It would seem the hits keep coming for WarnerMedia. On August 10th, reports surfaced that many people were laid off from HBO, DC Universe, DC Direct, DC Comics and other departments. While the layoffs were seen as a sign that AT&T was taking further steps to move DC Comics away from printed monthly issues, Jim Lee, DC Comics’ Publisher, came out on Friday to explain that things are more or less business as usual.

When AT&T came on board, they made it clear that their focus was to enhance the HBO brand by creating a streaming service that would, hopefully, become a rival to Disney+. This led to questions about the future of the DC only streaming service, DC Universe. Most of the content on DC Universe began migrating to HBO Max upon the launch of the later service, and no new content was announced for DC Universe.

DC Universe, however, isn’t just a streaming service for shows and movies. It also houses around 90% of DC’s published comic books in a format similar to Marvel’s comic book app, Marvel Unlimited, a digital comic book subscription service for $9.99 a month. More comics get added to DC Universe every month and, unlike the DC branded movies, aren’t shared by other services. Now AT&T has laid off most of the staff involved in running DC Universe, which has led many to suspect that DC Universe is being shut down for good. Jim Lee’s Hollywood Reporter article, however, points to a different outcome. DC Universe was the response to fans requesting a DC equivalent to Marvel Unlimited, a place where they could “binge read” comics, the difference is that it comes with movies and TV shows as well. Instead of being shut down Jim Lee said “We’re excited to transform it,” hopefully implying that the layoffs and restructuring mean they won’t shutter the app altogether, but rather make it a true competitor to Marvel Unlimited.

Another DC department that suffered a large layoff was DC Direct. DC Direct has been a staple of the DC family since 1998. The company handles the merchandising of DC characters. Last year, DC Comics licensed out their characters to McFarlane Toys in order to get merchandise into wider markets since DC Direct mainly focused on “direct market.” That basically means they were almost exclusive to comic book stores through Diamond Distribution. Jim Lee seems to imply that the laying off of 95% of the DC Direct staff doesn’t mean the company is shuttering, but rather going to be restructured to provide different high quality content at a higher price. DC Direct made a name for itself by delivering high quality action figures as well as statues for hard core collectors. It was a business model that didn’t always make sense, since they couldn’t get those figures into bigger toy retailers like Walmart or Target. There is a more niche market for high quality statues, such as the ones distributed by Sideshow Collectibles, so it’s not without reason to assume that the future of DC Direct is more collectible oriented than toy oriented.

The biggest hit came to DC Comics: Many of the “old guard” that moved from New York to LA a couple years ago, were laid off. The major rumor was that Jim Lee was removed as Publisher, though he himself has discredited that one. One of the most surprising layoffs was Mark Doyle, who oversaw DC Comics’ Black Label imprint. The Black Label came about because DC wanted to focus more on reaching a wider market through more mature trades. They’re stories that aren’t concerned with continuity and can be picked up at a local Barnes and Noble, for the average reader looking for a Batman book. The laying off of Mark Doyle puts into question what the priorities for the prestige imprint are now. He could be replaced with someone, of course, but it’s curious why AT&T would want to let someone go who has overseen a successful series of books.

Jim Lee also made it clear that they are going to focus more on digital books and cut 20-25% of their publishing line, though it’s the bottom 20-25%, which happens all the time in the industry. Still, AT&T’s actions speak to a different bottom line than Jim Lee is letting on. If comic books are the “lifeblood” of DC then why get rid of one third of the editorial staff? If the only reason for the layoffs are to restructure the overall WarnerMedia company then why not transition the editorial staff rather than letting them go?

Who knows what AT&T’s long term plans for all the WarnerMedia subsidiaries are? Jim Lee could do his best to put out all the fires stirred up by these new layoffs, but 600 people don’t lose their jobs because “everything’s fine.” A large tech company like AT&T, buying a media company like the former Time Warner, often creates issues with how the new owners want to see the company run. Layoffs are nothing new, and sometimes not much to be concerned over. These layoffs came at a pretty bad time for WarnerMedia, however, because their big digital event DC FanDome is just around the corner. Bad news like this only creates conspiracy theories that cast further dark clouds over the upcoming event. Hopefully Jim Lee’s optimistic take on the company is more than an attempt to quell the speculative fires and does point to a bright future for the company.

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