Tokyopop has decided to renew its distribution agreement with The Perseus Books Group's independent distributor CDS (Client Distribution Services).  CDS has been distributing Tokyopop to the bookstore market since 2002 (Diamond Comic Distributors will continue to distribute Tokyopop books to the direct market). Perseus acquired CDS last year, and according to the New York Times, which chronicled the contest between book distributors to acquire the right to distribute Tokyopop's titles in the Business Section of Monday's paper, 'Tokyopop officials said it was unlikely that the company would have stayed with CDS if not for its new owner.' 

The Times article pointed out the increasing competition between the distribution arms of the major publishers, all of which have computer systems, warehouses, and sales forces capable of handling third party distribution for small publishers, which of course lowers the cost of distribution for the big publishing houses.  As recently as 1998 many publishers were anxious to get out of distribution -- in that year Random House sold off its distribution unit, which became CDS, to a group of managers.  But Random House went back into distribution in a big way in 2003 and according to the Times, expects to collect $150 million from its distribution segment, which now serves 15 outside publishers, in 2006.

Given the rising popularity of manga and the potential profits from layering Tokyopop's volume on top of an existing distribution operation, it is easy to see why Tokyopop had a number of suitors for its distribution business.  Stuart Levy, Tokyopop's CEO, explained the decision to stay with Perseus / CDS to the Times this way: 'With their new infrastructure, Perseus will be instrumental in helping manga tip beyond the niche market into the mainstream.'  Getting manga into grocery stores, mass merchant-outlets and other specialty stores where best-selling books are sold is a key component of the growth plans for both Tokyopop and its chief rival Viz Media, which recently announced an expanded sales partnership with its distributor, Simon & Schuster (see 'Viz and Simon & Schuster Expand Distribution Agreement').