Cloud 9 Comix

Cloud 9 Comix is a digital comic book publishing arm of Spectrum Pacific Publishing, which was founded by Benjamin Slabak in 1996 in Sydney.

Spectrum moved towards print publishing in 2009 and then digital publishing in 2010. Cloud 9 Comix was officially launched in October last year and unveiled its first app in January  following the release of the Apple iPad.

Slabak and business associate Praz Hari talk to StartupSmart about comics, iPads and plans for world domination.

What inspired the idea for Cloud 9 Comix?

It all started back in the early 2000s when we were doing computer games and we tied up with a number of publishers in Europe who had properties in comics and computer games.

We were actually obtaining some rights for European comics. We tried to bring them out in print from here but it kind of got shelved and we were waiting for something to come along that we could start publishing digitally.

When the iPad was announced, we pretty much pounced straight away and got those old properties off the shelf and started cleaning them up digitally.

We were originally going to do just a selection of comics and then we thought, why don’t we represent other independent authors and publishers?

How did you fund the business?

It’s a joint venture between Slabak and Slabak’s partner overseas so it’s privately funded. If we were to charge our time, we would easily be looking at hundreds of thousands [of dollars].

But the actual out-of-pocket expense – it wouldn’t reach triple figures. We were probably looking at about $30 to $40k.

What is your pricing model for the comics?

Most comics are between $US1 and $US2 and it’s a revenue split with the author. iTunes also takes a percentage.

With digital comics in general, we’re encouraging impulse buys, so we’re trying to work around a 99 cent model, just like music tracks from iTunes.

Obviously, you don’t get anything tangible in your hands so we don’t expect people to pay much more than that.

What process do you go through with prospective publishers?

Initially, we did all the approaching. Since we’ve gone live, we pretty much get queries every day now; at least four or five. The volume of comics out there is just amazing.

We’ve got the bigger continents like Asia and Australia, and we’re starting to look into the really niche markets where we know there are comic books there, but it’s also [about determining] how we get hold of these guys in countries like Africa, Pakistan and Libya.

How do you plan on doing that?

The power of the internet – a lot of what we do is network within the internet, find contact bases, go through one contact to the other, trawl through Twitter, etc. It’s surprising what you can stumble on.

We’ve got a rep across America now representing Cloud 9 Comix, not only to spread our brand but to encourage consumers and authors to sign up.

How long did it take to set up the website?

The website acts more as a catalogue – it lists news and comic book titles that we carry in the catalogue.

If you want to see previews of comics or anything like that, you have to load up the app on your iPad. The app itself took about six months. The website was maybe about a month.

What were the challenges associated with setting up an app?

The main thing that everyone found attractive was that every comic book artist and publisher that we’ve come across wanted to go digitally. They were sort of like, well how much is it going to cost me to go digital?

Our answer was always, it doesn’t cost you anything – we bring you onboard for free and then you sell via the app and we do a split share.

We studied what was out there already and we took some elements of what worked and what didn’t.

We worked on the actual interface design and just tried to make it as simple as possible – the most popular books come up straight away and there are no complicated registrations required initially.

So someone can check out the app if they like and then they can register. With some of the other apps, as soon as you log in you are thrown questions and some people get put off by that.

We just tried to make it accessible and easy to use, but the iPad is not easy to develop due to hardware limitations – we had a lot of trouble with it.

As the app market starts to become more crowded, how will you differentiate yourself?

We’re signing up a lot of comics on an exclusive basis so they’re only available from us. If another player comes to the market, we’re going to have to look for different content.

We’ve got a variety of content for comics – we don’t have a particular genre we stick to. We’re primarily concentrating on independents.

We want to differentiate ourselves so that when users open up our app, they’ll know we have exclusive content and we’ve always got something new they won’t see anywhere else.

At the moment, we’ve got over 150 titles from all six continents and many of them are on an exclusive basis.

Also, we’re tying up with studios around the world – publishers and media companies – to push this brand.

Anyone who comes into the market now, I think would find it quite hard to actually get the content and to break through without some major funding behind them.

What are your revenue projections for 2011?

Right now, we’re more concerned with actually getting the word out, spreading the brand and getting a user base. Getting a projection at this point is probably a little bit difficult.

We’re launching our app for Android and we’re going to spread to Windows 7, all of which will exponentially increase our potential readership. Six months from now, any projections we do now will fall out the window.

How many staff do you have?

We’re looking at about 12 to 15 people. We operate more as a group of contractors. We have graphic designers; we have a couple of studios in Europe doing the design work for us and we’ve got development teams.

We’ve never really employed full-time staff as such. At the peak time [throughout Spectrum Pacific Publishing], we would have had about 100 contractors, so numbers fluctuate depending on what projects we’re working on.

Through that, with those connections we’ve made over the years, we know which agencies to approach for which jobs.

Do you ever struggle to convince publishers your concept will work?

I’d say about 90 to 95% of the ones that we talked to were thrilled with the idea. Then you get that small percentage that is a little bit skeptical, especially some of the European ones where digital devices don’t particularly take off.

They’re a bit more traditional and conservative, so in some cases it’s taken a little bit of persuasion and we’ve shown them some of the other models that we’ve done.

What was the biggest challenge that you faced?

Issues with the iPad. We were running late with the app – we were supposed to come out in September and we were about two and a half months late with it due to some nightmarish issues with the actual device.

Marketing is also a challenge because we only have a certain budget for it, so we can’t really throw an ad on TV or anything like that – we have to utilise social media, which still works very well.

It will take a bit of time to build up the user base that we want but we strongly believe we will get there, particularly with the arrival of the iPad 2.