Timewaster's Guide Archive
Games => Role-Playing Games => Topic started by: Mr_Pleasington on April 19, 2006, 09:20:59 PM
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Have you all seen this: http://forums.palladium-megaverse.com/viewtopic.php?t=57048&postdays=0&postorder=asc&&start=0
Now I'm no fan of Palladium and absolutely hate how their vigourous defense of their IP doesn't allow for conversions (since I'm a fan of the RIFTS setting but can't stand the Palladium system), but I sure wouldn't like to see them go under. Variety is the spice of life and all.
That said, it's kind of crappy that you make a bunch of bad business decisions and then have to ask your fans to bail you out.
Anyway, there's the scoop.
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We'll I wouldn't say its crappy business decisions alone that caused this (since we don't know what did) but I do know they had a problem with thefts in the company and he mentioned some embezzling.
I'll be buying one of those prints. They're not asking for handouts, $50 for a limited edition signed print plus your name in a book isn't that much. To get a unsigned copy of EUOL's book cover at that size is roughly the same cost.
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I'd say there were some crappy business decisions. Putting their first video game on the N-Gage which was a joke of a system well before the game was announced. Bragging about the RIFTS movie for years, etc... It seems to me they may have started counting on money they didn't have. Let me over-analyze:
I may not be a fan of Palladium, but I hate to see any hardworking RPG company go under.
I may be wrong, but I seem to remember KS bragging about how his company has held onto the third spot of the big 3 for so long doing it his way and the upcoming movie will just futher vindicate him and give him a pile of money so he could continue to do whatever he wants. This, then, would be irony.
His reasons for the trouble, other than the embezzelment he can't speak of, perplex me a bit though...
...I wouldn't think that any investment would have been lost in liscensing out RIFTS for the Nokia game. Sure, profits could come in well under projections, but as long as he didn't count on the income from that...which no businessman taking a new venture should then there should have been that much of a problem. It also seems to be poor research...most everyone knew the N-Gage was a joke by the time the game was announced. Why go with that system?
...Not getting into the book trade certainly sucks, but since Palladium was never there before it's not like they lost anything.
...Rifts movie stalled? Again, seems to be loss of potential income.
...RIFTS MMOG? Ditto.
It seems that all these "unfortunate events" represent more a loss of growth potential rather than big sinks in capital. I could be wrong, of course. If Ultimate RIFTS sold as good as he claims then one would think Palladium would be coming off of a big upswing in profits.
The question this whole thing raises for me is whether Palladium was actually sustaining itself on it's book sales. It's very possible they were and the embezzlement did them in, but there is also the possibility that profits at Palladium have just been plummetting and KS is embellishing the story to get aid, not willing to admit poor sales.
Again, this is all conjecture, but given the lack of details and KS's comments over the years it certainly does raise a lot of questions....
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I see the movie and video games as a means to try and get out of the debt not the cause, he mentioned selling personal possessions such as art and rare toys for this and he started doing that quite a while ago.
The sad thing is Palladium is arguably #3 in the RPG field (they shift from month to month) and if they can tank then anyone can. Palladium has been always seen as the over-zealous company that never took any risks since staying in business and paying employees was more important then any other flashy things (like colored pages).
I'm just as curious as you as to what actually caused this problem, though I can't place judgments since I don't know.
What I do know is their 2005 schedule got postponed almost a year due to thefts by employees (they actually couldn't print new books because the masters were stolen).
As for that I'm not sure what else "bad business decisions" would entail? I just see them trying to make good ones that don't pan out (ie the movie, VG, getting into book store chains) offset by some really bad luck (all the thefts).
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I just re-read Kevin's statements and all he says is that this was due to theft and embezzlement. There really isn't anything else to say about it I guess, I'm not a conspiracy type of person so I have to take his word at face value.
I see this as something we could add a banner to the front page on, if we had that stupid Save Farscape banner up for almost a year we could have a Save Palladium one up for a few weeks.
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It sucks for Palladium, it really does, and I agree with Sprig, but it certainly points to one thing. You cant count on movie deals. Thats what almost sunk Pinnacle that and the Video game thing. If palladium does survive then its time to change with the times. New layout, new art, new everything. Frankly they need books like Ianus games did for Macross Plus (the ship books).
Robotech (if they get the liscense) would be a good place for that.
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Ya, I was surprised to see they're trying to re-acquire the Robotech license since before they dropped it due to how much Harmony Gold was asking for it.
Will they update their style, probably not, for every person that wants fancy layouts and color interiors there's people like me and Fell that would rather save $20 and not have it.
Now a rule revision is one thing I wouldn't mind.
edit: this is an intresting post http://forums.palladium-megaverse.com/viewtopic.php?t=53080
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I was just making observations and speculations...as I said, I have no desire to see Palladium go down in flames.
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I know Mr. P. I'm just not one to speculate in matters when the people involved say one thing and then the internet rumors say "that can't be all!" as I'm sure is going on over at RPG.net.
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well, I don't want to see anybody's business die off. WOrking for yourself is the American Dream, after all.
However, I'd be much more interested in Palladium if they had done some copyediting somewhere along the line and done some actual book design. I'm not talking about Wizards-style glossy-page hardbacks in full cover. I'm talking about legible text with an organization that flowed.
It's possible the Palladium system won't disappear, too, even if they go out of business. I think there will be companies willing to invest in the market that Kevin already created. The problem will be if Kevin refuses to let someone else market it.
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I honestly cannot see him licensing out his stuff to other companies, nor do I really thinks he needs too (just to get cash that is).
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My idea on selling the lisence would be if he goes out of business. When the only other option would be the death of Palladium as a supported game system.
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Another example of a bad business decision:
Basically begging fans to help with dire consequences when you haven't exhausted all of you publishing options. KS doesn't want to do PDFs, but it's certainly something I would have tried before making the big 'sky is falling' announcement.
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IMHO, Kevin Siembieda should step aside and let someone with more business sense run the business. He would be best suited to relegated himself into overseeing developement and doing some consulting. I think his stranglehold on the company is having the start of a big fall out.
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Would PDF sales alone have saved them? I doubt it.
Also considering it would have cost them a significant investment to start up a PDF program I can't see that as a good business decision. sure they could go with DriveThrough, but Drive through over charges and Palladium would have seen very little of that cash since those sellers keep a huge amount for themselves. PDFs aren't worth it for every company, they didn't make WotC enough money to keep doing it so I doubt it would make enough to keep Palladium alive.
The RPG industry, and the book industry, has such small margins of profit off their products I'm amazed some of them even manage to last as long as they have.
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I think his stranglehold on the company is having the start of a big fall out.
Or it could be the only thing keeping the company a float. It's really hard to say what the company did wrong from an outside view. Sure it's easy to say "Convert to D20!", "Make your books fancy and expensive!" or "PDF for teh winz!". But the RPG industry is small and unstable, plus none of us or business majors so who are we to tell people that have been doing fine for over 20 years that they screwed up when their in this situation due to thefts?
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it wasnt all thefts Sprig, the Rifts Card Game years after the cardgame market collapsed and the Ngage deal were bad buisness descisions.
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I'll give you those, to an extent. The CCG was years ago and they did loose money on it, but the N-gage was just a loss of potential income they didn't invest much into it. From what I understand if it wasn't for the thefts then the N-Gage flop wouldn't matter.
The Rifts VG was quite good from what I heard, which is sad, they should port that bad boy over to the DS.
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thats not quite the impression I got, I assume if Nokia lost "truckloads" of cash then Palladium probably did too. Heck I even remember ad copy about it and other stuff.
The lost productivity alone had to hurt.
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I can see them loosing some money productivity wise, but I don't see how they would have invested any more money into it. Usually how these things work is someone pays you to use your stuff then you sit back and wait for the royalties.
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I don't think you can say that the Nokia deal lost them millions of dollars. It doesn't make sense.
Nokia says "We'll pay you so we can make a game on your product."
Kevin says, "ok!"
Nokia spends money developing the game for a lame system that everyone knows will go nowhere.
If anything, Kevin lost a few hours here and there clarifying a rule or looking at pretty graphics.
Can you honestly say that would collapse a company?
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Kevin "I must micromanage every project that centers around my IP" Simbeda... yes I can. Maybe not millions, but enough to damage the company when combined with the other factors. I never said it was the sole reason for them being in trouble but there is marketing, product tie ins, freebies, convention support, and much much more.
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I don't think you're being reasonable when you make the Nokia deal to be such a determinate factor. If anything, I dislike Palladium more than you, but you're being a bit silly about it. ALl those things you mentioned that tie into the game? That's Nokia's pocketbook, not Kevin's.
Did you read the thread? They lost 7 figures to theft and fraud. Yet you're saying that doing all the normal things that a game company does it what screwed them. That doesn't make sense. Anything they've lost over a game deal (nokia, or card games or whatever) pales in comparison to that.
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I think your overreading my argument. Im not saying it was the only factor, just that I think Sprig made it much less of a factor than it probably was.
And yes I do think doing the things that a normal game company does started to put it out of buisness. Its done the same for lots of companies lately, and frankly KS backs me up on that blaming the slowing of the RPG market.
When other companies were retooling their lines to make them more competitive and streamlined Palladium kept to the same format. This isn't 1985 E, the major competition for RPGs out there isnt other RPG's its video games. While the video game deal was a good idea it fizzled. The video game model is exactly why d20 is so successful (well that and the huge amount of marketing) because characters in the game are more video game like advance faster and have a breakneck release schedule to deal with Gamer ADD.
Once palladium books looked great ,and that was a big draw, but now, everyone has pretty much surpassed that, switched to better paper, hardcovers, better art and much much more. Now Palladium games undercompete because they aren't the slick new thing. Sure they sell consistantly to old players, but new players are snapping up D20, and a lot of slick small press games.
One thing I do know about gaming and publishing company is that one or two bad products and slumping sales can torpedo a company faster than you can say jimeny cricket. Thats what FASA and GDW had to deal with and they arent around today.
In this day and age, playing the same game in the publishing buisness isn't going to pay the bills, or at least it doesnt seem like it.
Now the embezzlement hurt, and hurt them badly, I wont deny that (and never did) but the embezzelment has kind of been old news (its at least a year old now even though it was only whispered about earlier) but like I said, this has been going on for a while. I was making the argument that the embezzlement wasnt the only cause of their financial situation.
I hope Palladium can pull itself away from the brink, I have fond memories of the Robotech game, but I do think that they need to start changing with the times or they wont be around much longer.
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The problem with your whole, argument, however, is that they were doing great until someone stoll over a million dollars from them. I don't see that the N-Gage is ANY sort of significant loss. It's a loss of expectation, sure, but not actual cash flow. It's not like the profit-margin on their books suddenly disappeared, or that people stopped buying. It's that they lost more than they had in the bank. It has almost nothing to do with business practices.
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I never got that they were doing great... I just got that it should have been a good year. And it should have... if like a dozen things had happend. In all fairness... I may be misreading the post but I dont think I am.
If the book trade had been better, if the movie hadnt stalled, if the MMOG had happened, if the nokia game had worked, if other deals hadnt fallen through, or been slow, if the RPG trade hadnt been in a slump and if they hadnt been stolen from.
Thats an awful lot of ifs. Some of the if's could have made a lot of cash, but it always sounded like Palladium counted on them a bit too much especially the movie which they have been talking about for years.
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"The irony is, we should be doing fine except for the treachery that has crippled us."
ie, even with those failures, they would be afloat except that they lost truckloads to a crook.
So, yeah, you read it wrong.
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I tend to agree with e, that the video game was a relatively minor factor--but I know Siembieda well enough to predict that this huge financial emergency will scare him out of licensing deals for a long time. His mantra is "keep doing the same thing, and doing it well," and the video game venture represented a break from that philosophy. When he gets things under control and the time comes to knuckle under and get back to work, he's going to jettison everything that isn't a pure RPG. Ironically, this will probably mean that he'll resist other changes even more strongly, such as new business advisors, new copy editors, digital publishing, hardbacks, and full color.
I love Palladium, perhaps unreasonably so. I would hate to see them go under, and I would hate to see them lose control and quality. But I do believe that something needs to change, and the changes most likely to save them will be painful.
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I don't really have an opinion on Palladium, except that I like what little I've seen from them, and I'd hate to see them go under.
I have no problem putting up a stickied banner on the front page for a while, if they have one available.
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I'll make one today or tomorrow and send you a link if that works (I don't know if they have a banner for this).
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There's a lot of this that doesn't totally add up. I've asked some questions on other forums about similar subjects as talked about above, for instance the fact that the Ngage ordeal and hte movie should have lost them money...but it was brought up it was more of a loss of people devoting time to work than anything else.
Some other points...
1) It's been confirmed that the embezzlement/theft is the same that was announced a few months back. Sure, it's bad, but from the list he posted of stuff that was stolen I can't see anything that would put him nearly close to the million bucks he says he's lost. Obviously, we know nothing of embezzlement. The big question here is an easy one...doesn't he have insurance? I'm a new business owner and if this kind of thing happened to me, I'd be fine because I bought insurance, you'd think a guy running his own company for 25 years would have invested in that.
2) If Palladium is so desperate, why haven't they taken to other methods before asking for what amounts to a handout? I mentioned PDFs earlier, which would show them good return as they are closely tied to the distributor of DTRPG and basically all the work on them is done...they just have to convert them. They could put up OOP items like this and at least make some money back.
Also, why not do what other companies do when they're in trouble and encourage sales. Sell off backstock directly at 25% - 30% off and he could take in some dough.
Or, god forbid, open the company. Stockholders could save it.
Why were these options tried before begging the fans? It's bad business.
3) I have real problems with the whole "give a handout and you're a hero" statment in the release. Giving money to a company you like when they're in trouble doesn't make you a hero. There are plenty of charities you can donate to that would qualify you as a hero. Giving a company you have no say in money just so they can make more product that you can buy does not make you anything close to a hero.
Just more thoughts...
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1) As extrernal to the affairs, I'm sure that you can't realistically identify the real price tag. Maybe he's lying. I don't see that there's any real evidence that he is though. As for the losses of the other events, Kevin doesn't claim those as money losses in his letter. He lists them as opportunities that didn't pan out.
As for insurance? Well, bad business decision. This makes him a bad person?
2) i'm not sure why the handout thing keeps coming up. He's asking people to buy something. Something with a large profit margin, true, but it's a purchase, not a giving money for nothing. In short, it *is* one of those "other options" you keep harping on. I don't know why you're so stuck on pdf. pdf is Much more easily (and cheaply) copied and distributed than print. It's not a gamble all companies are willing to make, and I understand that.
3) I don't remember the word "hero" in the open letter, but maybe when I go read it again I'll see it. You seem to imply that it's morally wrong to give money to someone you like so he can keep doing something that has brought you pleasure in the past. While it's hardly "heroic" from an external perspective, I'll agree, it's also a good show of friendship. And, if you were the beneficiary, then you are "saved," in a very real sense, and I'm sure the doner looks like a hero to you.
-- correction, the word "hero" does come up three times. Once as the title of the section of a book where the print purchasers will be listed. "Heroes of the Megaverse -- implying that the purchasers saved Rifts, which, in reality, they will have. Once it comes up in the title "Heroes Unlimited," not relevant, and once he says it as an actual adjective of purchasers... if they help them out by working to spread the news. I guess you can still have a problem with it, but it hardly seems like an abhorrent usage of the word.
I'm entirely comfortable with the model. Web comics and other web sites have been using the donate or purchase merch to help me out for years. If you want them to stay in business, this is what it will take at this point. So why is that so bad?
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I don't get what the attraction of PDFs is with gamers, I've never liked them myself, and I understand even less why there's this element on the web that's decided if you don't sell PDFs then your a moron.
As for the insurance, maybe they had it and it didn't cover all the losses (there is limits on what it will cover and how much) or maybe they didn't have it. It's a point, but not one that concerns me.
I don't have a problem with the word hero nor him asking you to buy a print. As I've stated before $50 for a signed print isn't that expensive, and it's a lot more respectable then all these web comic people begging for money ever week via donations (like the OOTS guy asking $5 for a freaking wallpaper).
I don't even know why people are bringing up the idea of palladium going public and selling stocks. Come on, this is an RPG company, I doubt any of them but WotC even make enough a year to be allowed to go public.
I guess it's a difference of opinions that won't change, but I see nothing wrong with what Kevin is doing. I'm actually glad he turned to the fans with the problems instead of just crumbling like what happened to Steve Jackson games a few years ago.
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would this be the SJG thats going stronger than ever?
I dont remember anything about that at all.
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I had no idea either, yet many people have been bringing it up on other sites. Apparently they almost did close down a few years ago, not sure what they did to come back but many people have said they hope Palladium doesn't do as bad as they did during that time.
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SJGames are noted for releasing reports of their fiscal health - despite being a private owned company. SJ himself says he likes to do that so the fans know how their favourite company is doing. Always respected him for that.
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Aside from WotC (which is public) I think they're the only RPG company that does that. Quite commendable since it's the only real gauge we have on how the market is doing.
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Did some reaserch SJG bounced back with Munchkin and a few other card games. They had an embezzlement issue too.
I found out some interesting stuff too about the supposed million dollar figure in Palladiums thing. Some of that cash was vapor, and a lot of it wasn't technically the companies. Apparently some of it is Simbedas personal animation cell collection and "art proofs" and original pieces of art for past books which he is using for a "projected" future loss in the thousands and hundreds of thousands of dollars. In addition the library of first print, first editions was stolen too as well as a few boxes of minis. Im not sure how much of that could actually be sold for capital or not. Its tricky because Palladium is Simbeda and its finances are his own, and no one elses. I still think the whole thing is unfortunate, but Im leaning a bit toward pleasingtons "doesn't quite add up" attitude.
Still they deserve our help, so as soon as the banner can go up the better.
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More commentary:
Full Frontal Nerdity (http://archive.gamespy.com/comics/nodwick/ffn/ffn.htm)
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Lol, backstabed by the party's thief. Nice, this is why I think DnD gives paladins detect evil at will.
I am just one boy, but I have spent easily ten times more on tabletop rpgs in the last four years then the rest of my life combined.
My personal impression of D&D product, the rules of supply and demand are probably the main cause of any sales fluctuation. When 3.0 first came out, lots of people (like myself) bought every new book and suppliment that came out. Since there was so little 3rd edition product, then people are more thirsty for it and there is a demand. So then it made more and more releases come out, I mean there are a few new dnd products every month, compared to the start of 3.0 when the PHB came out, then 2 months or so later DMG, then another 2 or so months after that the MM. The 3.5 edition helped a bit, but mostly just delayed it. There are so many books now that people are way more choosy about what to buy.
Wow, how does this even apply to the subject anymore? Okay, well going back to the idea of supply and demand, if you want continued growth in the market rather than it just going stagnet and declining, then you have to get more competitive. So you need better and/or cheaper products. Here I think is where the pdf thing comes in, as you can oftentimes get a digital copy at 1/3 to 1/6 the cost of a hard copy. Also then comparing Palladium and other such books to WotC, with the hardback and artwork, obviously you have better quality. Since it's already been brought up in this thread, then I think its understood how much this can play a role in the current rpg marketplace. Of course, then there is the actual content which also plays an important part of overall quality, large enough that individual subtopics could merit their own discussion (such as errata).
Now when you also have to suddenly pay more for editors, binding, color print, artists, etc. then even if your sales are growing, the extra overhead might still mean less earnings. Anyway, this is mostly my explination of how profits in the rpg market could be down, when I think the gross is probably at a high (well it might have actually peeked a few years ago, I have no idea, but it has to still be way way above what it was ten and twenty years ago, or whenver Palladium started up).
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Here for more on the Palladium situation.
http://forum.rpg.net/showpost.php?p=1445566&postcount=184
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Way to bring up a three year old post buy a disgruntled ex-employee that had only visited Palladium offices once. The funniest part about that thread is how no one on RPG.net understands what "free lance" means. While there's interesting things in that post, Colins has such a huge axe to grind it's hard to tell what's true and what's not.
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Ooooh, the "Crisis of Treachery" continues.
I throw up a bit in my mouth every time I hear that term.
Read here: http://forums.palladium-megaverse.com/viewtopic.php?t=65409
Seriously, the first time they begged for cash it was sad, but this is just pathetic. I wonder if all the folks who donated last time will wise up about this.
At least this time he's pushing sales more even though he implies throughout the whole thing that sales alone won't save the company.
Talk about losing all shreds of dignity and respect.
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Way to bring up a three year old post buy a disgruntled ex-employee that had only visited Palladium offices once. The funniest part about that thread is how no one on RPG.net understands what "free lance" means. While there's interesting things in that post, Colins has such a huge axe to grind it's hard to tell what's true and what's not.
Just wanted to point out that besides Bill Coffin, Steve Conan Trustram and Jason Vey have also recounted their experiences while freelancing for Palladium and basically say the same thing Bill does (just with a lot less vitriol).
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and to be honest, his account of how the book is made doesnt sound far fetched at all.