Pathfinder 1E Pathfinder outselling D&D

[DaveMage]

We can pretty much infer that 50-odd thousand subscribers means 50-odd thousand people interested in playing 4e (even if they aren't currently doing so). And we can assume it generates something in the neighborhood of $500,000-$600,000 per month. What it costs we can really only speculate at and so we don't have much information on net revenue. I presume it's profitable and probably helps turn big troughs in the revenue stream into a more steady inflow. That's good for WotC. But I have no idea if it also blunts the spikes in the revenue stream that you'd see with regular published offerings and I have no idea how far it cuts into their book sales (I'm reasonably confident it cuts to some extent). As a result, I don't know if the net effect is good or bad or how WotC interprets the results they are seeing.

Well, I think WotC's intent was to produce a core set of evergreen books with the occasional supplement here or there, so I don't think they really see the DDI as cutting into sales. Rather, they see the DDI as their D&D RPG revenue stream. Of course, the D&D *brand* includes the board games, accessories, novels, etc. The brand itself seems quite healthy, even if the core RPG physical book sales are slow. (In other words, they now only have to put out the occasional RPG supplement. This could actually be a good thing for 4E fans because WotC will - hopefully - choose such titles carefully, and thus put greater emphasis on quality and value.)

 

[Dannager]

The 50,000+ count comes from seeing how many members belong to a certain forum, right? Have people confirmed that when someone cancels they are removed from being listed as having access to this forum?

Just curious as to how accurate that number might be or if it is more a count of the number of people that have had DDI at one time and not an actual count of current DDI users.

I know it's been cleared up already, but more importantly, we know that that forum group only includes DDI subscribers who have also created forum accounts. It's a safe bet that a lot of subscribers have no interest in the forum community whatsoever, and it therefore stands to reason that the number seen in the forum group is lower than the actual number of DDI subscribers.

As for only 50,000 players using DDI, that's hardly true. In nearly every group I've been aware of, one person (typically the DM) owns an Insider account and the rest of the group is able to take advantage of it. If this is true of all DMs with Insider accounts, the actual number of players using DDI is probably above 200,000.

 

[Guest 85555]

Yes but 4 people can also share a single book as well. And if you are right, that means they are only getting one paying customer for the service for every four who are using it.

We can guess how many people are actually playing pathfinder or 4E all day by throwing out these kinds of estimates based on anecdotal evidence. In my own area for example, I see tremendous displacement of 4E by pathfinder. But that is just my experience and I don't think it would serve as a solid basis for gauging the success of either system. To me the important numbers I see are 50K+ subscribers to DDI and Pathfinder beating 4E in print sales. I do think 4E has a solid chunk of the market, and wizards can use that to sell products for years to come (do not see any danger of D&D going broke). But I think the market is pretty well split and it really looks like D&D has lost a large swath of its customers since 4E came out.

This may not be a bad thing. Like I said, times are getting exciting again. I for one was a little tired of everything being d20 a few years ago. And now there seems to be a surge in different kinds of games for different sets of preferences. 4E looks like it pleases its target audience perfectly. People who like it REALLY like it. Pathfinder appears to please its target audience as well. But I think the days of one company dominating the RPG market may be over.

 

[Dannager]

Yes but 4 people can also share a single book as well. And if you are right, that means they are only getting one paying customer for the service for every four who are using it.

It seems like the argument against this is hopping back and forth over its own lines.

I point out that 50,000 subscribers is probably great from a profit standpoint, and then I get told that 50,000 people using DDI might be profitable but it's a sad reflection of its popularity.

I point out that 50,000 subscribers probably means closer to 250,000 people are using the service, making it quite popular, and I get told that this means they only have 50,000 paying customers, which is supposedly not great from a profit standpoint.

Is there an actual argument you want to sustain, here, or is your point just to poo-poo DDI's metrics no matter what side of it you look at it from?

 

[Guest 85555]

It seems like the argument against this is hopping back and forth over its own lines.

I point out that 50,000 subscribers is probably great from a profit standpoint, and then I get told that 50,000 people using DDI might be profitable but it's a sad reflection of its popularity.

I point out that 50,000 subscribers probably means closer to 250,000 people are using the service, making it quite popular, and I get told that this means they only have 50,000 paying customers, which is supposedly not great from a profit standpoint.

Is there an actual argument you want to sustain, here, or is your point just to poo-poo DDI's metrics no matter what side of it you look at it from?

I guess what I was saying was, I am not convinced about your 200K number, since it is very speculative. My point was, even if it were true, it is a sign the model has issues in terms of profitability. I don't pretend to know how much they are making on it. I do assume however that it is still not 100% profit at this point. There have to be some production costs and upkeep costs eating into their return on each subscription (and this is normal, all gaming products have to account for production costs and costs of day to day operations). At the end of the day, I don't see 50K as being a great sign of the game's popularity being where it was 8 years ago.

In terms of profit we can only speculate. I see no reason to assume DDI is more profitable than traditional book sales at this stage. Both PAIZO and Wizards are using a subscription model to maintain consistent levels of income it seems. Personally subscription services are a turn off for me as a customer, but if they end up working for either company in the end that is a good thing.

I am just giving my honest assessment of the situation. I think there is little chance we will convince one another of our positions. For what it is worth you seem to have put a great deal of thought and enthusiasm into your position, and I think your conclusions are perfectly reasonable (and your arguments compelling). I just come down on the other side of things after looking at the info that is out there. Up until recenlty I held the view that 4E was very popular. It wasn't until I started seeing changes locally, listening to rumors from people, and then the recent changes at Wizards and the announcement by lisa, that I changed my mind. I could certainly be wrong though. Even though 4E isn't my cup of tea, I have no desire to see them fail.

 

[Dannager]

I see no reason to assume DDI is more profitable than traditional book sales at this stage.

Really?

Aside from the fact that their subscription model eliminates printing costs, distribution costs, inventory costs, and any risk of under- or over-estimating necessary production runs (not to mention that its income is far more stable than book sales)?

And the only real costs that the model adds over traditional print are related to server costs and paying the salaries of a small team of web and software developers?

I can't imagine a scenario where that setup isn't more profitable.

 

[Guest 85555]

Really?

Aside from the fact that their subscription model eliminates printing costs, distribution costs, inventory costs, and any risk of under- or over-estimating necessary production runs?

And the only real costs that the model adds over traditional print are related to server costs and paying the salaries of a small team of web and software developers?

I can't imagine a scenario where that setup isn't more profitable.

I think it could be more profitable. But printing costs are all factored into the price of a book itself. Compared to other game companies, wizards prints a high enough volume that they can probably keep their printing costs and their cover prices reasonable. One thing I can say is their full color hard cover books are much cheaper than if a POD company made them for example. Plus there are plenty of models out there where you don't have to deposit a dime to do print. That is what Bedrock Games does.

Keep in mind, they still have all the other costs of pre-productoin (art, writing, editing, design, layout, etc) and my understanding is software teams aren't cheap. I could much more easily order a print run of books than I could hire a team of software designers.

The real question is whether online support is more of a supplemental thing or whether it can replace print. I am inclined to believe it is the former. I think for games especially people still want the physical product. They may buy supplemental support in the form of online software, but I don't see the physical books going away anytime with RPGs.

My point initially was that we don't have information at this stage to indicate whether it is more profitable than print. All we know is there are 50K+ subscribers at something like 10 dollars a pop. We have no idea how much of that translates into profit.

At this stage though, I think the debate has gone dry. You have made very reasonable arguments. I (I hope) have made very reasonable arguments. And we each reached different conclusions.

 

[Dannager]

At this stage though, I think the debate has gone dry. You have made very reasonable arguments. I (I hope) have made very reasonable arguments. And we each reached different conclusions.

Absolutely. I've been impressed with the internet, lately. I've managed to have two very agreeable disagreements on two different messageboards in the last 24 hours, both of which were very enlightening. Cheers!

 

[Hussar]

Something to not forget in the discussion of print vs online is when does WOTC get paid?

I remember in an interview with Eric Mona, he talked about getting paid from the distributors some nine MONTHS after shipping. Think of the costs there in terms of interest alone. Right there, that's about 4% on your money.

This is a very complex issue and there are all sorts of factors involved beyond simple gross sales.

 

[James Jacobs]

Something to not forget in the discussion of print vs online is when does WOTC get paid?

I remember in an interview with Eric Mona, he talked about getting paid from the distributors some nine MONTHS after shipping. Think of the costs there in terms of interest alone. Right there, that's about 4% on your money.

This is a very complex issue and there are all sorts of factors involved beyond simple gross sales.

I'm relatively sure that quote from Erik was him talking about how and when a magazine publisher actually gets the money they're owed from magazines.

AKA: If you launch a new magazine on day 1, and assuming you have a 6 month period where the contents are written, edited, laid out, and printed so that on about day 180 your magazine is finally on a shelf for its lifespan of 30 days, you get paid basically for what you can sell in that 30 day window about 9 months later. So: Pay for your magazine's creation starting on day 1, and you'll be getting your check for your hard work (or finding out if you made any money at all) on day 450 or thereabouts. And in the meantime, of course, you'll have had to do numerous other magazines along the way...

More or less.

Magazines are rough.

Books, on the other hand? You get paid for those a LOT sooner.