This series of articles was published before D&D Next was announced in early 2012, telling the story of how the once respected brand became tarnished and speculated on the future in The State of D&D: Present and The State of D&D: Future.

Sitting around a table pretending to be human fighters and elven mages delving through dungeons in search of loot and fame hasn’t been a favorite pastime for fantasy fans for all that long. The first tabletop RPG was released a mere 37 years ago, in 1974, but there are now more roleplaying games on store shelves than ever before, – covering every niche of geek culture from the superheroes of Mutants & Masterminds to character-based “story-games,” to space exploration in Traveler, to games that meld all genres like Rifts. Through it all though, there was one game to rule them all – Dungeons & Dragons – and even though the rules were revised over the years, the majority of the fantasy-gaming audience have used whatever edition of D&D was currently available.

Confidence in the official Dungeons & Dragons is at an all-time low. Players are split into various camps, viciously defending what they believe is the “true” D&D.

That changed in 2008, with the release of the 4th edition of Dungeons & Dragons. Many tenets of the game like spell memorization and alignment were thrown away in the name of modernization and streamlining. Confidence in the official Dungeons & Dragons is at an all-time low; on forums, at conventions and at your local game store, players are split into various camps, viciously defending what they believe is the “true” D&D.

To understand the current landscape of the RPG industry, it’s essential to comprehend the important events in D&D‘s past and present before we look to the future. Like Ebenezer Scrooge in A Christmas Carol, lets visit with the ghosts of RPG history to get a better understanding of how the hobby got here, what is happening in the tabletop gaming industry today and what it faces in the future.

The Ghost of D&D Past

In the beginning, there was only one set of rules. Dave Arneson adapted the rules of Gary Gygax’s war game Chainmail in the early 70s to concentrate on a smaller group of characters fighting against monsters. Gygax finalized those changes into what would come in a white boxed set called Dungeons & Dragons. He later revised the rules and his company TSR published them as Advanced Dungeons & Dragons in 1978. TSR published a new 2nd edition of AD&D in 1989 that significantly changed the core rules in order to unify much of the supplementary material that had been published for D&D – a move that pleased some players but disenchanted many others. A troubled run in the 1990s nearly bankrupted TSR, but, but the game survived when Wizards of the Coast stepped in and published another edition edition of D&D in 2000. This new edition not only spurred sales, but also fixed many of the previous edition’s problems. Another slight improvement, called Edition 3.5, arrived in 2003, followed by yet another edition of the beloved roleplaying game in 2008. By this time, D&D had passed through so many hands and filtered through so many imaginations that playing 4th edition bore almost no resemblance to playing the game created by Gygax and Arneson some 35 years before.

Gygax had a troubled relationship with his own game because he was a much better game designer than a publishing company CEO. In the 80s, a lot of his attention turned to overseeing the Dungeons & Dragons cartoon, and a faction within TSR wrested control of the company from him in 1985. Unfortunately, TSR fared no better without Gygax running the books, and Magic the Gathering-owner Wizards of the Coast purchased TSR in 1996 when the D&D publisher was on the brink of bankruptcy. Despite no longer owning the game he created, Gygax still remained active in the hobby, posting on forums and attending gaming conventions whenever possible until his death in 2008.

When Wizards of the Coast was acquired by toy-maker Hasbro in 1999, there were already plans to create a 3rd edition to unite the various disparate groups of tabletop RPG fans. “You had people playing 1st edition AD&D, 2nd edition AD&D, five or more flavors of Storyteller games, a couple of different games from FASA, GURPSs, Call of Cthulhu, Deadlands, Legend of the Five Rings5R,” recounts Ryan Dancey, the VP of Tabletop Games at Wizards of the Coast at the time from 1997 to 2001. “By percentage, it was probably 2nd edition 30 percent, everything else 70 percent.

“When we were working on 3rd edition, it became clear that our biggest competitors were 1st and 2nd edition AD&D, not a third party game system.”

“When we were working on 3rd edition, it became clear that our biggest competitors were 1st and 2nd edition AD&D, not a third party game system,” Dancey continued. “2nd [edition] had clearly suffered because it had not managed to get enough 1st edition players to switch.”

In order to group all of these camps under the same game umbrella, Dancey had a crazy idea that ultimately shaped the current roleplaying marketplace. “I remember Ryan Dancey walking into a meeting where all of RPG R&D was gathered,” said Mike Selinker, one of the creative directors of the 3rd edition of D&D. “Ryan and his team came in all sheepish, as if they had something to say that could have gotten them lynched. Ryan starts talking about the open source computer movement and the future of paper-based publishing and so on, and eventually gets to the nugget. ‘So,’ he says, ‘we’re thinking about giving the system of D&D away for free. Pretty much anybody can publish anything they want using our game and our text. They can even copy it and print it. Other game publishers can republish their own settings using our rules. What do you guys think?’

“The room was dead silent. Eventually, from the far corner of the room, I said, ‘I think that’s the most brilliant thing I’ve ever heard.'” Selinker remembered that there was an intense debate afterwards but eventually everyone “coalesced around this crazy idea.” The Open Gaming License [OGL] was born in that room, a legal document with very loose copyright restrictions that allowed basically anyone to produce content using the core D&D mechanics.

“We wanted to ensure [the division of 2nd edition vs. 1st] did not repeat, by trying for an (unobtainable) goal of 100% conversion,” said Dancey. “The OGL was a big part of making that possible – because it let hundreds of developers fill in the niches that Wizards didn’t have the time or the inclination to do itself, including a lot of content desired by 1st and 2nd edition players.”

When it was published in 2000 along with the 3rd edition of the rules, the OGL sparked unprecedented growth in the RPG industry. The OGL made it so easy to use the rules conventions of D&D like hit points, spells and monsters that hundreds of products – the official signifier of D&D-compatible materials created using the OGL – emblazoned on them made their way to game store shelves.

“The core of the D&D property was released through the Open Game License. WotC held back a few monsters like beholders and mind flayers, but for the most part the guts of D&D were made available to everyone for legal re-use,” said Chris Pramas, President of Green Ronin Publishing. Companies Green Ronin were able to use the OGL to create entire RPG lines like the superhero game Mutants & Masterminds and make a significant amount of money.

The OGL and the 3rd Edition of D&D were unarguably a success. “[3rd edition] was the most successful RPG published since the early years of 1st edition AD&D,” Dancey said. “It outsold the core books of 2nd edition AD&D by a wide margin. I attribute some of that success to the OGL and to the massive amount of player network support the OGL engendered.” According to a 2007 issue of Comics & Games Retailer , five out of the top ten bestselling RPGs were either published by Wizards of the Coast or utilized the OGL. More than that, the OGL allowed smaller companies and even individuals with big ideas to bring their products to the market. Because of the OGL, gamers could concentrate on imagining new adventures, dungeons, and characters instead of reinventing the nuts and bolts of the mechanics.

Of course, not every module or supplement created using the OGL had the same level of quality and polish. “Plenty of distributors and retailers assumed that all d20 stuff was of a similar quality,” said Andy Collins, who was a design team lead for 4th edition under Bill Slavicsek and Rob Heinsoo before taking over as Design & Development Manager around the launch. “Which is a little like expecting that every new book with a vampire on the cover will automatically sell as well as Twilight, but hey, these were exciting times.” The swell of new products with a somewhat “official” D&D stamp on it led to a boom period in the industry with hundreds of new products suddenly on hobby store shelves.

“Wizards has a $100 million brand – Magic: the Gathering. It tried to convince Hasbro that it could have two, by amping up D&D to that level.”

With every boom, there is a bust. The glut of unsold d20 products from the early 2000s began to weigh down those same store shelves, as did the core D&D products that supported them, such as the Player’s Handbook. Wizards of the Coast added to the 3rd edition rules with product lines like the Complete series, but, with only a few exceptions such as Psionics, it never again released its content as open source, nor took material others had developed using the OGL and incorporated it into official D&D products.

D&D had to support itself through the sales of secondary books – such as the class books, or the setting books, or additional rules supplements. As more and more of these become available (over the life of any edition of the game), the audience gets closer and closer to a saturation point,” said Ed Stark, a creative directors from the 3rd edition era of D&D. “Eventually, the individual consumers start buying every new book and become pickier about what they add to their collections. Sales drop off – not necessarily because of book quality – and a new edition becomes necessary to ‘reset’ the knowledge base and introduce a new influx of sales to the support products.”

As much as fans of the game were impressed with 3rd edition and its modest revision of 3.5, market pressures began to build. Wizards of the Coast, at first emboldened by the corporate resources of Hasbro, suddenly felt the need to make D&D more profitable. In the mid-2000s, “Hasbro restructured itself internally to focus on its most successful brands,” said Dancey. “Brands that did $50-$100 million a year in revenue were considered ‘core,’ and smaller brands were going to be marginalized. Marginalized businesses get downsized in headcount. They may also be mothballed, or sold.”

The sad truth was that D&D was in danger. “Wizards has a $100 million brand – Magic: the Gathering. It tried to convince Hasbro that it could have two, by amping up D&D to that level,” continued Dancey. “D&D was not a $50 million a year business, nor was it likely to ever become one on its then-current trajectory. So the reaction of the folks working on RPGs at Wizards is totally understandable – they felt their jobs were at risk.”

The desire to grow roleplaying games and D&D into a bigger business is a noble goal, but the executives at Wizards were divided on how to make that happen. The obvious success of fantasy MMOs like World of Warcraft in 2004 suggested there was an as yet untapped audience for fantasy RPGs. A new edition of the beloved game that catered to these folks might push growth of D&D players to new levels. The OGL and its degree of success was also a hot topic of debate, and many of the people in charge when it was implemented – including Dancey and former Wizards CEO Peter Adkinson – were no longer employed at the company. Executives’ confidence in giving away content for free began to wane as the company invested time and money in having young, eager game designers develop a new edition of the rules. Even to fans, an update to the D&D rules seemed like an exciting prospect, but unlike how the OGL and 3rd edition united audiences, Wizards’ handling of the release of the 4th edition of D&D in 2008 splintered roleplaying gamers into violently opposing groups.

Find out what happened, and the current state of the RPG industry, in the next installment as we welcome a visit from the ghost of D&D Present.

This series of articles continues with The State of D&D: Present and The State of D&D: Future.

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