How Gygax Lost Control of TSR and D&D

An anonymous reader writes "Sunday was the birthday of the late great Gary Gygax, co-creator of Dungeons & Dragons and Futurama guest star. With the fifth edition of D&D soon to come out at Gen Con this year, Jon Peterson, author of Playing at the World, has released a new piece to answer a historical question: how was it, back in 1985, that Gary was ousted from TSR and control of D&D was taken away from him? Drawn from board meeting minutes, stock certificates, letters, and other first-hand sources, it's not a quick read or a very cheery one, but it shows how the greatest success of hobby games of the 1980s fell apart and marginalized its most famous designer."

Comments

Easy

[halivar]

He lost a Will save.

Re:Easy

[dreamchaser]

Will saves didn't exist under any of the editions he wrote.

When going into business with Friends

[Danathar]

This should serve as a cautionary tail of what can happen when you go into business with friends and or relatives. As soon as big money starts being made...unfortunately the greedy side of human nature tends to rear it's ugly head.

Re:When going into business with Friends

[JosKarith]

IIRC Williams went on to sink as much of TSR's money as possible into buying up the rights for the Buck Rogers RPG ... which flopped and sunk without a trace, crippling TSR's finances. Rather than invest in it to turn its declining fortunes around as she was supposed to she effectively asset stripped it - her family owned the Buck Rogers franchise rights...
All in all a classic carpetbagger move by Williams that everyone except Gygax fell for.

Re:When going into business with Friends

[Danathar]

That SOUNDS a lot easier than you think.

Firing a relative or friend has repercussions outside of your business relationship. It simply isn't easy for most people who love and cherish their family and friends to toss them out on the street along with their kids.

Do you really think that a nasty money fight between friends and relatives with contractual obligations in a business would not affect the personal relationships between them?

Re:When going into business with Friends

[DerekLyons]

IIRC Williams went on to sink as much of TSR's money as possible into buying up the rights for the Buck Rogers RPG ... which flopped and sunk without a trace, crippling TSR's finances.

TSR's finances were in perpetual disarray from about '83 forward... when the D&D bubble popped.* TSR had built itself around the assumption that growth would occur at the same rate as it had during the bubble, and was screwed when it didn't. It never fully recovered. Even though Williams' mismanagement didn't help, by the mid 80's significant percentage of gamers had moved onto computer gaming and their purchases of hardcopy games dropped precipitously. They stumbled on long enough to be around when WOTC came into bucketloads of cash, but they were anything but a healthy company.

Not to mention the Buck Rodgers RPG is far from only "flopped and sunk without a trace", whether from TSR or elsewhere in the industry. (Even games that were huge successes (by the standards of the day) are by-and-large completely forgotten today.) At the height of the bubble ('82-'83) it seemed a new RPG was coming out every week, and the premises of the games were increasingly specialized and/or outlandish. By 1983, the market for tulip bulbs was beyond saturated**. By 1984 it was busted. By 1993, when the Buck Rodgers RPG was released, it would have taken a miracle for any RPG to be a breakout hit.

*The largest problems that hardcopy gaming (board, pen-and-paper, etc...) companies face are the replayability factor and the scaling factor. For the first, you can buy a set of rulebooks and literally play for years without further purchase. For the second, one guy can purchase a set and then ten or more others can play using that set for years. Once a significant proportion of your userbase has a set of your products, you're screwed. There's a reason why every gaming company of the era got into supplements and expansions and ancillary products and media as fast and deep as possible - it's the only way to survive. WOTC didn't create the idea of endless supplements and expansions (as many seem to think), they merely perfected the implementation by convincing players they were vital to continued gameplay rather than being optional.

** I remember a meeting of our gaming group in 1983 where we were deciding which GM/game would be added to our rotation to replace one that was moving away... we literally had twenty or thirty different RPG's in hardcopy physically sitting on the table. When I attended Dracon I (or was it Hexacon I, can't remember as there were so many start-up gaming cons back in the day) in 1984 I took something like ten different games from my personal collection to the con. (Met Tracy Hickman there, out stumping the then newly released Dragonlance.)

Re:As someone who played D&D in the 1980s,

[FilmedInNoir]

Wives: Gail Carpenter Gygax (m. 1987–2008), Mary Jo Powell (m. 1958–1983) ... If the stories of how marriage works are true, then you are correct.

I still don't get it...

[leonem]

The Blume family also exercised options -- which means creating new shares at a price agreed previously.

They needed money to do this, and conveniently Williams' downpayment for their other shares was exactly the same amount.

This is pretty standard: a company will often reserve X amount of notional 'shares' to be issued as options, and the existing investors are aware that their own holding will be diluted when these options are exercised. Until the options are exercised, however, they do not actually exist as shares. *

* There are various caveats on all of this, as shares may be held in treasury by the company, converted from one type to another and various other things in order to avoid tax / split control differently to the profits.