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... When H.G. Wells published Floor Games, updated in 1913 as Little Wars. It was the first published rules for waging battles with military miniatures, and while we can assume people had been playing with miniatures for centuries before (and may have evolved their own house rules) Wells' games are the first to codify them in a commercial product. Perhaps curiously, Little Wars did not immediately spawn a market; indeed, until the 1950s, it's rare to find any other miniatures rules in print, Fletcher Pratt's 1938 Rules for Naval Wargaming being a notable exception. In 1957, Jack Scruby began publishing War Game Digest, a small press magazine devoted to miniatures gaming that often published rules, and within a decade, dozens of rules sets for different periods were on the market. They remained historical in nature, however, until 1971, when Gary Gygax and Jeff Perren released Chainmail, the first rules for fantasy miniatures. In 1983, Games Workshop released the first edition of Warhammer Fantasy Battle, which today is played by hundreds of thousands of people worldwide, and has relegated historical miniatures to a small audience of enthusiasts (which, of course, is where it always existed).
Miniatures gaming led directly to the creation of what's called the hobby games or "adventure games" industry, non-digital games sold primarily to an audience of hardcore game geeks. The first game style to become established after miniatures was the board wargame, a genre created by Charles Roberts who, in 1953, published Tactics, a game with a square map grid and cardboard pieces representing military units, simulating a battle between two abstract armies. It was self-published, but sold well enough for Roberts to turn to publishing under the Avalon Hill label full-time in 1958, releasing Tactics II as its first title. By the late '60s, there was an enthusiastic audience of board wargamers who purchased every new Avalon Hill release, and in 1969, AH got its first real competition, when Jim Dunnigan and Redmond Simonsen founded what became Simulations Publications, Inc., which published games far more frequently and helped to expand the audience further.
By mass market standards, board wargames were incredibly complex, with the simplest having several thousand words of rules, and the most complicated enormous tomes. But the wargame market had a major impact on the development of the modern industry; it created, in essence, the first game geek culture. Wargamers were the first to call themselves "gamers" and to view themselves as something of a nerdy elite; the first books on game design emerged out of the field; and, indeed, the term "game designer" first appeared in the wargames industry (coined by Redmond Simonsen, SPI's art director), along with the first games to credit their developers on a consistent basis. And it spawned the first "star designers" - Dunnigan, John Hill, Richard Berg and John Prados, to name a few. Many of the earliest stars of computer gaming, including Chris Crawford and Dan Bunten, became interested in games because of the wargames they played. And board wargames retain an influence today; e.g.., Rick Goodman, creator of Empire Earth, is an old school board wargamer.
Board wargames continue as a viable, if small, commercial medium, but in the hobby market, they have been eclipsed by two subsequent game styles: roleplaying games (RPGs) and trading card games (TCGs).
The first RPG, Dungeons & Dragons, emerged out of the Chainmail rules, which had the concept of "heroes," individual characters as powerful as whole stands of regular units. Dave Arneson modified and refined the rules, approaching Gary Gygax, Chainmail's publisher, with the results. As refined by Gygax, the first edition of the game was published in 1973 (a few pre-release copies were available in 1972). Despite dismal production quality and equally badly written rules, it was an instant smash hit, and by the early '80s had become a genuine cultural phenomenon, played by geeks and nerds in high schools and colleges across the nation and the world. No other game ever dislodged D&D's dominance of tabletop RPGs, but by the late '80s, dozens of competing games were on the market, taking the basic paradigm of the RPG to different settings and genres.