What Diamond Digital is, what's wrong with it, and how to fix it.

Announced on February 9th, Diamond Digital is the
veritable distribution company's first foray into
the digital sphere

For the longest time, Diamond and comic book publishers in general have been resisting the advance of digital media.  Stuck in their ways and doing just about whatever they can to continue to prop up the brick and mortar stores, Diamond has been very reluctant to enter the digital arena.  This complacency, borne out of their virtual monopoly on monthly comic distribution, has finally caught up with Diamond.  Now, dragging their feet, Diamond has finally announced their partnership with iVerse (think similar to comixology) to distribute issues digitally.

Normally, such an announcement would be heralded as an important step forward for the industry and forward motion towards the digital future that the comics medium undoubtedly faces.  Unfortunately, Diamond's announcement was poorly communicated and led to all sorts of wild speculation, ranging from higher prices for digital editions to lack of iPad support to bizarre distribution schemes that made less sense than Diamond's previous resistance to going digital.  Thankfully, due to the journalistic diligence of the fine folks at Robot6 via CBR, we have a much clearer picture as to just what Diamond Digital actually is.

iVerse is having to play catch up
to competitors Comixology
and Graphic.ly

So... what is it?  In terms of technology, iVerse is a comics/literature purchasing platform similar to those proffered by Comixology or Graphic.ly.  If you're unfamiliar with those platforms, both offer ways for publishers to sell their comics digitally, protecting it with some form of DRM, and allow the publishers direct control over release schedule of back issues and current releases.  Some of the publishers have even waded into the "dangerous" area of releasing the digital edition of the comic same day as the print edition, to somewhat mixed results.  Of the three developers, Comixology leads the way, having made developed the apps for the majority of the major comics publishing companies including Marvel, DC, Dynamite, Image, Boom, Dark Horse, and more.  Graphic.ly also works with Marvel and Boom, while also distributing more independent publishers such as Archaia, Archie, Devil's Due, and 12-Gauge.  iVerse works largely with the same clientele as Graphic.ly, but includes more independent publishers such as Top Shelf, TOKYOPOP, and Bluewater Productions.

iVerse's platform, ComicsPlus,
has to play a lot of catch up
with its competition

Seeing that comparison side-by-side makes Diamond's decision to go with iVerse a real headscratcher.  With Marvel leaving Diamond for Hachette for the distribution of their collected editions, Diamond's main source of revenue is even more concentrated in the monthly comic.  And who dominates the monthly markets month after month?  DC, Marvel, and Image.  Of whom, only Marvel has no previous experience dealing with iVerse and their purchasing platform.  Comixology has much more experience dealing with Diamond's bread and butter clients, making the choice of working with iVerse a bit perplexing.  That is not to say iVerse isn't capable of stepping up to the plate should the major publishers decide to jump on this initiative.  Based on their apparently successful deals with Marvel, IDW and Archie it seems they have the technical knowhow to integrate and expand their offerings.  The main problem that arises here is that the transition period  is likely to be lengthier and much more prolonged as each new major publisher verifies that this new platform can perform to their needs and specifications.  However, the biggest problem is that iVerse has yet to develop an Internet portal, multiple device management, or Android.  Compare that to it competition, both of whom have developed Internet portals while Comixology has released a beta version of their app from Android. Again, while I hate to assign motives where I can't confirm them, the whole thing reeks of continued feet-dragging on Diamond's part as they seem to be wading into the shallow end instead of diving right in where they need to be.

Beyond the baffling choice of platform, Diamond's actual scheme for distribution makes some business sense, but some of the decisions make none at all.  While it's clear that Diamond's main interest is to prop up existing brick and mortar stores, their methods make no sense or still haven't been properly explained.  In the way of getting customers in the door, Diamond is allowing retailers to sell redemption codes both in store and through a digital storefront.  The digital storefront as proposed by Diamond and iVerse is a personalized storefront for each retailer on the retailer's own website.  Essentially, iVerse is envisioning a veritable swap meet of sites, all having their own iVerse-powered storefront to sell comics through.  On the in-store side of things, the sales strategy gets a bit bizarre.  By Diamond/iVerse's thinking, the in-store customer will buy an issue of a new series of the shelf at the comic store.  Either intrigued by what they read or wanting to buy the entire story, the reader will look for the back issues.  If, catastrophe of catastrophes (maybe I'm hyperbolizing a bit here), the shop should not have the back issues in stock, well then don't worry!  You can purchase a digital copy of this back issue from your LCS guy who will print out a redemption code for the digital copy.

Steam has turned gifting and impulse
buys into an art form.

There's a few problems with this scheme.  While I can see the appeal to retailers, having a specialized source of income that requires no overhead costs or inventory space, I see a lot of shortcomings in regards to the consumer.  One, it's competing with a similar digital storefront program from Comixology (albeit details are vague on it as well), splitting the retailer and consumer focus.  Indeed, it undermines one of the most appealing aspects of the digital storefront: gifting.  Gifting someone a redemption code for them to read an issue is a lot easier than mailing a physical copy and 9.99 times out of 10, the electronic copy is going to arrive at its destination in better shape than it left.  Look at Steam, the idea of gifting the electronic product is built right into the platform and the option is so popular that entire online communities have formed around the idea of gifting Steam games to others.  Having two popular platforms competing and splitting the customer base destroys a large part of this aspect.  Second, many comics-buyers who still frequent LCS's often go to more than one.  How do they choose which storefront to purchase through?  My guess is that more often than not, one will be favored at the expense of the others, actually causing a few stores to lose potential sales in that regard.  Third, they're trying to sell a piece of printer paper.  It's a ridiculous thought to go to a store with the idea of purchasing a printout.  Next, we need to centralize the digital storefront.  Having one unified iVerse site is going to be getting a lot more traffic than thousands of clone sites all working from the same platform.  Imagine wanting to buy from iTunes, but instead of one program as it is now, we have the West Hollywood iTunes, the Spokane iTunes, the South Hampton iTunes, and the Djibouti iTunes along with thousands of their closest friends all trying to pop up their own little storefront.  It's a cluster#^@$.

Moving on, there's the greater issue of how publishers are pricing and releasing their digital comics that needs to be addressed. Currently, the big 2 are pricing their day-and-date releases at the same price at the printed version, expecting customers to dish out equal amounts of dough for a 32 page floppy as a 30 MB file that incurs no shipping or printing cost on Marvel.  Additionally, there's the problem of release dates.  Unfortunately, same day release comics are the exception to the rule.  Indeed, many of Marvel's and DC's digital offerings are riddled with incomplete runs and tremendous delays between print and digital release date.  Examining the back issue allure of the in-store digital sales program, it's easy to imagine several customers disappointed to find out that the "back issue" they're looking for has yet to be released.  However, I don't think I can fault Diamond for that one as it's up to the publishers to decide those things, but it puts a definite damper on their plans.

So, how should it be done?  What comics needs is its own iTunes.  It needs one central app or program where all or at least most publishers release their comics through in a DRM-free format with scheduled regularity.  The price of the digital copy should be much lower than the physical copy and I think over time, the single issue physical floppy should be mostly phased out with an emphasis placed on buying the physical collections.  Now before any of you cry heresy at this, and I'm sure some will anyways, let me explain my reasoning behind this platform.  One central platform is more of an inevitability than a recommendation.  Looking at the trends of other industries who have moved on to digital media, one platform has risen above the others either after a growing pains period where several competitors hacked it out to see who was left.  Steam rose above competitors like Direct2Drive, Impulse and Xfire.  iTunes rose above Rhapsody, Napster, and eMusic.  Those who didn't fold in the wake of the "killer" platforms rise contented themselves with serving a small niche and exploiting that.  It also unifies the customer base as more customers have a shared shopping experience.  Additionally, having that one main app makes the prospect of gifting or buying gift cards a much simpler transaction.  It's much easier to pick up a gift card for someone who likes comics if there's one main site to buy through rather than several.  Having all or most all major publishers release through it is another factor in contributing to the shared shopping experience.  Now the next point is surely going to be a sticking point with at least some of the publishers.  With piracy on the rise, companies have been looking for ways to protect their content against theft, whereas this is seen as enabling it.  However, iTunes got rid of DRM on all of their products over two years ago, and sales haven't suffered for it.  Steam allows publishing companies to decide on their own DRM, but implements none of their own.  Companies such as Ubisoft that have implemented DRM on Steam-sold games (often in ass-backwards ways) have, for most part, received such a public backlash over the policy that they are quietly doing away with the practice.

Superman: Earth One
was a near unmitigated
success for DC.

The final, and possibly most controversial bit, is the last part of my proposal.  Based on the trends extracted from Bookscan data by Brian Hibbs over at Tilting at Windmills, single issue comics are in a bit of a spiral downwards.  The only thing stemming the bleed for publishing companies is the ever increasing average cost of comics.  That is a short term fix, not a solution.  Looking at graphic novel sales, with mega-hit and manga outliers removed, sales of graphic novels are holding fairly steady.  It's clear the market there is able to sustain this format for the foreseeable near future.  In fact, one of the biggest graphic novel hits of the year was Superman: Earth One.   A story released entirely on its own with no single issue lead-in, and it became DC's fourth best-selling GN behind Watchmen, V for Vendetta, and Blackest Night. There's clearly a hungry market for that out there.

One thing I know I haven't covered is pricing.  The problem is that comics hasn't hit it's "99 cents" sweet spot yet.  That sweet spot being where the comic becomes an easy impulse buy, but still brings in enough revenue per issue to make the selling point worthwhile.  Creators such as Jason Howard, Skottie Young, and Chris Eliopolous have experimented with the $2 price point to relative success, but pays to notice they are distributing the digital comics themselves so the sale is as pure a profit as is possible.  $2 may yet turn out to be comics' sweet spot, but I don't think we can can infer that just yet.

So there's my plan for how to fix Diamond's digital app and how to make it for the needs of the customer.  Which is the biggest fault of Diamond's plan.  Diamond is looking out for the retailer here and until it focuses back on the customer, it's not going to find success in its digital ventures.  So, what do you guys think should be done with Diamond's Digital venture?  Fine as is?  Needs tweaks?  Sound off in the comments below!

A funny from Incredible Hercules for those that had the
patience and fortitude to read this whole rant.  Or
for those who merely scrolled to the bottom.