WotC Hasbro's CEO Reports OGL-Related D&D Beyond Cancellations Had Minimal Impact

Hasbro held a quarterly earnings call recently in which CEO Chris Cocks (who formerly ran WotC before being promoted) indicated that the OGL controversy had a "comparatively minor" impact on D&D's revenue due to D&D Beyond subscription cancellations. He also noted that D&D grew by 20% in 2022 (Magic: the Gathering revenues grew by an astonishing 40% in Quarter 4!)

WotC as a whole was up 22% in Q4 2022.

Lastly, on D&D, we misfired on updating our Open Gaming License, a key vehicle for creators to share or commercialize their D&D inspired content. Our best practice is to work collaboratively with our community, gather feedback, and build experiences that inspire players and creators alike - it's how we make our games among the best in the industry. We have since course corrected and are delivering a strong outcome for the community and game.

 

[OB1]

what do you base that number on? DDB users? That does not really measure new players…

You're right, it was probably substantially more than that (though certainly not every new D&D player can be directly attributed to WotC either, I don't want to discount the effort of DMs, Players, Livestreams and fans out there). But the smartest thing WotC did with 5E is focus on always looking to convert new players, rather than focusing on the existing base.

That's a problem my industry is having a reckoning with right now (theatrical movies), as over the last few decades, movies have been more and more focused on appealing to a demo that grew up in the 70s and 80s instead of working harder to appeal to a new generation.

 

[dave2008]

With the combined efforts of my entire side of the hobby, numerous YouTubers and social media influencers garnering hundreds of thousands (millions?) of shares and views, tens of thousands of cancelled subscriptions - if everything we have isn't the slightest blip on their financial radar, then I would like to side with products, publishers, and creative teams who value our engagement and business.
This was a corporate level brush-off of the whole of the fanbase who were impacted by this debacle.
They don't deserve my fandom.
And their products have been substandard for years.

That is one way to look at it. Or you could be that they did the right thing despite it not being a financial issue. The did because it was the right thing to do, not be cause they had too.

You are likely seeing what you want to see. We all do. You don't have to continually justify your desire to not support WotC.

 

[dave2008]

I was not looking at the 20% for D&D. I was looking at MtG 40% in Q4, WotC overall 22% in Q4

OK - I didn't see the 22% was for Q4. Yep - I have no idea about the math on that one!

 

[dave2008]

Indeed possible, but not likely applicable in this case unless they had a reeeeeeeeeeeeeeeally dire 4th quarter.

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I know Hasbro made a profit, I was just saying having huge revenue doesn't guarantee profit.

 

[jerryrice4949]

And this is why I am not getting back on the train.

What does one have to do with the other?

 

[ThorinTeague]

It doesn't, that data isn't available yet. But it's a company's job to talk up the share price.

But at what cost?

Far more money is lost due to a fall in share price than any effect of the boycott. And a company with a falling share price is vulnerable to hostile takeover. The sharks are quick to smell blood in the water. There isn't room for such niceties as "truth" when you are fighting for survival.

Well, at the cost of the truth I guess. As well as community goodwill, 1,500 workers, the whole Latin American staff... I just fundamentally do not get “business decisions.”

 

[Oofta]

Tens of thousands are relatively minor in comparison to several million, yes, particularly when as Cocks says many are resubscribing.

Something like 2-3% theoretically canceled if my math is correct. That's a drop in the bucket. Depending on how many resubscibed (I would guess over 90%), it's probably a fraction of a percent drop.

There is no more widespread bad publicity, except for the typical clickbait that targets D&D because it's big. Within a few months only a few diehards (as a percentage of players) will even remember what happened. The success or failure of the movie will have far more impact.

 

[doctorbadwolf]

It happened right at the end of 2022, even after holiday purchases - it wouldn't have affected sales any of that year. “There are three kinds of lies: lies, damned lies, and statistics.” In this case, they put up a statistic that literally has nothing to do with the event as proof to their stockholders their "misfire" wouldn't affect them.

Let's look at 1Q2023 year-over-year to actually judge that.

Well, looks like WotC is continuing putting out misleading statements to the public. Multiple times start to outline a recurring pattern. While I'm not sympathizing with the stockholders, WotC still haven't identified who sent that original "apology" that also contained information that later was shown to be false to have them apologize for lying to us. Wonder if it's someone to high up to be willing to take a fall so they just hope we forget about it with Kyle Brink's effective media blitz. He at least seems to get it.

Um…they didn’t put out a misleading statement, though. A tweet was mildly confusing and conflated two separate things that were said.

He didn’t present the ‘22 increase in players and revenue as evidence that the OGL debacle didn’t harm the bottom line meaningfully, it’s an “also” not a “because”.

Like, it’s a revenant juxtaposition when discussing the overal health of the company.

It’s basically:
“The subscription drops weren’t a big hit. Not only that, we grew 20% in the most recent fiscal quarter we have complete data for. We’re fine.”

 

[doctorbadwolf]

Something like 2-3% theoretically canceled if my math is correct. That's a drop in the bucket. Depending on how many resubscibed (I would guess over 90%), it's probably a fraction of a percent drop.

There is no more widespread bad publicity, except for the typical clickbait that targets D&D because it's big. Within a few months only a few diehards (as a percentage of players) will even remember what happened. The success or failure of the movie will have far more impact.

Eh people will remember, this “no one will remember in a year” refrain comes up with every controversy and is almost always false.

It not being front page news doesn’t mean people don’t remember. It just isn’t news.

Edit: don’t type in a hurry, folks

 

[ThorinTeague]

Eh people will remember, this “no one will remember in a year” refrain comes up with every co teoversy and is almost alpooways false.

Not to mention the condescension and arrogant tone.