layoffs?

[Mistwell]

Bloomberg just reported today that "Almost all businesses are in survival mode, and they’re slashing payrolls and investments just to conserve cash...We’re in store for some big job losses".

Why is it some folks here think that WOTC is immune as a hobby company from that "almost all businesses" and their layoffs were primarily similar to all prior layoffs and have nothing really to do with the immediate chaos set into motion relatively recently that is hitting all those other businesses?

I think it's fair to debate the various causes of these layoffs, and what percentage of the bad economy contributed to the layoffs as opposed to what percentage was normal staged layoffs. But, I don't understand folks who think the bad economy isn't a major contributing factor.

You may right (I am not simply dismissing the "normal layoffs are the only primary cause" concept outright), but I am having trouble seeing the evidence there. If someone could post some links showing that overall hobby-type or entertainment-type companies have done well this last quarter relative to the rest of the economy, that might help. Or if anyone has anything showing WOTC profits themselves are up this prior quarter, that would help even more. But without that sort of stuff, why would people conclude that the bad economy is not a major contributing factor to this?

 

[Dannyalcatraz]

When I was studying for my econ degree (many, many moons ago), we looked at the flexibility of demand for various luxury goods, though not RPG products in particular.

Luxuries that had highly flexible demand were things like jewelry, fine dining, a new car, and so forth. They were all either high in initial cost and/or low in long-term value.

Items that had good long term value tended to be more "recession-proof"- and these were things like books and family entertainment (at the time, cards, boardgames, bowling leagues, sports participation fees)*. Though I have no hard data, I would imagine that RPGs would have a similar demand flexibility to such items.

* Oddly, for the poor, seeing movies in theaters was in this class- they were seen as inexpensive family entertainment and one source of air conditioned fun for families without quality AC. Since their initial consumption levels were low (relative to the general public), there was little change in their pattern as prices rose.

 

[Mark]

I would imagine that RPGs would have a similar demand flexibility to such items.

The problem might lie in the change in the business model whereby the rules are spread out over many more books, thus decreasing the perceived longterm value, coupled with the subscription-based support that requires and additional continuous cost. Gone are the days of an up-front core book cash layout coupled with tons of free online support with optional tied-in supplements for those who wish to go above and beyond the core.

 

[Dannyalcatraz]

True, but the Core books would have relatively stable demand over time- something that seems to hold up according to the various people who post sales data on such things.

 

[Mark]

True, but the Core books would have relatively stable demand over time- something that seems to hold up according to the various people who post sales data on such things.

Maybe if core books came out only once every three to four years but that's no longer the model now that yearly core books are planned, with a cost of $35 a pop for three ($75 each for three if you want the deluxe editions).

 

[joethelawyer]

When I was studying for my econ degree (many, many moons ago), we looked at the flexibility of demand for various luxury goods, though not RPG products in particular.

Luxuries that had highly flexible demand were things like jewelry, fine dining, a new car, and so forth. They were all either high in initial cost and/or low in long-term value.

Items that had good long term value tended to be more "recession-proof"- and these were things like books and family entertainment (at the time, cards, boardgames, bowling leagues, sports participation fees)*. Though I have no hard data, I would imagine that RPGs would have a similar demand flexibility to such items.

* Oddly, for the poor, seeing movies in theaters was in this class- they were seen as inexpensive family entertainment and one source of air conditioned fun for families without quality AC. Since their initial consumption levels were low (relative to the general public), there was little change in their pattern as prices rose.

I think the bottom line is that most rpg'ers of any edition who have been playing for a while and like their system can play indefinitely with that system with no more purchases required, ever. Add the advent of programs that enable illegal filesharing, and one could have a megalibrary of enough supplemental material to last 13 lifetime, in just a single weekend of downloading.

As times get tougher, more people will ikely turn to that avenue, in effect socializing gaming, having the rich pay for the poor's gaming hobby.

 

[Mark]

Add the advent of programs that enable illegal filesharing, and one could have a megalibrary of enough supplemental material to last 13 lifetime, in just a single weekend of downloading.

People who take part in that sort of activity can never be considered as those who would have been part of a revenue stream. There are some who illegally download and then also legitamately purchase some of what they download illegally but those people are already accounted for in accounts of the regular revenue stream. Trying to factor in issues of piracy into any discussion of economics is impossible due to the lack of hard data. I advise leaving that part of the discussion aside.

 

[benichov]

Dave,

No fun losing a job - especially this close to the holidays. I miss you on the podcast and I really hope you are keeping your spirits up.

Warmly,

Boris

 

[joethelawyer]

People who take part in that sort of activity can never be considered as those who would have been part of a revenue stream. There are some who illegally download and then also legitamately purchase some of what they download illegally but those people are already accounted for in accounts of the regular revenue stream. Trying to factor in issues of piracy into any discussion of economics is impossible due to the lack of hard data. I advise leaving that part of the discussion aside.

true, but they may be people who USED TO be part of revenue stream calculations.

Now they just cant afford it and download for free.

That would tend to make the hobby as a whole more recession-proof, in that players wuld be available and it wouldn't die off due to lack of players. Whether the 3pp's can afford to survive is another matter. They would have to scale back output, likely, to fewer products which would likely sell best. The most bang for the limited production cost bucks.

 

[Dannyalcatraz]

People who take part in that sort of activity can never be considered as those who would have been part of a revenue stream. There are some who illegally download and then also legitamately purchase some of what they download illegally but those people are already accounted for in accounts of the regular revenue stream. Trying to factor in issues of piracy into any discussion of economics is impossible due to the lack of hard data. I advise leaving that part of the discussion aside.

Actually, they are part of the revenue stream, in the form of a drain on a company's bottom line. There are formulae for such calculations.

As for hard data, it exists*, but its mostly in the hands of the investigating agencies (FBI, INTERPOL), the IP holders & their professional organizations (RIAA), and in certain reports given to some organizations (like speeches & lectures to Copyright lawyers getting their CLE ). It can be had, but you may have to pay for it.

Some polls and investigative reports have also shown interesting data regarding the behavior of downloaders- whether they'll subsequently purchase legal copies of the IP they acquired illegally (under 50%); whether a pirate's ties to organized crime or terrorism matter to those who get their IP from them (for about 20%, it doesn't). Interesting stuff.

* The data exists mainly for books, albums, computer programs and certain games- mainly board games. However, AFAIK, none exists specifically for RPG games.