[Because I realize there are subjects that just make some people hinky, a spoiler warning for the first and last time ever in this column: if you don't already know the terrible secret of Yuletide and don't want to hear it, stop reading now.]

The state of the business, 2000.

Not good.

Poet and sf-horror writer Thomas Disch (who wrote my favorite last paragraph of any book, in his dystopian 334) once postulated the true role of Santa Claus in our culture. As small children, we quickly learn about Santa, mainly that he's the one who brings us presents on Christmas morning. We hear endless recitations of "The Night Before Christmas" with its jolly old elf. We sit on Santa's lap at the mall to declare what we think our goodness has earned us. TV weathermen track his travels across the world, bringing toys to all the good little girls and boys.

Somewhere along the way, we all figure it out: [this is your last spoiler warning. Turn back now.] Santa Claus doesn't exist.

We all figure it out. Our parents lied to us. Our teachers lied to us. Our merchants and our leaders lied to us. It's not learning that Santa doesn't exist that's childhood's end, it's realizing that everyone lied to us. Leaving that little seed of doubt, and that first twinge of cynicism as we all join the game, winking about Santa. After that first brief burst of sharing our new knowledge, we all stop telling people Santa's a lie. We jump from patsy in the Santa conspiracy to co-conspirator, because, let's face it, we still get presents. And when we have kids, we start the cycle all over.

Disch's theory is that Santa's a cultural indoctrination, and that, as adults, we all figure out about God what we long ago as kids figured out about Santa: he doesn't exist. Learning that Santa doesn't exist cushions the blow for us when we learn God doesn't exist, and our response to the latter instance - shut up, play the game - is learned behavior from the former instance.

It wasn't long ago a great number of people were touting the Internet to me as the Santa Claus of comics. It was going to save the medium, and turn us all into wealthy superstars. This notion got a big boost when Stan Lee announced he was heading up what was touted to be a big budget, major league online comics company, modestly called StanLee.Net. With his partner, convicted cocaine abuser and embezzler Peter Paul, the USS Stan was going to seek out new concepts, new marketing opportunities, and take comics where no comics had gone before.

There ain't no Santa Claus.

On Friday, virtually all the staff of StanLee.Net was laid off. A couple weeks prior to that, the stock price had begun an abrupt and to this day inexplicable (at least publicly) price plunge that went from ~$18/share to 13¢/share. (Recently I used the stock market term "dead cat bounce." The SLEE stock actually dropped to 9¢/share but went back up to 13¢/share. This was a classic dead cat bounce: toss a dead cat out a high window, and even a dead cat will bounce when it hits the ground. But that doesn't make it alive.) Nasdaq was forced to call a halt to trading on the stock, and word has it the SEC is now investigating the company. A refunding plan crashed on the shoals of the stock collapse, forcing the layoffs. Last Friday, seven people still remained on staff. Last I heard, it was six, possibly down to five. One spokesman for the company, who promptly resigned after the statement, indicated they'd continue waving Stan's name around in an effort to raise more funding. I suspect the debacle has erased Stan's cachet in financial circles. Worse, as far as the industry is concerned, his continued association in the public mind with Marvel Comics could hinder Marvel's attempts to refinance at a time when they, too, desperately need the money, as well as investor confidence. (Time-Warner, particularly at this moment of merger with AOL, may not want any DC Comics debt on the books - and I don't know if there is any, for all I know DC's pulling a profit this year - but the corporation can certainly afford to ride out any shortfalls. Marvel's current parent, Toy Biz, on the other hand, is caught in the same apocalyptic crunch as the rest of the floundering toy industry, meaning Marvel's got no corporate Santa Claus if push comes to total financial collapse, a scenario that can't be ruled out of Marvel's near future.)

In fact, the evaporation of StanLee.Net doesn't really signal anything for future attempts at internet comics companies. It does provide some object lessons.

1. Have a business plan. All indications are that investors were lured in on the strength of Stan's creation of Spider-Man, The Hulk and X-Men. Stories coming out from inside the company suggest power struggles between different factions seeking not to make comics but, like Ronald Perelman abortively attempted with Marvel (which led to the company's current woes), to create a media empire.
2. Make decisions early and stick with them. Stories abound of management from Stan and Peter Paul on down constantly second-guessing themselves and wasting tons of money implementing rethink after rethink. Or, worse, starting projects in motion, then forgetting about them until work was well underway, then coming back and deciding the project either wasn't what they wanted and didn't communicate or that they then wanted the project to be something different. Over and over.
3. Treat all money like it's your own. If speculation turned America into a nation of gamblers in the 80s and 90s, IPO fever among investors eager to get in on the ground floor of "the new economy" created the same "free money" insanity in some sectors that deregulation of Savings-And-Loans launched in the 80s, with the same result: lots of people spending other people's money on their own desires without a care because it wasn't their money. Combine this with the tendency of venture capitalists to remold companies without concern for their longterm survival (as long as the VC got quick short term profit via IPO offerings) and you have a horde of online companies targeted for collapse. StanLee.Net is just one among many. If people spent all money as if it were their own instead of someone else's, they'd likely be a lot more careful with it.
4. Have something to sell, and some idea of how you're going to make money from it. It's no secret that StanLee.Net's output was crap - its own employees are very vocal about it - but being crap never stopped anything from selling. (Probably the most popular webcomic, Icebox's MR. WONG, is absolute crap, which even Icebox acknowledges.) But no one had a clue - and, unless we're talking porn, when it comes to the Internet nobody yet has a clue - of how to get people to actually pay for material. You can successfully give away anything, but at some point the bills come due. Management at StanLee.Net were reportedly fixated on "revenue streams" - an offshoot music company, licensing to film and TV, things like that - but no one seemed very focused on revenue. Artistically, online comics might be wonderful (though no one's likely to accuse the StanLee.Net output of that) but unless a business makes money it can't be a success.

What no one has figured out is how webcomics are going to make money. Though there are upcoming web ventures that have potential, most webcomics wizards are living on the prayer that their product will be so vital that "viewers" will eventually fork over rather than live without it. In a world where TV networks teeter on insolvency because audiences won't sit down to watch programming pumped directly into their home free, this smacks of believing in Santa Claus, like they've all agreed that he might be real as long as no one says he's not.

What of the rest of the business?

Philip K. Dick wrote a hallucinatory quasi-religious novel called VALIS, built around the premise that since Roman times the same year has been played over and over again, that progress and change are illusions and we're actually living in Year One in Roman times. In 1965, the comics industry was dominated by two powerhouse publishers, DC and Marvel, and a singular monopolistic distributor, IND. (While there were other distributors, they were little more than blips on the radar. IND was the overwhelming giant that kept all others down - and kept Marvel's superhero line restricted to a set number of books that wouldn't upset DC's dominance.) A handful of other companies - Charlton, Tower, etc. - put out occasionally interesting but mostly ignored titles. Focus was entirely on company-owned comics; creator ownership was all but unknown. The public perception of comics was that they were cheap, gaudy pamphlets for small children and imbeciles. Organized fandom was borderline non-existent. 35 years later, in the year 2000…

Not much has seriously changed.

DC and Marvel dominate the comics industry, with Marvel, under the new Jemas-Quesada regime, even trying to position itself back in the old Stan "we're the underdogs but we do the really brilliant comics" mold of 1965. Diamond controls virtually all comics distribution, and are increasingly restrictive of what new material - particularly from new publishers - gets distributed. In an era of flatlined sales (as opposed to '65, when Marvel sales were rising rapidly and DC would cancel a book whose sales dipped below 300,000) when the future of the market may rest on new ideas from new publishers, and Diamond is virtually the only conduit to the public, this is a dangerous game, seemingly geared more toward protecting its major clients' interests and minimizing its own efforts than serving the interests of the industry. There are far more than a handful of small publishers, but they're now little more than feeding grounds for the major companies; anyone who does anything interesting is lured away by the prospect of actual money and attention doing superhero comics. Creator ownership - the right of a creator to actually control the development and marketing of his own ideas - remains largely a distant dream (short of self-publishing, which Diamond ensures is a crippling, ludicrous prospect, even if launch money can be found), though creator-participation (relatively sizable payments to the creator for continued use of his creations by a company that nonetheless controls the creation creatively and financially) has finally become something of a standard in the business, even at Marvel. The public perception of comics can still be summed up in three words - BIF! WAM! POW! (Holy onomatopoeia, Batman!) What good will films like X-MEN has brought to the concept of superheroics, it hasn't really spilled over to comic books yet. The general attitude has improved from total disdain to curiosity, but not enough to actually lure an audience in, and with some companies now ostensibly focusing their efforts on bringing in a phantom "untapped audience" of kid readers, we risk a backslide to the "comics are for kids" mentality that various sectors of the comics industry keep trying to enforce. Where comics used to be thought of as cheap, gaudy pamphlets for small children and imbeciles, they're now viewed as overpriced gaudy pamphlets for the obsessed, and there aren't many of the obsessed left who think comics are a good enough value for their money. (Want to bring kids back? Drop the price to a quarter. Quarter boxes are where all the kid action in comics shops is. Don't want to do that? Forget about bringing kids back.)

While there are good projects all over, and arguably far more genuinely talented and inventive people working in the industry, even in positions of control, than ever before, unlike 1965 there's no focus - then Marvel, with Stan turning comics hep - you can point to and say "this proves comics are getting better."

There's one bright spot in the comics market as 2000 closes out, and not a new one to MOTO readers. Back in my third column, I wrote that what the industry has been experiencing over the past five years or so isn't a crash, but a shift from a magazine economy to a book economy. Recently PUBLISHER'S WEEKLY agreed with me, in a lengthy article about the rising tide of graphic novel sales in bookstores. Robert Boyd of the distributor LPC's main complaint about graphic novels: "There's not enough of them."

Compared to other books, graphic novel sellthrough has been phenomenal, particularly on books like SAILOR MOON. (There's your kid audience money, right there.) Bookstores are starting to learn to display graphic novels and trade paperbacks (the article doesn't distinguish) en masse, creating a presence for them. PW cites material like TRANSMETROPOLITAN, which sells far better in trade paperback than in comics (fulfilling my prediction that the role of the standard comic in the future will be as a loss leader for trade paperback publication).

Yet, to my knowledge, there's only one publisher - Larry Young's AIT/PLANETLAR Books - that has specifically embraced the future and turns his focus toward producing graphic novels rather than comics. Larry manages on his reputation and goodwill among talent - we know he'll put an effort behind it - but it would be nice to see a publisher with actual money to spend take the same step.

The bookstore/tpb/gn market still isn't a Santa Claus. There won't be any gifts. It's still a slow build, even if it's rapidly picking up steam. Anyone looking to make a quick killing ala Internet IPOs, is out of luck. But this is still our future. That it comes quickly isn't as important as that it comes at all.

Ho Ho Ho.

Funny how these things get by you: in addition to X-MAN #72, which should be available from Marvel this week, it seems DC's also releasing LEGENDS OF THE DC UNIVERSE #37, with the first half of my final "Traitor" two-parter. Traitor's been making trouble for Green Lanterns through two stories so far, and here he takes on the current GL in all-out war, with art by Scott Kolins and Klaus Janson and a painted cover by Greg Staples that caught me completely off-guard: considering Mike Zeck and Gil Kane have drawn him, I have to say Traitor has never looked better. (Scott and Klaus' version is pretty good too.) It's a big week for planet smashing in my books, I guess. Didn't plan it that way (no pun intended). Check them out.

I'm up to my neck in a CATWOMAN script and trying to finish a couple graphic novels (including the WHISPER script) before year's end, plus I still have my Christmas shopping to do, so no other tidbits this week. Except:

Question Of The Week at the Master Of The Obvious Message Board (which I'm stealing from the Warren Ellis Forum over on Delphi, mainly because it's a really good question): What ONE thing do you want to see happen in the medium in 2001? This could be as simple as "I want ROM back" (which will earn you a lockout, even if said as a joke) or as wide-ranging as "the end of all serials and a complete immediate changeover to an OGN economy". Whatever. I want to hear one thing that, in your opinion, would make a better medium in 2001. (Thanks, Warren.)

Whatever questions you might have about me can probably be answered with a quick trip to Steven Grant's Alleged Fictions. You can also express your own views at the Master Of The Obvious Message Board, or send me mail. Bear in mind that while I read all my mail, time constrains me from replying in most cases. Thanks.