Loading summary
Transcript67 lines
- [00:02]
A
Wondering.
- [00:10]
It's August 1996, and in Milwaukee, Gen Con is underway. It's been nearly 30 years since Dungeons and Dragons co creator Gary Gygax started this annual gaming convention. Since then, tsr, the publisher behind D and D, has built it into North America's biggest gaming Expo, with 30,000 attendees expected this year.
- [00:33]
At the center of the exhibition floor is TSR's domineering stand, featuring a huge replica castle complete with 20 foot tall turrets. Within its walls, gamers can discover, play and buy the D and D publisher's latest offerings. And the queen of this castle is TSR's owner, Lorraine Williams. As she walks through the stand, she tries to project calm and confidence. But the truth is, her kingdom is crumbling. TSR owes its main distributor, Random House, millions of dollars, and last December it missed a deadline to repay a large chunk of that debt. TSR took desperate measures to avoid being sued into bankruptcy, like halting royalty payments to many authors of Dungeons and Dragons novels. This saved enough cash to keep Random House at bay. But now TSR owes its printer, JB Kinahan, more than $6 million. So to stop the PR from demanding payment, TSR gave it ownership of its corporate headquarters and signed a contract prohibiting it from moving its business elsewhere. All of which makes it harder for Williams to pretend that everything's okay. And what's making it even harder is that she's about to have a one to one meeting with Peter Atkisson and she doesn't know what's on the agenda. Atkinson is the founder of Wizards of the coast, the Renton, Washington company behind Magic the Gathering, the hugely successful collectible card game. Williams isn't happy about this meeting. She doesn't like Atkinson or his game. Magic is crushing sales of Dungeons and Dragons and pushing TSR closer to the abyss.
- [02:21]
Williams arrives at TSR's private meeting room, where Atkinson is already waiting. After handshakes, they move to sit down. But before Williams can do so, Atkinson blurts out why he's asked to meet. So yeah, thanks for making time to talk. Here's the situation. I'm under pressure from my board and investors. They want me to look for opportunities to grow through acquisition. William stops moving to sit and glares at Atkinson, but he keeps talking. Long story short, if you ever wanted to sell tsr, I'd be interested. We got the money. Williams swallows her irritation. TSR is in trouble, but she can't bear the idea of selling to Atkison. She steps away from the chair she was about to sit in.
- [03:07]
B
Thank you for your interest, but we're not looking for a buyer.
- [03:11]
A
Atkison looks surprised. The entire tabletop gaming industry knows TSR is in deep trouble. He thought she'd at least hear him out. Instead, Williams glances at the door.
- [03:22]
B
Is there anything else you'd like to discuss?
- [03:26]
A
No, not really. Great.
- [03:28]
B
Well, nice to see you.
- [03:29]
A
Peter Atkison didn't even get to sit, let alone start buyout talks. But TSR is in critical condition, and if Williams doesn't find a solution soon, both her company and Dungeons and Dragons will be finished.
- [03:53]
This message is brought to you by Apple Card Apple Card members can earn unlimited daily cash back on everyday purchases wherever they shop. This means you could be earning daily cash on just about anything, like a slice of pizza from your local pizza place or a latte from the corner coffee shop. Apply for Apple Card in the Wallet app to see your credit limit offer in minutes subject to credit approval. Apple Card issued by Goldman Sachs Bank USA, Salt Lake City branch terms and more@applecard.com this message comes from Capital One. The Capital One VentureX business card has no preset spending limit, so the card's purchasing power can adapt to meet business needs. Plus, the card earns unlimited double miles on every purchase, so the more a business spends, the more miles earned. And when traveling, the VentureX business card grants access to over a thousand airport lounges. The venturex Business Card what's in your wallet? Terms and conditions apply. Find out more@capital1.com venturexbusiness.
- [04:56]
From wondery, I'm david brown, and this is business wars.
- [05:24]
In the last episode, Dungeons and Dragons co creator Gary Gygax formed publisher TSR and turned the game into a household name. But when out of control spending pushed TSR to the brink, his deputy, Lorraine Williams, staged a coup and bought the company from under him. But now, history is repeating itself. TSR faces ruin again. Sales of the game are slipping, debt is piling up, and if the company can't break the cycle, it won't survive. This is Episode two, A Kingdom Reborn.
- [06:05]
In June 1996, struggling with its debts, TSR uses its copyrights to its books and games as loan collateral. It's a dangerous move. If TSR goes bust now, the Dungeons and Dragons brand will be auctioned off in pieces and potentially end up in the hands of multiple owners. D and D could wind up like King Kong, a famous brand weakened by confusing ownership rights. But even this move is just a band aid. That fall, six trucks from Random House roll up to TSR's warehouse, loaded with millions of dollars worth of unsold products and a demand for the cost of returning them. With cash running out again, Williams orders layoffs, slimming the business down to a skeleton crew of demoralized survivors surrounded by vacant cubicles. And still the death spiral continues.
- [07:02]
Returns in collateral look harmless until they don't. If your distributor can send you back truckloads of product at will, you don't have revenue. You have consignment with paperwork. Rule of thumb? Titan returns up front even if it does cost you sales. And never, never put your core IP or some other must have asset on the table unless you can really live with losing it.
- [07:27]
As 1997 begins, TSR's printer, JB Kenahan, delivers another blow. It tells Williams it will cease printing TSR's products until TSR repays the millions it owes. TSR now owes around $30 million and can only earn money from selling its existing inventory. Williams halts almost all spending just to keep making payroll. The cutbacks are so severe that employees now have to bring their own toilet paper to work. It seems inevitable that TSR will go bust and take Dungeons and Dragons down with.
- [08:06]
In February 1997, Williams attends Toy Fair in New York City, where she's cornered by Bob Abramowicz Abramowicz is the CEO of tabletop game publisher Five Rings. It's a small Seattle outfit that's had some success with games based on Star Trek and Dune, and he's got an offer for Williams. He tells her he knows TSR is nearly bankrupt and he wants to explore buying it. He shares how he worked at TSR back in the early 1980s and says he understands the brand and company culture. He also tells Williams that 5 rings is backed by investors with access to plenty of capital.
- [08:46]
Williams listens with interest. This just might be the lifeline TSR needs. But what she doesn't know is that Abramowicz isn't being fully candid. 5 Rings doesn't have enough money to buy TSR. In fact, it's also nearly bankrupt. The company's bank credit is maxed out, and if it doesn't get a new investment of capital soon, it's finished. An agreement with TSR might help 5 rings secure new investment, or maybe even convince someone to buy the company. To his relief, Williams doesn't press him on his ability to finance a deal. Instead, she invites him to come to TSR headquarters in Lake Geneva, Wisconsin, to look over TSR's books.
- [09:38]
A few days later, Abramowicz and his team arrive in Wisconsin and discover that TSR's finances are even more of a horror show than they imagined. But this doesn't deter him. TSR might be a dumpster fire of a business, but Dungeons and Dragons is still a famous brand with seemingly untapped potential. Abramowicz offers to pay $25 million for TSR and take on its debts. Williams accepts and signs a letter of intent to sell. Stage one of his master plan is complete. Now Abramowicz just needs to find the money he promised to pay her.
- [10:21]
It's spring 1997, and in a diner in Seattle, Abramowicz rises from his chair. He greets the man he's invited for breakfast, Peter Adkisson, the founder of Wizards of the coast, the company behind Magic the Gathering. After ordering, Abramowicz gets down to business. Peter, I know there's a company you've always wanted to buy and can't seem to get. Well, I'm buying that company. Bob, it's early. Help me out here. What are you talking about? Tsr. Atkinson's eyes widen. He's long dreamed of owning Dungeons and dragons. In the 80s, at the height of the satanic panic, his Seventh Day Adventist college almost kicked him out for being the ringleader of D and D activity on campus. Buying this game would be like buying a piece of his childhood. But Williams has rebuffed every approach he's made. Abramowicz slides a manila folder across the table to Adkisson. What's this? It's a letter of intent signed by Lorraine Williams. Atkinson opens the folder. It's there in black and white. Williams is ready to sell TSR to five rings. Okay, Bob, how do I get involved in this? Well, you'll write a check for $1 million alone. If we don't complete the deal, we pay you back. If we do complete it and you still want tsr, you buy five rings. That'll cost you six to eight million dollars. You know, I could just wait for TSR to go bankrupt and buy it then. That'd be a mistake, Peter. They've used their copyrights to guarantee loans. If you let them go under, there's a strong chance that ownership of Dungeons and Dragons will be auctioned off to multiple buyers. Be like Humpty Dumpty. You'll never be able to put all those pieces back together again. Hmm. Okay, I'll. I'll think it over. Yeah, you do that. But if you want in, don't think for too long. Less than 15 minutes after leaving the diner, Abramowicz is back in his office when the phone rings. It's Atkison. Okay, who do I make the check out to? Abramowicz grins. Stage two of his master plan is complete. The million dollar check from Wizards of the coast will keep five rings alive long enough to finalize the acquisition of tsr. But now he has to break the news to Williams that she's about to sell her business to the one man she's long refused to deal with.
- [12:59]
What can 160 years of experience teach you about the future? When it comes to protecting what matters, Pacific Life provides life insurance, retirement income and employee benefits for people and businesses building a more confident tomorrow. Strategies rooted in strength and backed by experience. Ask a financial professional how Pacific Life can help you today. Pacific Life Insurance Company, Omaha, Nebraska. And in New York, Pacific Life and Annuity, Phoenix, Arizona.
- [13:28]
C
In 1993, three 8 year old boys were brutally murdered in West Memphis, Arkansas. As the small town local police struggled to solve the crime. Rumors soon spread that the killings were the work of a satanic cult. Suspicion landed on three local teenagers, but there was no real evidence linking them to the murders. Still, that would not protect them. Hi, I'm Lindsey Graham, the host of Wondry show American Scandal. We bring to life some of the biggest controversies in US history. Presidential lies, environmental disasters, corporate fraud. In our latest series, three teenage boys are falsely accused of a vicious triple homicide. But their story doesn't end with their trials or convictions. Instead, their plight will capture the imagination of the entire country and spark a campaign for justice that will last for almost two decades. Follow American Scandal on the Wondria or wherever you get your podcasts. You can binge all episodes of American scandal. The West Memphis 3 early and ad free right now on Wondery.
- [14:40]
A
It's spring 1997 and Five Rings boss Bob Abramowicz is back at TSR headquarters in Lake Geneva, Wisconsin. He's meeting TSR owner Lorraine Williams and hoping he's not about to blow up the deal to buy Dungeons and Dragons.
- [14:56]
Lorraine I wanted to live up to the promise I made to buy tsr, but I have to tell you something's changed and you're not gonna like it. But hear me out, because it's the best solution for all three of us.
- [15:10]
B
Hang on. The three of us?
- [15:13]
A
Wizards of the coast is going to buy us so we can buy you. William's expression turns frosty.
- [15:21]
B
I don't like Peter Adkisson and I don't like what he's done to this industry.
- [15:25]
A
Abramowicz doesn't know exactly why Williams is so hostile towards Atkinson, but he knows if he doesn't overcome it, both of their companies will die. This shouldn't be personal. Lorraine. Peter built a fine company in Wizards of the Coast. He has the business savvy and the passion to make Dungeons and Dragons grow again. Come on, think about your staff. If TSR dies, what happens to them and to their families? Wizards has the money to keep em on.
- [15:55]
Lorraine. Lorraine, you saved tsr. You saved Dungeons and Dragons. It would have died in 1985 without you. You've kept it alive for another 12 years. But TSR is bleeding out. And this deal, well, it's the blood transfusion it needs.
- [16:17]
B
Okay, but only if the deal is done within 50 days.
- [16:21]
A
Lorraine, if your lawyers move as fast as ours, we'll have it done in 30.
- [16:27]
A few weeks later, 5 rings buys TSR. Wizards of the coast then pays $25 million to buy 5 rings and acquire TSR.
- [16:40]
After collecting the keys to TSR's headquarters, Peter Adkisson finds himself unable to walk through the doors to meet his newest employees. Instead, the multi millionaire game tycoon retreats to his car and bursts into tears.
- [16:57]
He now owns the game that set him on the path to founding Wizards of the coast, the game that made him who he is today. He feels like a sports fan who's just bought their home team. And now the main thought swirling through his head is, I better not mess this up.
- [17:19]
Let's pause for just a moment and take this all in. You know, buying your childhood dream is romantic, but now comes the hard work integrating it. The smartest move we just heard wasn't the price. It was the pause. A little humility on day one beats a hundred memos later. When you acquire a beloved brand, think like a caretaker, not a conqueror. Keep what the fans love, fix what they'll forgive, and don't try to optimize the soul out of it. You just might find that little touch of humility will pay dividends in the long haul.
- [18:01]
Having bought Dungeons and Dragons, Wizards of the coast sets to work on a plan to revive the game's fortunes. First, it starts by cleaning up the intellectual property ownership issues. The game's creators, Dave Arneson and Gary Gygax, plus Gygax's ex wife, all have royalty interests in the game, which could complicate attempts to update or change it. So Wizards of the coast buys them out and gets full control. Then it rehires many of the key creatives who were fired during the recent layoffs and relocates the Dungeons and Dragons team to its offices in Washington State. Wizards also drops TSR's fish bait strategy, which had subdivided the D and D fan base into smaller and smaller pieces in a misguided attempt to compete with every other role playing game on the market. Now the goal is to bring the game's fans back together, even if it does mean scaling back releases and losing sales in the short term. Of course, TSR couldn't afford to do this. At tsr, Dungeons and Dragons was the breadwinner. But at Wizards of the coast, there the job falls to Magic the Gathering. By 1997, the game has sold more than 2 billion cards, meaning that Wizards of the coast can afford to take a hit on Dungeons and Dragons as it course corrects the brand. Think of it this way, a cash cow buys you time, so use it to simplify. Prune the product trees so the sunlight reaches the roots. You know the hitch. Fewer better releases builds trust and makes each launch feel like a bona fide event.
- [19:42]
But the pruned product line is just the warm up. The core of Wizards of the coast turnaround plan is releasing a revised third edition of D and D. The gameplay hasn't changed significantly since the 1970s, and Atkinson felt it was now showing its age. The hope is that an overhaul will make the game more appealing and put it back on the map. The old hands who joined from TSR warned that this could be a risky move. The second edition, released in 1989, split the fan base and it only refined the rules. Who knows what will happen if the rules are more thoroughly overhauled? But sales of Dungeons and Dragons are drying up, so if the game is going to attract new fans, it has to do something big. Brand chief Ryan Dancy and his team reworked the rules so that most of the outcomes in the game are now determined by the roll of a single 20 sided die. The change makes the game simpler and more accessible. But Dancy also has another big idea for the third edition. Dancy got his inspiration from the buzz among Seattle tech workers about the computer operating system Linux. Linux is what's called open source software, meaning its code is open to anyone to modify, share or sell as long as they follow certain rules. It's the exact opposite of Microsoft Windows, which only Microsoft can modify or sell. Dancy's big idea is to make the rules of Dungeons and Dragons third Edition open sourced. He calls it OGL Open Gaming License. Under the ogl, players and rival game publishers can use the D and D rules to create their own games, ones they can share and Even sell without asking for permission or paying Wizards of the coast any royalties. All they have to do is follow the terms set out in ogl. Wizards of the coast will keep control of the Dungeons and Dragons brand, stories and world. But the rules can be used by anyone. The initial reaction inside Wizards of the coast is pure horror. Too many D D's rules are the game, and Dancy wants to give them away. It seems like business insanity, a surefire way to destroy the brand for good. But Dancy's convinced it will do the opposite. He believes the OGL will inspire rival publishers to release add ons to Dungeons and Dragons rather than competing against would also allow Wizards of the coast to dial back from the low margin business of publishing D and D campaign books. Because now the community can start doing this themselves. Alarmed colleagues hope the Wizards of the coast legal team will veto the idea. But instead they back it. They point out that legal protections for game rules are largely theoretical and hard to defend in court. The OGL isn't about surrendering rights. It's about making Dungeons and Dragons the default role playing game engine and getting the community to create a lot of cool stuff for fans in return.
- [22:55]
In the end, it comes down to Akkisson. Dancy gives him the pitch, and he doesn't even hesitate. He sees the idea from the perspective of a Dungeons and Dragons fan, and in his gut it feels right. He gives the OGL his blessing and rejects all attempts to change his mind.
- [23:16]
Now here's the counterintuitive play. Give away the engine to sell the car. Open rules invite a thousand creators to build on your platform, and every add on points back to you. You keep the name, the stories and the world. They expand the universe for free. Openness isn't charity. It's distribution you don't have to pay for. If the tide rises, your flagship floats the highest.
- [23:46]
In summer 2000, Dungeons & Dragons throw third edition debuts. The world's number one role playing game where you get to interact with your friends as never before. The only limitation is your imagination. Find out what the rest of the world is talking about. Dungeons and Dragons. The adventure starts here.
- [24:07]
The initial sales are strong. The new edition sells almost 400,000 copies in its first year. That's more than three times as many copies as the second edition managed in its first year. But the reaction to the OGL itself is muted by the time the third edition arrives. Wizards of the coast has been bought by toy giant Hasbro, the owner of Monopoly and Transformers. Rival publishers view the OGL with suspicion. They suspect that once they've invested in making games using Dungeons and Dragons rules, Hasbro will snatch away their permission to do so. So Wizards of the coast employees hit the road, meeting the player, community and other role playing game publishers to reassure them that the OGL isn't some trick. Slowly, companies start releasing games based on D D's rules. And as the number of community creations grows, so does interest in the third edition rules, fueling more sales. Dungeons and Dragons sales are climbing again. After years of decline. The game is still niche and still struggling to break beyond its core fan base. But it's progress. But just as it gets back on its feet, a new threat emerges. Chuck Norris is a hunter. But Chuck Norris does not hunt. Hunting would imply the possibility of failure.
- [25:40]
There are 10 million people in the world of Warcraft because Chuck Norris allows them to.
- [25:46]
D
Live.
- [25:48]
I'm Chuck Norris and I approve this.
- [25:50]
A
Game.
- [25:52]
In November 2004, World of Warcraft, the D and D inspired online video game juggernaut, launches. And now Dungeons and Dragons must fight to prove that its tabletop adventures still matter in an online.
- [26:10]
D
World.
- [26:19]
Hey, basketball fans. Steve Nash here, ready to elevate your basketball IQ? I'm teaming up with LeBron James to bring you the latest season of Mind the Game. And we're about to take you deeper into basketball than you've ever gone before. We're breaking down the real game, the X's and O's that actually matter. In every episode, we'll share elite level strategy, dive into career defining moments, and explain the why behind plays that changed a game, a team, or a championship. LeBron and I have lived this game at the highest level for decades. We've been in those pressure moments and made those game changing decisions and learned from the greatest basketball minds in history. Now we're pulling back the curtain and sharing that knowledge with you. Time to go beyond the highlights and get into the real heart of basketball. Watch Mind the game now on YouTube, Prime Video, or listen wherever you get your.
- [27:09]
A
Podcasts. In just a few years, Ozempic has gone from a diabetes drug to a global phenomenon. But behind the miracle claims, another battle is raging. Demand is exploding. Supply can't keep up. And as drug maker Novo Nordisk scrambles to produce more, its rival Eli Lilly is racing to take the crown. Meanwhile, a darker market is emerging. Shady online sellers are offering cheap, unregulated knockoffs. Now millions are injecting mystery vials with no FDA oversight. I'm David Brown, host of Business Wars. In our latest season, we're diving into the race to Ozempic and the billion dollar showdown between big Pharma's biggest players. Can they close the supply gap before one bad vial destroys everything? Make sure to follow Business wars on the Wondery app or wherever you get your podcasts. You can binge all episodes of Business wars early and ad free right now on Wondery.
- [28:16]
It's 2006 and the dungeons and Dragons team is in Rhode island preparing to face the dragons of Hasbro's senior management team. The toy and games giant has decreed that its brands will now be deemed core or non core. Core brands are ones that bring in at least $50 million in revenue a year. These brands will get development and marketing support to continue to grow. Non core brands will be left to fend for themselves in the marketplace or get shelved indefinitely. And right now, Dungeons and Dragons is non core. It's making no more than $30 million a year in sales. This number would be higher if the D and D team were allowed to include the revenue from its popular video game spinoffs. But it can't, because those aren't made by Hasbro. So the D and D team have flown in from Seattle to plead their case. They propose a new edition of the game, one designed to appeal to a younger generation by borrowing ideas from online video games. By now, World of Warcraft has more than 6 million players worldwide. The D and D team believes it, and other online role playing games like EverQuest has stunted sales of their third edition rules. But if they can make Dungeons and Dragons more like the games young people are already playing online, that'll make it more appealing. But wait, there's another problem, one that's baked into the game's very soul. See, Dungeons and Dragons may be famous, but it's hard to monetize. Why? Well, because it's a niche product that doesn't encourage its fans to keep spending. All players have to do is buy the core rule books. Once they've bought those, well, they're set for life. They don't need to buy another Dungeons and Dragons product ever again. Sure, some fans buy campaigns and novels, but there's no built in compulsion for them to do so. Compare that to some of Dungeons and Dragons tabletop peers. Magic the Gathering makes far more money because the game's design compels fans to keep buying new card packs. Here's another example. The fantasy war game Warhammer. It's got fewer players than D and D, and yet Warhammer delivers far bigger revenues. Why? Because the game's fans spend a lot of money buying miniature armies to paint and play with.
- [30:38]
In their pitch, the Dungeons and Dragons team tackle this problem head on. They propose building a website called D and D Insider. It'll offer tools to help Dungeon Masters run games online and include a virtual tabletop with 3D animated miniatures. Dungeon Masters will pay a monthly subscription to use the site. By now, the Hasbro executives are nodding along. This is sounding good, but the team's pitch isn't over yet. They're also going to sell virtual miniatures for use on their virtual tabletop. And once the existing D and D video game licensing deal ends, Hasbro could use the same virtual tabletop to build its own version of World of Warcraft. It's a compelling vision, one that could take Dungeons and Dragons from an underperforming brand to a Hasbro tentpole. The team leaves Rhode island victorious, and in June 2008, the fourth edition of the game is unleashed. Everyone could use more heroic fantasy adventure in their lives.
- [31:44]
And with a few of your friends, you can find it. Dungeons and Dragons 4th Edition get together, roll some dice, have fun.
- [31:57]
But the fourth edition's launch is anything but fun. The reception from existing fans ranges from cool to hostile. Some complain about Hasbro's attempt to widen its appeal. Others dislike the new rules because they aren't compatible with earlier editions of the game. Many players refused to switch to the new edition, once again fragmenting the D and D player base. The D and D Insider website also disappoints. It costs almost $15 a month to subscribe, but its biggest selling point, the virtual tabletop, isn't ready at launch. The Dungeons and Dragons team believed they could build that feature themselves. By the time they realized it was beyond their capabilities, it was too late. D and D Insider launches without that virtual tabletop, the one feature that was vital to the business plan. The grand plan to catapult Dungeons and Dragons into the ranks of Hasbro's most treasured brands has failed. So as the 2010s began, D D's designers go back to the drawing board. They began working on a fifth edition with the aim of releasing it on the game's 40th anniversary in 2014.
- [33:13]
The overriding goal of the fifth edition is to reunify the player base. But at this point that's a tall order. Dungeons and Dragons is a complicated game. Convincing players to embrace new rules is a big ask due to the learning curve involved. So there's a natural resistance to embracing change. But the fragmented fan base and limited numbers of newcomers are problems for players, too. They make it harder to find people to play with. And when people can't find others to play with, there's a risk that even the most passionate fans might stop playing. So this time, Wizards of the coast takes a new approach to revising the game. It collaborates with the fans. They share early ideas with influential players to get their feedback and buy in. They spend months traveling to gaming events, holding play tests and soliciting opinions from players. The company even shares the draft rules online so that thousands of players can get a sense of what's coming and offer feedback. This time, they aren't imposing change from above. They're co creating the next edition with the Dungeons and Dragons community.
- [34:27]
In a sense, Wizards of the coast is replicating what Gary Gygax did back before publishing Dungeons and Dragons. He too shared the rules with friends and fellow wargamers to get feedback. And that also seeded demand for the game. This is the thing about having a passionate fan base for your product. They want to be involved. They feel it's as much their brand as the company's, even if legally that's not true at all. What's more, fans who were invested in your product are also powerful advocates who are often more effective at drumming up sales than PR campaigns or ad spends. And unlike your PR or ad agency, they do it out of love, not for the paycheck.
- [35:09]
By the time the fifth edition of Dungeons and Dragons launches in July 2014, the buzz among players is huge. Three years of buildup has left them eager to upgrade. Stores order three times as many copies of the rule books than they did for the fourth edition, and the copies sell out on day one. Dungeons and Dragons hasn't been this popular since the 80s, but Wizards of the coast knows that the real test is year two. The pattern for new editions of the game is now established. Strong first year sales as existing players buy the new books, followed by a rapid decline. For the game to really make a comeback, sales have to rise year over year. And in 2015, they do. Sales rise by a massive 23%. In 2016, sales jump again, aided by an unexpected boost from Netflix's latest blockbuster show, Stranger Things.
- [36:12]
Something is coming, Something hungry for blood. A shadow grows on the wall behind you Swallowing you in darkness. It is almost.
- [36:21]
B
Here. What is.
- [36:22]
A
It? What if it's the Demogorgon? Oh, Jesus, we're so screwed. If it's the Demogorgon, it's not the Demogorgon. With a monster named after D&D's demon prince and a plot inspired in part by the satanic panic of the 1980s and the real life disappearance of James Dallas Egbert III. Stranger Things turbocharges D&D's sales the game starts selling at levels not seen since its 80s heyday. And it's not just Netflix that's fanning sales. The game is also a regular feature on the hit sitcom the Big Bang theory. In the 1980s, D&D was seen as something for misfits and geeks. Forty years on, geek is chic. Comic book characters dominate the box office, celebrities openly talk about their love for the game, and the social stigma has melted away. Then come the live streams. Millions of people are watching others playing Dungeons and dragons on YouTube and Twitch. And leading the way is the popular web series Critical Role. Welcome to tonight's episode of Critical Role, where a bunch of us nerdy.
- [37:28]
C
Ass voice actors sit around and play.
- [37:30]
A
The first game of our new campaign in Dungeons and Dragons.
- [37:36]
And when the COVID pandemic hits in 2020, the game experiences another surge in popularity as people stuck at home start playing the game over zoom. By 2021, Dungeons and Dragons is five times as popular as it was a decade earlier. By 2022, it boasts more than 13 million active players and estimated revenues of $150 million a year. In 2023, the brand delivers a blockbuster movie, Dungeons and Honor among thieves, and a smash hit video game, Baldur's Gate 3. And yet, from Hasbro's perspective, Dungeons and Dragons is still under monetized. Its earnings are dwarfed by the Gathering, which generates sales of a billion dollars a year. And it lags behind Warhammer, which is pushing sales of almost half a billion dollars a year. Still, the game's trajectory is trending upwards. And as Dungeons and Dragons 50th anniversary in 2024 approaches, the brand seems unstoppable. But then, in January 2023, an internal document from Wizards of the coast is leaked to the website Gizmodo. It reveals a plan to revise the ogl, the open gaming license that allows fans and other third parties to use the Dungeons and Dragons rule set. The proposed changes would allow Wizards of the coast to profit from products created under the OGL without paying those who created it. Any company publishing OGL content with revenues of more than $750,000 would have to give Hasbro a 25% cut of the sales. The leak sparks fury among the D and D community. Within days, more than 66,000 fans sign an open letter condemning the proposals. D and D influencers flocked to YouTube to express their dismay and threaten boycotts. So we are one week into 2023 and Wizards of the coast are already going for the ultra any percent speedrun of destroying their own company as quickly as possible. They are attempting to revoke the old license and replace it with a new one, which is just so cartoonishly evil and horrible that when I saw a leak of it in December, I didn't want to publish a video about it because I knew you wouldn't believe me. A few days later, Wizards of the coast issues a statement promising it will not move forward with the draft, offering assurances to the community apologizing and generally distancing itself from the leaked draft.
- [40:19]
Trust is compound interest, but it evaporates faster than it grows if your brand sits on Fan Devotion don't change the rules of the relationship without a seatbelt. Spell out what you're changing. Explain why it's fair and how creators will still win. Leave room for discussion before you draw hard lines. In communities like this, you don't just sell a product, you steward a pact.
- [40:47]
The OGL controversy burns much of the goodwill built up in the previous decade. It sows mistrust between the game's most vocal fans and its owner. Now fans online view every announcement with suspicion. Suspecting some ulterior motive and winning back their trust is gonna take time. But Dungeons and Dragons has survived far, far worse threats than this. It has faced customer confusion, retailer boycotts, internal power struggles, brushes with bankruptcy, divided player communities, and droughts of interest. And it survived it all. You know, not many games endure 50 years. Even fewer enter their 50th year. Bigger than ever. It's a case study in how building and nurturing a loyal fan base can build a business that lasts. And its quest? Well, that's far from over.
- [42:00]
From wondery. This is episode two of the Many Deaths of Dungeons and Dragons for Business Wars. A quick note about the recreations you've been hearing. In most cases, we can't know exactly what was said. Those scenes are dramatizations, but they're based on historical research. We've used many sources for this season too, including Slaying the Dragon by Ben Riggs. I'm your host, David Brown. Our story was written and produced by Tristan Donovan of Yellow Ant, with sound design by Kyle Randall, fact checking by Gabrielle Drollet voice acting by Chloe Elmore. Our managing producer is Desi Blalot. Our senior producers are Jenny Blum and Emily Frost. Karen Lowe is our producer emeritus. Our executive producers are Jenny Lauer Beckman and Marshall Louie. For.
- [42:42]
B
Wondering.
- [42:53]
I'M Indira Varma. And in the latest season of the Spy who we open the file on Oleg Gordievsky, the spy who outran the kgb. A rising star in the heart of Soviet power, Gordievsky is secretly feeding MI6 the Kremlin's deadliest secrets. For 11 years, he walked a razor's edge, exposing KGB threats that hastened the Cold War's end and helped prevent nuclear annihilation. But the KGB have a mole of their own. When they discover the truth, Gordievsky's world collapses. MI6 hatch a desperate, high stakes plan to smuggle him out of Moscow, an escape that could rewrite history. Follow the Spy who on the Wondery app or wherever you listen to podcasts. Or you can binge the full season of the Spy who Outran the KGB early and ad free with Wondery.