Odhanan said:
I think it's obvious the 3.5 path you're talking about Matthan is the less rewarding on the short term. If you read carefully Erik's post, you'll find out that the real concerns are about long term survival for Paizo. He's speaking about 5th, 4.5... whatever edition comes next, not 4E.
That's the real gamble we're talking about: everyone will agree that 4.0 is the path for instant reward. 3.X OGL however provides a path that is harder, but ultimately could build a solid, long-lasting niche costumer base Paizo could build upon.
The point of the questions Erik is asking is exactly how niche the costumer base is at the moment, what exactly is the size of the potential market we're talking about here? That's the real question. If Pathfinder, GameMastery and retailing can make Paizo survive for a while, they can hope to build a sustaining customer base. Is there potential for that? That's the real question, I think.
And I think that's an honest appraisal. I even talked about it a page or so ago before things went all angry. I doubt the ability of any publisher to launch a system in direct competition with D&D 4E in terms of market timing which is what Paizo would essentially be doing if they decided they needed to make a new Player's Handbook or 3.75. That is, unless they delay those things for several months at which point, the damage could already be done. I'm curious how someone would market that. Intentionally supporting an old system is a rough thing to spin into something appealing. The other issue that I see is that their products mainly market to DMs, which is fine, but producing on a periodical level means that their customers are getting a lot of content yearly. Possibly more than they can use. It would be interesting to see whether Pathfinder has subscription troubles around each six month mark as DMs jump off and new ones, hopefully, jump on. By serving a shrinking market, you could hurt your ability to replace anyone who jumps off after having enough content to last them awhile.
It could work though, but it's my understanding that most of the smaller RPGs, (Mutants and Masterminds, Conan, and such) do not produce a lot in the way of adventures or modules. They produce source books. I could be wrong there. But if you're basing your main product line around adventures and you want to reach the most potential buyers (which is generally considered a quarter or even generously half of the RPG audience when you're dealing with adventures), you need to market towards the game that has the most DMs which, in most likelihood, will be D&D 4E.
To me, it absolutely makes sense to diversify your business plan so that you are not dependent on the whims of another company five years from now. I'm questioning the wisdom of doing that in such a way as to take on the industry leader. In my mind, it would make more sense to convert to 4E if at all possible to hopefully maintain or increase your revenue (and adventures will be in short supply with the new edition so its a good time). While this is going on, have your other system (fantasy or otherwise) in development so that it is ready to ship once the heat has left 4E.
The one thing that I realized that I'm not sure is being taken into consideration is that I am of the belief that Erik Mona and the Paizo crew are doing their dream job. From reading Mona's posts, I think that there is nothing else that he would rather be doing than making stuff for D&D. His fears seem to revolve around not being able to do that in the way he views D&D as much as they are financial. Which makes sense, honestly. Who wants to give up or compromise their dream job? It's easy for me to say, wait and make an game that fills a niche that you can control, but that means nothing, if all they are passionate about is creating amazing fantasy stories.
I just can't see a 3.75 move working. I could see it sustaining itself if it was already in place. I just can't see launching it with the chips against it like this. I'm not a businessman though. I don't envy the decision facing Paizo.