Wednesday, March 14, 2012

Gaming History: The Space Gamer and Black Gate Magazine, TSR Buys SPI

On February 28th, the publisher of Black Gate Magazine, wrote a blog post celebrating an old SPI game called Swords and Sorcery.  He praised the game in his semi-regular "new treasures" column.  The game itself was published in 1978, but O'Neill had just acquired an edition from eBay.  If the edition he purchased is the edition photographed in the blog post, he and I own the same edition of the game.  The game may have been old, but it was new to him. 

The post is quite positive, and I largely agree with O'Neill's review.  As is common in discussion of old SPI games, a discussion of TSR's acquisition of SPI -- and their subsequent "killing" of SPI game lines -- was brought up in the comments section.  Among the grognards of the gaming hobby, of which I am certainly one, there is often a good deal of ire aimed at TSR for their behavior.  This ire is often directed at Lorraine Williams, but not always.  One of those cases where it isn't directed at Lorraine Williams is in the TSR purchase of SPI in 1982.  At that time, the company was very much in the control of Gygax and the Blumes -- though they were having plenty of internal strife at the time.

In this particular post, Black Gate's managing editor (and talented author Howard Andrew Jones) was the individual who brought up TSR's "killing" of SPI product lines.  In my typical "provocateur" fashion, I mentioned that I thought that the TSR acquisition and killing of SPI was more complicated than most grognards think and even included some slight praise for Lorraine Williams -- as a fan I am actually amazed at the products that came out during her tenure, even if she hated gamers.  Here is what I wrote:

While it is easy to blame TSR for what they did to SPI — and they deserve a lot of blame — one should keep two things in mind
First, when they purchased SPI it was in dire financial straights and would likely not have survived.
Second, they had hoped to keep SPI’s staff, but those staff members refused to work for TSR — for varied reasons — and left to form the Victory Games studio over at Avalon Hill.

Third, and this is where I get near heretical, it was the Blumes who devalued SPI’s contributions. A massive resurgence of publishing of SPI games happened under Lorraine Williams. We would never have seen the SPI monster TSR World War II game, or Wellington’s Victory, SNIPER (including BugHunters), let alone the 3rd edition of DragonQuest.

I believe she did the publishing of SPI stuff out of desperation, not any love for the product or the fans, as TSR was starting to have financial troubles which could only be met by an ever expanding publication schedule and continual revenue flow.

It was the Blumes who refused to acknowledge lifetime subscriptions to SPI magazines.
There is an excellent issue of Fire and Movement, printed by Steve Jackson Games, that goes over the purchase of SPI.

I have since hunted down the issue of Fire & Movement I mentioned, and it is issue 27 (May/June 1982).  In that issue Nick Schuessler writes a remarkably detailed article about TSR's acquisition of SPI and provides some context for the purchase.  Some highlights of the article are:

  • On March 31, 1981 TSR announced they were initiating a chain of events to purchase SPI.
  • On April 7th, eight key SPI staffers tendered their resignations and announced they were forming a new company called Victory Games that would work under the auspices of Avalon Hill.
  • TSR acquirexd the trademarks and copyrights of the entire SPI inventory.
  • Mark Herman, the leader of the eight defectors, had been negotiating with Avalon Hill to purchase SPI.
  • The TSR conglomerate owned a science fiction magazine (Amazing), and a needlepoint company, in addition to D&D and in 1981 they had $17 million in sales revenue.
  • SPI was a $2 million a year company.
Schuessler's article is heavy on facts, and only has one bit of speculation.  That bit of speculation is whether the brain drain, the loss of Mark Herman and crew, will have a long term negative effect on the acquisition.  I would argue, from a historical perspective, that this was the single most devastating part of the acquisition.  SPI's strength was in its designers.  Mark Herman, Jerry Klug, John and Trish Butterfield, and Greg Gorden were some of the most talented designers of their era.

But the May/June issue of Fire and Movement only gives us a part of the story.  It doesn't truly show how desperate TSR was to diversify their brand, and how much internal strife existed at the company.  Those elements can be seen in old issues of The Space Gamer.   In issue 60 of TSG, John Rankin writes an article about a visit by TSR employees to Dallas where TSR Vice-President Duke Seifried were to meet with Heritage-USA and where there were possibly discussions for TSR to purchase Heritage or to enter into a joint venture with them.  John Rankin's article states:

  • Heritage USA still owed Duke Seifried money from his time with the company, and that Duke was a stockholder in the company.
  • TSR was very much in need of a miniatures company if they wanted to diversify. 
  •  No meeting between TSR and Heritage actually occurred, though Duke did likely get information from them as a stockholder.
  • TSR "left no broken hearts in Dallas.  But they didn't make any new friends either."
  • There is a sense of some instability at TSR, and they are seen as not wanting to lead the industry rather just to "control it."  

This all seems like a relatively mundane deal gone bad...until one looks at other issues discussing TSR.  By issue 65 of The Space Gamer, the internal strife at TSR comes to the fore.  In that issue, the following facts are reported.

  • TSR released 40 of its employees in June of 1983.  Among these employees was Duke Seifried.
  • TSR was reorganized into 4 companies.
  • TSR Public Relations director Dietur Sturm described TSR finances as, "More or less, what you're looking at is money coming into the company from sales and not focused properly...Sales are there as far as the distributors and retailers and stores (are concerned); they have nothing to worry about."
This news demonstrates a number of problems within TSR.  There is obviously internal strife.  The firing of Seifried and the "banishing" of Gygax to Los Angeles hint at that.  The company also clearly had no idea how to maintain and expand their product lines.  They purchased a needlepoint company for goodness' sake!  Why?  What synergy could that provide?

They purchased SPI, a company that had a rich catalog of war games but that also had a Fantasy Roleplaying Game called Dragon Quest.  Supporting the SPI rpg would have possibly meant cannibalizing their own product lines.  They had no plans to retain the talents acquired in the SPI purchase, and in fact eventually fired everyone they hired from SPI and refused to support life time subscriptions to SPI's magazine Strategy & Tactics.  TSR did everything they could to alienate the customer base of the company they had just acquired, and they were "reorganizing" to end an outpouring of money.  They were in constant need of revenue to stay afloat. They were selling a ton of product, but they also weren't developing products with any logical consistency.  These are trends that wouldn't end any time soon.  You can read Ryan Dancey's financial audit of TSR when Wizards of the Coast purchased them to see just how much this remained a problem in 1997.

I think that Rankin's comment regarding not wanting to lead, rather to control is a perfect description of the company.  They boycotted GAMA and demanded D&D not be played at Origins.  They had no plans for talent retention.  They didn't publish the products they acquired.  They don't seem to have been logical in the determination of the size of print runs.  They cannibalized product lines -- even in the Blume/Gygax era though this became disastrous in the Williams era.  As much as I love TSR's many settings having the Forgotten Realms, Greyhawk, Mystara, Hollow World, Birthright, and Dark Sun all as simultaneous fantasy setting product lines is a case study definition of cannibalizing product lines.  Having "Basic," "Expert," "Companion," and "Master" D&D as well as Advanced D&D -- let alone a 2nd edition -- is also a case study definition.

The company produced great games, but they were not managed well at all.  Bad management is endemic throughout the rpg industry.  It is an industry primarily run by hobbyists and not business people.  This is a creative boon, but a business curse.

On an interesting note, as I was looking through old The Space Gamer issues I found a letter by a John O'Neill of Ottawa, Canada in issue 66.  I'm going to take a huge leap here and say that the John O'Neill in that 1983 letter is the publisher of Black Gate Magazine.  Why would I make such an assumption?  Just look at the first two paragraphs of that letter:

In an age of man now only distantly remembered, there existed a magazine which the good people in the land of Fandom did enjoy.  But lo, there came a day unlike any other day, when the Powers That Be sent a lightning bolt to rend asunder that magazine.

From the fragments of the one there emerged two magazines, and the Powers That Be told the people of Fandom to partake of them.
Who, but the future editor of a Sword and Sorcery magazine, could write such a letter? 

Image Copyright 2012 Jody Lindke



John O'Neill said...


Wow -- what a find! :)

And yes, I wrote that letter, although I have absolutely no recollection of it. How do I know? I was a subscriber to THE SPACE GAMER, and I knew what the letter was about the moment I read the first two sentences -- TSG was splitting into SPACE GAMER and FANTASY GAMER, big news at the time.

Now I'll have to dig up my copy of issue 66 and read the rest of the letter. :)

Thanks for the great article -- and for bringing this particular time capsule to my attention.

John O'Neill

Dan Eastwood said...

I'll second John --> great post.