Here's the summary of a long post.
If D&D doesn't allow third party publishing, it forces the 3rd party publishers to compete with D&D, using the Pathfinder system. Or whatever, but mainly Pathfinder. They have the choice of
recruiting a mass of competitive allies, or throwing all that capital
and creativity onto Paizo's side of the scale. It's an existential
decision. Not this year certainly, but as early as next year I think the
absence or presence of third party publishers will begin determining
the ultimate survival of D&D in the face of Pathfinder.
it's public relations to call it a "license," or whether something
titled "license" was put in there with the operative legal documents,
what WotC has done with Kobold Press and presumably again with
Sasquatch, isn't what I'd call a license in terms of putting the
benefits of third-party creativity into the system.
I don't fault them for that; they had to have an adventure to go out
with the core books, and they no doubt had (and probably still have)
internal wars over exactly the same question here on this thread -- is a
real license a good idea for WotC or is it a bad one, and even if it's a
good one then some poor lawyer has to write the thing with multiple
people telling him/her how to word it. (I'm a lawyer, my heart bleeds
for that person)
But the arrangement with Kobold is more like hiring a production company at best.
(1) Surely no one thinks Kobold wasn't given parameters for content
(betcha it had to have at least one dragon, no dead kids, etc.). Granted, some content ratings,
though, can definitely still be "like a license," (see Paizo's nipple restriction) but the amount of restriction and guidance is obviously quite major in this case.
(2) Surely no one thinks Wolfgang Bauer was required to invest his own
money at a measurable scale relative to the project for an investor's
share? That's in the nature of a license.
(3) Surely no one thinks that there wasn't a set range for the page count.
See, here's the thing. Licenses can take many forms, and have many
layers of complexity, including all manner of restrictions, but AT HEART
a license is something that allows a third party to be an independent
business using the licensed material. Not necessarily a successful one,
not necessarily one that supports a family, but one where the
significant decisions, most of the risk, and most of the gain, are
undertaken by the licensee. Here, WotC is undertaking all the risk, and
capturing most of the upside. That's not a license agreement, it's
hiring a group of excellent authors who have a company. Which, again,
was a good call. I don't fault that decision for even a moment in terms
of where WotC stood on its production schedule, its work load and
personnel coverage, the evolving state of the rules, and the
legal/marketing interface on the question of how open to be with the
rules. I would have done the same thing at that point in time. Remember,
it takes a LONG time to produce a book like Tyranny of Dragons, and you
have to manage lots of moving pieces. WotC effectively hired Kobold to
handle as many of those moving pieces as possible within the context of a
flagship product. Wolfgang Bauer was a brilliant choice for it. But
that's (a) not really a license in any meaningful sense of the word, and
(b) not something that grants the benefits of a robust licensing system
-- or the downside either, and some downside does exist.
The question of true licensing is this: WotC is trying to catch up with a
well-funded, popular competitor that has a well-established brand name,
in almost exactly the same competitive space. WotC has a more widely
recognized brand name, but it's an older brand name with fewer loyal,
die-hard customers than Paizo has. The different aspects of those brand
names are important to the way the competition is going to roll out.
WotC is starting from behind, but has to work slightly less hard per new
customer, and slightly less hard to shift a customer from the Paizo
circle in the Venn diagram to the WotC circle. On the other hand, Paizo
has WotC under siege. All Paizo has to do is hold onto enough customers
that WotC doesn't meet the expectations of the Magic the Gathering
return on investment for long enough that WotC decides not to keep
funding new books for D&D. Paizo can last much longer because of
that existing base of loyal customers. WotC can generate phenomenal
return on investment with the core books, but has to sustain a cash flow
stream. Paizo already has, and will undoubtedly retain, enough cash
flow to continue publishing Pathfinder under their existing model.
D&D will, without question, grab enough fans to stay in business if
those fans keep playing and buy more books. But they have to hold that
That's a summary of the competitive space, and I think it's accurate.
D&D probably got the one, big, expenditure authorization. Core
books. After that, have production houses produce smaller books that
will also sell to players (campaigns, adventurer sourcebooks. Look at
the production schedule and whether full-time WotC employees are doing
the writing: I rest my case).
Where do third party publishers fit in here? It all has to do with the
popularity of one system or the other. D&D is fighting to survive in
that competitive space long enough to gain customer loyalty for those
player-targeted books (and the ability to license pinball machines,
shirts, computer games, movies, happy-meal toys, etc). They have to stay
in the game.
You can't. Cannot. Stay in the game against Paizo with limited funding
and a single WotC-supervised line of products. Not even if you are
casting a wide net on your product definition such as "Forgotten
Realms," or "Greyhawk," or "Spelljammer." That's been tried. The older
ones of us remember how successful D&D can be if it runs many
campaigns, player-targeted books, and attempt to control outside
publishing. That was late-TSR business planning, and it ran TSR out of
business. It didn't kill the brand name, but that's because there was no
established competitor of any size.
In this case, there's Paizo. Phenomenal customer service, fanatic
customer loyalty, stable game system rules (I think WotC's D&D rules
are pretty stable and spiffy, too, but I'm profiling Paizo, not
comparing), well funded, and with owners that won't cancel the game over
a couple of bad fiscal quarters in a row.
One of the ways Paizo got so powerful as a competitor? Third parties
publishing "alternate visions" of Pathfinder. Publishing little things
to spice up a non-standard game. Publishing robot-power-pirate-dinosaur
adventures for the 25 gaming groups that needed exactly that module on
exactly that release date. All those people who might have drifted to
D&D or Savage Worlds, or Swords & Wizardry, or gone back to First Edition D&D ...
they stayed with Pathfinder because of the 3d party publishers. And then
maybe a week, maybe a month, maybe six months later, they bought
another Pathfinder book from Paizo. Or they bought another
robot-power-pirate-dinosaur adventure in the Paizo store, giving Paizo a
WotC benefits LESS from third party publishers than Paizo, because they don't (and
won't) have a store like Paizo does, where they get cash flow direct
from the third party publishers. Let me tell you, Paizo got a measurable
chunk of change by selling Frog God Games' Rappan Athuk. WotC wouldn't
get that cash flow stream. But having the third party publishers prevents this scenario: "Hey, let's play
Rappan Athuk. Oh, it's for Pathfinder not D&D. Oh well, drag out the
Pathfinder books again, we'll play D&D again later, maybe." Because
remember, D&D needs that cash flow stream now, not later. They
need: "Hey, let's play Rappan Athuk. There's a 5th edition version [not
yet, fans, this is an example]. But I need a DM screen. No problem, I'll
get one this afternoon over at the game store [where, additionally to the DM screen, there are other
WotC products next to it on the shelf]."
There's no question that in the above example, some WotC product (say,
Tyranny of Dragons) got left on the shelf, and all WotC sold was a DM
screen (and maybe a related impulse buy). But the relevant comparison
ISN'T less vs more, which many commenters seem to think. The relevant
comparison is an existential one: it's selling NOTHING vs selling
something. Selling "something" to those who would otherwise play the
competing game because of third party publishers keeps the lights on at
D&D alone can muster up a nice, robust product line that will sell
to people who like the common denominator. Mike Mearles has done a good job of
hitting a broad common denominator. He's in there swinging. He built an
awesome battleship out of what looked like a sunken wreck.
The competing product line, though, is a freaking juggernaut. Paizo is
at the center like an aircraft carrier, delivering wave after wave of
common denominator product. What's different is the vast armada of third
party publishers meeting every need of the Pathfinder player, from
alternate minis, to little status tokens, to specialized adventures, to
variant character classes, to whatever imaginable whim that player might
have. If they play Pathfinder. Instead of D&D.
The summary is this:
Without those 3rd party publishers, WotC has no way to capture the
marginal customer. The people who simply can't live with the concept of a
world without [your favorite Pathfinder 3pp product]." Single product
line relying on multiple official campaigns and policing 3pp production
didn't fly in 1998. And now, in 2014, Paizo is out there. Paizo is lean,
mean, and popular. If D&D wants to beat the empire, it needs a
plucky rebel alliance. They need to start assembling that rebel
alliance, fast. And that doesn't mean hiring companies to produce
company-approved material using WotC capital and Hasbro's corporate
bonds. That's the TSR model circa 1998. I'm assuming that this is just
because the rest of the WotC business model hasn't rolled out yet. But
the clock is ticking. OGL-based material won't continue to flow from 3rd
party publishers without a license to use the copyrighted terms in the
rules (not necessarily the trademark, and not an SRD).
Without at least that level of open license, D&D won't have the
staying power, and Paizo just has to wait. The third party publishers
will do all the competing that Paizo needs done.
If D&D doesn't allow third party publishing, it forces the 3rd party
publishers to compete with D&D, using the Pathfinder system. Or
whatever, but mainly Pathfinder. They have the choice of recruiting a
mass of competitive allies, or throwing all that capital and creativity
onto Paizo's side of the scale. It's an existential decision. Not this
year certainly, but as early as next year I think the absence or
presence of third party publishers will begin determining the ultimate
survival of D&D in the face of Pathfinder.
6 hours ago