BoG: What’s with Wizards?

Business of Gaming (BoG) is our regular series looking at the business of hobby gaming from the perspective of the hobby gamer.

Something weird is definitely going on over at Wizards of the Coast.  First, during last week’s GenCon, many commentators made note of the minor presence sponsored by WotC.  This was further compounded by the notable reduction in their annual “Dragon’s Hoard” giveaway.  Overall, WotC didn’t have a lot of new material to release, leaving several gaming communities fairly unhappy (particularly the Heroscape community).

Now, WotC has issued the following:

Wizards Announces New Organizational Alignment

Wizards of the Coast today announced new organizational alignment to focus on key growth strategies for core brands.

“As a company, we will continue to be the leader in entertaining the lifestyle gamer,” said Greg Leeds, President of Wizards of the Coast. “Re-aligning resources ensures we achieve this goal for our most powerful brands.”

While restructuring results in some job eliminations, Wizards of the Coast is actively recruiting to fill open positions in multiple areas of the company.

“Organizational change is always difficult on those impacted,” said Leeds. “But we will take great care in the transition, and continue to invest in the growth of the business, specifically innovation for our Magic and Dungeons & Dragons fans.”

With no further information and rumors putting the layoffs as high as 50 people, we’re left to wonder what areas are being hard hit.  Its worth noting that Hasbro’s (WotC’s parent company) stock was downgraded this week and is currently trading at half its 52-week high.  Even worse, the only mention of Wizards during the most recent analyst call was to mention that the Duel Masters CCG continues to do well in Japan (and you though the game had died off!).

Magic and D&D probably remain safe given brisk sales across both product lines, but with the recent shutdown of Gleemax, many are suggesting that the layoffs are related to WotC’s digital development areas.  Given the delays in the D&D Insider program and the 4E tools, I don’t think that’s particularly likely.  Instead, I suspect the cuts are in some of the weaker product lines like the Transformers battle card game and possibly Heroscape – we’ll keep you updated if any existing lines are cancelled.