Gizmodo Reveals OGL v1.1's 'Term Sheet' Carrots For Selected Publishers

In December, WotC arranged meetings under NDA with a number of prominent third party 5E OGL creators in order to persuade them to sign up to the new Open Game License v1.1. before it was revealed to the world. Part of this approach included 'Term Sheets'. According to Gizmodo, which has sources at Wizards of the Coast, these term sheets offered: A 15% instead of 25% royalty Marketing on D&D...

In December, WotC arranged meetings under NDA with a number of prominent third party 5E OGL creators in order to persuade them to sign up to the new Open Game License v1.1. before it was revealed to the world.

Part of this approach included 'Term Sheets'. According to Gizmodo, which has sources at Wizards of the Coast, these term sheets offered:
  • A 15% instead of 25% royalty
  • Marketing on D&D Beyond (but not at times when WotC had its own releases)
It's not clear whether any publishers actually signed the contract at the time.

WotC has since walked back some of the terms in the upcoming OGL v1.1, but the OGL v1.0a still remains slated for 'de-authorization'.

According to an anonymous source who was in the room, in late 2022 Wizards of the Coast gave a presentation to a group of about 20 third-party creators that outlined the new OGL 1.1. These creators were also offered deals that would supersede the publicly available OGL 1.1; Gizmodo has received a copy of that document, called a “Term Sheet,” that would be used to outline specific custom contracts within the OGL.

These “sweetheart” deals would entitle signatories to lower royalty payments—15 percent instead of 25 percent on excess revenue over $750,000, as stated in the OGL 1.1—and a commitment from Wizards of the Coast to market these third-party products on various D&D Beyond channels and platforms, except during “blackout periods” around WotC’s own releases.

It was expected that third parties would sign these Term Sheets. Noah Downs, a lawyer in the table-top RPG space who was consulted on the conditions of one of these contracts, stated that even though the sheets included language suggesting negotiation was possible, he got the impression there wasn’t much room for change.

 

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Haplo781

Legend
It's not. It was part of the shareholders presentation from Hasbro going back to 2021. Wizards of the Coast was responsible for 75% of the profits for the entire company in 2020. It's why they moved Wizards of the Coast to a top-level division on par with their Consumer Products (that would be every toy and board game Hasbro makes) and the Entertainment division (all the movies and TV including Transformers, GI Joe, My Little Pony, Peppa Pig, etc.). I don't have numbers for 2021 that I can find in a quick search, but the revenue recline for that year was less than the company overall so it's likely that Wizards represents somewhere around the same percentage of profits this year.

That's why there was a proxy war in 2022 over control of the Board of Directors at Hasbro. An activist investment group wanted Hasbro to spin off WotC to its own company to pay higher dividends to shareholders rather than use the profits from WotC to invest in the rest of the company.
Their case just got a whole lot stronger.
 

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tetrasodium

Legend
Supporter
Epic
He was so damn good in that movie, that I had a hard time watching him in anything else after.
He was pretty good in the batman. Interestingly though given the way it ended I got the feeling that there was some setup for a handoff to Terry McGinnis in a movie or two :D

edit: apparently I have my actors who were in a movie I never really took to mixed up
 
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Maxperson

Morkus from Orkus
"According to an anonymous source who was in the room, in late 2022 Wizards of the Coast..."

where it happens i wanna go GIF by Official London Theatre
 

WotC/Hasbro leadership have painted themselves into a corner. They could save the D&D brand by abandoning this strategy, but they would lose their jobs and their options. So they’ll keep fighting until the end.

They’ve been incentivized to make bad decisions.

If they'd moved quickly enough to completely reverse direction they could have saved their jobs before things hit the tipping point that they have, all attempts at saving the new OGL is making it worse, to the point every day this crisis continues the likely hood CEO Chris Cocks, WotC President Cynthia Williams and VP of D&D end up fired and looking for new jobs goes up exponentially.
 
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