The Hits Drive The Revenue
Appreciate the financial analysis. Definitely some great insights into the different elements and how they interact with each other. But there's one thing you mentioned that is just not correct:
[INDENT][I]"...(there) is a pretty large amount of titles that simply can't be making back their creative costs from the largest publishers, being followed by collections that barely make their printing costs back. This is a fundamentally foolish way to do business, because it simply isn't sustainable."
Every media business is like that. Music, books, movies ... the profitability of every media segment is driven by the hits, because most of the other titles simply don't cover their own costs. Barely more than 3 out of 100 music releases are profitable.
But unlike other media industries, there is a "war of universes" going on in comics where I'd bet only a small number of buyers are egalitarian enough to invest equally across the board. I would surmise most readers tilt heavily either towards DC or Marvel.
There's a psychological principle at work. The average person only has so many favorite magazine titles, only so many favorite TV shows, and can only wrap their minds around so many continuities. A war of universes means that the winner keeps getting bigger, even if their product is slightly inferior, simply because the fan of the larger universe either shifts their spend to another part of the universe or opts out. I would hazard a guess that complete defections from Marvel to DC or vice-versa happen less frequently than someone dropping their LCS habit cold turkey.
So how do we get more traffic? Actually, the question DC is answering is "How do we get more people into OUR universe?"
Good books and events have always been jumping-on points into universes. Recently we have seen movies and videogames also drive new readers. The videogame is a huge front, and it will be interesting to see whether DC's MMORG is judged to be superior, for how long, and how it will influence overall sales of individual titles.
But to sustain interest in a universe, you need a diversity of titles. For years, DC has been slowly drawing down the number of titles published, which leads to a smaller shared universe in which to explore, which in turn becomes a decline in overall share.
At the same time, books that are irregular and cannot be counted on to be published as promised have been huge jumping-off points.
Thanks to the Internet, people are increasingly living in "real-time". Across the board, the more "real-time" a media product is, the more successful it is. A monthly magazine that is actually released quarterly is shuttered quickly. In comics that practice is tolerated somewhat.
SO.....I'd argue that more titles from a specific universe, released more frequently and more consistently, are more likely to reset reader expectations and lead to greater share. A larger number of titles gives you a larger number of entry points, and creates a multiplier effect for TPBs and digital comics. Ten different titles could produce fifteen to twenty different ways to purchase, each appealing to a different segment.
(Then again, I could just be smoking a superior brand of crack.)