Wow, huge thread thusfar. Dozens of very good points.
A WotC rep once told me, "This is the same company that puts out a new edition of Magic every two years." Several people have admitted that D&D 4 is already pretty much on its merry way, possibly next year. In short, the corporate muckitty-mucks see a new edition as a constant refreshment of their intellectual property. New core rules/base system changes sell books, although the paradigm may shift when D&D 4.0 arrives.
Module writing is, IMO, dead at WotC. Even the RPGA is drying up when it comes to modules. The thing is, most DM's end up modifying pre-packaged mods on some level anyway. More often than not, I just find it easier to write my own material because it takes less time and caters to my PC's more closely. If you like modules, Necromancer games and Goodman Games are putting out a lot of exciting stuff right now.
Part of the module problem also lies in that WotC, going back as far as the old TSR days, does not/ will not accept solicitations for adventure material unless you are a well-published author or have lots of RPGA clout. Even Dungeon magazine is cutting back on modules, becoming more of a DM's magazine. Unfortunately, the last round of published modules WotC did (i.e. Standing Stone, etc,) were not resounding financial successes. Yes, they have done some Eberron modules, but those are to support that setting. Hasbro has basically forced WotC out of the module-writing business because the numbers just aren't there in all likelihood and they aren't in any hurry to accept new submissions.
The drive that prompted the setting search that gave us Eberron is still alive and well today. New worlds, even new game systems are starting to sprout up all over the industry. Take a look at Secrets of Zi'Ran, the new Warhammer FRP, and Deathstalker 2 for examples. People are starting to crave new, exciting fantasy realms, which means D&D is again starting to leave some of us flat.
I suspect much of this comes from the fact, and I've said this for years, that Greyhawk, FR, etc are still very much been-there, done-that gaming worlds. While definitely not boring, they are not exactly new-gamer friendly because of their incredibly long lineage and ludicrously powerful NPCs. A new setting needs unexplored territory to be viable.
Eberron is over-hyped. I think much of Eberron's success is due to the fact that we're constantly being told that it's a huge success by WotC's Marketing department and it's easy to be a success when the majority of the current effort is being directed toward that product line.
While I'm not the world's biggest GURPS fan, as a generic engine, it does do one thing exceptionally well- It branches into every kind of gaming style, setting and genre almost effortlessly. IF D&D is going to continue to thrive, the people at WotC need to learn that lesson. They not only need to start coming up with new fantasy settings, but branch out into other settings as well. While they have half-heartedly attempted this with D20 Modern, they need to put some serious effort into some new settings.
Oh, and how many of us would like to see them do something with the STAR WARS RPG??? I'm not trying to be a troll, but I wish WotC would focus a little less on miniatures and a little more on writing RPG's. These days it seems a lot of very brilliant, talented game designers at WotC are getting thrown at every project but RPG's. What made Dragonlance, FR, Ravenloft, Planescape, Star Frontiers, Top Secret, Gamma World and so many other game settings a resounding success- they had never been done before. Why? Because the writers at (then) TSR were encouraged to come up with new ideas, and someone was willing to take a chance on it making money. Stagnation leads to profit loss as much as any bad idea. (Just ask anyone who owned GURPS Russia and remembers SJG declaring bankruptcy.) The main point of this thread rings very true. WotC is likely headed for extinction at Hasbro because they're not doing anything new. Not evolving.
In closing, I think what would bring the industry out of its current "funk" is a NEW well-supported D&D fantasy setting that appeals to new gamers and old veterans alike. I think we all need a good dose of new, unexplored RPG territory.
