D&D (2024) D&D Pre-orders; this is sad

[mamba]

That's not how it works. Just because your margins on one product are higher than another product (or revenue stream) doesn't mean that if you only offer ONE OF THEM then you'd make more money. It's just not how it works.

I am fully aware of that, otherwise I would not have such a long time horizon

No, but "liking it" is the only reason that I can see for anyone attempting what you're suggesting. Stupid Bosses can make stupid decisions, and companies tank. That's the only reason I could see for anyone seriously considering your "plan".

the advantage of my 'plan' is that you do not have to commit to it right now. WotC can do what is in their best interest anyway (incentivize people to move to digital, roll out their VTT) and if that turns out to be so successful that only a small percentage still cares for books, then they can look into what the results would be if they stopped printing them (for the mass market) at that time.

I don't doubt that they'll try. They won't succeed, though.

so we agree and them trying it least

 

[CommodoreKong]

Gotta love these assertions. Servers and infrastructure are not free. Maintenance is not free, just translating rules into the database that drives DDB has a cost.

Meanwhile once it's set up, printing is fairly cheap and shipping is the biggest cost. All the rules, the art, the text in either format? Those costs are shared.

Just because DDB is (presumably) profitable we have no reason to believe the books are not also profitable.

There's zero evidence that they will stop printing books.

I'm not saying the books aren't profitable. They're just no where nearly as profitable as a digital sale. CDN costs are a tiny fraction of the costs required to print, store and ship a physical book, especially since it's only text and compressed images. Physical products also have the risk of not making the correct amount, either you make too much and can't sell them all, having unsold product sitting in warehouses collecting dust or not making enough and not meeting demand, missing out on sales while waiting for more physical product to be made. With digital you don't have that risk. And that's not to get into the retailer cut of physical product (which likely varies but it usually around 50%). With digital WotC has to pay a few percentage of sales to credit card companies and a few percentage points will go to CDN costs, but they get to keep the rest.

Actually Roll for Combat has a good discussion about this back when WotC announced they were raising the prices of some of their physical books. While they have much smaller print runs than WotC (and WotC will certainly make more per book by having larger print runs) it doesn't change the fact that physical books make very little money per books when all costs are factored in.
The whole thing is very much worth watching though it is fairly long:

 

[mamba]

Right - but you're okay with making the same mistake as swathes of people before you, and you won't listen to those who've been there. I don't think being unaware of how common your prediction has been is a point in your favour. (I'm sorry if that comes off harsh, I can't think of a better way to put it. I respect you - I just disagree with you here.)

I am not sure that saying 'this was predicted before but it never came true, so we dismiss any future prediction of it' is a good approach though. Technology moves on, what was a stretch 20 years ago might not be a stretch today, it depends on the case.

I agree that I have no way of knowing, I do however consider it more likely than not. Maybe I am wrong, maybe you are. We cannot definitively determine this today

 

[Parmandur]

I am not sure that saying 'this was predicted before but it never came true, so we dismiss any future prediction of it' is a good approach though. Technology moves on, what was a stretch 20 years ago might not be a stretch today, it depends on the case.

I agree that I have no way of knowing, I do however consider it more likely than not. Maybe I am wrong, maybe you are. We cannot definitively determine this today

Thing is, the technology has been there for digital books and the market has evolved. But there is just a limit to folks wanting digital instead of print.

 

[CommodoreKong]

That's not how it works. Just because your margins on one product are higher than another product (or revenue stream) doesn't mean that if you only offer ONE OF THEM then you'd make more money. It's just not how it works.

Many companies, especially publicly traded ones, may eventually decide the opportunity costs of working on something new or putting additional resources on something that’s more profitable is a better way to use those resources than using those resources on something that’s not very profitable.

I see this in my day job. I personally work with many small ISPs across the US and over the past few years a number have decided to stop offering TV service to customers. They made money on it but it’s wasn’t a lot and they’re often tired of dealing with the headaches that come it, like all the truck rolls related to it and the ever increasing cost of licensing channels. Just because they’re making some money off of it doesn’t mean it makes sense to continue to offer it.

I’m not saying that physical D&D books are anywhere near that point, especially since Hasbro and WotC have a lot of physical products but they will get to the point they start to think about it. If say it becomes a 20% physical and 80% digital split Hasbro execs may start to question if it would be better to spend the money spent on the physical side of things on something else that can generate higher profit than the low margin books, especially if they believe many physical book only holdouts would migrate to digital.

 

[FitzTheRuke]

Many companies, especially publicly traded ones, may eventually decide the opportunity costs of working on something new or putting additional resources on something that’s more profitable is a better way to use those resources than using those resources on something that’s not very profitable.

Oh, I know - I also think that much of the time, it is a short-sighted decision. And we're not talking about something that's "not very profitable" - we're talking about the core of the business. It's likely that it will not remain the core of the business, but that doesn't mean that it will get to the point where it's not worth doing.

I see this in my day job. I personally work with many small ISPs across the US and over the past few years a number have decided to stop offering TV service to customers. They made money on it but it’s wasn’t a lot and they’re often tired of dealing with the headaches that come it, like all the truck rolls related to it and the ever increasing cost of licensing channels. Just because they’re making some money off of it doesn’t mean it makes sense to continue to offer it.

Sure.

I’m not saying that physical D&D books are anywhere near that point, especially since Hasbro and WotC have a lot of physical products but they will get to the point they start to think about it. If say it becomes a 20% physical and 80% digital split Hasbro execs may start to question if it would be better to spend the money spent on the physical side of things on something else that can generate higher profit than the low margin books, especially if they believe many physical book only holdouts would migrate to digital.

Right. They are unlikely to find that is the case any time soon. No one is saying that it's impossible. Many of us just believe that it is unlikely. I honestly think that they're more likely for them to completely screw up (in some other way) and go out of business first - that's how unlikely I consider it to be.

 

[FitzTheRuke]

I am not sure that saying 'this was predicted before but it never came true, so we dismiss any future prediction of it' is a good approach though.

I'm aware. The reasons they were wrong and the reasons you are wrong continue to be true.

Technology moves on, what was a stretch 20 years ago might not be a stretch today, it depends on the case.

It sure does. This is not that case.

I agree that I have no way of knowing, I do however consider it more likely than not. Maybe I am wrong, maybe you are. We cannot definitively determine this today

True.

 

[Parmandur]

Many companies, especially publicly traded ones, may eventually decide the opportunity costs of working on something new or putting additional resources on something that’s more profitable is a better way to use those resources than using those resources on something that’s not very profitable.

I see this in my day job. I personally work with many small ISPs across the US and over the past few years a number have decided to stop offering TV service to customers. They made money on it but it’s wasn’t a lot and they’re often tired of dealing with the headaches that come it, like all the truck rolls related to it and the ever increasing cost of licensing channels. Just because they’re making some money off of it doesn’t mean it makes sense to continue to offer it.

I’m not saying that physical D&D books are anywhere near that point, especially since Hasbro and WotC have a lot of physical products but they will get to the point they start to think about it. If say it becomes a 20% physical and 80% digital split Hasbro execs may start to question if it would be better to spend the money spent on the physical side of things on something else that can generate higher profit than the low margin books, especially if they believe many physical book only holdouts would migrate to digital.

That isn't a particularly relevant comparison, as non-streaming TV is a collapsing industry.

A more apt comparison would be standard book publishing, where the technology for ebooks is strong and well-established. Still, ebooks make up a fraction of book sales, like 1 in 8, which are predominantly hardcover or paperback with no sign of changing.

 

[Remathilis]

So we all agree that the D&D Beyond pre-order bonuses chart is going to be bad for the game somewhere around 15 years from now?

Good.

 

[Chaosmancer]

I am not saying it isn't, I am saying they rather have you go digital right away

And how will you buy their product digitally from the beginning if you don't know about the product in the first place? You keep insisting you can replace physical sales with digital, but you can't explain how they will accomplish the same sales goals in the process.

Heck, as someone pointed out earlier, FLGS and Big Box stores like Wal-MArt buy the Core Books from WoTC to sell. So they are actually replacing guaranteed sales of their product with uncertain sales of their product. That is an additional bad decision on top of the point I've been arguing.

how do they get them to buy print today? I don't think they rely solely on impulse buys, and I do not think impulse buys need to be print either. Nothing changes here

Solely? Sure they don't rely solely on it. But they do happen and they do plan for them, and your solution seems to be thinking that they simply will stop caring about that potential revenue. And as for something like an FLGS, WoTC is basically getting someone to buy their books and do their advertising for them. Will that continue to be true if they cut those people out and refuse to sell them products to sell? I don't think so.

a DVD costs very little to manufacture (maybe $1.50), the code is identical so most of the expense is upfront, whether you create a DVD or not

The cost of print or digital for books is mostly upfront, and the same whether you print the book or not. And as MULTIPLE people have told you, long-standing, high-volume customers for print factories get major discounts and are way cheaper than you might think. You also may be accounting for the DVD itself, but not the paper insert or the plastic case, which are also part of the cost of manufacturing a DVD (which most games don't even make. They sell a code written into the cardboard.)