NOW LIVE! Today's the day you meet your new best friend. You don’t have to leave Wolfy behind... In 'Pets & Sidekicks' your companions level up with you!

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Message: <blockquote data-quote="Erik Mona" data-source="post: 5430555" data-attributes="member: 2174">I have no more insight into the current workings at WotC than any member of EN World, so I have ZERO info on what Hasbro expects from Wizards of the Coast. I do know that Magic is tremendously successful and tremendously lucrative, and that in recent years Magic The Gathering Online has been a growing part of that revenue. They make money on that game and get people collecting electronic cards that WotC doesn't have to print. It's all direct to the consumer, so there are no middle men like retailers and distributors. That's got to look very attractive on a balance sheet, and corporations are not known for lots of sympathy for underperforming brands. (I'm not saying D&D is underperforming, because I don't know that either.)I suspect that the amount of money brought in by, say, 12 employees working on Magic dwarfs the amount of money brought in by 12 employees working on D&D. That just seems irrefutable to me based on the associated printing costs, profit margins, etc. Magic is simply a better business, in pure dollar terms, than D&D. From running my own publishing operation, I've come to appreciate the concept of "opportunity cost" more acutely than ever before. Let's say I have 1 employee. I can put that guy to work on a Pathfinder book, and let's say that book makes Paizo $200 of profit. The same guy could also work on a Planet Stories mass market pulp reprint, which takes about the same amount of time and effort and has somewhat similar costs. But because the margins are nowhere near as good and the audience is much, much, much smaller, let's say that Planet Stories book makes $2.My job is to make money for the stakeholders of my company, so no matter how much I personally love pulp fiction, and no matter how strongly the folks who love it with me love it, there aren't as many of them as there are Pathfinder players, and from a purely objective point of view, I'm making a sub-optimal decision by focusing on products with the lower margin and the smaller audience. That 1 man-effort would be more profitable if put to work on a Pathfinder book, or on something with an equal or better profit potential.You can make sub-optimal decisions for a long time for a lot of different reasons (strategery, love, because it's the "right" thing to do, stupidity, etc.), but you can't make them forever, especially if you work for a publicly traded company. From my perspective, it all comes down to opportunity cost.But again, and I think it's important to stress this, I do not have any inside information on Wizards of the Coast, how it deals with its parent company, the fate of D&D, etc. I'm just as in the dark as everyone else, so please take my observations with a grain of salt. I don't know what's going on either.--Erik</blockquote>

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