Wednesday, December 12, 2007

Wednesday.

Sigh.

I got nothing. Today.

Well, OK, I'm endlessly transcribing the interview with Neil Gaiman, which is a slog despite his lilting voice (even going two+ days with no sleep, Neil's voice is pleasurable listening -- I mean, with him going two+ days with no sleep...). In fact, that's part of the problem: like most Americans, English accents carry a strange hypnotic quality, and I find myself having to back up time and again because I stop typing and start listening again, a problem I don't have when transcribing silly, shallow Americans, even when they're being deep, profound and articulate. I still think the bedrock of Vertigo was DC and Karen Berger being so thoroughly seduced by British accents that almost anything was acceptable if it was pitched with a UK accent of one kind or another, and this transcribing process has only reinforced that conviction.

This morning started with my hope of laying uselessly in bed and a fetid pool of my own snot for at least an hour past my usual waking time pounded soundly into the dirt with Marge being unable to get her car out of our ice-rink driveway. Well, she almost got it off by plowing into a snowbank, but still, that wasn't getting her to work, was it? I was up, dressed, and spreading 25 pounds of rock salt merrily within minutes. I let the salt do its work as I scarfed down breakfast, then hustled back out to add a few flourishes of sodium chloride to the remaining patches inhibiting vehicular movement, then I backed Marge's car out of the snowbank, up our driveway and into our garage for the morn. She's home working as I type this, and the driveway is already clear enough to ensure we'll both be at our respective dayjobs by after lunch, as we should be. Lucky us.

The other highlight of the week thus far has been prepping a crash-course, for both the Center for Cartoon Studies freshmen and seniors (each in different contexts), on what happened to the Direct Sales market in the 1990s. Here's the timeline I prepared, and riffed off of (with many personal anecdotes in the classroom delivery):
_______________________

The Mid-’90s Comics Crash! A Time Line...

1989:
January 1989:
Billionaire, chairman of MacAndrews & Forbes and notorious Wall Street junkbond king Ronald O. Perelman buys Marvel Entertainment Group.

[Note: billionaire rival Carl C. Icahn fought Perelman’s reign throughout, repeatedly trying to acquire Marvel and/or organize shareholder revolts until he succeeded in June, 1997.]

1991:
Marvel Entertainment stock shares go public, yielding Perelman a $36 million cash dividend.

1993:
* March 1993:
Marvel’s “first junk bonds issued” (Comic Wars, pg. 242), yielding $288 million for Perelman; a second “tranche of junk bonds” yield $145 million in October 1993, a third set net $121 million in February 1994 (Ibid., pp. 241-243).

* Perelman’s restructuring of Marvel includes acquisition of Toy Biz (controlling shareholder: Isaac ‘Ike’ Perlmutter) via “shares-for-licensing rights deal” that makes Toy Biz a subsidiary of Marvel; Marvel also purchases trading card companies Fleer and SkyBox, Italian sticker manufacturer Panini, more.

* Marvel Entertainment stock reaches highest value since going public.

[Note: Kitchen Sink Press, founded in 1969, “merges” with Tundra Publishing, moves offices from Wisconsin to Northampton, MA., with Tundra founder Kevin Eastman reportedly holding majority share of 51%.]

1994:
“Pearl Harbor”
Marvel Comics pulls out of all Direct Market distribution to purchase NJ-based Heroes World Distribution, thus instituting/owning its own exclusive Direct Market distributor.

[Note:
* Success of the feature film adaptation of James O’Barr’s The Crow-- earning $50 million in theatrical release alone -- creates a windfall for Kitchen Sink sales of Crow comics, graphic novels, merchandizing, exceeding all expectations.
* May 1994, Los Angeles-based investment banker group Ocean Capital Corporation acquire Kitchen Sink Press]

1995:
DISTRIBUTOR WARS!

* DC Comics, Image Comics, Dark Horse Comics and others sign exclusive distribution contracts with Diamond Distribution, the Direct Market’s largest distributor.

* DC Comics, Image Comics and Dark Horse Comics report drops in sales “as much as 15%” after signing with Diamond, though the three Diamond major exclusive publishers combined still constitute about 75 percent of the market, sans Marvel.

* Kitchen Sink Press is the only publisher to sign a similar exclusive with Capital City Distribution. Initially, this boosts KSP sales, but this boost doesn’t last into 1996.

* Marvel Entertainment suffers major losses, stocks value begin freefall.

1996:
THE IMPLOSION
Spring 1996:
Final Diamond Comics and Capital City Distribution trade shows. Capital City co-founders John Davis and Milton Griepp appeal to retail community; reportedly, Capital’s 1996 revenue was already half of 1995’s revenue.

July 26, 1996:
Capital City Distribution -- the second largest Direct Market distributor -- sells its assets to Diamond Comics to avoid bankruptcy. This provides Capital with a means of paying the approx. $7.4 million due to suppliers over a two-year period of incremental payments.

* The Direct Market shrank by at least 50% in the wake of the events of 1996. According to Capital City co-founder John Davis (subsequently employed by Diamond), “about half of the approximately 4500 retailers in business during 1996 dealt only with Diamond in the wake of the ‘distributor wars’...”

* Marvel Entertainment suffers further losses and stock collapse -- from $13.25 early in ‘96 to $4.50 per share and less -- down 85 percent from their high in 1993.

* Marvel fans launch a “reader rebellion,” boycotting Marvel product for almost a full year. Note that Marvel’s market share had slid throughout their ill-fated exclusivity upset: “from around 70 percent of American sales [in 1990-92] to 35 percent in 1995, then 25 percent to 1996” (Comic Wars, pg. 71).

[Note:
* Kitchen Sink Press returns to Diamond, suffering many lost orders, revenues, etc. in the transition.
* Labor Day 1996 opening of The Crow movie sequel The Crow: City of Angels enjoys $9 million opening weekend boxoffice, then fades; Kitchen Sink merchandizing fails, a fiscal disaster for KSP on heels of Capital City’s demise and delayed payments.]

1997-98:
AFTERMATH

January, 1997:
Marvel Comics files for Chapter 11 corporate bankruptcy

February, 1997:
Marvel and Acclaim (a former indy publisher purchased by Marvel) sign exclusivity contract with Diamond as its sole distributor to the Direct Market.

June, 1997:
Ronald O. Perelman departs ownership of Marvel Entertainment Group; it is estimated that “Perelman’s net gain from eight years of running Marvel could be put at $280 million -- plus the tax advantages for his wider empire” (Comic Wars, pg. 243).
Rival billionaire and corporate-raider Carl C. Icahn, purchasing Marvel bonds throughout the 1996 company crisis, becomes Marvel’s chairman June 1997, appoints former Marvel executive Joseph Calamari the new CEO of Marvel.

[Note: Due to Marvel’s bankruptcy filing, prospective Kitchen Sink investors withdraw, deciding the comics business as a whole is too risky. Kevin Eastman and others had already departed KSP’s board; Denis Kitchen is fired by board of directors; Kitchen Sink closes shop later in 1997.]

1998:
Marvel Comics emerges from corporate Chapter 11 bankruptcy (and a period of time “for sale”) with Peter Cuneo, “a turnaround specialist, at the helm” (Fortune magazine; see sources, below) via aggressive licensing of Marvel characters and concepts to movies, TV, videogame and toy manufacturers, reversing Perelman strategies of 1989-1997.

October 1998:
Marvel Entertainment is restructered by bankruptcy court order with Toy Biz partners Isaac ‘Ike’ Perlmutter and Avi Arad at the helm. Carl Icahn departs “with a relatively paltry $3.5 million” (Comic Wars, pg. 252); Marvel stock ceases to exist, replaced by Toy Biz shares, which start at $7 per share. Note Icahn continued to fight, but soon abandoned the struggle.

[Note: By 2005, Marvel Enterprises was producing its own films with great initial success.]

Sources: The Comics Journal, various issues, 1993-97; Comic Wars by Dan Raviv (2002, Broadway Books, NY); Fortune, June 27, 2005, pg. 194.
_________________

And it was fun, fun, fun till Daddy took the T-Bird awaaaaaaaaay ---

Anyone still wondering why SpiderBaby Comix & Publications quietly folded up its tents in 1997, reread the above five times.

Have a whacked Wednesday!

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10 Comments:

Blogger HemlockMan said...

Ah, the great implosion.

You may want to mention how the Clinton Administration-era Justice Dept. was investigating Diamond as a monopoly, and how the Bush Administration Justic Dept. promptly declared that the Diamond monopoly was not a monopoly and let them go.

12/12/2007  
Blogger Bridgett said...

Man, that was a crazy arc. I bought comics through some of it and I still can't quite believe it all happened so fast.

12/12/2007  
Blogger bob said...

"Marvel and Acclaim (a former indy publisher purchased by Marvel)"

I'm pretty sure that bit is wrong. Wasn't Malibu the indy publisher that Marvel bought, while Acclaim was something else entirely (and I believe was a Diamond exclusive at the same time DC, Image and Dark Horse signed)? A few other bits didn't quite jibe with my memory, but I'm not sure about so I'll check them later.

12/12/2007  
Blogger Mark Martin said...

Oh Hemlockman - even the comics are not safe from Bush's Evil Meddling!!!

Steve, have you started dreamily doodling SB+NG all over your transcripts yet?

12/12/2007  
Blogger HemlockMan said...

"Oh Hemlockman - even the comics are not safe from Bush's Evil Meddling!!!"

Not when he can protect yet another of his billionaire butt buddies!

12/12/2007  
Blogger dogboy443 said...

Great timeline Steve. I'm reading Tales to Astonish by Ronin Ro now and it focuses on this timeline and the amount of time Marvel was purchased. A fascinating read if you have any interest in the history comics and the Age of Kirby and Lee.

12/13/2007  
Blogger SRBissette said...

The Kirby bio is great, as is the Stan Lee bio -- both worthy and essential reading for those who care! But COMIC WARS offers the most intensive chronicle of the 1990s madness, even though it's highly biased toward the new Marvel/Toy Biz regime.

Acclaim/Malibu were part of the whole scenario -- I'll investigate further, but the Acclaim acquisition was featured in the FORTUNE article cited, TCJ issues, and COMICS WARS, so I'm certain of that factoid.

The Malibu acquisition, BTW, scored Marvel its breakthrough theatrical movie hit they so sorely needed: MEN IN BLACK. Forgotten fact, that, and a fascinating turn of events -- that Marvel needed a minor Malibu property (clever concept, but never a good comic) to break the logjam of decades of crap movies to arrive at their current blockbuster status.

Who needs Bush in this monopoly assessment? I vividly recall Gary Groth calling me from TCJ during all this, declaring that their own investigation found no blame with Diamond's monopolistic status -- and so it went. Again, it really wasn't a difficult call in '97 to pull the plug on self-publishing, given the shitstorm. It was tougher two years later to bag the whole ballgame, but that, too, is a decision I never regretted.

12/13/2007  
Blogger HemlockMan said...

Groth was hardly an objective voice in reference to Diamond, as they had some co-publishing projects.

12/13/2007  
Blogger bob said...

I'd be curious if you can verify the Acclaim thing, since it does seem to run contrary to my memory. For one thing, Marvel doesn't seem to have any stake in those comics now. The old Gold Key stuff (Magnus, Solar etc) has reverted to whoever bought the original publisher (some of the old stuff is being reprinted by Dark Horse) and their original stuff being involved in a kerfuffle a few months back, between a group which bought the copyrights to the comics and a group which tried to grab the lapsed trademarks to slap on new characters (not sure if or how that one was finally resolved).

12/13/2007  
Blogger Roger Green said...

I stopped buying comics in 1992 because the hyper-frenzied market just irritated the crap out of me. Didn't buy anything until I started blogging and got a few recommendations, but it's FAR lighter than the FantaCo days.

12/14/2007  

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