All is not well in the land of Dungeons & Dragons. Wizards of the Coast, and its owner, Hasbro, are receiving push back from its D&D fans. Before I get into why, let me take a moment and express just how vital Wizards of the Coast is to Hasbro, According to a Motley Fool article:
It’s hard to overestimate how important Wizards of the Coast is to Hasbro. According to data from S&P Global Market Intelligence, it accounts for just 22% of Hasbro’s annual revenue — but produces a staggering 72% of Hasbro’s profit.“A Big Change Could Be Coming for Hasbro: Should Investors Worry?,”Motley Fool January 17, 2023
D&D is the world’s most popular role-playing game. It was first published in 1974 and purchased twenty-three years later in 1997. Hasbro, in turn, purchased Wizards of the Coast two years later, in 1999.
So important is Wizards of the Coast to Hasbro that the CEO of Wizards of the Coast, Chris Cocks, was elevated to the Hasbro CEO position upon the demise of Brian Goldner.
It is, therefore, surprising Wizards of the Coast has been under intense criticism since Cocks left in February of 2022. In November, Bank of America accused Wizards of the Coast of over-producing new cards. That charge resulted in a number of negative stories in the press. Here is a quote I ran in my article on the subject, “Hasbro Gets Blindsided by Bank of America:”
An oversupply of Hasbro Inc.’s “Magic: The Gathering” cards is hurting the ecosystem for the fantasy trading-card game, “destroying the long-term value of the brand” and threatening sales, BofA analysts said in downgrading the stock on Monday.
Shares of the toymaker slid 9.2% during regular trading, putting the stock on pace for its biggest percentage decline since Oct. 26, 2020. Hasbro HAS, 4.41% was Monday’s worst performer in the S&P 500 Index.Hasbro is making too many ‘Magic: The Gathering’ cards, analyst says in downgrading stock, Bill peters, marketwatch, november 15, 2022.
Now we are told that Hasbro has angered the D&D ecosystem with a decision, later retracted by Hasbro, to monetize any company providing products based on Dungeons & Dragons. This is a departure from the previous policy, which took a more laissez-faire approach.
Under the new terms, anyone creating content with use of Hasbro intellectual property, and selling that content for profit, would need to report to Hasbro on everything it is selling — and inform Hasbro of its annual revenue from such sales if it exceeds $50,000.“A Big Change Could Be Coming for Hasbro: Should Investors Worry?,”Motley Fool January 17, 2023
As I read this latest contretemps, my mind returned to the Scrabulous kerfuffle of 2007. Scrabulous was a Scrabble knockoff that was played online. It was featured on Facebook, and quickly attracted a fervent fan base that loved its use of the Internet to enable players to communicate in real-time while they played. It was an early use of social and gaming components.
Hasbro saw Scrabulous as an impingement on its intellectual property rights. It therefore took legal action, and forced the company owning Scrabulous to change the game’s name to Lexulous.
At the time, there was a lot of anger aimed at Hasbro by Scrabulous fans who threatened never to play Scrabble again. Now, 15 years later, Scrabble is still a highly popular game, and I don’t know about you, but I had just heard of Lexulous when I wrote this article.
The bottom line is that there may be some angry people in the D&D fan world, but I bet this all goes away, just like it did with Scrabulous.