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Message: <blockquote data-quote="TerraDave" data-source="post: 5444675" data-attributes="member: 22260">Hmm...focusing on TTRPGs (which is quite different from say the thriving hobby board game industry, for example) Market structure: one big company and big brand, a tier of medium players, and then several small niche producers. Monopolistic competition might be the simplest model--price markups combined with low overall margins and many differentiated products--but with very different scales to the various "monopolies". Such that at its core, the industry looks more like a monopoly in durable goods. The OGL and PDF publishing have lowered the barriers to entry at the edge of the market, but this mostly affects the edge and maybe some of the midtier players (I will get into a key exception or two below...). At this end of the market, there are many many products, and a fair amount of entry and exit, both by start ups and by established game makers that cycle in and out of RPGs. The core of the market is D&D, which has had a dominate position for the entire history of the hobby. A handfull of companies and games have come close, but never for as long. Barriers to entry and economies of scale rest on a few things:-Intellectual property: Copyright may not be what it used to be, but still counts for something. -Product differentiation: This follows from the first, and that for a game to get any where, it needs to be seen as offering something at least slightly different. -Marketing: Not that easy to get a large number of players to try your game.-Support: The model that emerged years ago for TTRPGs is that it is not just a game, but a line of products. Doing this whole line is a barrier.-Durable products: You compete with pretty much everything ever released, from that point of view, the market is quite crowded...you need to show some kind of "innovation". Fortunatly, the complexity of RPGs has left space for that over the years. -Network externalities: (the big one I have held back). People play D&D because they play D&D. The combination of strong underlying consumer preference (people like fantasy RPGs) and this does help it dominate. To break out, you need to build a new network, probably by finding a major nich, filling it, and then holding on.Lets take some examples from this last point:Mutants and Masterminds: real rival, champions. Champions has long had its detractors, but its only real competition was Marvel Super Heroes back in the old days, which combined biggest RPG maker (TSR) with huge brand with simple mechanics that where really far from Champions. That license was lost, champions (inspite of all kinds of issues) hung on. Then comes OGL and D20 license. You know have a new network to latch onto with your supers game. As time has passed and that network has solidified,  M&M has evolved into its own game.Paizo: How did pathfinder do so well? First, it did face two big problems, the durable goods problem (tons of 3E stuff) and direct competition from WotC. Solution: network. The 3E network, and there own built with the mags and then adventure paths. They knew they couldn't (and didn't want to) beat 3E, so they came up with a strategy to be innovative enough and leverage those networks. In general I think they key to understanding the market is the interplay of  durability and network externalities, that certain niches are bigger then others and probably have established companies in them, and that the complexity of the product that allows for some continued innovation and differentiation.</blockquote>

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