Leaving aside the rather tasteless Hurricane Katrina comparison, this press release doesn't bode well for a number of reasons. Palladium needs an influx of cash to pay it creditors. It needs to drum up money as cost-efficiently as possible. When a company is in that sort of position, they shouldwant to make sure that it considers what short term risks takes very carefully.

The announcement of the art book is a "new" product of a sort, but not the kind of product Palladium should be pursuing. An art book is a product gamble in the RPG market, as it isn't very useful for actual play sessions. A large chunk of a game system's fan base already HAS the art featured on all the other products they've already bought, so an art book will appeal to a smaller fraction of the fan base, right out of the gate. That's not the kind of roll of the dice Palladium should be making when they're trying to battle back from near-bankruptcy. Palladium especially shouldn't make a roll of the dice to the tune of $18,000 that distibutors have been reluctant to take on because art books haven't sold. As Kevin said, he ".. pushed ahead with it despite the fact that distributors are afraid to touch it," because he's "... trusting that the fans will find it, want it and purchase it".

Have we truly seen a focus on Palladium getting their core business-- tabletop gaming systems and sourcebooks-- back in operation? I've just seen some novelty trinkets (art prints, laser-etched glasses, etc), an art book full of reprinted, albiet attratively drawn, content. Palladium recently "unofficially" confirmed getting the Robotech license renewed to use in its sourcebooks... which may pan out if the rumored Robotech movie starring Spider-Man's Toby Maguire is released. Unfortunately, as Palladium found out, movie options are not a sure bet, with sevral languishing in so-called "development limbo" for years, f they see the light of day at all. Renewing the Robotech liscense is another gamble-- this time, on an older property that isn't as well-known or relevant by tody's anime and roleplaying generation. Further complicating a release date is the fact that licensed properties require much more vetting, leading me to the conclusion that a release in time for the 2007 holiday season is near nil.

This makes me sad; some of the most fun I've had was playing a RIFTS game in high school, or the Heroes Unlimted games that my friend Ken has run, or participating in the one-shots run by fellow RPGX member Wraith. Unfortunately, what I'm seeing now is a company that has been simply coasting on the fumes of past success while frittering away energy in projects that aren't going to recoup losses. While Kevin Siembieda's obviously had success in the RPG business in the past, pointing to the Palladium of today and saying the company doesn't need some good advice is just pretty contrary to the facts at hand.

Palladium's financial crisis isn't just a matter of theft (which falls under "bad business decisions", because there clearly wasn't sufficient internal oversight); its financial woes haven't been helped by choices regarding product that also haven't done well in the market.

There's a point where the trope "Kevin's been in the business for over two decades" gets totally swallowed by the current reality of "Kevin's begging his customers to save him and is taking unnecessary risks for a company that is as financially unsound at the moment as Palladium is."

Palladium needs an influx of cash, right? I can think of something that will have a large profit margin, draw upon the existing back catalog they already have and bring them in extra sales and revenue. Ready?

SELL PDF VERSIONS OF RIFTS BOOKS.

Palladium has a HUGE catalog of material. There are publishers that are not in the RPG industry, with back catalogs that are nowhere NEAR the size of Palladium's, who make a few thousand a month on their back product through PDF. Sales of a print version work pretty close to sales as a PDF: there's an inital surge at release, but there's always those customers who didn't have the money earlier, didn't show interest in the product earlier, or are just finding out about a product-- and that's how the PDF products are sold.

Now, there are some technical hurdles. If what Eric Burns said in the first entry I linked to is true, most of the Palladium books of old were done on pasteboard, much longer than other publishers were doing layouts on desktop publishing software--which would mean that there are no electronic copies to make pdfs of.

But this is a bump in the road, not a roadblock! Palladium could easily take some time to grab a RIFTS book, get a fan or intern or hire a part-time worker to convert it to PDF through Adobe Professional by bookmarking files the old fashioned way (straight hi-resolution scan as an image, with bookmarks dividing up the various sections), and you'd still have a product that could sell well. Considering the ever-growing PDF market, it would be worth it to hire a company like DriveThru to redo the PDF e-book layout entirely, using the raw text and original art files (make the text searchable, images manageable, etc). The long term benefits versus short term costs would almost certainly prove to have a larger margin than novelty laser-etched glasses!

I've heard tell that Kevin Siembieda is reluctant to sell PDFs because he's either afraid of losing book sales, wants to wait until he can reprint the actual print books, or is afraid of rampant piracy.

Loss of book sales? WHAT loss of book sales? I haven't seen other publishers who sell print and PDF complain about this. Why? Well, because a new market (the pdf market in this case) does not necessarily exist ONLY by cannibalizing other markets (in this case, print books). The profit margin is higher for PDF versus print, since you only have to pay to scan and convert them once-- after that, you can sell a digital file over and over. And instead of having to sell via a print book distributors at below cover price, you can eliminate the middle man and get a higher percentage of list price. There are also many out-of-print sourcebooks that a number of RIFTS fans have been eager to see that can't be reprinted because the cost is prohibitvely high. As it stands right now, instead of getting 50%-60% of list price by selling them as PDFs Palladium is making 0% by not being able to reprint them.

As for fears of "What's to stop someone from putting up pdfs of sourcebooks on file sharing networks".. well, guess what? People are already doing that; there's already a demand for it (just go to The Pirate Bay or your torrent site of choice and search for "RIFTS" if you don't believe me) . You can't lose sales you're already not making, and selling its own, company-branded PDFs will give Palladium nothing worse than what the situation already is by default.

When a company is begging for cash, and when the company won't take logical steps on its own to increase cash flow or profit margin before holding its collective hat out to its loyal fans and consumers, it seems like a slap in the face to those same fans and consumers. Selling PDFs or RIFTS books is one such logical step of many it could take. Even a few thousand dollars made mean that's a few thousand dollars more that can be given to those that Palladium owes money to.

Palladium does seem to recognize that there is interest in offering online downloads of out-of-print material-- witness the company's very own Cutting Room Floor section of its web site.

Unfortunately, I don't know if Palladium is going to be around for 2009, or even 2008. In a post on his company forums, Kevin said:

So, reading what Kevin himself has written, he clearly did not expect to be able to cover his monthly expenses for June. June had barely a week left to go! Not being able to cover your monthly expenses as a publisher is a clear sign you won't be around for very long, and at the least, are not in a healthy place, business-wise.

Kevin tries to make the online sales dip sound like it's a recent occurrence or a blip on the radar, but he's commented about sales being low for the last several months. That doesn't bode well for Palladium's third quarter, and certainly poses some serious hurdles to making anything close to a decent year-end.

But don't just take my word for it; why not discuss it in our [Palladium forums]