After the news last week that Dark Horse had laid off seven employees
-- and the subsequent criticism by a former employee about several significant comics projects and delays in releasing rolling out their digital comics program -- Dark Horse's founder and president Mike Richardson spoke with ComicsAlliance about his perspective on the layoffs and the digital strategy, and his vision for the company moving forward.
ComicsAlliance: Thanks for taking the time to talk with us. I know you wanted to address some of the comments made by a Dark Horse ex-employee in our recent article about the layoffs at Dark Horse. What was your perspective on that?
: The article was sort of off-centered; I suppose that the writer has his own impressions of things, but... the reason for the layoffs had nothing to do with the books he was citing, it was simply the rising cost of doing business. We have a very large staff for a comic book company, probably as large or larger than Marvel or DC. As we look going forward, in recent years we've had to resort to wage freezes as we try to bear the brunt of the health costs and rising business expenses. As we see those rising we have to figure out how to deal with them. We made some very hard choices and did the best we could over that. Rather than considering wage freezes and passing on more health care costs, I made a decision to do it a different way. One element of that cost-cutting was reducing our payroll and staff. On a personal level, it's horrible. On a company level, it's something you have to do from time to time. It's not the first time and probably won't be the last time, but for now we're hoping it is, obviously.CA: The two series you mention that were cited in the article were the Gold Key books with Jim Shooter and the Troublemaker series with Janet Evanovich. It was my understanding that those were two of the bigger and expensive projects for Dark Horse in recent years. Considering that, did those books perform up to expectations?
: [The article] was just off target. For example, the Janet and Alex Evanovich books – the article mentions that they didn't appeal to comics readers, but they were never intended for comics readers. If you follow Dark Horse's history, we've always tried to reach out and find new readers to bring into the market. We have a very diversified line... and when we look at the increasing sales in the bookstores, it seems like a good idea to bring in mainstream authors that have large followings and try to bring them into the comics market. Janet Evanovich has sold something like 120 million books. She's a best-selling author... It seemed like a great project to create not only comics and graphic novels that appeal to women, which is a market we'd like to grow, but also to get prominent placement in the bookstore. The article can talk about how we overprinted it, but that was the deal we made. She has such a large ceiling and we had no idea what the book would sell. It was almost an experiment to see what that level would be.
So we printed 100,000 [copies] and we've learned more about what the print run should be, what the price should be, and what the format should be, and we plan to make changes on the next book. If you want to call it a failure – it sold nearly 40,000 books, and for us that's a pretty good number. On the dark side we could have sold 15,000. Who knows? We did not know. The 100,000 print run was to try and make sure we reached all of Janet's market, and that's what it took so that's what we contracted. We're happy and we're doing another one, and we'll do it with more information. And inside the direct market, we had a nice sale there; it did better than we expected.
CA: So the Troublemaker project has ultimately been profitable for Dark Horse?
: We'll judge it and see in the long run how it does, but for now we're happy. So to blame that for layoffs is silly. It's part of a larger program and we're on our way. The article also pointed at the Doctor Solar and Magnus [Gold Key] books, saying the characters are basically old and worn-out. Well, I guess that's the writer's opinion. What would say about characters like Superman or Batman who were created 30 years before those [Gold Key] characters? Characters are as worn out as their creative teams.
The article mentions Jim Shooter, and it was intentional that we brought him in. We had tried to launch superhero projects before without getting any notice in the past, and Jim ensured that we'd get noticed. The problems we have with that series are more about the untimeliness of the books. If the books are continually late, superhero book sales will drop in the direct sales where these were intended. It's a fact of life in the comics market. We're aware of it, and we've talked to retailers. We have changes coming down the line. To blame the Shooter books for the layoffs is not right. It's part of a larger deal where we've made quite a lot of money. So to pick one part of the deal and say that's the reason for our layoffs is silly.
CA: When you say the overall deal, do you mean the entire line of Gold Key titles?
: Not just that, but the whole program. [Shooter] is working on classic media properties. We have a large relationship with classic media and it's just part of the overall arrangement with have with him... Part of that deal is the archives of classic material. Those have and continue to make money. We do other projects in other properties in classic media, so it's part of a larger relationship that's been very successful.
CA: In and of themselves, have the Gold Key books been profitable and performed to expectations?
MR: Obviously we have trouble getting them out, so as I said earlier when timeliness is a big factor in these books. We've talked to the retailers. We've been to the conventions, and they tell us they're upset that they're not coming out on time. So we're making the changes to have these books come out when they're supposed to come out.
CA: In the criticisms about Dark Horse, these two series – which were bigger projects for the company – were used to represent concerns about the larger direction of the company--
: We have a diverse line of projects. So to pick those two as the direction of the company – one's an outreach program for bookstores. We have our traditional characters and in-house characters just as Marvel and DC has, with Hellboy and the Goon and those types of properties, and we have big projects on the way involving those characters. But we have all kinds of projects on the way. Is Axe Cop the direction of the company? That's a recent success that we've had and continue to have.
CA: Do you have any concerns about Dark Horse's market share slipping from third to fifth place? How do you see Dark Horse addressing that as you move forward?
: The slipping of market share also you have to take in context. First of all, we've slipped before, and in the month we supposedly slipped, our lineup was not that strong that month. We have those months in the past; they happen occasionally. But if you take the time to look at what that actually means, our market share slip, all three companies after Marvel and DC are pretty close. I think we published less than twenty comics. The companies that supposedly passed us up published around forty comics. So is that relevant? Should we have doubled our offerings so we could stay in third place? It's sort of a silly argument.
CA: So you think if you'd been publishing more comics you would have been less profitable but had greater market share?
: Of course! The books that we publish outsell most of the books in the other publishers' offerings. So it would make sense that we could publish many more books that sell less than our average books sell and increase market share.
CA: Even aside from Dark Horse's relative market share, comic book sales have been slipping across the industry. How does Dark Horse plan to address this moving forward?
: We do what we always do. Every few years we reevaluate our lines and talk about where we want to go in the next few years and start setting direction. That process is apparent starting this month with the relaunch of Dark Horse Presents
where we have a great number of industry favorites and old, long-standing name creators as well as young creators coming on and making a name for themselves.
CA: What younger creators are going to be appearing Dark Horse Presents?
: One of them that I'm particularly excited about is Sanford Green, who's terrific and is launching a project called Rotten Apple. We've got Patrick Alexander, a new cartoonist from Australia. We've got any number of great creators who will be well-known names at some point in the future.
CA: There are a lot of established creators as well on the Dark Horse Presents lineup, and obviously a big part of your publishing slate is established creators. How important do you think developing new talent is for Dark Horse moving forward?
MR: Well, long-term it's the most important element: finding new talent and allowing them to do the books that will get them attention. And I think we're a great home for those creators. I think it gets lost sometimes with the Star Wars line and the big name creators we work with, but if you really look at the line over the last few years there are lots of creators who are young people. Perry Bible Fellowship
is an example of something that made a big splash in the comic market. We are constantly looking for new talent and we will continue to do that. Obviously Dark Horse Presents gives us an opportunity to find the talent and have them work on creator owned projects even if they're working for other companies.
CA: When you talk about this regular process of reevaluating the line and how Dark Horse Presents is the beginning of implementing that, what other sorts of changes are in the works to help Dark Horse adapt to what's going on in the market right now?
: Of course, one of the big areas is digital. And that was another point made in your article, that management somehow held back digital comics from development, which is far from the truth. I've been a big proponent of it from the beginning. It's all about the delivery system. Our comics went on the iPhone some time ago and are available in the iTunes store so we have been involved in digital. The bigger launch before the iPad was delayed by me, not because I didn't see the future in e-books because I didn't like the delivery systems that were available...
When the iPad came out we were looking forward to that and started building our app. Your article said that we didn't launch in January when we said we would, but we were ready to launch in January. We were ready to launch on the day we announced, but unfortunately Apple changed their conditions for apps being put in the iTunes store and because they made new rules we had to go back and rework our app. We're ready to go with 300 comics right out of the gate, and there'll be more. Also, we're doing something I don't think anyone's done yet; we produced a 40-minute motion comic film that is a graphic novel that will be available shortly. We're working on the technical aspects of delivering it.
CA: You mentioned having comics in iTunes, but as a fan who has wanted to download more Dark Horse comics than are available, I'm curious whether there was a decision made to not make as many comics available there until the proprietary app came out?
: Yes, we were trying to develop our own app, so we slowed down the release of digital comics because even for the iPhone there was a new app being developed. And we didn't want to spend the time on basically for a format that was being modified.
CA: With the proprietary app, why did the change in the Apple rules affect you differently from other publishers who were also developing proprietary apps?
: Marvel and DC are having their comics transferred through outside comics, and those companies charge a certain fee. Then they go into the Apple store and they charge 30 percent. So we were trying to build a system that preserved as much of the income from this material for creators and for Dark Horse as possible. We had a plan to do that, and we knew at some time Apple would eventually be interested in content, but originally our understanding was that for the time being they were interested in selling the hardware and wanted the apps. Our app gave readers the chance to buy directly from Dark Horse. And Apple evidently changed their minds, so we changed our app. We're going to be available on all delivery devices and we're going to have some unique things to offer. We're also building programs for retailers too, because we've not forgotten that they need to stay in business. We'll have special materials for them that will be digitally distributed.
CA: At a time when the market seems to be changing rapidly, who do you see as the core Dark Horse reader and the type of content you'll be offering them as the company moves forward?
: The original vision of Dark Horse was to have a diverse line that appeals to all kinds of readers. And if we stay on target, that's what we'll be doing. You'll see a variety of projects. We won't live in a superhero world. We're going to be creator-based and we're going work towards having the best comics out there by the best creators. Obviously we try programs to reach into areas that aren't traditionally ours, and sometimes they're successful and sometime they're not. But overall we've been very successful and we've been around 25 years. There are very few comic companies in the history of comics that have prospered that long.
Portland is now a comics community and that is directly a result of Dark Horse's influence here. There was no comics community when I started Dark Horse and the comics community has grown out of Dark Horse's presence. That's just a fact. We intend to continue to try and build the community to bring more people in and bring more creators in to town, and that's how we plan to move into the future. It's all about working with great talent.