Dungeons & Dragons Fifth Edition is out – and it’s pretty good! I hated Fourth Edition and, like many folks, defected to Paizo’s 3e-derived branch called Pathfinder and Paizo rose to the top of the sales charts for a long period. But now with a viable product, good community engagement, and the nostalgia factor (Drizzle the elf! Space hamsters!) WotC is back in the game. Will Paizo just fade away, only beloved by a fringe of the old guard? No, and here’s why.
Let me preface this by saying these are “big boy” reasons, not game system details – how many hit points a bard gets is very meaningful to some ultrageeks but is not relevant to market position. If you wanted to hear something about 5e gnomes vs Pathfinder gnomes, please go play and let the grownups talk for a minute. With that preamble, here are the three major edges Paizo has over WotC and why those will help them maintain their market position.
1. The subscription model. Paizo’s subscription model of selling is like printing money. You’ve heard how comics subscriptions are basically the single largest factor in keeping comics and comic stores afloat right? Well, same effect applies with Pathfinder subscriptions. The convenience wrenches the money right out of me and many other customers automatically without requiring us to re-make purchasing decisions each month (and to be at the mercy of stores just happening to stock products we want). It’s the same reason why WoW always made huge bank and that model became very compelling to video game producers. Paizo keeps quiet about how much of a big deal this is, probably deliberately so folks like WotC don’t get the memo. But from a business point of view, this is probably the single biggest innovation and leverage point they have from a revenue model perspective. And it’s a big one. I work in software, where we desperately try to get people into subscription models – maintenance, SaaS, etc. because it’s so financially productive.
2. The iconics. With their iconic characters – an idea enhanced from 3e D&D – Paizo doesn’t just have a game system, they have intellectual property. They have then used those iconics to fuel their comics, audio dramas, card games, mini-figs – and I wouldn’t be surprised to see movies or TV in the future. I thought it would be a no-brainer for WotC to have a strong stable of iconic characters in 5e but they completely didn’t for reasons that elude me. Sure, they have some older recognizable characters from their campaign settings – Elminster, Drizz’t, the Dragonlance characters – but they’re not capitalizing on them. One big reason why the D&D movies sucked was that both the good guys and the bad guys were just new made-up generic folks. “I have purple lips and am evil!” Screw you. Call me when you make Strahd or Bargle or Vecna or someone the bad guy. Hasbro is supposed to be “branding” geniuses, but even Paizo’s unique visual take on goblins generates stuffed animals and cute comic spinoffs and miniatures while with the 5e launch WotC’s critter of choice, kobolds, has pretty much zero sizzle and visual styling. [Normal] People relate to characters way more than setting way more than rules. Companies work very hard to get good commonalities to use to push customers across product boundaries inside brands, and that’s a great way to do it that WotC doesn’t seem to have an answer for, making it much harder to really capitalize on cross-media opportunities.
3. The adventures. “It’s the adventures, stupid.” Why do people have such nostalgia-love for the old days of Basic D&D/1e AD&D? Do they go back and talk about their love for weapon speed factors and to-hit tables? No, they talk about THE ADVENTURES. Temple of Elemental Evil, Ravenloft, Scourge of the Slavelords, Isle of Dread… These were the shared experiences people had and what they find compelling about the hobby. Adventuring is the entire point of all the rules and setting content, it’s the actual activity of the game. WotC gets this enough to keep revisiting those classic adventures every edition (Now – Return to the Return to the Keep of the Elemental Hill Giants!) but not enough to actually put out frequent and compelling adventure content themselves except for a smattering of mostly indifferent products. In 3e, the Open Gaming License covered this gap and new adventures are what propelled third party companies like Green Ronin and Atlas Games into the larger businesses they are today. In 4e, they kicked off with a couple and then slid into nowhere and now with 5e, they managed to get two out – but frankly, they’re not all that good, and again, it’s a matter of amount. Paizo gets out an Adventure Path chapter per month, every 6 months it’s a new one, there’s previous ones where if you want to do gothic horror or Arabian Nights or whatever there’s something to scratch that itch – WotC’s just planning to retread the same old properties, at a plodding pace. And as they are still farting around on licensing, third parties aren’t filling that gap as avidly as they could be. That is leaving player engagement on the table and providing fewer shared experiences to build the nostalgia that’d drive their sales in the future, especially in other media.
So though 5e is a fine game – I’m not sure that as part of the overall package, Paizo has a lot to worry about. Sure, Hasbro can pump in marketing dollars and get things into bookstores, but a) do they care enough about a small line to do so, as opposed to making more Iron Man doodads, and b) can they really successfully capitalize on multiple product lines and the D&D IP? You’d think that’s where they would be Vikings, but so far early results don’t show a lot of spark there. Anyone that’s listened to Paizo employees talk about behind-the-scenes stuff at Gen Con/PaizoCon seminars (all available on various podcasts) know that they are very smart, squared away professionals who tightly manage their own work, freelancers, licensed products, everything. They’re a well-tuned machine producing huge amounts of product across various channels and product types – Hasbro/WotC could probably do the same – but they don’t seem to be. So sure, brand recognition and deep pockets and being a decent game product will help push 5e into the limelight, but their execution isn’t crisp enough to push Paizo out, is my prediction.
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