Last week Amazon acquired the largest purveyor in digital comics, Comixology. The company has been going strong since 2007 and functions as the primary distribution method for Archie, DC, GI JOE, Marvel and over 70 different publishers. These publishers are now very worried that Amazon will employ the same strong-arm tactics they did with publishers to get eBooks at rock bottom prices.
During the last few years Amazon categorically informed a large number of small and medium sized publishers that Amazon would not negotiate agency selling terms with any other publishers outside of the five initial Apple partners. The publishers were told that if they switched to an agency model for ebooks, Amazon would stop selling their entire list, in print and digital form. Amazon also played hardball with companies like S&S, HarperCollins, Hachette and Random-Penguin when the agency model was disbanded to get the best deals possible.
Amazon is a company that functions on margins and firmly embraces the wholesale methodology to their entire ecosystem. The big problem is comic publishers have no experience with outside companies mandating lower prices. A number of comic book publishers have told me off the record that they are really worried that they are going to receive a call from Amazon and inform them they have to reduce their prices. The vast majority will have no choice but to aquis to whatever new terms Amazon mandates, because they have no other resource to sell their comics.
Comixology is not the only player in town that sells digital comics, but is the definitive force when it comes to single issue comics. Amazon, Apple, B&N, Google and Kobo all sell graphic novels. Comic book lovers often are enamoured with single issues because they can stay current with the major storylines, instead of waiting a number of months for them to be packaged into a graphic novel. A few times a year Marvel and DC have big events that crossover into popular franchises. Fear Itself, AVX, Age of Ultron tend to have four or five comics coming out every single week. People want the single issues in order to really get into the story. Sadly, Comixology is really the only company to actively market them.
DC Comics is one company that has been branching out on their own lately, instead of exclusively relying on Comixology. The company made their first single comic distribution agreement with Google Books. Starting last week, readers will be able to buy all new issues every Wednesday. The company also pulled out all of their comics out of the Comixology app for the Kindle Fire, citing better sales on other platforms.
Marvel has been actively developing their own end-to-end solution where they want to get into the business of selling their own comics and not relying on 3rd parties. The first step to this was incorporating Marvel AR into the main Marvel app. This gives users the ability to use their tablets camera on a physical book to get commentary from the writers/artists or to check out animations. A few weeks ago Marvel unveiled the ability to have comics read aloud to you at South by Southwest. The big rumor is that Marvel plans on incorporating their Netflix for Comics Marvel Unlimited into their main app and also start selling comics themselves.
It is currently unknown what Amazon will do with Comixology. They might pull a Zappos or GoodReads and let them run autonomously, while incorporating some key technology into their own ecosystem. Alternatively they might elect to shutter it completely and if you want comics, Amazon will be the only game in town. I don’t know how DC or Marvel will enjoy the talks with Amazon to lower their prices or if they will physically resist it.