Quote: "The RPG category is still struggling to right itself after the fallout from the 3E bubble."
First, I think it is impossible to determine what hurt the RPG category more, the immense success of World of Warcraft, a massive exodus of hard core RPG players deployed overseas in armed conflicts, the rise of widespread internet discounting for RPG products, the failure of the marketshare leader to implement a successful new player acquisition strategy, or a substantial erosion of the disposable income of the target demographic. All are factors in combination, creating a perfect storm, to be sure.
What I am virtually certain of is that no "bubble" effect in the TRPG category hurt stores or hurt the RPG category in stores. Lets remember that Y2K was The Year Of Pokemon, and stores were awash with cash as the first OGL/D20 products hit. Pokemon declined rapidly in 2001, but in 2002, Yu-Gi-Oh! exploded on the scene, generating 3+ years of steady profits that replaced most of the Pokemon revenue. The CCG component of a retailer's economic model dwarfs the RPG component.
When people say "look at all these crap products that flooded the market", I shake my head and wonder how many of them shop in bookstores or go to movies. Does the endless parade of crappy novels or flopped blockbusters create "bubbles" of economic disaster in those industries? How many really crummy comic books are released every year? How about Pop Music CDs?
Entertainment businesses ALWAYS follow Sturgeon's Law. They survive & thrive because the 5% that isn't crap sells really, really well. The fact that a whole lot of badly designed, poorly marketed, and barely supported RPG products were released using the OGL/D20 license likely had little or no impact on most retailers. Sure, for some of them who stupidly overbought thinking the licenses were guaranteed lotto tickets there may have been a steep price to pay when it became obvious that not everything D20 would sell. But on the whole, changes in the volume of Games Workshop, the struggles of WizKids, the cyclic decline in Magic sales, and a whole host of macroeconomic factors had much, much more to do with the problems of retailers than a couple of boxes of unsold D20 books.
Blaming D20 for the collapse in the TRPG market is just whistling into the wind, in my opinion. The problem is structural, not cyclic, and it is not going to get fixed by Wizards of the Coast, or any other publisher, with any licensing regime they implement.
RyanD