D&D General The First Demise of TSR: Gygax's Folly

Gary wasn't "long gone" in '82. He was still one of the guys in charge, even while he was abdicating most of the management responsibilities to the Blumes while he was in Hollywood. That was by his choice, and he repeatedly approved and agreed with decisions they made which hurt the company. Though he disagreed with others, it was still his choice to have the Blumes make those decisions. One of the recurring themes we see in When We Were Wizards was how a lot of the creative staff thought of Gary as one of their own and expected that if he knew what the Blumes were doing he would help them out, while behind the scenes he was indeed aware of the Blumes' decisions and giving them tacit or explicit approval. And he was already making terrible decisions well before deciding to focus on media and movie deal- like when Dave Megarry tried to share a book with him on corporate management and stages of development, and tried to get the company to hire someone with actual management experience to head off problems, and was treated with contempt.

Yes, we all know about the Random House deal. You're late to the discussion and preaching to the choir on that. If you want to call Williams worse because as a manager she kept the company operating two years longer than Gygax and the Blumes... That doesn't seem to add up. We also have the fact that virtually every TSR employee who worked under both the Gygax/Blume regime and the Williams regime has said they preferred working for Williams. Williams seems to have been unpleasant in some regards, and definitely made some bad decisions, but the company wasn't a massive mess of nepotism, over-expansion and years of mass firings like it was under Gary and the Blumes. The "Comic Book Modules" idea and screwing up with licensing deal with DC was indeed dumb. But it wasn't "buy needlepoint company Greenfield Needlewomen because my cousin owns it" dumb, or "hire my brother in law to run procurement and purchasing and swallow hundreds of thousands in losses when he mass-orders mismatched board game board and box sizes" dumb. Or "dump the Grenadier and Ral Partha licensing to try to bring miniature production in-house, overpay Duke Seyfriend to run it, then throw good money after bad to buy him out when it fails completely" dumb. Or "stop ordering dice before in-house molds are actually anywhere near ready, and be forced to sell Basic sets with cardboard chits for several months" dumb.


Nah. She contributed more competent management, as attested by TSR employees who worked under both. She kept it alive at least long enough to and finally did sell to WotC, allowing the game to continue to exist. Gary and the Blumes in 1985 were in the same kind of financial position in terms of debt and failure. The company was on the verge of bankruptcy and being lost to the bank before Gygax recruited Williams and she gave it another 12 years.


And we credit him for his creative and promotional achievements! Gary pretty much founded the TTRPG hobby at the overlap point between the wargaming and sci-fi fandoms. But we don't need to keep repeating lies he told about all TSR mismanagement being other people's fault. And we don't need to keep repeating the canard that Williams never did anything for the hobby, when a ton of books millions of people love came out under her watch, including all of 2E, Dark Sun, Planescape, and the vast majority of the fiction. And when she's the one who made the WotC deal and enabled Peter Adkison to save D&D. If she really didn't give a damn she could have walked away and let it sink.
Yes, he was. Gary was in California working on movie deals and got the cartoon made. He was not in day to day running of TSR. As far as I know it was the Blume brothers & Lorraine Williams. Many people felt Lorraine was more organized for sure but few people spoke well of her. She often picked unnecessary fights with staff and caused chaos with many creatives such as Weis & Hickman and Salvatore. You credit her with the development of many failed genres such as Planescape, Dark Sun and Spell Jammer that never sold well and caused additional strain the game by fracturing the player base. She also caused damage with third parties such as the unnecessary dispute with DC Comics by trying to bring the D&D comics in house even though they were selling well while being managed by DC. The Buck Rogers and Alternity games were huge flops as was the Dragon Strike and Dragon Dice games. Lorraine may have been a good middle manager, but she lacked the understanding and vision to bring TSR forward because she did not understand the business or her customers. She owned the company and managed it for 12 years. It failed with a huge mountain of debt that Wizards of the Coast had to pay off. If I take over your company and run it as I see fit for 12 years, I don't feel its fair for me to blame the demise of my company on you. 12 years is a lifetime for CEO's and most would be fired long before with such poor results if they personally don't own the controlling shares.
 

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Yes, he was. Gary was in California working on movie deals and got the cartoon made. He was not in day to day running of TSR. As far as I know it was the Blume brothers & Lorraine Williams. Many people felt Lorraine was more organized for sure but few people spoke well of her. She often picked unnecessary fights with staff and caused chaos with many creatives such as Weis & Hickman and Salvatore. You credit her with the development of many failed genres such as Planescape, Dark Sun and Spell Jammer that never sold well and caused additional strain the game by fracturing the player base. She also caused damage with third parties such as the unnecessary dispute with DC Comics by trying to bring the D&D comics in house even though they were selling well while being managed by DC. The Buck Rogers and Alternity games were huge flops as was the Dragon Strike and Dragon Dice games. Lorraine may have been a good middle manager, but she lacked the understanding and vision to bring TSR forward because she did not understand the business or her customers. She owned the company and managed it for 12 years. It failed with a huge mountain of debt that Wizards of the Coast had to pay off. If I take over your company and run it as I see fit for 12 years, I don't feel its fair for me to blame the demise of my company on you. 12 years is a lifetime for CEO's and most would be fired long before with such poor results if they personally don't own the controlling shares.
So in 1982, 2 years before Lorraine Williams was hired, she was already involved in the day to day running?
Outside of that not a great defense if saying the reason why the person in charge of tge company wasn't responsible for how it was being run because he chose to go to Hollywood and leave others apparently not up to the task in charge. Like you say, if didn't control shares Gary likely would have been fired long before his ouster with actions like that.

Also @Snarf Zagyg isn't saying Gary was responsible for the ultime demise of TSR, just the first demise which ended in Lorraine having control of TSR.
 

I think the reality is that in order for TSR to have remained profitable, they would have had to downsize, limit themselves to only a handful of actual D&D projects, and not overload their novel line.

The fiction line suffered some bloat in the mid-1990s, to be sure, like all the company lines, and TSR would have done better with fiction by having fewer hardcovers and not trying to support so many game settings with novels. Some people inside the company saw this, even as the fiction program was expanding circa 1990. (In 1991 I personally cautioned Lorraine about the company publishing too many fiction titles in the coming years, in my role as (secret) interim managing editor of the Book Department while Mary Kirchoff was on maternity leave.) But it's always good to remember that the fiction releases were far, far more likely to earn back their costs and make a profit than the game products. They had limited text and art costs, required far fewer staffers and freelancers to create than game products on average, and often sold many, many times what the game line releases were selling.

The fiction also had a longer active sale window than the games. In fact, the old fiction still sells pretty well, thirty-plus years on. The 40th anniversary omnibus of the first Dragonlance trilogy even hit the New York Times bestseller list earlier this year. Most of those fiction titles Random House returned when TSR (foolishly) ended their distribution deal in the late 1990s were still selling. Even many of the paperback books TSR had overprinted would have sold through their print runs in time. They largely came back because the distribution deal with Random House ended, not because RH didn't think they could move them eventually.

So overproducing game products was a bigger problem for TSR than overproducing fiction, though failing to accurately track all costs and returns was a massive problem impacting all lines.

On the overall trajectory for TSR--from all I have heard from colleagues who were working at TSR before me, Gary was driving TSR toward a cliff (or, more accurately, allowing it to be driven toward a cliff by the folks in charge in Lake Geneva while he was in California) when the company was taken away from him. I can't speak to that directly. I only worked with Gary after his time at TSR.

Lorraine took over, turned away from that cliff, built up the company through the late 1980s in some impressive ways (for which she does not get enough credit--and I say that as someone who had years of legal issues with her and the company after I left in 1994), but she eventually turned the bus toward a different cliff, while actively populating upper management with people who helped her stomp on the accelerator as they approached the edge of the world. The company would have gone over that cliff and into the void were it not for Peter Adkison and WotC. But it likely would not have made it through the 1980s without Lorraine.
 

Most folks don't remember or maybe just don't know how stunning the growth of TSR's fiction program was in the late 1980s and early 1990s. The Book Department started in 1982 with the Endless Quests books (championed by Rose Estes), the fiction program in earnest in 1984 with the first Dragonlance books. But the department really took off in 1987 and 1988. By 1990, TSR’s book program accounted for 17% of fantasy/SF bestsellers at B. Dalton and Waldenbooks, with only 23 releases. Most, if not all of those 23 were bestsellers. That 17% was the largest percentage by a single publisher for the year, at chains that sold at least half the paperback books in the United States at the time. Major New York publishing house Ballantine/Del Rey/Fawcett had 116 releases that year and only 16% of the bestsellers at the two chains. TSR was competing with those publishing giants with our department staff of 5.5 people: a managing editor, three full-time editors, a part-time editor, and an editorial assistant.

And this was just for books in English. Many of the shared world works were translated in multiple languages almost as quickly as they were released. The EQ books and the first six Dragonlance novels had set the stage, but the company needed to level up as a professional publisher to take advantage of that initial success and do so consistently.

That shift at TSR to fantasy fiction publishing powerhouse took place under Lorraine and with managing editors Jean Black and Mary Kirchoff.
 

I am a big Gygax fan generally.

But am so glad D&D survived to the present. Like 5e…but am most grateful it is not “the end.” It might be the end for me, but the game lives on.

But make no mistake the game lives! I have been playing about 4 decades and now my kids play (they only know 5e—-and it’s what I play now).

Grateful to the founder, flounders and all he kept it alive…
 

Most folks don't remember or maybe just don't know how stunning the growth of TSR's fiction program was in the late 1980s and early 1990s. The Book Department started in 1982 with the Endless Quests books (championed by Rose Estes), the fiction program in earnest in 1984 with the first Dragonlance books. But the department really took off in 1987 and 1988. By 1990, TSR’s book program accounted for 17% of fantasy/SF bestsellers at B. Dalton and Waldenbooks, with only 23 releases. Most, if not all of those 23 were bestsellers. That 17% was the largest percentage by a single publisher for the year, at chains that sold at least half the paperback books in the United States at the time. Major New York publishing house Ballantine/Del Rey/Fawcett had 116 releases that year and only 16% of the bestsellers at the two chains. TSR was competing with those publishing giants with our department staff of 5.5 people: a managing editor, three full-time editors, a part-time editor, and an editorial assistant.

And this was just for books in English. Many of the shared world works were translated in multiple languages almost as quickly as they were released. The EQ books and the first six Dragonlance novels had set the stage, but the company needed to level up as a professional publisher to take advantage of that initial success and do so consistently.

That shift at TSR to fantasy fiction publishing powerhouse took place under Lorraine and with managing editors Jean Black and Mary Kirchoff.
I can believe it. Going back to late 80s me, and I only knew of a handful of non-D&D fantasy authors, and most of them were for books written in the 60s and 70s--hardly NYT best sellers in the 80s. Terry Brooks and David Eddings were one of the only ones still churning them out, and Robert Jordan entered the scene in 1990. But man, I sure remember Weis&Hickman, and Salvatore, and Rose, and Gary, and Douglas Niles, Kate Novak and Jeff Grubb, and Ed Greenwood all over the place.
 

Most folks don't remember or maybe just don't know how stunning the growth of TSR's fiction program was in the late 1980s and early 1990s. The Book Department started in 1982 with the Endless Quests books (championed by Rose Estes), the fiction program in earnest in 1984 with the first Dragonlance books. But the department really took off in 1987 and 1988. By 1990, TSR’s book program accounted for 17% of fantasy/SF bestsellers at B. Dalton and Waldenbooks, with only 23 releases.
The only D&D novels I read were a few of the Ravenloft ones, but, man, I sure remember seeing those novels at B. Dalton, Waldenbooks, Kroger, and later Barnes & Noble when they arrived in my neck of the woods.
 

Yes, he was. Gary was in California working on movie deals and got the cartoon made. He was not in day to day running of TSR. As far as I know it was the Blume brothers & Lorraine Williams.
In '82? Absolutely not. Gary didn't (edit, correction) move into the mansion for another year, and he didn't hire Lorraine until '85. As Game Wizards and When We Were Wizards clearly document, Gary was still one of the people in charge of TSR, and tacitly or explicitly approving and agreeing with most Blume decisions, as they mistreated the creative staff and ran up absurd debts and overhead. In March of '85 he took control again and brought in Lorraine, and they desperately needed her because they were loaded up with debt and sinking, and needed someone competent at management to right the ship. Later Gary dumped ALL blame on the Blumes, but in retrospect now that more documentation has come to light, we can see that the version Gary told (and which you're uncritically parroting) was... incomplete is a generous way to describe it.

Over the weekend I was just reading Flint Dille's book, and he talks about how he wishes the two of them could have worked together more amicably and come to an arrangement where both worked in the respective roles they were good at, and that Gary at first told him he was very happy with Lorraine's work, though Flint cautioned him that he'd feel that way until Lorraine realized that "this" (gesturing at King Vidor's mansion in which they sat) was a part of the problem.

Dille's take (scattered around the book, but the most focused chapter on the dispute is The Board Meeting, p 212-217) is very evenhanded. It concludes thus:

I was at my new roll-top desk in my new home office on Strathmore (later to be the inspiration for Strathmore Castle in Dragonstrike) when somebody called to say that Lorraine had won every point in the lawsuit and it was over. I was happy for Lorraine, but I was unhappy that Gary had lost. For me, there was no win in this. Gary and I were alienated because he was convinced that I knew about Lorraine's takeover, even though I was as blindsided as he was. I felt horrible for him. You don't have to have much imagination to empathize with his sense of injustice as his company was taken away from him. And in a creative, moral, and spiritual way, he was right. We can play corporate coroner all day long and rationalize the fact that, yes, Dave Arneson cocreated D&D, and that, yes, the Blumes were investors and that without their investment the company never would have happened, and that, yes, Gary made decisions that put him in the position he was in, and so on. But the one thing you can't do, if you have an ounce of compassion, is not feel his sense of loss and theft, because every other component of the origin is fungible. It could have been somebody other than the Blumes and Arneson and the other motley cast of characters who made it work, but TSR would never have happened without Gary.

And that's the plain truth.

Thus, if you put yourself in his position, you can easily see the world as a network of parasites and scavengers: lawyers, businesspeople, and others spotting vulnerability and enriching themselves by stealing his company. And, in a way, he's right. The law of nature and the cycle of life dictate that by creating a company and creating value, you've entered the food chain, and like everything else in nature, you're eventually going to get devoured by the scavengers, maggots, and bacteria until there's nothing left but bones and fossils.

It's life. Life is not fair. We all know it.

All of that having been said, had there been no Lorraine, it's quite possible that TSR would have shut its doors in 1985 and maybe been sold for scrap to some company that would also have gone facedown, and D&D would be a nostalgic memory and some moldering boxes in closets and attics and game stores, with all the rights trapped in some attorney's file cabinet until the requisite gold was delivered. Instead, TSR had another ten years and survived to be passed on to Wizards of the Coast, then Hasbro. A couple months ago I was standing on a Hollywood cosplay/live action role-playing stage of Waterdeep while watching a podshow of celebrities playing D&D and spreading the religion to a whole new generation and reawakening backsliders. D&D in particular, and role-playing in general, is having a huge revival. That's due mostly to Gary Gygax changing the world with a game, and in part due to Lorraine preserving the company.

So, given that this all started with a pulled line of credit and Chapter 10.5, it could have been a lot worse.

But it could have been a lot better, too.

Many people felt Lorraine was more organized for sure but few people spoke well of her. She often picked unnecessary fights with staff and caused chaos with many creatives such as Weis & Hickman and Salvatore. You credit her with the development of many failed genres such as Planescape, Dark Sun and Spell Jammer that never sold well and caused additional strain the game by fracturing the player base. She also caused damage with third parties such as the unnecessary dispute with DC Comics by trying to bring the D&D comics in house even though they were selling well while being managed by DC.
Most TSR staff who've gone on record have expressed that they preferred working for her than for Gary and the Blumes.

What you've written there is just totally ignoring that Gary and the Blumes did the exact same kind of stuff. Picking unnecessary fights (Origins, Chaosium, Mayfair, etc.), disrespecting Rose Estes' work on Endless Quest, failing to adequately compensate her and denying her promised stock options, bullying other companies with C&D letters, developing failed games like Indiana Jones or Boot Hill or what have you. Mistreating other creative staff, including refusing to honor stock options, refusing to honor royalty agreements and physically taking signed contracts away from staff, refusing to honor promised creative bonuses which were supposed to replace the royalties (look at how Zeb Cook and Lawrence Schick got absolutely screwed over by Gary and the Blumes on Star Frontiers), etc.

I'm absolutely fine to criticize Lorraine for the downright stupid decision to mess with DC, and many other things, but the amount of stuff you're just ignoring from the previous regime is... substantial.

She owned the company and managed it for 12 years. It failed with a huge mountain of debt that Wizards of the Coast had to pay off. If I take over your company and run it as I see fit for 12 years, I don't feel its fair for me to blame the demise of my company on you. 12 years is a lifetime for CEO's and most would be fired long before with such poor results if they personally don't own the controlling shares.
Gary and the Blumes ran up a huge mountain of debt and had the company going under in about 10 years. Williams made her own mistakes and kept it alive for 12. Both eventually ran it into the ground, but Williams kept it alive longer. 🤷‍♂️ As Snarf wrote in one of his previous essays- "scoreboard". I've never seen Williams go on record to blame the previous management for her mistakes. Gary on the other hand seems to have taken almost zero responsibility for bad decisions made when he was one of the guys in charge.
 
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Most folks don't remember or maybe just don't know how stunning the growth of TSR's fiction program was in the late 1980s and early 1990s. The Book Department started in 1982 with the Endless Quests books (championed by Rose Estes), the fiction program in earnest in 1984 with the first Dragonlance books. But the department really took off in 1987 and 1988. By 1990, TSR’s book program accounted for 17% of fantasy/SF bestsellers at B. Dalton and Waldenbooks, with only 23 releases. Most, if not all of those 23 were bestsellers. That 17% was the largest percentage by a single publisher for the year, at chains that sold at least half the paperback books in the United States at the time. Major New York publishing house Ballantine/Del Rey/Fawcett had 116 releases that year and only 16% of the bestsellers at the two chains. TSR was competing with those publishing giants with our department staff of 5.5 people: a managing editor, three full-time editors, a part-time editor, and an editorial assistant.

And this was just for books in English. Many of the shared world works were translated in multiple languages almost as quickly as they were released. The EQ books and the first six Dragonlance novels had set the stage, but the company needed to level up as a professional publisher to take advantage of that initial success and do so consistently.

That shift at TSR to fantasy fiction publishing powerhouse took place under Lorraine and with managing editors Jean Black and Mary Kirchoff.
I definitely remember this - as kids who didn't always have regular D&D games, that fiction was a connection that we still had to it. A lot of kids who never even played the actual game still read the stories. I still recall going into my local Crown Books and just seeing an entire section dedicated to Endless Quest, and Choose Your Own Adventure, and Fighting Fantasy books, as well as all the TSR fiction. It was a big deal, and at least for my school and friends, very popular.
 

Even before 1980, the Blumes were already tired of Gary. Gary was given the title of President by the Blumes, but ultimately it was the Blumes who were in charge (they had well over 50% of the shares) and they were quite happy to subdivide TSR into quarters and shuffle Gary off to Cali in '83 so they wouldn't have to deal with him anymore. When Gary came back in '84, he had to appeal to the Board of Directors to move against the Blumes (as Gary had no individual power over the business). The board agreed with Gary's arguements and that was beginning of the end for just about everyone.

As for Lorraine, she replaced the previous bad decision making with her own. She insisted Brom follow her recommendation on which paints to use for projects even though she knew nothing about painting and she grossly overvalued IP's that she owned (like Buck Rogers). She wasn't any better; she was just a different kind of bad.
 

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