THE VIRGINIAN-PILOT
Copyright (c) 1994, Landmark Communications, Inc.
DATE: Sunday, November 13, 1994 TAG: 9411120101
SECTION: BUSINESS PAGE: D1 EDITION: FINAL
SOURCE: BY RICHARD GRIMES, STAFF WRITER
LENGTH: Long : 176 lines
Star Trek fan? If so, you're probably familiar with the replicator, a machine that transforms matter into anything from Scotch whiskey to the Klingon delicacy Gahk.
The fictional replicator sounds great, but Warren Holland Jr. thinks he has something better: a licensing agreement for ``Star Trek: The Next Generation.'' If all goes as planned, it will transform a deck of cards into $40 million.
Last week Holland's Norfolk-based company, Decipher Inc., launched a new card game modeled on the popular television series, and it promises to be a hit. Already, Star Trek: The Next Generation Customizable Card Game has orders for more than 100 million cards.
Hoping to cash in on this burgeoning market even further, Decipher formed an alliance with the game maker Parker Brothers to produce another card game, this time based on the George Lucas movie ``Star Wars.''
The card games put Decipher in an enviable position. Not only does it hold two of the hottest licenses in the gaming industry, it's also getting in on the ground floor of a gaming revolution started by a college mathematics teacher.
The pioneer of the trading-card game market is Richard Garfield. In August last year, a small Renton, Wash.-based company called Wizards of the Coast released a card game created by Garfield called Magic: the Gathering. The game featured quick play and lush paintings of fantasy creatures such as basilisks and bog wraiths, and when it was introduced at gaming conventions, it took off immediately.
Magic quickly proved to be the crack cocaine of card games. It's overwhelmingly addictive for users and intensely lucrative for dealers.
Game store owners who offer playing tables are often forced to cajole players out of their shops when they close, only to watch them deal their cards on the sidewalk and continue to play.
Magic is also a game pusher's dream. Before each game, players can ``tune,'' or customize, their card decks by selecting the number and kind of cards they want to use. The cards that you use determine whether you're playing with a strong ``killer'' deck or weak but still effective ``weenie'' deck.
This is the part the marketers love. Some Magic addicts out there called ``suitcase players'' literally own thousands of cards. Each starter pack of 40 cards costs $10 and booster packs of 15 go for $3.
The hobby gets more expensive, too. Because limited quantities of the cards are printed, comic and gaming shops can resell the most powerful cards singly at a tremendous markup. Scry, an industry magazine, lists The Black Lotus card, for instance, for about $122, while the Summon Clone card can be found for about $3. This secondary market in turn influences speculators to buy whole boxes of the cards and their booster packs of supplemental cards.
Game companies are understandably enthusiastic. J.M. White of Scry says it's too soon to estimate how big a marketplace Magic has forged, but she estimates there will be ``10 games out in the next five months.''
``By the end of 1994, there will be 1 billion cards in circulation by Wizards of the Coast'' alone, White says.
Wizards of the Coast notes that though its pre-Magic revenues barely cleared $100,000 a year, it expects to hurdle the $40 million mark in sales this year. And if Magic is good, Star Trek has the potential to be better, industry observers say. THE NEXT GENERATION
Holland, whose work uniform includes tennis shoes and a tie with bright red peppers, expects Decipher's Star Trek card game to at least match the numbers Magic is racking up.
``I anticipate 40 million dollars,'' he says. ``There's a chance we'll be doing double.''
The reason for such optimism, Holland says, is that Star Trek has incredible name recognition. In addition to citing the number of people who consider themselves fans, Holland and his vice president of marketing and sales, Cindy Thornburg, say that 99 percent of Americans are at least aware of Star Trek.
``That is more than the number of people with telephones in the United States,'' Holland says.
Thornburg is more blunt: ``The only people who don't know about Star Trek are babies and people in comas.''
White from Scry magazine agrees. ``We literally expect a secondary market to open up as soon as they (the cards) hit the market. . . . They are going to jump on it.''
Decipher has 12 playing cards from its Star Trek game framed and hanging on the wall in its office on Granby Street. Each of these cards pictures one of the Decipher employees and lists the skills each would have if they existed in the Star Trek universe.
At the bottom of Holland's card is the word Comeback. Here's why. A ROCKY LAUNCH
In its early going back in the 1980s, Holland's fledgling enterprise was nearly grounded by legal problems.
In 1984, Decipher learned that the game business was no playground. When it marketed Forte, cards meant to supplement the Trivial Pursuit game manufactured by Selchow and Righter Inc., it was accused of trademark infringement. Selchow sued Decipher and won. Judge Robert Doumar not only ordered the cards off the market but also found that Decipher had ``copied'' Selchow's cards and ordered Decipher to pay the company $380,000.
Ten years later, Holland is still uncomfortable with the judge's decision. He says that Selchow sued several companies and that Decipher talked with Selchow before Forte was even sold in a effort to avoid violating its trademark.
``Nobody on our side, and in fact, I don't really think the lawyers on their side, ever anticipated that it would get to damages.'' The suit, Holland says, ``almost killed us.''
Decipher survived the loss by negotiating to pay a smaller sum and spreading the payments over a period of years.
Decipher moved on in 1985 by introducing another successful game, How to Host a Murder. The game eventually got Holland's foot in the door of Paramount Pictures, the company handling Star Trek's licensing.
Things were jelling for Holland in the late 1980s. Even his personal life got a boost. In 1987, Cosmopolitan magazine selected him as November ``Bachelor of the Month,'' when Decipher's marketing staff sent his picture and bio to the magazine.
Things turned worse about four years ago when a bank called in one of Decipher's loans. Decipher was forced to pay out more than $1 million.
``That literally drained us of working capital,'' says Holland.
Decipher responded by trimming its staff - now numbering 12 - and working out a debt repayment plan with its creditors.
Except for a loan taken out last week, Decipher is debt-free, Holland says. He's betting that Star Trek will further improve the company's bottom line. THE FINAL FRONTIER
How to Host a Murder proved to be Decipher's salvation. A party game where players act out a murder and then solve it, the game's success helped Holland get Paramount's attention.
Paramount licenses thousands of different Star Trek products, and the competition for these niches are fierce. Instead of competing for a niche, Decipher created one. No one had built a mystery party game around Star Trek, and in 1992, the How to Host a Mystery Star Trek game was born.
Early this year, when the people at Decipher saw the kind of numbers the game Magic was generating, they used the relationship to broker an agreement for a Star Trek card game.
Once they had the licensing agreement, Decipher turned to Technical Game Services. The Washington-based company provides both game agenting and game design services. The cards are maunfactured in Belgium by a company called Carta Mundi.
With initial sales of 100 million cards for Star Trek - and the potential for millions more - it was no surprise that Holland wasn't alone in trying to woo the Lucas people for the right to produce a Star Wars card game.
Wizards of the Coast and Decipher went head to head for the rights. However, an alliance with Parker Brothers appears to have won the game for Decipher.
Though Lucasfilm has not officially signed the contract, Holland and Thornburg spent part of last week at Skywalker Ranch, the California complex that houses Lucasfilm. They were among 250 licensees invited to a seminar that included both a speech by George Lucas and a visit to a museum laden with Star Wars memorabilia such as the Landspeeder and Chewbacca's costume.
It was the icing on a very sweet cake.
``We have the two top science fiction licenses that exist,'' Holland says. ``It's overwhelming, but it's a nice kind of overwhelming.''
Despite competing for Star Wars, Decipher and Wizards of the Coast have complimented each other. Richard Garfield even play-tested Decipher's Star Trek card game.
The verdict?
``I was very impressed with the general outline of the game. It captures the feeling of Star Trek.''
Scry magazine is putting together its first price list for individual Star Trek cards, and in the process, it'll figure out which cards are rare and which cards are common.
The rarest card, though, is a Warren Holland ``comeback'' card. If you're like Decipher and you have that card, you're definitely not playing with a weenie deck. ILLUSTRATION: Color photo
PAUL AIKEN/Staff
Decipher Inc.'s Cindy Thornburg, vice president of marketing and
sales, and Warren Holland Jr., president, have created a card game
based on the popular television series ``Star Trek: The Next
Generation.'' They have orders for more than 100 million cards.
KEYWORDS: GAMES by CNB