transcript july 21, 2008 hsbro earnings conference call and business overview

Thunderfoot · Jul 30, 2008

joethelawyer said:
i am that joe, if you mean the one in 93/94 who was ranting and ravng on the usenet newsgroups about T's online tactics . hehe. my reputation preceeds me still?

joe

OMG!!!! ~ Please don't get us cease and desisted...

Welcome to the loony-bin BTW

Henry · Jul 30, 2008

joethelawyer said:
if insider does not get up and going soon, and if it doesn't blow people away and get them signed up, i expect that the pen and paper aspect of dnd will no longer be supported within the next business cycle-- 12-18 months.

In which case, thank God for the OGL, I say.

From what I'm seeing, and based on comments from Ryan Dancey eight years ago, it's working exactly as he intended. I also really have to question any supposition of third-party publishers as direct competition for D&D, because of its position in the market; any sales to third party companies on board with the OGL will usually be in addition to D&D purchases, not instead of them, with the D&D purchases taking precedence. The number of people using d20 games who AREN'T also making D&D purchases is really pretty small by comparison. On the other hand, when D&D is sufficiently different from the rules as open sourced, THEN is when you start to see them functioning as competing systems - and if they do drop the ball, then someone else likely becomes leader of the niche, as White Wolf did in the 1990's.

But hopefully, Insider will do well for them, because despite the delays in the other parts, they have the Dungeon and Dragon Online mags looking very nice -- nice enough for me to pay money for them when they go subscription, quite frankly. For 4E players, there's some really good content in those magazines.

joethelawyer · Jul 30, 2008

Henry said:
In which case, thank God for the OGL, I say. From what I'm seeing, and based on comments from Ryan Dancey eight years ago, it's working exactly as he intended.

what did he say 8 yrs ago?

Mistwell · Jul 30, 2008

joethelawyer said:
to respond to my own post, i thought it was interesting that they only mentioned wotc in passing. this is 2 months after 4e released. this was a huge meeting with all the big wall street firms. this is where you toot your own horn loudly. if 4e really did well they would have been talking about it here.

I disagree. When I've worked on these types of meetings, we wouldn't bother mentioning a segment as small as D&D, even if it did really well. If we did mention it, stockholders would assume we were trying to distract from something much bigger that had not gone well. It would just be inviting that question...how much $, and when the answer was "a really small amount relative to net revenues" people would at best wonder why we were wasting their time, and at worse assume very cynical reasons for that time wasting.

Unless it's going to make a blip on the bottom line, either now or in the following year, or it justifies a noticeable expense, or you badly DO need to distract from something, you don't mention it.

Mistwell · Jul 30, 2008

joethelawyer said:
again, these meetings are where you toot your horn and make small achievements seem bigger than they are to impress financial analysts at the big wall street firms.

Only at a relatively crappy company Joe, that's having bad times. If you make small things look big, most of the time in my experience it comes back at you worse than any gains you can make that way.

Do you have a specific example in your experience that runs contrary to what I just said?

Miyaa · Jul 30, 2008

Interestingly, the Hasbro stock (which is more or less an indication of how people would bet on it to ride well, like in a horse race) is up 21.55% in the past year (as of July 29, 2008), and 54.38% in the Year to Date analysis. It hasn't done this well since, well, 1999. They also have a new CEO who just started a less than two months ago (May 22nd).

Now, what does this, along with the rest of the thread have to do with Wizards? Well, I would contend as long as profits overall are fairly good and the stock price is high enough for Hasbro to buy back some of the stock, Wizard can continue to try to find some way towards a sustainable profitability goal. However, given that the global economic conditions aren't good right now (as indicated in the conference call transcripts), that could all change rapidly. So I would be (if I was running WotC) in a "Be Quick, but Don't Hurry" mode.

I'm also kicking myself for selling the stock earlier in the year.

Mistwell · Jul 30, 2008

manhammer said:
Along a similar vein, Wizards of the Coast was conspicuously absent from San Diego Comic Con this year. A person at the Hasbro booth said they were gearing up for Gencon. I have been attending SDCC since about 1991 and I can't remember D&D not being there.

I noticed that too, and looked into it a bit. The answer I got (not from them) was that because floor space did not grow, but interest in floor space did from a variety of entertainment sources, WOTC (along with many other booths) were forced to make a decision on trimming their square footage and how they would use with that reduced space. D&D was a natural cut for them. Even Hasbro built UP more than out this year, if you noticed.

I wouldn't read too much into it.

Mistwell · Jul 30, 2008

Thunderfoot said:
Between the two cons, Comicon or GenCon, GenCon is just the larger of the two in terms of D&D and role-play, regardless of the actual media coverage or attendance - playing to a bunch of comic collectors isn't necessarily playing to a group of gaming geeks and vice versa.

Boy do I wish Comic Con was a bunch of comic collectors!

Amphimir Míriel · Jul 30, 2008

Joe the Lawyer:

Paraphrasing Voltaire: If tabletop D&D did not exist, it would be necessary to reinvent it.

manhammer · Jul 30, 2008

Mistwell said:
Boy do I wish Comic Con was a bunch of comic collectors!

Here here. As a comic collector I was going to add that less then 50% of SDCC is now comic books and some would argue less than that.

It has become a huge move, video game, toy and kitsch event. While it is still fun, I always come away shell shocked.

While some of the comments about a lack of time to prepare may very well be true, I was still saddened/surprised with no WOTC/D&D.

Joe read the situation as I did, and he has a much more impressive pedigree.

However, I don't see this as the death of D&D but very possibly ANOTHER change in ownership.

In regards to the solution to the problem, I think (and again I'm a graphic designer not a lawyer or business man) the solution is not to be owned by a large company. D&D was a labor of love and predictions about online revenue and miniature sales seem to have very little to do with creating something "of quality".

I think this is why we see the cycle of great books at the start of a D&D cycle and then pure drek by the end of one. The business model says "where is my new revenue" and the creatives who were so excited at the beginning know they have to push product in order to keep the job they love. So they make what they can (sometimes it's bad) and in the end, end up hating their job and moving on.

I am dying to know what Ryan Dancey said 8 years ago, my hunch is it has something to do with the OGL and giving D&D to the people. Maybe we need to take it away from WOTC.

Oh and just for some geekcred gamer since 1985.