And you base this on your extensive market research...?
I would say not, but I would say, 3.5 (and probably even 4e) made a LOT more money than 5e has.
Not hard numbers, but guesses, but used as examples.
If you see 25 books and at $30 a pop and only sell 50,000 copies, that equals around 37-38 million dollars.
You sell 2 books at $30 a pop (because, let's face it, most people are buying online rather than at bookstores at full retail on these books) and sell a 500K of them, you've only made 30 million dollars, despite each book selling 10X the amount of any of the other books in the other lines.
Now 3e and 3.5 had even more releases than that, but we're just using some little numbers here for comparison. Same with 5e (though it's not that far from 2 releases, you've had 2 releases for players really, though the Monster book is debatable as it had SOME player stuff in there...but so do some of the modules). [A better comparison may be Pathfinder and Paizo right now, which release at least 15 or more books if you include their APs each year].
4e, even with only 10,000 subscribers a month at $10 each made 100K a month, for 1.2 million a year for not much on WotC's side of the equation. The original 3, lets say, which sold quicker at first than 3e or 3.5 (but slowed down considerably afterwards) has around 1.1 million sales overall in the first year at $20 a pop (because, though more arguable as more people bought retail back then...apples to apples, we'll compare online prices) for 22 million for those. With around 20 books released in the first two years, and another 20 the two years after that, even with reducing returns (so around 500K at first, down to 10K at the end)...we'll even the first two years to around 100K buyers for each book at $20 a pop to get around 40 million (which unfortunately means though it seemed it might be on target at first...means it feel short of the 50 million mark set by Hasbro...but there were more subscribers then so we'll say it came close and had around 8 million come in from the subsriptions for a total of 48 million, not hitting the mark set by Hasbro...but CLOSE). The second two years...we get an average of 30,000 buyers at $20 a pop for 20 books for far less around a 22.5 million return.
But the above explains WHY 3e-4e had a MUCH LARGER D&D department, as they were trying to be a major brand for WotC and Hasbro. However, they failed.
So, 5e has a far smaller department because they are a branch now, rather than even trying to be a major brand. This is why they also have less releases, they are more like Monopoly or Risk rather than Magic or Major Brand departments that carry the company.
So, with 5e, you have 1.5 million buy the core books at $30 a pop, giving them 45 million. Good return, giving them more than 4e made on the core books. However, you sell only around 300K of the first module (not bad considering the end of 4e, but not great considering all the sales you could have gotten). We still have to keep it under the major brand category, because they haven't made it into a major brand with 5e yet. So, whatever they sold, it had to be less than 50 million, though it could be on par with 4e at that point.
However, AFTER that, the DM books/modules do not sell as well as other books...soooo...we are looking at 300-400K a pop maybe...twice a year (I rounded it up to 500K to try to be more fair, but I think the average is 1/5 as many DM books sold compared to a player book?).
This is WHY Paizo can keep up with WotC in regards to RPGs. Currently their books might not sell as many as any single 5e release, but combined, all those books make MORE money for them overall than WotC makes from D&D.
I think that's what he was saying. By NOT selling books you avoid oversaturating the market (something 4e did very well [aka the market got oversaturated] and even 3.5 as sales kept diminishing more and more and more with each book), but at the same time you miss out on all the money you MIGHT make if you sold more books.
On the otherhand, for the D&D player, the 5e release rate makes it far easier to buy the books than the numbers which were released in 4e and 3.5 were if one wanted to get them all.
I'd say there may be a better middle ground, but considering that 5e has another splat coming in the next year, they probably have that idea as well (splats have been coming out in an increasing number comparatively to the first year or two.
Adding: That said, I wouldn't be surprised if Xanathar sold a million books the first year of it's release, but if we take into account Amazon is probably selling them dirt cheap, the totals (so not what WotC actually sees) is still probably only going to be in the 30-35 million dollar range. Not bad, but not as good as selling a ton of books like Paizo does in how much money one sees (and especially as these are indirect sales rather than as Paizo does some of their sales directly from them to the customer over the internet).
