The WotC Situation

[Username17]

So the Q1 earnings call came out for Hasbro. You can find it Here.

Of the pieces we are interested in, there seem to only be two:

With respect to mix, we saw some very good growth in the quarter in our core brands and in particular those brands are profitable and contributed a great deal in volume and much of that passed through. The other thing that’s not really in the cost category but we benefited from in the quarter and we’ve told people is that our amortization expense is continuing to decline as our Wizards of the Coast amortizations is starting to roll off in the quarter.

As we look at Hasbro’s mega brand performance; Littlest Pet Shop, Monopoly, Magic the Gathering, Nerf, and Playskool all grew in the quarter. In addition, Baby Alive, Play-doh, Tonka, FurReal Friends, and Super Soaker were all up versus a year ago. The Iron Man brand also contributed to the growth in our global boys business in the quarter. We are excited for the opening of Iron Man 2 scheduled for May 7th.

One more thing I should mention as I look at the array of games that are selling well I think the Wizards of the Coast folks certainly deserve a shout out for their effort and really Magic the Gathering is performing exceedingly well both as the analog paper based game as well as online.

So... they had some kind of one-time costs with respect to Wizards of the Coast that they were doing as monthly payments. Those are running out, which means that the costs of owning WotC are dropping. Also, they report that Magic is making them a lot of money, and counts as a "mega brand" up there with Transformers and Nerf.

Equally interesting is that Dungeons and Dragons still does not rate a mention in the discussion. And that the current waves of firings began right after this call. So we can dispense with any conspiracy theories that the cost reductions mentioned had anything to do with Andy Collins leaving. But we can infer that D&D is not doing as well as hoped, because it was just after they opened up the books for Q1 that they felt th need to give Magic the Gathering a couple of shoutouts for being awesome and start firing half the creative staff working on the current edition of D&D.

-Username17

[Lago PARANOIA]

I am honestly baffled by the fact that Magic: The Gathering is still growing as a brand after all these years, considering how on the down-low it is in popular culture.

Frank, how come a traditional game like Magic is a megabrand but another traditional game like D&D is not? We really need to start working on marketing. ... then again, I can't imagine that M:tG is a very expensive thing to produce. It's probably like printing money.

[Jilocasin]

The only off the cuff reason that Magic continues to do well (and grow, that is surprising) that I can think of is that there will always be new middle schoolers.

[Zinegata]

The amortization mentioned is probably just the cost of acquiring WoTC. I know most finance departments don't like putting down acquisition/merger costs in one big lump as it tends to glaringly effect the profitability of that company for that particular year (whereas splitting it over several years makes it easier to hide, even if cash-flow wise the company still takes a huge hit during the acquisition).

Also, MtG had a very good run with the release of Zendikar, largely because of clever marketing. They randomly added a bunch of Beta-era cards (including, if rumors are true, some Power 9 cards) into a few packs in the set, which caused a huge increase in demand.

It didn't really matter that the chance of getting something like a Black Lotus was as remote as winning a lottery. I had people who were willing to pay up to twice the retail price of a pack during the pre-release on the off chance of getting a Power 9 card.

[Red_Rob]

Don't forget Zendikar included enemy fetchlands. Players of every format have been waiting for those since 2002 which I can guess pushed the sales up.

My local circle has been playing magic since Revised and we still buy cards occasionally. Not as often as we used to, but if a lot of old players buy cards occasionally, and the game keeps getting new players, thats a recipe for steady growth.

[hogarth]

Frank, how come a traditional game like Magic is a megabrand but another traditional game like D&D is not?

Because Magic is a card game that appeals to collectors and it takes 5-20 minutes to play, whereas D&D is a game where you pretend to be an elf that appeals to folks who like reading textbooks and it takes 4-6 hours to play. Oh, and you need a referee, too.

[magnuskn]

Because Magic is a card game that appeals to collectors and it takes 5-20 minutes to play, whereas D&D is a game where you pretend to be an elf that appeals to folks who like reading textbooks and it takes 4-6 hours to play. Oh, and you need a referee, too.

And one who has to have talent as a storyteller, to boot.

[Zinegata]

Don't forget Zendikar included enemy fetchlands. Players of every format have been waiting for those since 2002 which I can guess pushed the sales up.

My local circle has been playing magic since Revised and we still buy cards occasionally. Not as often as we used to, but if a lot of old players buy cards occasionally, and the game keeps getting new players, thats a recipe for steady growth.

Yep. Magic has done a lot of stuff over the years that aims to bring old players back into the game. Hell, the whole Coldsnap/Time Spiral set was one massive nostalgia trip aimed to get old players into the game again.

[souran]

Mostly boring corporate speak.

One more thing I should mention as I look at the array of games that are selling well I think the Wizards of the Coast folks certainly deserve a shout out for their effort and really Magic the Gathering is performing exceedingly well both as the analog paper based game as well as online.

Note that while this singles out magic as doing well, it doesn't actually say which other properties are doing well or badly. It jsut says, of the things doing well magic is performing above expectation.

Infact, none of these quotes really says a thing about D&D. There really isn't anything in here to think that hasbro is dissatified with wizard of the coasts managment of their properties. Infact it seems clear that Hasbro DOES NOT think that wizards of the coast as a buisness unit is underperforming. How they feel about the individual properties run by Wizards is fairly opaque, there was no mention of pokemon either.

Especially when we have a better theory of why people are being axed/leaving wizards, (they are publishing a revised version of 4th edition and "classic" 4e supporters are being forced out similar to events during 3.0->3.5 and at TSR during previous editions) these comments don't actually seem to provide support for a "hasbro is disappointed with D&D" conclusion.

Anyway, has anybody actually got real comparative sales numbers of the different major rpgs that they can link to? All I can find are people with anedotal evidence, including my favorite from on FLGS owner: 'People who are happy with 4e, or pathfinder, or who were still content with 3.5 are not on the internet btiching about the existance of 4e, pathfinder, or 3.5"

Also, does anybody know how products like D&D miniatures / the dungeon tiles are selling? Those products are edition independant and would seem to be a helpful gage in determining how much the whole industry is depressed.

[Crissa]

And the 'best' way to play Magic isn't to actually collect the cards: But to buy new cards to play each game with.

That ensures a small population will support the game.

I've been looking at smartphone games lately - and there are people who literally own a handful of iPhones to play games with no win condition. They just sit around and buy points to play the games! It's crazy. Like the one arm bandit where the best you can do is see the three bars pop up but you get no rewards...

What the hell do you do with four iphones on your couch?

-Crissa

[Smeelbo]

I can tell you that at our store, at least, Magic The Gathering is doing extremely well. We sell almost all the booster packs we receive in less than a week, and that includes the last eight sets: Rise of the Eldrazi, Worldwake, Zendikar, Alara Reborn, Conflux, Shards of Alara and Magic 2010 Core Set. Basically, I can sell all the MtG I can get into to the store, for prices far exceeding our previous "normal" prices. For example, we used to sell booster displays for $90/box, but now we cannot keep Rise of the Eldrazi in stock at $110/box, the most we have ever charged for a new set. And at $110, we are lowest price in the county. Single sales are very strong as well.

While listening to players brag about their decks is only slightly less horrible than having someone blather about their D&D character, my impression to listening to a lot of players (we host over a dozen Magic tournaments a week), is that WotC has gotten really good at putting together Magic sets. Cards are more efficient, involve more interesting trade-offs, satisfy multiple formats (sealed, draft, constructed, extended, etc.), and there are far fewer crappy cards. They also mostly have a pretty firm hand on the meta-game, although Jund decks have been dominating Type II to the detriment of the game for some time now.

Ever since the Magic 2010 Core Set, every set Wizards has released has sold out almost immediately, and demand remains strong. We used to be able to satisfy our demand through only two major distributors, Wizards itself and Alliance, but now we find ourselves paying higher prices to buy from other distributors, and selling all of it at higher prices ourselves.

Now is a good time to be selling Magic Cards.

As for 4E versus PathFinder, that is less clear. We have a strong RPGA presence that fills half a dozen tables every third Saturday, we run a table or sometimes two of D&D Encounters every Wednesday, and we often host 4E games on other Saturdays.

On the other hand, every private D&D campaign associated with the store the store is either 3.5 or PathFinder, about half a dozen of these, there is a non-4E MeetUp twice a month, and the sales volume between 4E and PF is comparable, with the edge towards 4E.

Role playing accessories are doing very well: dice, play mats, and so on.

On the other hand, board games are doing better for us as well, almost twice what it was two years ago.

But all of that is but a fraction of our Magic sales.

Smeelbo

[Count Arioch the 28th]

Now is a good time to be selling Magic Cards.

Slightly off topic, does that extend to older cards?

I have a small collection of Magic Cards that I haven't touched for about 15 years and I am tried of looking at the things. Is their still a market for old cards?

[Zinegata]

Depends on what the cards are. Since they're 15 years old, I'm assuming they're only legal in Legacy or Vintage format now.

If they're Legacy or Vintage viable, then you may be able to sell them at a good profit. But if they're not... expect to get only peanuts for them.

Unless of course it's an old copy of a good card that has been recently reprinted. Being Standard or Extended legal makes cards much more valuable

[Zinegata]

While listening to players brag about their decks is only slightly less horrible than having someone blather about their D&D character, my impression to listening to a lot of players (we host over a dozen Magic tournaments a week), is that WotC has gotten really good at putting together Magic sets.

I'd agree. I'd even go as far and say that the trend of good Magic sets really began with Ravnica when they started designing entire sets around a specific theme or idea as opposed to just randomly throwing cards together with some fluff/characters you don't really care about.

I've heard mixed things about the sets immediately after Ravnica, but I liked Coldsnap, I liked Time Spiral, but mainly for the nostalgia. Lorwyn was reportedly very good too... but I backed away from it out of principle. I'm not playing a game where all the people are just hobbits, ents, and elves .

[A Man In Black]

I'd agree. I'd even go as far and say that the trend of good Magic sets really began with Ravnica when they started designing entire sets around a specific theme or idea as opposed to just randomly throwing cards together with some fluff/characters you don't really care about.

It didn't start with Ravnica. Kamigawa had an obvious theme, Mirrodin was a mechanical metal world, and Onslaught was creatures, creatures, CREATURES. I'd say Onslaught is well-regarded in hindsight, feelings are strongly mixed about Mirrodin, and few like Kamigawa. Odyssey, the last I'm-on-a-(flying)-boat block was well-regarded, too.

[Red_Rob]

I'd agree. I'd even go as far and say that the trend of good Magic sets really began with Ravnica when they started designing entire sets around a specific theme or idea as opposed to just randomly throwing cards together with some fluff/characters you don't really care about.

It didn't start with Ravnica. Kamigawa had an obvious theme, Mirrodin was a mechanical metal world, and Onslaught was creatures, creatures, CREATURES. I'd say Onslaught is well-regarded in hindsight, feelings are strongly mixed about Mirrodin, and few like Kamigawa. Odyssey, the last I'm-on-a-(flying)-boat block was well-regarded, too.

The first magic expansion set was themed around the Arabian Nights.

Although, if you're talking about themed in a mechanical way, that really started around Invasion with the first big "Multicolor" push. This was something Mark Rosewater talks about in his column - they moved towards having an overarching block theme with this set rather than just having a number of individual mechanics. For example, Invasion premiered Domain (relying on having many different coloured lands) and split cards (which allow two different colours of spells on one card), both of which push you to play multicoloured decks. It also included plenty of mana fixing lands and a lot of multicolor cards. After this, Planeshift expanded the Multicolor theme and Apocalypse focussed on enemy colour pairings.

So, that seems like a pretty heavy theme to me. Did you by any chance start playing around Ravnica?

Smeelbo, you are seeing strong sales of Rise of the Eldrazi? There's been a lot of talk about how not a lot of the cards are constructed playable and whether enough of the casual crowd would invest to make up for constructed players bowing out.

[Smeelbo]

While there are some complaints about Rise of the Eldrazi for some formats, the fact is that we can't keep it in stock, evening charging $20 more per display than usual. And our suppliers are out of stock as well.

Based on what I am hearing, Rise of the Eldrazi really mixes up the Extended Format meta-game, and at the same time, people are so sick of Jund's domination of Type II that the player base is desperate to find something else that works.

Smeelbo

[Zinegata]

Sorry, let me clarify: I meant block, not set.

http://www.wizards.com/Magic/Magazine/A ... eature/311

Ravnica Block has the most comprehensive, overarching block design in Magic's history. This careful structure, planned across all three sets during Ravnica design, laid some valuable foundations on which to build. We knew from the beginning that the Gruul, the Orzhov, and the Izzet guilds each needed a Guild Leader Legend, an “Each color matters” Henchman Legend, a Guildmage, a guild artifact, a common hybrid, a rare hybrid, monocolored spells “enhanced” by another color, monocolored permanents with off-color activations, a signet, a karoo, an uncommon guild land, a dual land, and its own keyword, to say the very minimum.

[A Man In Black]

Sorry, let me clarify: I meant block, not set.

That doesn't clarify anything. Kamigawa, Mirrodin, and Onslaught were all blocks, and immediately preceded Ravnica. They have unifying design elements, a unified theme both mechanically and thematically, and a planned arc both in story and in mechanics.

What did Ravnica bring that those blocks didn't? I don't see how contemporary "Get excited about the new SKU!" promotional materials clarify your point.

[Zinegata]

Sorry, let me clarify: I meant block, not set.

That doesn't clarify anything. Kamigawa, Mirrodin, and Onslaught were all blocks, and immediately preceded Ravnica. They have unifying design elements, a unified theme both mechanically and thematically, and a planned arc both in story and in mechanics.

What did Ravnica bring that those blocks didn't? I don't see how contemporary "Get excited about the new SKU!" promotional materials clarify your point.

Again:

We knew from the beginning that the Gruul, the Orzhov, and the Izzet guilds each needed a Guild Leader Legend, an “Each color matters” Henchman Legend, a Guildmage, a guild artifact, a common hybrid, a rare hybrid, monocolored spells “enhanced” by another color, monocolored permanents with off-color activations, a signet, a karoo, an uncommon guild land, a dual land, and its own keyword, to say the very minimum.

Blocks prior to Kamigawa were designed on more of a set-by-set basis, as opposed to having the whole block planned out from the get-go.

[A Man In Black]

Blocks prior to Kamigawa were designed on more of a set-by-set basis, as opposed to having the whole block planned out from the get-go.

And that quote illustrates that how? That quote simply says that they had cross-set cycles of cards, which is a new but trivial invention for Ravnica. Are you really saying that the success of Ravnica block was due to having a guildmage for each color pair? Your base claim, that Ravnica was the first block planned from the beginning, is silly, because Scourge and Onslaught were co-developed at much the same time and Mirrodin block was planned from the beginning and broken into sets.

Look, I agree that Ravnica was a watershed. I don't think you make a convincing case why, because the blocks leading up to it had many of the qualities you're talking about.

[Zinegata]

And that quote illustrates that how? That quote simply says that they had cross-set cycles of cards, which is a new but trivial invention for Ravnica. Are you really saying that the success of Ravnica block was due to having a guildmage for each color pair?

Your base claim, that Ravnica was the first block planned from the beginning, is silly, because Scourge and Onslaught were co-developed at much the same time and Mirrodin block was planned from the beginning and broken into sets.

If you don't want to take Mark's word that Ravnica is the first block that they really comprehensively planned the whole thing out as a block as opposed to focusing on the set and just hoping they have unified elements, then it's no longer my problem.

I'm just quoting one of many articles that repeat over and over that Ravnica was the first fully planned block, as opposed to the previous paradigm of "Let's make a set and let's just hope it fits the fluff and mechanics of the whole block!"

[A Man In Black]

If you don't want to take Mark's word that Ravnica is the first block that they really comprehensively planned the whole thing out as a block as opposed to focusing on the set and just hoping they have unified elements, then it's no longer my problem.

That's not Mark Rosewater, that's Devin Low. I'm not taking his word for it because he doesn't say it. He says it's the "most comprehensive, overarching design in Magic history" and that's BS marketing fluff. When he talks about Ravnica's overarching design, he contrasts it with Prophecy, a set from all the way back in Masques block, and not the sets you're contrasting it with.

Man, I agree with you, I just can't put my finger on why. I do know that your explanation is insufficient.

[Zinegata]

If you don't want to take Mark's word that Ravnica is the first block that they really comprehensively planned the whole thing out as a block as opposed to focusing on the set and just hoping they have unified elements, then it's no longer my problem.

That's not Mark Rosewater, that's Devin Low. I'm not taking his word for it because he doesn't say it. He says it's the "most comprehensive, overarching design in Magic history" and that's BS marketing fluff. When he talks about Ravnica's overarching design, he contrasts it with Prophecy, a set from all the way back in Masques block, and not the sets you're contrasting it with.

Man, I agree with you, I just can't put my finger on why. I do know that your explanation is insufficient.

I'd rather not hunt down _all_ the articles where they compare Ravnica to more recent blocks such as Onslaught, but I do recall MR writing such comparisons in Making Magic .

[A Man In Black]

I'd rather not hunt down _all_ the articles where they compare Ravnica to more recent blocks such as Onslaught, but I do recall MR writing such comparisons in Making Magic .

I dunno about anyone else, but I'm not looking for sources. This isn't fucking Wikipedia. I just want to know what made Ravnica different from Kamigawa and Mirrodin and Onslaught.