Periodical publishing is a tough business, and the Internet has only made it tougher over the past decade, with newspapers and magazines of all types suffering circulation decreases as more and more people prefer the immediacy of getting their information online. Coupled with the maturation and increasing adoption of social networking and other Web 2.0 technologies, many publications, especially business-to-business and consumer niche magazines, are shifting to an online model or, in more competitive spaces, are simply calling it quits.

No matter the size of the publisher, though, online has become a key component of any sound business plan, and increasingly, it’s being seen as the main component. In the current issue of Folio: magazine, Don Nicholas, Chief Information Architect & Managing Director for Mequoda Group, LLC, has an enlightening article on a few publishers’ efforts to transform their well-known print brands via major online initiatives, noting that “the concept of a single-title magazine publisher, delivering a single printed magazine to a single audience in 2007 seems almost quaint.”

With multiplatform publishers delivering content through magazines, newsletters, books, reports, live events, radio, television, CDs, DVDs, RSS, podcasts, PDF downloads, mobile phones, software, seminars, e-mail, and more, the Web has become a nexus where every consumer expects to find a publisher’s entire suite of content.

In years past, when publishers created brand extensions or ancillary products, they were usually another print product. The Web burst onto the scene and changed everything.

Now, every media company doing business in the digital world needs three critical characteristics: A robust user-centric online presence; a multiplatform approach to information products, and a database-marketing machine powered by the Internet.

In light of this [not terribly new] reality, only in the bass-ackwards world of comics would you find a fledgling, single-title publisher not only attempting to swim upstream by leveraging a low-profile web presence into a monthly print magazine, but one that’s doing so by targeting the superhero-centric, monopolistic Direct Market with a mission and vision that’s defiantly anti-Wizard. No, I’m not talking about UVC, which clearly acknowledges Wizard’s appeal while recognizing its blind spots, and is targeting a very specific one of them; at least they’re seemingly being realistic about their prospects and the uphill battle they have ahead of them to achieve their rather modest distribution goals.

I’m talking about Comic Foundry and Tim Leong, its fledgling publisher, who since the end of last year has inexplicably been attempting to move CF from an online magazine of minor repute to print (and on a monthly frequency at that!) and has just learned that it was rejected for distribution by Diamond Comics Distributors.

Why was the magazine rejected?
According to Diamond: “a B&W title at the price you’re using just won’t work well in the current market we believe.” Fact: our cover price is $6.25 for an 80-page B&W magazine. Now they might not think that will sell, but it isn’t consistent with what they’re already approving. Such as Issue 14 of Draw! magazine, that’s 80 pages, B&W and retails for $6.95. Same with issue 15 of Write Now! Both same specs, but 70 cents more.

I called Diamond for more clarification and spoke with Tim Huckelbery, who let me know the news in the first place. He said, among other things, “When I was looking though it and reading a magazine of that type, which is about comics, which has lots of images of comics characters, that is looking to be timely and topical, I was expecting color. That, just for me, is how my brain is wired.” So, to be a timely magazine with topical content (and feature images of comic characters) it has to be in color? I’m sorry, I’ve thought about this all afternoon, and I don’t really see how this makes sense. What about The Comics Journal or Comics Buyers Guide? Neither of those are full-color, right?

Is this yet another shocking example of why Diamond’s direct market monolopy is bad for comics, or is it just another unsurprising example of the comics internet being completely out of touch with reality?

Just based on Leong’s version of Diamond’s feedback (I’ve emailed Huckelbery for comment but have not heard back from him yet to confirm or clarify), I can understand why they rejected CF, and no, my first instinct is not the conspiratorial “Wizard had something to do with it!” that I’ve seen suggested in a couple of places. While they’ve got several problems of their own to deal with (not the least of which are some high-profile transitions and a rather ugly site redesign), worrying about potential competition from Comic Foundry is undoubtedly not very high on Gareb Shamus’ list.

Notably, Leong makes a very telling mistake in comparing CF to some of TwoMorrows‘ publications that Diamond does distribute, which suggests to me that his business plan wasn’t very well researched because a) TwoMorrows isn’t a single-title publisher with no direct market track record; and b) all of their publications are hyper-targeted to very niche audiences, most of which are right in line with direct market sensibilities. Ironically, TwoMorrows is in the midst of some online initiatives themselves in an attempt to grow their subscriber base and expand beyond the limited and generally unresponsive direct market.

Over the last three months, we did a mass mailing to over 1500 comics shops (1523, to be exact), offering a free TwoMorrows Sample Kit, containing one free copy of each of our mags for them to display, to see how they sell. You’d think a lot of stores would jump at getting $40 worth of free stuff to sell, no strings attached. Exactly 60 of them took us up on the offer (that’s less than 4% of shops). In 2006, we did a similar offer by phone, calling 500 shops, and got 18 stores who wanted the freebies (3.6%, so roughly the same percentage).

Hopefully those will result in some new regular customers for them (and us). But if only 4% of the country’s comic shops display our wares, we’re never going to increase our circulation that way. (And yes, more than 4% of shops sell our mags, through pull lists; it’s just that most of them don’t also DISPLAY copies, out in the open for potential new customers to discover.)

…So we have to get creative in finding other ways to build our audience.

This, of course, is the same direct market into which Leong wants to launch Comic Foundry, and in yet another sign of him/it being not-ready-for-prime-time, it appears he’s put most of his eggs into the direct market basket, stating that: “Without being in Previews means a serious hurt in circulation. Can the magazine survive without Diamond? I certainly hope so. I’ve got a will, I’m just looking for a way.”

One “way” that’s most unlikely is side-stepping Diamond and going with a traditional magazine distributor, whose feedback would likely make Diamond’s lack of confidence seem almost complimentary in comparison. It’s a segment of the industry that, while not yet monopolized, has experienced significant consolidation over the years, to the notable detriment of many independent publishers, as well as some larger ones.

Another mistake Leong seems to be making (and again, I’m speculating here) is that, in the non-returnable direct market, the retailer is the primary audience for publishers, especially newcomers, because “reader demand” usually won’t get you any further than pull list orders and if the retailer isn’t convinced that you have a saleable product, it’s dead in the water. While a handful of orders each from 200-300 comics shops who ever bother to look in the back of Previews may be enough for a single creator to justify self-publishing a four-issue mini-series as a loss leader to a potential collected edition, it’s definitely not the foundation for launching a successful monthly magazine.

Not having seen the mock-up of the print version myself, but accepting the word of others who have said good things about its visual presentation in response to its rejection, I can only speculate as to what kind of advertising support Leong’s been able to drum up. CF’s $6.25 cover price — approx. $3.13/copy for retailers, and non-returnable — suggests there’s not much and they’re working on thin margins, and its positioning in that nebulous space between Wizard and The Comics Journal leaves it without a clear group of potential advertisers. As a new publication with no track record and an unidentified audience, they’re going to have sell on price as opposed to value, which I can speak from experience is never a good place to be in.

Leong’s desire to offer “brand new concepts, ideas, formats and presentations… [and] to find new ways to cover comics and create something the readers deserve” is an admirable one, but completely delusional from a print perspective, much better suited for the Internet where, like the webcomics that have built a solid enough audience to justify the occasional trade paperback, it has the best chance for long-term success and profitability.

One could make a reasonable argument that in rejecting CF, Diamond is actually doing Leong (and his contributors and advertisers) a favor by forcing him back to the drawing board to get things right, but I don’t imagine that will be the popular angle on the story. Predictably, the usual suspects (several of whom are contributors to the magazine and/or personal friends) are responding to his plea to contact Diamond on CF’s behalf, asking that they reconsider their decision, and based on similar instances in the past, it’s quite possible they will ultimately give him the rope he needs to hang himself.

If he does, that will not only be unfortunate for Leong, but it will make it that much harder for the next well-intentioned but underfunded publisher who comes along to be distributed by Diamond.

Speaking of, what ever happened to LoFi Magazine? I’ve emailed former publisher Greg Narvasa to find out. Stay tuned…