for completing a run of issues (anywhere from eight to fourteen)
without requiring a fill-in. In the current market, this practice has
almost disappeared. 

SALE OF ORIGINAL ART: Pencillers and inkers have an additional source of
income open to them. Publishers normally only buy reproduction rights to
the art. They almost never buy the physical artwork. Thus, once a publisher
has finished scanning their art boards, the art is returned to the creators. 

Original art is normally split 2/3rds to the penciller and 1/3rd to the
inker (although the exact percentages can vary depending upon contractual
relationships and/or upon the relative contributions of the penciller vs.
inker to the finished art). Writers do not receive a share of the original
art.

Once an artist has their art back, they may choose to sell it to collectors
in the secondary art market. If the artist is popular, he or she may be
able to sell originals for as much--or more--than his or her page rate. On
the other hand, many originals go for $10 to $20 a page. And some never
sell...

A few important caveats about page rates and creator incomes:

1) Royalites (AKA "incentive") levels are almost never reached in the
current market.

2) You can't just multiply a page rate by 22 pages per month and get a
realistic approximation of your potential salary as a comic professional. 

A number of factors make such calculations questionable: fill-in issues
being scheduled, getting work on non-monthly special projects, sickness (no
sick days for freelancers), being fired off a title, having a comic
cancelled out from under you, sale of original art, cover work, etc.
Furthermore, freelancers also have to cover self-employment taxes and
health insurance out of their earnings.

3) All this goes out the window for smaller publishers. Rates are usually
much lower: $5, $10, or $20 a page--or even nothing. On the other hand,
with small-press publishers, royalties are often higher, and royalty
thresholds are much lower. A breakout hit in the small press arena
(rare--but it happens) can net artists effective page rates of hundreds of
dollars per page.

4) Self-publishing is different. No one pays you anything. There are no
page rates. You live off (or fail to live off) of your profits. 

Rich Johnston (who's had some experience as self-publisher through his
Twist and Shout Comics label) explains some of the economics:

     If you can sell 3000 copies a month, you can make a living. A 
     3000 print run will cost between $1000 and $1500 (black and 
     white). Print at somewhere that Diamond pick up from and 
     there's no extra shipping cost. Retail at $2.95, you sell to 
     Diamond for $1.18. Profit of about 70c an issue. Multiplied by 
     3000, that's $2100 a month. Or $25,200 a year. Mind you, then 
     there's materials, inventory copies, conventions, promotion, 
     everything else to figure in. Plus the fact that you won't 
     sell 3000 a month. Few self-publishers do.

Don't quit your day job...


----------------------------------------------------------------------
J. Carl Henderson
carl.henderson@airmail.net

Intro: Introduction / Revision History
Contents: Table of Contents/Acknowledgements
Part 1: The RAC Newsgroups and Posting to Them
Part 2: Comics News and Commentary on the Net
Part 3: Inside the Comic Book Industry
Part 4: Comics Industry Contact Information
Part 5: Comic Book Professionals--And How to Become One
Part 6: Misc. Comic Book Questions
Part 7: Whatever Happened to ___________?
Part 8: RAC Newsgroup Charters

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