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Marvel, DC Initiate Seismic Shift in Comics Distribution

By Gary Symons

Editor in Chief

Marvel Comics has followed the lead of DC Comics, ending its exclusive arrangement with Diamond Comic Distributors, and signing a global agreement with publishing giant Penguin Random House (PRH) to be its new Direct Market distributor.

Direct Market sales are those that involve distribution to independent comic book shops, which until recently received almost 100 per cent of their product from Diamond, which held a virtual monopoly on the industry.

Both Marvel and DC are giants in the licensing industry, and while the comics industry itself is not that large in terms of revenue, the films, TV shows, and other licensed content or products are a major part of the licensing sector globally. As well, comic book customers play a major role in determining the popularity of various characters or properties, such as the recent push by fans to have the so-called ‘Snyder Cut’ of Justice League aired on HBO Max. The indie comic book stores are also major influencers in the market, and when DC terminated its relationship with Diamond, many store owners reacted angrily, some even threatening to reduce their orders to the minimum necessary.

The move by Marvel, therefore, is a big deal for an industry that thrives on a dedicated fan base, but it’s also true that Marvel has had a rocky relationship with Diamond over the years. In the early 1980s, Marvel had similarly approached Random House to see if the company wanted to build an alternative distribution network for the direct market. After months of haggling and study, Random House decided the fixed costs of handling lower priced products like comic books wasn’t worth the effort and cost, and walked away.

Diamond, on the other hand, specializes in the comics market, and was able to make it work, but with both DC and Marvel growing due to their multimedia approach to content creation, it appears that having Diamond hold a monopoly on the market did not sit well. Also, Penguin Random House’s Publisher Services has grown by leaps and bounds since the merger between Penguin and Random House, giving it capabilities that are hard for any competitor to match.

Diamond, however, downplayed any idea that Marvel’s move will be ruinous for the company, which has been at the centre of comics distribution for several decades, and is typically well liked by retailers.

“We value our almost 40-year relationship with Marvel and are pleased that we will continue selling Marvel products to the Direct Market and other channels, said Steve Geppi, the CEO of parent company Geppi Family Enterprises. “The change Marvel announced today represents a behind-the-scenes shift in how Diamond interacts with Marvel for certain products, but does not impact our ability to supply our customers with Marvel comics, trades, and graphic novels.

“I expect the discount terms under which our retail partners order these Marvel products to change, and Diamond will communicate that information to our customers well in advance of any adjustments,” Geppi added. “While there are still details of this new arrangement to work through, my leadership team and I are committed to making this supply change as operationally seamless as possible for our retail partners and we look forward to our continued distribution of Marvel products.”

The move this month follows a similar action by DC in April last year when the comic book giant terminated its decades old relationship with Diamond, and adopted a multi-distributor model with UCS Comic Distributors and Lunar Distribution for its Direct Market sales. DC also opted to work with PRH for graphic novels and collected editions.

“We recognize that, to many of you, this may seem like a momentous decision,” DC  said in an email sent to retailers at the time. “However, we can assure you that this change in DC’s distribution plans has not been made lightly and follows a long period of thought and consideration. The change of direction is in line with DC’s overall strategic vision intended to improve the health of, and strengthen, the Direct Market as well as grow the number of fans who read comics worldwide.”

However, the decision did not go over well with retailers, who felt they were treated well by Diamond. “Without the DC purchases through Diamond, my discount will be less, making my business no longer profitable or viable,” said Charlie Harris of Charlie’s Comic Books in Tucson, Arizona.

Others complained about the timing of the split with Diamond, which happened during the first wave of the coronavirus pandemic from April to June last year.

“It was a nice gut punch after we just reopened our doors for the first time in two months,” said J.C. Glindmyer, owner of Earthworld Comics in Albany, N.Y. “As with most retailers, I’m not going to cut off my nose to spite my face, I’ll order for my regulars, the minimum for racks, but not putting any significant resources in their future projects.”

“The timing of this is terrible and shows a blatant disregard for concerns of comics sellers,” added Benn Ray of Atomic Books in Baltimore. “So I say this as a lifelong DC Comics fan as well as a retailer—screw you, DC Comics. I wish them every bit as well as Marvel did when they did this back in the ’90s. Whoever is calling the shots at DC, if there is anyone, should be sacked immediately.”

As well, within months of cutting ties with Diamond, DC also announced it was severing its relationship with UCS and would only be working with Lunar, which essentially was building up distribution almost from scratch.

Marvel, by contrast, has chosen the largest publisher in North America to work with. Retailers thus far are reacting cautiously but with sympathy for Diamond, as Marvel and DC together comprised an estimated 70 per cent of the company’s business.

March Nathan, of Cards Comics Collectibles in Reisterstown, MD, also thought of Diamond first and foremost.

“I’m beside myself,” said March Nathan of Cards Comics Collectibles in an interview with GamesRadar. “The question is what happens next? I don’t know. I’m more concerned for my friend [Diamond’s CEO Steve Geppi] than anything. I’m sure he’s been thinking about how he’s going to have to change and react. I’m sure he’ll be positive. They still have plenty of other stuff to sell.”

Another retailer, Patrick Brower, worried he’d get a worse deal from PRH, and that comic books, which depend on more on their appearance, could be damaged in shipping.

Not excited for this at all,” he told Newsarama. “Cons will be a probably worse discount, and Penguin Random House is bad at protecting books in shipping.”

But others, like Jean David Michel of Megabrain Comics, were more positive about working with PRH.

“I’ve definitely got a lot of opinions about this, but my initial and basic reaction is that this is great news,” he said. “I’m a big fan of Penguin Random House’s operation, customer support, and infrastructure.

“Comic book stores at their core are ‘book stores,’ so it seems like a no-brainer to have the biggest distributors to book stores also handle distribution to comic stores as well.” Michel continues. “We will still use Diamond for a lot of our merchandise and books, but for over a year now, we began to diversify the vendors that we source our comic books and graphic novels from starting with Scholastic, Ingram, and Lunar. In fact, we already have a Penguin Random House account too, so we’ll see how things shape up in October and that will determine who we choose to supply us with weekly Marvel Comics. I look forward to the inevitable changes that this will bring to the comic book industry as a whole.”

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