10
\$\begingroup\$

Hasbro recently released its Q3 2023 sales figures, and boy, things are looking dire. They were even worse in Q2 with an 11% Dip in the whole segment Wizards of the Coast and Digital Gaming, which only was smoothed out in the Q3 by the millions of copies of Baldur's Gate 3 being sold, which likely is an outcome of the people allegedly leaving DNDbeyond in early 2023 in the wake of the attempt of OGL 1.1/2.0 and forcing all attempts in that direction to stall or be abandoned.

Is the time ripe to call out for a retrospective on the whole debacle and look at it from a historical standpoint, akin to such a question described below?

Situation Background

In early January 2023, a document about a proposed OGL 1.1 and shortly after 1.2 were leaked proposing extreme changes. Those changes would have been been massive and lead to a massive uproar on fans, distributors and led to a massive change on other projects too. Even mainstream media reported about an exodus within days. Allegedly, DnD Beyond hemorrhaged subscribers in the 5 digits, and numbers such as "more than 40000 players canceled" were mentioned, but the only sure data point is, that at some point the subscription-canceling page broke.

In the end, WotC caved at the end of January, and OGL 1.0a stayed untouched, but that did not make good any damage they did to themselves. Powerful influencers like Critical Role still announced to stop using D&D around June.

Chaosium, Paizo, and other publishers began work on a different license to OGL 1.0a within a month of the leak. the ORC-license that was finalised in or around July. This is breakneck speed for license writing, especially with thousands of people giving input into the public discussion.

Financial Data

Hasbro's Q1 2023, Q2 2023 and Q3 2023 don't mention the the screwup at all, though Q2 shows a horrible 11% less net revenue from the segment that contains DnD-Beyond (Wizards of the Coast and Digital Gaming), while Q3 showed a total of 40% gain in that segment. However, that Q3 report does not show the whole situation the Q3 Power Point presentation to it shows. That includes the "Wizards Tabletop" (+14%) and "Digital Gaming Licenes" (+23%) (such as Baldur's Gate III). Only 2% growth is on the back of "Digital Games" [owned by WotC], which seems to be the combination of DND-Beyond, Monopoly Go, and Magic the Gathering Arena. Report Presentation Q3, p.16

This, so Stephen Glicker of Roll for Combat claimed in an extract from a longer stream with Professor Dungeon Master), would be a sure sign that the mass exodus from DND-Beyond was still affecting the company and might lead to massive impacts on Hasbro in total. It appears, that Wizards of the Coast would prop up the whole company as a whole. As a publisher and publisher agent for the past decades, his interpretation of the sales reports sounds credible but...

Question (restatement)

Does other data or reporting compound the interpretation that the debacle of the OGL 1.1/1.2, with its (alleged) mass exodus of players from DnD-Beyond, actually impacted the Digital Games subsection of the Wizards of the Coast & Digital Games department's numbers in the Q3 Hasbro earnings report in the claimed manner?

\$\endgroup\$

1 Answer 1

19
\$\begingroup\$

Speculating about the underlying causes of a lackluster earnings call from a company with a diverse product portfolio in very unstable economic times probably isn’t what we’re looking for on this site. I think there’s room to document what happened surrounding the OGL incident in Q1 as objectively as we can, but asking if or to what magnitude it impacted the Q2 and Q3 earnings is just inviting speculation. The question you’ve provided for workshop is, in my opinion, this sort of speculative question, and I would vote to close it as opinion based. But like I said, WotC’s actions around the OGL are a significant part of the company’s, and the broader hobby’s, history, so a question asking to document what happened based on available data would be on topic and valuable.

This is not to say that an ambitious answer could not make the observation that earnings in the pen and paper D&D product space underperformed after the OGL debacle, while making the appropriate caveats about the broader economic climate, etc., but it’s that asking us to speculate that is the problem. I think we want to frame the question in a way that encourages objectivity and evidence based observations, rather than unprovable conjectures.

\$\endgroup\$
7
  • \$\begingroup\$ Good points - which is exactly why I pulled this to here instead of the main first. Back when the 1.1 thing came up, I called for "Calm down and observe", now you do me the favor. If you have a good proposal for a counterquestion or two, I would be grateful. Or should we do a Meta to gather data and reports on the outcome of the situation? \$\endgroup\$
    – Trish
    Nov 5, 2023 at 11:56
  • 7
    \$\begingroup\$ @Trish This is not to say that an ambitious answer could not make the observation that earnings in the pen and paper D&D product space underperformed after the OGL debacle, while making the appropriate caveats about the broader economic climate, etc., but it’s that asking us to speculate that is the problem. I think we want to frame the question in a way that encourages objectivity and evidence based observations, rather than unprovable conjectures. \$\endgroup\$ Nov 5, 2023 at 12:17
  • \$\begingroup\$ If the goal is to document what happened regarding the OGL debacle, why not make that the question? E.g. What happened with WotC's OGL proposal? What were the lasting impacts of WotC's failed OGL proposal? (In which case, most of the sample question works as an answer or part thereof.) Or is @Trish more interested in investigating specific allegations in depth? \$\endgroup\$
    – BBeast
    Nov 13, 2023 at 22:52
  • \$\begingroup\$ That's a good way to put it, yeah. We can objectively state that it did have some effect, but we lack the data to make any meaningful objective conclusions about how much of an effect the situation had on their sales figures. (For instance, we know that the situation is responsible for the creation of the ORC, and by extension, the Pathfinder 2 Remastered line, and can thus objectively conclude that Paizo has directly profited off of WotC's actions. We cannot objectively conclude that this is correlated to any dips in WotC profits; no matter how obvious it is, it's still speculation.) \$\endgroup\$ Nov 13, 2023 at 22:55
  • 1
    \$\begingroup\$ @JustinTime: Strictly speaking, I'm not convinced that even WotC has the data to make a conclusion like that. Nobody knows how many people might've otherwise gone out and bought [whatever product] if they hadn't messed with the licensing terms. \$\endgroup\$
    – Kevin
    Nov 19, 2023 at 1:18
  • \$\begingroup\$ That wouldn't surprise me, @Kevin. One of the few things we do objectively know is that the ORC sprang from it (and PF2R by extension), and thus that all sales of PF2R products were directly caused by the OGL fiasco spurring Paizo into action. But apart from that? Basically nothing can be concluded, I agree. \$\endgroup\$ Jan 9 at 0:18
  • \$\begingroup\$ [Long story short, from what I understand, Paizo has confirmed that wanted to remaster PF2 for a while, but weren't ready for it yet, so they left it on the back burner. But the OGL fiasco pushed them to create the ORC as an OGL-like license that WotC has no say over, and the Remaster was given top priority to switch PF2 over from the OGL to the ORC while legally distancing it from D&D just in case. Meaning that the PF2R books are probably the only products whose sales can be tied to debacle, on the grounds that the Remaster itself, in its current form, is a direct response to the debacle.] \$\endgroup\$ Jan 9 at 0:18

You must log in to answer this question.

Not the answer you're looking for? Browse other questions tagged .