Welcome back to The Deep Dive. Today, we are
tackling a subject that, quite honestly, has
achieved a level of cultural saturation that
I don't think anyone could have predicted ten,
maybe even five years ago. Oh, absolutely not.
I mean, you see it in blockbuster movies, you
see it in hit TV shows like Stranger Things,
and you see it being played by massive celebrities
on Twitch. We are, of course, talking about the
grandfather of them all. Dungeons and Dragons.
It is everywhere now. And it is fascinating because
for the longest time, this was the exact definition
of niche. It was it was the ultimate basement
hobby. And now it's a billion dollar brand. Exactly.
And that is the tension we are going to explore
today. I've been reading through this massive
stack of documents you sent over the history,
the business analysis, the accounts of the various
controversies. And the thing that just blows
my mind is the sheer improbability of it all.
We are talking about a game that started in 1974
with a production budget of, what, $2 ,000? Yeah,
$2 ,000. And only about $100 of that actually
went to the artwork. Which explains a lot if
you've ever seen that original white box. Right.
But seriously, this is a game based on arithmetic,
on improvisation, and on these funny -shaped
dice. By all logic, it should have been a passing
fad. Instead, it survived the satanic panic of
the 80s. It survived corporate bankruptcy in
the 90s. And it survived the entire digital revolution,
which was supposed to make pen and paper games
completely obsolete. And not only survived, but
thrived. It is essentially the cockroach of pop
culture. And I mean that in the best possible
way. So our mission today for this deep dive
is to unpack that survival story. We're going
to look at the origins in the wargaming scene,
the actual mechanics that make it tick, the wild
business decisions that almost killed it, and
the modern corporate wars that are defining its
future right now. And we have to answer the big
question, really. Here. How does a game that
requires you to read 300 pages of rules before
you even start playing become the coolest thing
in entertainment? Let's start at the very beginning.
Section one, the origin story. Because before
there were dungeons, And before there were dragons,
there were war games. And the sources paint a
picture of a gaming landscape in the late 60s
and early 70s that was, well, it was very different
from the chaotic energy of a modern D &D table.
It was incredibly different. To understand D
&D, you really have to understand its parents.
We are talking about miniature war gaming. This
was a hobby for hardcore history buffs. You would
have this massive table, often covered in sand
or green felt, to represent the terrain. You'd
have model trees. little hills, and hundreds
of tiny lead miniatures representing historical
armies. Like Napoleonic, Civil War, Ancient Rome,
that sort of thing. Exactly. And the key thing
to understand here is the mindset. In a war game,
you are a general. You are standing above the
battlefield looking down. You are moving an entire
regiment of infantry or a squadron of cavalry.
You aren't playing John the Soldier. You're playing
the 5th Battalion. So it's very detached. It's
a simulation. It is a rigid simulation. You literally
have tape measures to check movement distances.
You have complex charts to calculate artillery
fire trajectories. If a unit takes damage, you
remove a figure. But you don't mourn him. He's
just a casualty marker on a board. So the sources
mention a specific game called Chainmail as the
bridge between this rigid historical world and
the fantasy world. Chainmail is the critical
link here. It was published in 1971 by Gary Gygax
and Jeff Perrin. Now, Gygax is a name we are
going to hear a lot today. He was based in Lake
Geneva, Wisconsin. Chainmail was, at its core,
a medieval war game. Knights, archers. Catapults.
Just standard historical stuff. Mostly, yeah.
But Gygax did something really interesting. He
added a fantasy supplement at the very back of
the book. He loved pulp fantasy stories, Conan
the Barbarian, Lord of the Rings. So he wrote
rules for what happens if you put a dragon on
the battlefield. Or a wizard who can throw a
fireball like it's an artillery shell. But even
then, you're still playing a war game, right?
I mean, the wizard is just a tank with a pointy
hat. Precisely. You are still commanding units.
The psychological shift, the actual spark that
created role -playing games, came from a different
guy entirely. Gabe Arneson. Yes, this is the
part of the history I find most compelling in
the sources. The Bronstein games. This is deep
lore, but it is so essential. Arneson was part
of a group in the Twin Cities playing these highly
experimental games run by a guy named David Weasley.
The scenario was a fictional town called Bronstein
during the Napoleonic Wars. But instead of commanding
armies, Weasley gave the players individual roles.
He'd say, you are the mayor. You are the student
radical. You are the colonel. So the objective
isn't capture the hill. It's, I don't know, keep
the town from rioting or distribute these pamphlets.
Exactly. And Arneson loved this. He realized
that the fun wasn't in the geometry of the cannon
fire. It was in the negotiation, the bluffing,
the inhabiting of a persona. So he took that
individual concept and applied it to his own
fantasy setting, which he called Blackmoor. And
this is the aha moment. He uses the chainmail
rules for combat because they work mathematically,
but he changes the scale from an army to a one
-to -one ratio. That is the birth of the RPG
right there. The shift from unit to character.
Arneson introduced concepts that we completely
take for granted now. He introduced the idea
that if you survive a dungeon, you get stronger.
You gain experience points. You level up. You
have hit points that replenish. He essentially
invented the save game and the skill tree before
video games even existed. He really did. He created
a continuous narrative. In a war game, once the
battle is over, you reset the board. In Arneson's
Blackmoor, if you killed the dragon, the dragon
stayed dead next week. Your actions had permanence.
So Arneson has this wild, imaginative mess of
a game in Blackmoor. Gygax has the publishing
drive and the wargaming structure over in Lake
Geneva. And they meet up. Right. Arneson travels
to Lake Geneva and runs a game for Gygax. And
Gygax, to his credit, immediately sees the brilliance
of it. He realizes this isn't just a variant
of wargaming. It's a completely new medium. They
agree to collaborate. They call it the fantasy
game initially. Gygax takes the lead on codifying
the rules, organizing all the tables and turning
Arneson's improvisational style into a marketable
product. And we have to talk about the name because
the fantasy game is just terrible. It is incredibly
bland. The story goes that Gygax had a list of
potential titles. He didn't run a focus group
or hire a marketing firm. He read the list to
his two -year -old daughter, Cindy. A two -year
-old? A toddler, yeah. And she heard the list
and apparently said, oh, daddy, I like Dungeons
& Dragons best. That is incredible. A two -year
-old girl named the most masculine, nerdy property
of the 20th century. It's perfect, though. It
perfectly describes the two core elements, the
setting, which is the dungeon, and the antagonist,
the dragon. So they launch in 1974. They form
a company called Tactical Studies Rules, or TSR.
And we mentioned the budget earlier, $2 ,000.
What did the actual product look like? Because
I think for you listening, you probably imagine
the glossy hardcovers we have today. Oh, not
even close. Yeah. The original Dungeons & Dragons,
what fans call OD &D or the white box, was three
little staple -bound booklets inside a woodgrain
-colored cardboard box. It looked like something
you'd print at a local church bake sale. And
the rules were cryptic, to see the least. Cryptic
is being generous. The techs assumed you were
already a hardcore wargamer. It referred you
to the chain mail rule book for combat. It referred
you to a completely different board game called
outdoor survival just for wilderness travel.
It was disorganized. The art was amateurish and
there were tyco's everywhere. And yet and yet
it was magic because despite the mess. The promise
of total freedom was there. You could do anything.
You weren't limited by the buttons on a controller
or the spaces on a board. The viral growth mentioned
in the sources is just staggering. They sell
1 ,000 copies in year one, 3 ,000 in year two.
It spread like a contagion through college campuses
and high schools. One person would buy the box,
learn the rules, and then run a game for five
friends. Those five friends would get hooked.
buy their own boxes, and run games for five more
people. It was exponential growth, driven purely
by the quality of the experience. Okay, before
we get into the business drama, and oh boy, the
documents show there is a lot of drama, let's
actually explain the game. Because we keep saying
total freedom, but there are rules. For the listener
who has never sat at a table, what is the core
loop? At its heart, D &D is a conversation loop.
It has a specific rhythm. You have the dungeon
master, the DM, and you have the players. The
DM is the computer, basically. Yes, the DM is
the CPU and the graphics card. They describe
the reality. They say, you stand in a dripping
stone corridor. There is a wooden door to the
north and a goblin sleeping on a chair to the
south. And the players don't have a menu of options.
They just say what they want to do. Right. A
player says, I want to sneak up on the goblin
and tie his shoelaces together. That is the intention.
And this is where the game mechanics kick in.
Because you can't just say, I win. Exactly. The
DM determines the difficulty of that action,
and usually they ask for a roll. This introduces
the element of chance, which creates tension.
Let's talk about the hardware here. The dice,
the polyhedrals. The math rocks. You have the
D4, D6, D8, G10, D12, and the absolute star of
the show, the D20. Why the D20? Why does everything
revolve around that specific shape? It comes
out of probability. In wargaming, they often
use six -sided dice, the d6. But the probability
curve of a d6 is chunky. A d20 allows for 5 %
increments. Gives you a much wider range of outcomes,
from a critical miss if you roll a 1 to a critical
hit if you roll a 20. It feels much more granular.
So the mechanic is roll a d20, add a number from
your character sheet, and try to beat a target
number the DM has in their head. That is 90 %
of the game right there. Armor class is just
the target number you need to hit to damage someone.
Difficulty class is the target number to pick
a lock. And those numbers you add come from your
ability scores. Strength, dexterity, constitution,
intelligence, wisdom, charisma. These six stats
are iconic. They define who your character is.
A barbarian has high strength, but maybe low
intelligence. A bard has high charisma. It effectively
quantifies a personality. It does. It gamifies
human capability. I also want to touch on progression
because the sources emphasize this as a key addictive
element of the design. This is the Skinner box
element. You do things, kill monsters, solve
riddles, and you get a reward. Experience points
or XP. You accumulate enough and you level up.
Your numbers go up. You get new powers. It creates
a incredibly powerful sense of investment. You
aren't just playing a game. You are building
something over months or even years. And that
leads to the difference between an adventure
and a campaign. Think of it like television.
An adventure is a single episode. There is a
problem. You solve it. Credits roll. A campaign
is the entire series. It's the same cast of characters
going through arc after arc. A campaign can last
for years of real time. I have known groups that
have played the same campaign for decades. That
is real commitment. Okay, so we have the game.
It's growing. It is 1977. And this is where TSR
makes a business decision that reading about
it now on the source material feels absolutely
baffling. They split the game into two incompatible
product lines. The two -pronged strategy. It
is one of the most confusing eras in the game's
history. From 1977 to 1999, D &D wasn't one game.
It was two. Break it down for us. What were the
prongs? Prong one was basic Dungeons & Dragons.
This was the famous red box you might have seen
in Stranger Things. It was sold in toy stores.
It was aimed at younger players. The rules were
streamlined, edited by a guy named John Eric
Holmes, and later refined by Moldvay and Menser.
It was D &D lite. And prong two. Advanced Dungeons
& Dragons, or AD &D. These were the hardcover
books, the Player's Handbook, the Dungeon Master's
Guide, the Monster Manual. This was for the serious
hobbyist. It was rules -heavy, structured, complex,
gritty. But the crazy part is that they weren't
compatible, right? You couldn't just take your
character from the basic game and play in an
advanced game. Not without a lot of conversion
work. The math was different. The way classes
worked was different. In basic, elf was a class.
You were just an elf. In advanced, you were an
elf fighter or an elf wizard. Why would they
fracture their own audience like that? Well...
There's the official reason, which was market
segmentation. One game for casuals, one for hardcore
gamers. But there was also a widely believed
theory about royalties. Ah, follow the money.
Always. Dave Arneson, the co -creator, was entitled
to royalties on Dungeons & Dragons. Gygax argued
that Advanced Dungeons & Dragons was a completely
different game, and therefore Arneson wasn't
entitled to the same royalties on that line.
That is incredibly cynical. It was a highly litigious
time. Arneson eventually sued, and they settled.
But that split defined the game for 20 years.
It created a massive amount of confusion in the
market. And speaking of confusion, let's talk
about the content changes. The sources mentioned
that when A .D. and D. Second Edition came out
in 1989, it was strangely sanitized. It was.
They made some very deliberate changes. They
removed the assassin class entirely. They removed
the half -orc species. And most notably, they
removed all demons and devils from the monster
manual. Wait, no demons in a game that is fundamentally
about fighting evil? They renamed them. Demons
became Tanari, and devils became Batizu. They
were desperately trying to hide the occult references.
And this wasn't an artistic choice at all. This
was a survival tactic. Because we have to talk
about the elephant in the room from the 1980s,
the satanic panic. We really do. If you are under
the age of 40, it is hard to explain just how
intense this was. This wasn't just parents think
video games make you lazy. This was mainstream
media and major religious organizations genuinely
believing that... that D &D was an instruction
manual for witchcraft. It sounds so ludicrous
now. It was a full -blown moral panic, and it
was sparked by a specific tragedy that the media
just latched onto, the case of James Dallas Egbert
III. Walk us through this. This is 1979. Yes.
James Dallas Egbert III was a student at Michigan
State University. He was a prodigy, only 16 years
old, but he was dealing with a lot of intense
pressure. He was struggling with drug abuse,
he was closeted, and he was suffering from severe
depression. He went missing. And his family hires
a private investigator. William Deere. And this
PI finds out that Egbert played D &D. And he
cooks up this sensational theory for the press.
He tells reporters that Egbert had gone into
the steam tunnels under the university to play
a live -action version of D &D and had gotten
lost or had a psychotic break. The steam tunnel
myth. I have heard this. It was pure fiction.
Egbert was actually hiding in a friend's house.
The game had absolutely nothing to do with his
disappearance. Tragically, he did eventually
die by suicide a year later, but again, it was
due to mental health struggles, not a fantasy
game. Yeah, but the narrative was out there.
The damage was done. It was too good a story
to check. It inspired a novel called Mazes and
Monsters, which became a TV movie starring a
very young Tom Hanks. The movie depicts a college
student who plays the game, loses his mind, thinks
he is a cleric, and tries to jump off the World
Trade Center to fly. That is, wow, that is subtle.
It terrified parents. You had organizations like
BADD bothered about Dungeons and Dragons, founded
by Patricia Poling. She went on 60 Minutes, she
was on Geraldo, claiming that D &D was a literal
recruitment tool for satanic cults. So you have
the church, the media, and parents all attacking
the game. This should have killed TSR entirely.
But here is the massive irony. The Streisand
effect. The more they told kids, this game is
dangerous, it's a cult, it's forbidden, the more
kids wanted to play it. It gave the game an edge.
It became rebellious. Exactly. Sales peaked in
1982 and 1983, right at the height of the panic.
They were selling millions of copies. The controversy
bought them a level of publicity they never could
have afforded otherwise. And just to set the
record straight, because we always try to look
at all the source material impartially, the sources
do mention actual scientific... research on this.
Yes. In the years since, studies by the CDC,
the American Association of Suicidology, and
psychologists like Armando Simon have looked
deeply into this. They found zero correlation
between D &D and suicide or emotional instability.
In fact, modern research suggests the exact opposite,
right? Correct. It suggests D &D improves socialization.
It teaches empathy, teamwork, and problem solving.
It turns out that spending your Friday night
cooperatively solving complex puzzles with your
friends is actually good for your brain. Who
knew? So TSR survives the panic, but they can't
survive their own bad business habit. No, they
really couldn't. By the late 90s, the two -pronged
strategy and the massive flood of different products
had caught up with them. They were publishing
way too many books, splitting their audience
into smaller and smaller factions, and drowning
in debt. By 1997, TSR was functionally bankrupt.
They couldn't even pay their printers to make
the books. Enter the White Knight, or the Dark
Wizard, depending on your perspective. Wizards
of the Coast. Wizards of the Coast, or Woody
C., was a Seattle -based company that had struck
absolute gold with Magic the Gathering. They
had cash. So they bought TSR in 1997. And this
marks the beginning of the modern era. Their
first big move was third edition in the year
2000. And reading the analysis, this wasn't just
a rules update. It was a fundamental shift in
how the entire RPG industry worked. It was. First,
they finally reunited the game. No more basic
versus advanced. Just Dungeons and Dragons. They
streamlined the rules around the D20 system.
But the real revolution was legal, not mechanical.
The open game license? Or OGL. I want to spend
a moment here because this is a business strategy
that seems totally counterintuitive at first
glance. What exactly was the OGL? Ryan Dancy,
the brand manager at Woad TC, had a theory. He
looked at the software industry and the open
source movement. He decided to apply that to
tabletop games. The OGL effectively said, here
are the core mathematical rules of D &D. You...
Anyone can use them. You can write your own adventures,
your own settings, your own games using our engine,
and you don't have to pay us a dime. Why give
away the engine? That sounds like terrible business.
The network effect. The idea was that if everyone
is making content for the D20 system, then D20
becomes the universal language of RPGs. And since
Wizards owns the core brand... the player's handbook,
everyone will eventually have to buy that book
to play all this other cool stuff that other
people are making. It's the razor and blades
model, but they let other people make the blades.
Exactly. And it worked phenomenally well. It
created a massive boom. The market was flooded
with D20 products. It cemented D &D as the absolute
king of the hill. But looking at the history
here, it was a double -edged sword. Because when
Wizards stumbled later on, that license came
back to bite them. That brings us to 2008 in
4th edition. The controversial edition. Highly
controversial. Wizards tried to patch the game.
They saw the massive rise of World of Warcraft
and tried to make D &D play a bit more like an
MMO. It was very tactical, very balanced, very
focused on great combat. And the fans hated it.
It was very polarizing. Many felt it lost the
soul of the game, the improvisation, the theater
of the mind. It felt like a rigid board game
again. And because of the OGL from the previous
edition, a rival company, Paizo, saw a huge opening.
Paizo was publishing D &D magazine content previously,
right? Yes. And when Wizards switched to 4th
edition, Paizo said, hey, we know a lot of you
hate this new version, so we are going to keep
publishing the old version 3 .5 with a fresh
coat of paint. They called it Pathfinder. And
because of the open game license, Wizards legally
couldn't stop them. They had legally given away
the keys to the castle. And for several years,
Pathfinder actually outsold Dungeons & Dragons.
It was a major embarrassment for the market leader.
Which forces a huge course correction. And that
brings us to 2014 and 5th edition, The Renaissance.
5th edition is the version most listeners probably
know today. Wizards learned their lesson. They
spent years playtesting it with 75 ,000 volunteers.
That is a massive sample size for a tabletop
game. They wanted to know what D &D actually
felt like to the community. and the result was
a system that stripped away the heavy math of
3rd edition and the rigid tactics of 4th edition.
It went back to the philosophy of rulings, not
rules. It empowered the DM again. And the timing
was just perfect, because just as they released
this accessible, story -focused version of the
game, the entire culture shifts. We have to talk
about the actual play phenomena. Critical role.
Critical role. The Adventure Zone, Dimension
20. Suddenly, you had professional voice actors
and comedians playing D &D on Twitch and YouTube.
I think this is the key to the modern boom. Before
this, if you want to know what D &D was, you
had to find a group of nerds in a basement and
awkwardly ask to join. It was intimidating. Exactly.
Now, you've just opened YouTube. You watch Matt
Mercer tell a story. You see these professional
actors crying, laughing, screaming. You realize,
oh. It's not just math. It's collaborative storytelling.
It completely demystified the hobby. The sources
cite some wild numbers here. In 2020, viewers
watched 150 million hours of D &D content. It
turned a participatory hobby into a spectator
sport. That is a fundamental shift in the business
model. Plus, you have Stranger Things putting
the red box on screen in front of millions of
Netflix subscribers. And framing it not as satanic.
but as the thing that bonds these heroic kids
together. It reclaimed the cultural narrative.
So D &D is on top of the world. Sales are up
40 % in 2017, 52 % in 2018. But whenever there
is this much money on the table, things get complicated.
And the last few years have been really rocky.
Rocky is putting it mildly. The relationship
between the community and the corporation has
become very strained. Let's dive into the OGL
1 .1 debacle in 2023. We just spent time praising
the OGL for building the industry. Why did they
try to kill it? Greed and control, basically.
Yeah. Wizards of the Coast is owned by Hasbro.
Hasbro is a massive toy conglomerate. They looked
at D &D and saw a lot of people making money
off their intellectual property using that old
license. This is where the under -monetized quote
comes in. Yes. In a fireside chat, Hasbro executives
described D &D as... under -monetized. They compared
it to video games where they can sell cosmetic
skins and battle passes. They wanted to squeeze
more revenue out of the user base. So they tried
to revoke the old license and force creators
to sign a new, highly restrictive one that demanded
royalties. And the community revolted. It was
instant and unified. It wasn't just angry tweets.
It was wallet voting. Tens of thousands of people
canceled their subscriptions to D &D Beyond,
which is the official digital tool set. It literally
crashed their unsubscribe page. They hit them
where it hurts, the recurring revenue. And it
worked. Hasbro capitulated completely. They not
only withdrew the new license, but they released
the core rules of 5th edition into the Creative
Commons. Explain the significance of that for
the listener, Creative Commons. It means the
text of the game mechanics now belongs to the
public. Hasbro can never, ever try to take it
back. It is irrevocably free for anyone to use
forever. It was a total victory for the fans.
But the tension remains. We see it in the layoffs.
That's the really bitter pill. 2023 was the biggest
year in the brand's history. You had Baldur's
Gate 3, which swept all the Game of the Year
awards. You had the movie Honor Among Thieves,
which was critically acclaimed. And yet, Hasbro
laid off 1 ,100 people, including many of the
veteran designers who built 5th edition. They
even cut 90 % of the team working on their new
virtual tabletop. It feels like a massive disconnect.
The brand is flourishing, but the people making
it are being treated like line items on a spreadsheet.
It reinforces that feeling of community versus
corporation. There was also the inclusion controversy
with Spelljammer. And remember, we're just reporting
what is in the documents here. Yes, the Hadozi
issue. They released a space fantasy setting
that included a race of monkey people, the Hadozi.
The backstory provided for them had uncomfortable
parallels to real -world slavery narratives,
and the artwork was criticized for resembling
minstrel imagery. How did that happen in 2022?
It was a failure of editorial oversight. They
apologized and scrubbed the content from digital
versions and future printings, but it led to
a policy change. They now require cultural consultants
on every product. And notably, they stopped using
the word race in the game. Right. In the new
2024 books, it is referred to as species. Which
brings us to the present day, the 2024 revision,
Project 1D &D. What is happening right now is
the sixth edition. They're very careful not to
call it that. They insist it is revised 5th edition.
They do not want to split the player base again
like they did back in 2008, but they are releasing
new versions of the Player's Handbook, Dungeon
Master's Guide, and Monster Manual. But there's
a brain drain mentioned in the notes. This is
the thing to watch. The architects of 5th edition,
Jeremy Crawford, Chris Perkins, are still there,
but many others have left. And where are they
going? They're going to companies like Darrington
Press, which is owned by Critical Role, or MCDM.
The third -party creators are becoming the main
rivals. Exactly. The talent is migrating from
the corporation to the community -led studios.
It signals a shift in where the creative energy
of the hobby truly lives. So let's wrap this
up. We have covered 50 years of history, from
a woodgrain box to a digital empire. What is
the legacy here? The legacy is that D &D changed
how we think about games. It introduced the idea
of the party dynamic. It introduced the concept
of leveling up and hit points, concepts that
are now universal in almost every video game
you play. It's successfully transitioned from
a basement hobby for wargamers to a global entertainment
brand streamed by millions. And as a final thought
for you listening, something to chew on based
on all these documents, we have this incredible
contrast. The game is a creative, community -driven
hobby. but it is also a corporate asset deemed
under -monetized. It's a fundamental friction.
Right. And with the core rules now in the Creative
Commons and the original creators long gone,
you have to ask, does the community even need
the official publishers anymore? The game exists
in the minds of the players, not just the books
sold by Hasbro. Precisely. As long as you have
guys and friends, you have D &D. No subscription
required. That is a powerful place to end it.
The game belongs to the players. Thank you so
much for taking this deep dive with me. Always
a pleasure. May all your hits be crits. And to
everyone listening, keep rolling. We'll see you
next time.