The future of the RPG industry: Publishing in Microcosm

Ask any RPG gamer whether they buy their books locally anymore, and you will usually get one of two answers. Either they don’t, because it’s so much cheaper to buy them online, or they do, and they do it to support their local gaming store.

When Gaming Retail Becomes Charity

But, when did it become a matter of charity whether or not to buy locally? The fact of the matter is, for a variety of reasons tied into Gaming Culture and the profit margins of selling books of any sort, it’s simply not cost-effective to run a traditional RPG store anymore.

To run any Brick-And-Mortar store, you must balance the cost of rent per square meter of floorspace against the profits generated by that same floorspace due to customers buying your products. This is a pretty fundamental principal of retail, and you can see it in action everywhere you look. For example clothes shops must weigh the benefits of stuffing as much stock as they can against the discomfort it may cause and against the price of their clothing. So, very up-market clothes shops with huge markups on their clothes can afford to make shopping feel like a “premium experience” by leaving lots of floorspace, whereas Pennys and TK Marks try to stuff as much clothing into as little space as possible while still allowing customers to get in and buy things.

For gaming stores, the problem is that much of their stock sells slowly and carries an unexceptional margin, making it a business with underwhelming profit margin generally. Of course there are exceptions, but this is certainly true of the RPG book section. However, internet retailers do not have to pay nearly as much rent per square foot, as they can simply stack the books up high and not leave room for customers. Perhaps they don’t even pay commercial rent, as they can work out of home. Because of their drastically reduced outgoings, they can afford to charge far less than Brick and Mortar shops, which attracts buyers away from the latter. Which of course, feeds the cycle; to justify keeping an RPG book section, local shops must hike the margins to balance their poor sales against the floor area they occupy.

Eventually, the battle is lost. Shops either continue to stock RPG books simply because they attract clients without any expectation of meaningful profit, or they stop stocking the books altogether and focus on items with better margins; Card games and Warhammer for the most part.

Compounding all of this is the fact that the local gaming shop typically becomes a social hub for the local gaming community. This may seem like a boon, but in order to make people feel welcome you need to provide some floorspace in which they can socialise, floorspace that is not generating any profit. Asking players to “support” your shop by buying products they usually get cheaper online is an artificial sort of business, and is not sustainable. Players come for socialising more often than for books; instead of spending their floorspace stocking books, gaming stores ought to be enabling and monetising the social element of gaming.

Publishers Collapsing

It would be a closed case and just another story of gaming evolution if things were still going strong for games publishers. However, book publishing ain’t what it used to be, and even some of the big RPG publishers are dying. Between technological innovations that undercut their existing business model (make and sell books), a lack of spending power in their target audience (think: The “R” word) and the buy-one-and-share-with-friends nature of RPGs, things aren’t working out. E-publishing is growing quickly as a way to sell books without much cost, and the slew of smaller-scale e-publications from White Wolf are a good example of emerging coping strategies in relatively savvy companies.

The problem is, although gamers will certainly buy these e-books for reference texts, they still want to have physical copies for the mainstay books of the games they play. Having to print fewer books to satisfy their customers may seem like a tonic for the publishers’ outgoings, but the deficit isn’t wholly covered by the rise in ebook sales. What is needed is a way to have the cake and eat it, to provide books while not having to make, ship and sell them.

On-Demand Publishing

One potential avenue which fulfils the have-cake-and-eat-it desire is to employ on-demand models for publishing of books. Avid White Wolf fans may remember that several of their titles were published through Lulu.com in this way, including a cheaper soft-bound copy of Exalted 2e Abyssals and some nicely sized softbacks for LARP World of Darkness. For reasons I cannot understand, White Wolf pulled their collection from Lulu. This didn’t make any sense to me, because by Lulu.com’s nature, it is a zero-risk model for book authors and small publishing houses; if books don’t sell, you lose nothing. If they sell, you get a profit. Win-win?

However much I would have rathered they maintain their collection at Lulu, it is not the answer to their woes anyway: The lead-times on getting a new release would exceed the time taken for it to come in stock elsewhere. Nor is it a feasible solution for Brick and Mortar shops, who are ultimately agnostic about methods of production, making orders from Lulu a time consuming and pointless change for resellers. Lulu would make the perfect back-ordering system for people who missed the initial run, or for out-of-print previous editions, however.

Far more exciting is the advent of point-of-sale book printing, such as the Espresso Book Machine. This machine can print a 300 page book in 3 minutes, at a cost of about €3 for materials. Books are “perfect” bound with colour covers and black and white interior. In addition to a vast archive of out-of-print and public domain books that can be bought by interested customers, the company behind the machine has licensing deals with several major publishers, including a wing of Ingram that deals solely with alternative publishing. Even better, the interface on the machines can be used by customers to contribute their own work for sale on any other machine worldwide, making them an interesting new means of distributed publishing for unestablished authors.

Imagine a world where local gaming stores have adopted such machines. Rather than spending floorspace on a (invariably poor) selection of RPG books, they have a single machine capable of fulfilling the needs of even the nichey-est customer, as well as mainstream customers looking for regular or out of print books. Because of the low cost of local printing for smaller publishing runs (such as RPGs in general), lower prices can start to entice customers back from the internet with the promise of a book now instead of in several days. Publishers can start to publish directly to these on-demand sites, making the dissemination of new books an instantaneous task requiring no more effort than uploading a manuscript. They no longer have to pay for manufacturing or distribution, leaving that to the automated machines in the gaming stores.

In fact, this distributed as-you-desire-it model allows Errata to be amended into the core manuscript so all future versions of a book have the correct text and ruleset, an advantage wholly lacking from the limited print runs the publishers depend on at present. For some games, this becomes a serious headache: Exalted Second Edition, for example, has hosts of errors derived from the simultaneous writing of the core ruleset and an expansion based upon it during the launch of the new game, and the errata for these books is distributed across the publishing set. Referencing charm revisions is annoying and creates arguments among players; there would be a great motivation to upgrade to a “fixed” manuscript, should one become available at the local store.

The fact that these printers spit out black-and-white books that fit a certain build envelope may seem limited to some enthusiasts who want full-colour, stitched-binding “trophy” books for their shelf collection. This actually opens the door to a “Premium” business route for games publishers through Lulu, where they can stipulate far more about the quality and content in the books and thus offer a more attractive product for those willing to pay extra.

This solution could work now, except for OnDemandBooks charging upwards of $75,000 for their machine. Clearly they don’t realise the immediate need for a solution to the Publishing Industry’s immanent death. If this machine could be brought down to €5,000 and sold globally (it is currently limited to the US, UK and Australia), then publishers (RPG and otherwise) could strongarm or even subsidise point-of-sale shops into installing them. For that matter, if it could be leased to shops by Publishers, it could achieve a similarly dramatic effect even in small, struggling businesses that otherwise couldn’t afford the buy-in.

But, there is no sign of this happening just yet. Hopefully ODB will realise they are sitting on a goldmine and start to experiment. If they wanted a niche market to test this potential on, they couldn’t do better than RPGs. If they don’t carpe diem, someone else will make a book printer and steal the market from under them anyway. Maybe the competitor would even care to release their designs into the public domain?

Tablet Computers

As an alternative to On Demand Publishing (and probably an inevitable successor of in any case), the rise of usefully interactive book reading systems is about to go mainstream. I say “Usefully” to differentiate from devices like the Kindle or Sony Book Reader, which are explicitly designed for Novels, and deal very poorly with richer, picture-riddled RPG books and make page-searching an act of torture.

No, for RPG books that may need to be constantly re-opened on different pages, you need something more powerful, something like a Tablet Computer. Despite the ebook-related hype surrounding the iPad, it is a poor choice of tablet and has profoundly limited capabilities compared to virtually every competitor, not the least of which is the lack of extended storage (my collection of Exalted books alone is 1GB). The lack of USB ports or any other means of convenient connectivity also means it will be a chore to actually load books on and off the device, or to carry libraries of reference texts in a USB key ready for use. RPG publishing would do well to skip Apple’s early-market attempt at a tablet and take the longer-term view, particularly given the walled-garden, censored nature of Apple’s content stores.

The real game-changer about to enter this market (it is hoped, because it could be vapourware) is the Notion Ink Adam. For gaming, you won’t be able to do better. The device has a dual core processor with a separate graphics processor, meaning rich-content books will be trivial to read in real time. The battery life is superior to most competitors thanks to the processors and the display, which can be switched to an ultra-low-power reflective mode (resembling motion-capable e-ink) to make reading easier. The design is ergonomic, and the device has 3 USB ports for complete connectivity with external storage or whatever doodads you feel like using. Best of all, it will handle Flash 10, meaning embedded content in PDFs will work as expected, and Notion Ink promise an innovative e-reading system that may prove to be superior to the traditional on-screen PDF experience.

If the Adam fails to materialise, it doesn’t matter really. Someone else will make the Jesus-Tablet and kickstart the market. Flashing forward ten years, tablets like the Adam could be commonplace, having replaced the laptop for convenience and perhaps partnering with the mobile phone as a common communication system. If every gamer can reasonably be expected to own a capable tablet on par or superior to the Adam, why even use books anymore? PDF cannot compete with books at present due to the punitive lack of convenience, but this factor is already diminishing and may wink out entirely with the advent of touch-controlled book readers. It is likely that EPUB will replace PDF, or a new format with more interfacing flexibility will take over, but the light tablet form factor is an easy match for a library of reference texts.

It is even conceivable that publishers will start selling their “Books” as applications, containing a reference text and a convenient game-management system or even teleconferencing suite built in, which could transform the way that games are played. But, such ideas are getting ahead of the point of this essay.

Future of Gaming Stores: The Transition from Incidental to Deliberate Social Hub

Where does this leave gaming stores?

In one possible outcome, the publishing system changes to put reasonable distribution back in their control, but they are now left with extra floorspace and the demand for books is really just returning to its prior “business as usual” level; that is, unspectacular. It is an improvement, but not the complete solution to the problem of gaming stores making too little money; this is a problem far more complex than just RPG sales.

In the latter outcome, which might well follow naturally even if On-demand publishing takes off, Gaming stores are entirely divorced from distribution and sales of Gaming Titles. In reality, this doesn’t really affect their bottom line much. However, the only reason most Gaming Stores bother with RPG books is because they ought to maintain an inventory in order to attract customers into discuss gaming and keep the hobby vibrant. If a grocery store doesn’t stock milk, you won’t think of that store first when you need to get bread, because you’re used to going elsewhere. So if gaming stores stop selling the things Gamers enjoy, there is less attraction for them in a shop and the shop loses a great deal of incidental custom.

The solution may be for Gaming Stores to look at what gamers are coming for and what they want: society. Gamers like to have a place to come and meet others, talk and enthuse about stuff, try out new games, plan and play games or tournaments, and sometimes even seek employment relating to their hobby. Gaming stores provide this as an incidental thing, but they could start to deliberately support and enable gaming society.

Already some stores rent prepared and well-stocked rooms for running card games, war-games or Roleplaying Games, charging for access by the hour. For gamers accustomed to playing at home, this might not be a big lure, but an erstwhile group may lack a convenient location. By offering “premium” features, like Livegame Recording, media systems for ambient music or mood lighting, reliable teleconferencing for remote players and a ready supply of snacks, tea and coffee, a gaming store could attract groups to rent rooms for easily as much as €5 each per hour, which may be more than they are earning for that floorspace already.

Additional methods of providing an atmosphere of society might involve:

  • Creative use of media effects, like the projection of real-time gaming news or tweets on a wall to provide discussion-fodder.
  • Screening of gaming-related movies in the event rooms, somewhat like a niche-cinema.
  • Maintenance of a local gaming ledger into which gamers can write anecdotes to share with others for fun.
  • Free Ads for gaming and a place for young authors to showcase their work.
  • Workshops for Model-Making, games-writing and strategy; capitalise on the playing of games rather than on their sale.
  • Offer “trial days” for people to test out the games that interest them but which they don’t want to risk buying.
  • Award achievements in games to encourage a friendly competitive effect; players earn medals for killing 10 opponents in one conflict, or dying spectacularly. Make the shop a central, entertaining arbiter of gaming attainments.

Some of these can be directly monetised, others can’t. Ultimately shops are about making money, and one which fails to do so will fold, social hub or no. But in order to remain viable, shops must adapt to changing needs as they occur, and needs are changing now among gamers. A shop whose response is to post “Buy local, support us!” is shortsighted and doomed.

Last Word: Publishing in Microcosm

Although the Gaming niche is particularly social, this transitional scenario we are seeing mirrors what is happening to publishing in general, albiet more slowly. I have read it suggested that publishers no longer sell books in order to directly make profit from book sales, but rather to try to provoke the next big blockbuster to which they will have movie rights. This wouldn’t surprise me.

The larger publishers have more momentum behind them, and large companies take longer to fall. See Microsoft, Sony and Motorola for examples, and see how the latter is making a comeback due to their adoption and enthusiastic backing of a new and adaptive technology (Android, in that case). Those publishers that adapt will survive, while those that try to rebrand and push traditional book sales will probably not.

Because Gaming is a small niche, and because these problems are already beginning to manifest at ground level (Closing games stores, a rapidly shifting precedence to online publishing), it could end up being a model for the larger industries who need to see an example of a working transition to follow themselves. Achieving this transition will require dialogue and co-operation between the point-of-sale (and hobby-fostering) stores and the publishers, so that measures to replace the old business schematic can happen in short order with minimal fuss. If machines like the EBM are going to be needed to make this happen, then OnDemandPublishing.com need to be clued in fast, so they can tailor their pricing and distribution to match this testbed market, and perhaps help traditional publishers buy into their product more readily.

If Gaming sales become a social endeavor, expect to see this happening in smaller bookstores also. Innovative ways to get people interested in reading and building loyalty to a local bookstore may lead to a renaissance in reading-for-reading’s-sake, which would be good for everyone concerned. The “One Book One Twitter” concept is a great example of such innovative social projects for books and literature, and I’m sorry I missed the boat when they started reading American Gods.

It’ll be an exciting decade in Gaming. Expect to see casualties, and expect to see changes in your own backyard. These could be positive, bizarre or disappointing, but don’t be afraid to offer suggestions to your local store if you think of ways for them to tailor their service to your needs as a customer. After all, that’s what they’re there for!

Note: As with all things, I write, this is released under a Creative Commons Attribution, Sharealike License 3.0 Unported.