The Bad in this case was not bad overall for the game just bad in hindsight for profitability.
Except 3e was very profitable. And there's no guarantee that 4e's PHBII will be any more profitable.
As far as an RPG goes, yes 3E was about as good as one could expect, sales wise. The question becomes, good enough for whom?
A small independent company in the RPG business can be satisfied with the kind of profit that would make a large company like Hasbro see it as something barely worth thier time.
3e made money for Hasbro. D&D has never been one of even WotC's biggest cash cows (Magic, Pokemon, etc.). It hits such a small market segmentthat anything that actually *does* up the profit is still a drop in the bucket, barely noticeable.
Shareholders don't get excited about a product that simply makes a bit of money, they get excited about products with huge profits that help drive up the stock price.
The company has a duty to shareholders to invest in those products that produce the revenue and abandon or change those that don't.
Hasbro shareholders don't get excited about D&D, period. They might've gotten a little excited when they heard that Hasrbo acquired the company who makes those little packs of cards you see in gas stations. Now, they're more concerned with who's making the toys for next Christmas's big blockbuster movies, and this Fall's big children's shows.
Hasbro has much bigger fish to fry.
This is why RPG's and large publicly traded companies are a poor mix.
Do you honestly think that a non-gamer shareholder of Hasbro cares if the spirit of the original D&D is maintained when doing otherwise would drive up the stock price?
Its not evil. Its just business.
No, but they also aren't going to mess with what works very much, if it's not a big deal. Companies are very conservative, in general, and as long as D&D makes money and isn't a liability, the suits have no reason to get very deeply involved. It's not like D&D
matters to them, except as a small part of WotC, which is itself a small part of Hasbro.
This scheme to parse out the core is an effort to keep the edition robust over a long period of time. It seems to be less about shareholders and more about making sure 5e takes a while to get here.
What do I mean?
I believe one of the reasons 3.5 and 4e came down the pipes was the lagging sales of supplements in general. I believe that WotC rather correctly analyzed the problem on at least one front: after a few years of buying everything the edition has to offer, people just don't need that much more gaming material.
If they keep future releases "essential," (core, or with things that collectors will need), people will still have a perceived need for them and will still buy them. This will delay the need for a 5e, because sales won't lag as badly very soon -- the collectors will be buying things left and right.
However, there's a solid chance that they overlooked that people who very much appreciated the inclusiveness in 3e might not wait until their game is "complete." The collector's mindset is very binary: all or nothing. If they can't get it all, they don't bother collecting any of it, because partial mastery is unacceptable. This, combined with general consumer impatience and the existence of things like Pathfinder, mean that the "hardcore collector" D&D players that they are relying on to buy the PH#10 may have already bowed out, leaving people who aren't going to care about the PH#10 for the same reason that less people cared about
Dragon Magic than cared about
Sword and Fist.
This is a gambit. It is not assured to bring them the greater sales and longer edition life that they are gunning for here. They can take this risk because D&D isn't a big deal to Hasbro, and because of crack market research that has been right before.
You can't assume the inclusive model is less profitable than the parsing model at this point. That's just what WotC is banking on. Let me know in eight years of the PHB8 is selling more copies than
Dragon Magic did. THEN you can perhaps claim that parsing out the core was a good idea from a standpoint of
edition sustainability. But I bet you still won't be able to make the case that it was somehow good for investors, because D&D isn't big enough to be especially good or bad for investors.
Really, at the moment, with the looming global financial collapse still so fresh in the minds of investors, Hasbro would be happy to secure the rights to
High School Musical 3 action figures so they're not seen as a risky investment or something, I'm sure. D&D doesn't enter into it at that level.