4 Hours w/ RSD - Escapist Bonus Column - Page 21





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  1. #201
    Quote Originally Posted by Hussar View Post
    But, again, where are you getting this 50 million/year figure? And, other than at the height, has WOTC ever actually achieved that?
    I know for a fact that such a pitch was made to Hasbro. It was how they got the green light to do 4e & DDI.
    Ryan S. Dancey

 

  • #202
    Has any RPG company ever achieved that goal? For any extended period of time?

    Don't people get fired for making promises like that?
    The rules don't give the DM their authority. The consent of the players does. - Mallus

  • #203
    Quote Originally Posted by Hussar View Post

    I'm presuming that's gross sales of course. For the past year, we've had over 50 000 DDI subscribers (it's over 65 k now). 50 000x$7=$350 k per month. That's $4.2 million per year. But, since we don't have to worry about distribution or retail, that's effectively the same as making 16 million per year. And, that's a very conservative estimate by the way, since we are only taking into account DDI subs that we can prove.
    ?
    I don't pretend to know how much wizards is making, but why do you say that is the same as making 16 million per year? I don't see the step between making 4.2 million a year and that being equal to 16 million from other sources (since we don't really know their costs of doing business for either model).
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  • #204
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    Quote Originally Posted by RyanD View Post
    I know for a fact that such a pitch was made to Hasbro. It was how they got the green light to do 4e & DDI.
    Ouch...

    While we are on that, I believe a DDI could have been released for the same degree of sucess of a good MMO (not WoW, but still a good one), no new edition necessary (at least, not such a different one, which alienated a significant share of the player base). Necessary features, in my opinion:

    - Character builder
    - Monster/Encounter builder
    - Daily features, not necessarely Dragon and Dungeon, which should have remained as print material under Paizo.
    - Old edition material. I'm not even thinking of new stuff, just the ability to search and download the old stuff, but what about a weekly column on pre-3E D&D? I believe in potential freelancers who still love/play AD&D willing to write it.

    The VTT, while an interesting offer, is not the deal breaker, as I see it. But I think the model above would go a long way to allow Wizards to grab money from everybody with DDI, not only players of current edition.
    Everybody and their pet dogs seem to be professional game designers nowadays.

  • #205
    You have to learn all the backstory that led up to that meeting to understand the context. It's a long and winding road.

    After Vince Calouri was pushed out of Wizards of the Coast he was replaced by Chuck Heubner. Chuck basically had to manage Wizards on the downslope from the Pokemon salad days. Hasbro has been through many boom & bust cycles in the toy business and they have a standard response when it happens: cut headcount and reduce overhead. Since Wizards was de facto the only pat of the business that had not been rolled up into Hasbro proper it was not insulated by the successes of other things at Hasbro like GI Joe or Transformers.

    While this was happening there was a big internal fight for control over the CCG business within Hasbro. Brian Goldner who was at the time the head of the Boys Toys (i.e. half the company) division of Hasbro thought that the company was missing a huge window of opportunity to follow up Pokemon with a series of mass-market CCGs linked to Hasbro's core brands GI Joe and Transformers. These battles resulted in things being escalated all the way to the C-Suite and the Hasbro Board, where Brian lost the fight and Wizards retained the exclusive ability within Hasbro to make CCGs. The downside for Wizards is that they were forced to do things with the Duelmaster brand that they did not want to do, and it never got the traction in the US that Wizards thought it could achieve. (In Japan, by contrast, it became a huge best-seller).

    Chuck left after two years and Loren Greenwood, who had been the long time VP of Sales, replaced him in 2004. He was also a visible proponent of the idea that Wizards, and not Boys Toys, should set Hasbro's CCG strategy. Thus when Brian was named COO of the whole company in 2006 and CEO in 2008, Loren had a big problem on his hands. Loren guided the company through the post 3.5e crash of the TRPG market, the loss of the Pokemon franchise, and the unwinding of the Wizards retail strategy. All of this was pretty bitter fruit for hm since he'd been instrumental in building up much of what had to then be torn down. The combination of all these things led to Loren's exit and his replacement by Greg Leeds, who is the current CEO of Wizards.

    Sometime around 2005ish, Hasbro made an internal decision to divide its businesses into two categories. Core brands, which had more than $50 million in annual sales, and had a growth path towards $100 million annual sales, and Non-Core brands, which didn't.

    Under Goldner, the Core Brands would be the tentpoles of the company. They would be exploited across a range of media with an eye towards major motion pictures, following the path Transformers had blazed. Goldner saw what happened to Marvel when they re-oriented their company from a publisher of comic books to a brand building factory (their market capitalization increased by something like 2 billion dollars). He wanted to replicate that at Hasbro.

    Core Brands would get the financing they requested for development of their businesses (within reason). Non-Core brands would not. They would be allowed to rise & fall with the overall toy market on their own merits without a lot of marketing or development support. In fact, many Non-Core brands would simply be mothballed - allowed to go dormant for some number of years until the company was ready to take them down off the shelf and try to revive them for a new generation of kids.

    At the point of the original Hasbro/Wizards merger a fateful decision was made that laid the groundwork for what happened once Greg took over. Instead of focusing Hasbro on the idea that Wizards of the Coast was a single brand, each of the lines of business in Wizards got broken out and reported to Hasbro as a separate entity. This was driven in large part by the fact that the acquisition agreement specified a substantial post-acquisition purchase price adjustment for Wizards' shareholders on the basis of the sales of non-Magic CCGs (i.e. Pokemon).

    This came back to haunt Wizards when Hasbro's new Core/Non-Core strategy came into focus. Instead of being able to say "We're a $100+ million brand, keep funding us as we desire", each of the business units inside Wizards had to make that case separately. So the first thing that happened was the contraction you saw when Wizards dropped new game development and became the "D&D and Magic" company. Magic has no problem hitting the "Core" brand bar, but D&D does. It's really a $25-30 million business, especially since Wizards isn't given credit for the licensing revenue of the D&D computer games.

    It would have been very easy for Goldner et al to tell Wizards "you're done with D&D, put it on a shelf and we'll bring it back 10 years from now as a multi-media property managed from Rhode Island". There's no way that the D&D business circa 2006 could have supported the kind of staff and overhead that it was used to. Best case would have been a very small staff dedicated to just managing the brand and maybe handling some freelance pool doing minimal adventure content. So this was an existential issue (like "do we exist or not") for the part of Wizards that was connected to D&D. That's something between 50 and 75 people.

    Sometime around 2006, the D&D team made a big presentation to the Hasbro senior management on how they could take D&D up to the $50 million level and potentially keep growing it. The core of that plan was a synergistic relationship between the tabletop game and what came to be known as DDI. At the time Hasbro didn't have the rights to do an MMO for D&D, so DDI was the next best thing. The Wizards team produced figures showing that there were millions of people playing D&D and that if they could move a moderate fraction of those people to DDI, they would achieve their revenue goals. Then DDI could be expanded over time and if/when Hasbro recovered the video gaming rights, it could be used as a platform to launch a true D&D MMO, which could take them over $100 million/year.

    The DDI pitch was that the 4th Edition would be designed so that it would work best when played with DDI. DDI had a big VTT component of its design that would be the driver of this move to get folks to hybridize their tabletop game with digital tools. Unfortunately, a tragedy struck the DDI team and it never really recovered. The VTT wasn't ready when 4e launched, and the explicit link between 4e and DDI that had been proposed to Hasbro's execs never materialized. The team did a yoeman's effort to make 4e work anyway while the VTT evolved, but they simply couldn't hit the numbers they'd promised selling books alone. The marketplace backlash to 4e didn't help either.

    Greg wasn't in the hot seat long enough to really take the blame for the 4e/DDI plan, and Wizards just hired a new exec to be in charge of Sales & Marketing, and Bill Slavicsek who headed RPG R&D left last summer, so the team that committed those numbers to Hasbro are gone. The team that's there now probably doesn't have a blank sheet of paper and an open checkbook, but they also don't have to answer to Hasbro for the promises of the prior regime.

    As to their next move? Only time will tell.

    (Edit - changed the year of the meeting for the 4e/DDI pitch)
    Last edited by RyanD; Thursday, 5th January, 2012 at 05:21 PM.
    Ryan S. Dancey

  • #206
    Quote Originally Posted by RyanD View Post
    I can imagine developing a 4th edition that was less complex, but still rooted in the 1e/2e/3e design tradition of D&D. I can imagine de-emphasizing the Power Gamer quadrant of the player demographic and doubling down on the Storyteller and Character Actor quadrants. I can imagine learning something from the narrative control experiments in the "indy" RPG scene and bringing that to the D&D game to change the way the DM and players interact. I can imagine all sorts of ways to advance D&D, without putting the game into a paradigm shift. But now that it's been shifted, well, options for further progress become much more limited.
    Wait, what?

    I'm going to have to store that quote somewhere. Sounds like the Voice of Reason to me.

    Pathfinder is at heart a revision of a [revision] of 3.0. That makes it effectively a 12 year old game. I think a lot of innovative ideas have been added to the toolbox of TRPG design in those 12 years, and if D&D can pick them up and use them, I think it benefits everyone and that includes Pathfinder.
    To be fair, that does to.
    Last edited by Ahnehnois; Thursday, 5th January, 2012 at 04:34 PM.
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  • #207
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    Quote Originally Posted by RyanD View Post
    3: Some of the stores in it aren't game stores. They're stores that sell Magic or (less commonly) D&D, but that's it. The "game store" might be one rack of product maintained by the son of the owner for himself and his buddies. Again, they're seeking access to the promotional stuff Wizards produces. They may run a Friday Night Magic or an Encounters session on a for-profit basis (or just because they love the games), but they're not Full Line Game Stores.
    I can provide a personal anecdote to illustrate this particualr point; one of my best friends runs a comic store that fits right into this mold; they don't stock games (tried, but they didn't sell) but do host a D&D Meetup on a monthly basis. They just recently started running Encounters (primarily because, hey, free stuff!). So they would show up in the locator, but are not in any way a game store.
    "I hurt Firewing." is not something a huge number of people can say. "He dropped a parking garage on me," on the other hand, a lot of people can say. -Kazan, my Champions GM.

  • #208
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    Quote Originally Posted by TheFindus View Post
    I know, but the text of the rules can be protected. Plus iconic names. And that makes all the difference. Otherwise, why the need to design an OGL in the first place? It is to give 3rd party publishers that security.
    Again I refer everyone to my article series on Loremaster.org called Protection from Chaos. Read the "IP Primer" and "To GSL or Not to GSLLC." In short, neither rules nor ironic names can be protected through copyright, and the OGL (and especially the GSL) are more about maintaining game integrity than licensing protected material. That is, WotC uses the license to restrict your ability to use otherwise unrestricted material by way of *contract*, not IP law, and as a result there is consistency running through all products bearing the WotC logo, whether published by WotC or not. Understanding this goes a long way towards understanding just how brilliant those licenses are (regardless of the details of how they're executed).
    Rob Bodine, gamer, copyright/trademark atty (www.gamerssyndicate.net, @gsllc, @synDCon)

  • #209
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    Quote Originally Posted by RyanD View Post
    Magic has no problem hitting the "Core" brand bar, but D&D does. It's really a $25-30 million business, especially since Wizards isn't given credit for the licensing revenue of the D&D computer games.

    It would have been very easy for Goldner et al to tell Wizards "you're done with D&D, put it on a shelf and we'll bring it back 10 years from now as a multi-media property managed from Rhode Island". There's no way that the D&D business circa 2006 could have supported the kind of staff and overhead that it was used to. Best case would have been a very small staff dedicated to just managing the brand and maybe handling some freelance pool doing minimal adventure content. So this was an existential issue (like "do we exist or not") for the part of Wizards that was connected to D&D. That's something between 50 and 75 people.

    Sometime around 2006, the D&D team made a big presentation to the Hasbro senior management on how they could take D&D up to the $50 million level and potentially keep growing it.
    That's... pretty terrifying. If you don't mind my asking, how much of your post do you know, and how much is informed speculation?

    As to their next move? Only time will tell.
    Being freed of the promises of the previous management does them no good if they're still beholden to that impossible $50M target. I see no way for them to reach that.

    I suppose they could do a 5e on the cheap, and pray for a major hit. That would almost certainly fail, but it might just work. Even if successful, it would only be a short-term boost, but perhaps they only need to hold on for a few years, for things to improve, and for Hasbro to change tack.

    Alternately... you said that they were hampered because they couldn't benefit from the D&D electronic license. But, how about now? Now that it's back in-house, could they license it out for an MMO?

    The final option I can think of is for the D&D team to quietly position themselves to spin out at their own, independent company, and then pick up the license for D&D RPG when Hasbro cancels it.

  • #210
    Quote Originally Posted by Hussar View Post
    Has any RPG company ever achieved that goal? For any extended period of time?

    Don't people get fired for making promises like that?
    Sadly, no.

    1. What typically happens is one or more leaders makes such a claim, either from blind faith in their approach or desperation.
    2. Then the teams try to figure out a plan that if everything goes perfectly can achieve the goal and projects start fring off.
    3. The first intimations start coming in that the goal will not be met.
    4. There is a quick change of leadership as those originally in charge find other opportunities.
    5. The results of the initiative are tabulated and the new leadership attempts damage control and to assert control. Depending on the new leadership, start over at point #1

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