Did WotC underestimate the Paizo effect on 4E?

[IronWolf]

Upon the release of 4E, did Paizo gain some customers that WotC lost?? But, and this is important, anyone who thinks that WotC released 4E expecting 100% customer retention is being rather unrealistic. They knew that they would lose customers when 4E released. The amount of money that WotC losing to Paizo is probably rather close to insignificant when compared to WotC D&D revenue as a whole.

WotC certainly should have known they would lose some and I suspect they did. There are people that don't like change and wouldn't accept whatever was sold as 4e, even if it was just smaller tweaks, much less a major rework.

Where I think Paizo causes the most surprise is that now, all those people who did not move to 4e have had their choice reaffirmed. This is a factor I figure WotC was likely not expecting. It is quite possibly WotC knew some people wouldn't move on to the new system right away, but over time as the support of 3.x products dwindled people would begin to move just because 4e was the supported system. Instead, Paizo filled a void and those that remained with 3.x had someone that released compatible material and a ruleset that was much more inline with their idea of how D&D should be.

Of course what this means in terms of sales dollars versus sales dollars we can only speculate.

 

[Reynard]

Meh, while on the flipside, there are those who would claim that WOTC is TEH EVIL if they were giving away free puppies.

Tasty, tasty puppies.

 

[NiTessine]

They don't seem to be treating all the World of Darkness settings as a single RPG, either. I have a hard time believing that the World of Darkness doesn't outsell Shadowrun, if not Warhammer.

They do, actually. 2009 4th quarter, World of Darkness, fifth place: ICv2 - Top Q4 2009 Roleplaying Games

Not surprising that they've dropped from the top spots, really, considering that they've been so quiet with their RPG material lately that there was recently confusion on whether they're still in the business at all.

 

[BryonD]

I was actually about to post just this, when I saw you had beaten me to the punch. 37.000 (and rising) subscribers, a

...

From personal experience, the real number could easily be 2 to 5 times as big. That's a decent amount of money, just from their digital initiative.

It is amusing to me that store after store can speak up about their sales and that's just unsubstantiated supposition.

And yet last time this topic came up it was resolved that we really don't know if the number is current, or just a rolling total of ever was subscribers.

To be clear, if it is just 18,000 subscribers, then that is a hell of a lot of money and the DDI is doing gangbusters. I'm not arguing that.

I am laughing at the double standard of what constitutes facts versus suppositions (that we then casually throw 2-5X multipliers upon).

 

[BryonD]

They do, actually. 2009 4th quarter, World of Darkness, fifth place: ICv2 - Top Q4 2009 Roleplaying Games

Not surprising that they've dropped from the top spots, really, considering that they've been so quiet with their RPG material lately that there was recently confusion on whether they're still in the business at all.

Doesn't Shadowrun have a really new release also? I don't really follow it, but it seems I heard that, and it would certainly make a difference.

 

[LurkMonkey]

Also while there are always people who do not move on to a new edition, how many more did not move on this time, because their system of choice was still going to be supported by one of the best companies in the gaming industry?

Personally, I think that it was a congruence of different factors that led to Paizo's success following the whole silly Edition Wars.

1. OGL: It is there. It will always be there. If Paizo hadn't been around to capitalize on it, there would be other companies using the OGL to cater to gamers unwilling to switch systems.

2. Paizo: A great company, staffed by well-known game designers in the RPG field. They were in the right place at the right time, and by working on making quality products with more of a mature edge, they kept a lot of the 'grognards' aboard (me being one of them).

3. Marketing: It's been debated ad nauseum about the intent of WotC's marketing. I won't rehash this, but I think it is pretty evident that the initial rollout left a lot of folks cold.

Now, will Paizo ever be dominant over WotC? No. Will they survive and thrive in their niche? Assuredly. There's plenty of room for both. Would things be different if Paizo had somehow been included in 4e? 4e might have gotten some better adventures, but I'm sure that there would have been other companies willing to step into the OGL market. Plus I doubt, judging from remarks made the folks at Paizo, that they would have ever felt comfortable putting their business future in the hands of another company again, especially after the Dragon/Dungeon issue. So, what happened is basically good for everyone. Competition is the best thing for any enterprise, keeps the wits sharp.

 

[Herschel]

WotC "took back" Dungeon & Dragon, saw what the OGL had become and threw the market a (for them) dried-out bone. The OGL had (from a WotC standpoint) likely already watered-down the 3E product line and material and rules bloat had hist a saturation point with little flexibility to expand (which they built in to 4E).

Paizo's doing (in a manner of speaking) what WotC doesn't "bother" with: Centralizing around modules/adventure paths, and doing so with an obsolete (from WotC's standpoint) system.

WotC knew full well that someone (Paizo was probably the better's choice) would fill that niche because there is some demand there. I highly doubt they were surprised by much of anything. We see WotC employees on the sites so we know they're fully aware of what internet rants look like.

 

[Alzrius]

But not on the whole OGL/GSL thing. I can't blame WotC for that decision. It seemed a reasonable one to make at the time, given the quality issues with 3.xx 3rd party material.

You had me up until this. "Reason" at no time factored into WotC's decision-making process for the role of Open Gaming and Fourth Edition that I recall.

Now, I don't claim to have any special insight into their thinking here; rather, I believe it was obvious to anyone who was paying attention. I attended the seminar that WotC held at Gen Con 2007 to discuss the future of 4E and Open Gaming...only to find that WotC had no plan or outline, but was instead asking for ideas.

I've heard some people say that was them being proactively involved with the third-party community. Maybe so, but it seemed to me that they had no idea what they were going to do, and were opening the floor to suggestions because they didn't have any decision-making process going on in this area at the time.

This proved to be case as the months passed. If I recall correctly, they announced that 4E would be OGL, but with a new d20 License. Then that there'd be a $5,000 buy-in to use said license. Then that the $5,000 would only be for early-adoption, and after six months or so everyone could use it. Then a long silence where even the companies who wanted to pay couldn't. Then the release of the GSL (and the long struggles of Clark Peterson, Scott Rouse, and Linae Foster). Then the GSL revisions. And I'm sure I'm forgetting some of the other missteps that were made between then and now.

Between how many times they changed their stance on this, and how long it went between each revision, there's really no way to look at the process that led to the GSL as some sort of informed, rational decision on WotC's part.

 

[JohnRTroy]

Two things when discussing this.

Saying WoTC underestimated things refers to the company as a monolithic group mind, which from what I've seen is not the case. At some rather small companies I've seen different marketing managers and CEOs come and go, and there can me major changes in company policy, not to mention internal squables with other departments. Based on what I saw with their 3PP licensing issues (we'll have a license, we may not have a license, we can't release the license yet), I suspect there's a lot of differences in opinion going on at WoTC. While I know what the original poster meant, it should also be noted that organizations are made up of individuals, and that I'm sure internal debated occurred during the planning stages of 4e and after.

The one other thing I'd caution is saying "Will Paizo ever beat WoTC" as "never" as it was an unshakable fait acompli. At one time, Microsoft "won" the browser wars, with over 90% of the market, while Netscape retrenched and eventually came back as Firefox. Now, in the last few years we have a healthy alternatives with Firefox, Safari, and Chrome, while IE use continues to shrink. One thing to remember in many cases competition always starts as small. Paizo has sort of moved towards the #2 gaming publisher, if the ICV2 charts are accurate. That's quite an accomplishment. You gotta remember that competition usually starts little--remember when WoTC was a small little company that once had to worry about TSR?

 

[JohnRTroy]

Between how many times they changed their stance on this, and how long it went between each revision, there's really no way to look at the process that led to the GSL as some sort of informed, rational decision on WotC's part.

That's not a sign of "being irrational", rather, I think it is the result of departments or internal corporate conflicts. There were probably people for supporting 3pp, and people against it. And I think both arguments could be logical, informed, and rational.

The way they botched it was continuing debating this internally instead of saying "yea" or "nea" clearly and effectively, instead of waffling so much and causing so much angst on the part of the 3pp.