I have no clue what Wizards thinks it is doing with the "red box". The Intro product for D&D has one, and only one purpose: To introduce 12-14 year old kids to the roleplaying hobby and start them on the path to become purchasers of the core books. That product must be designed to sell in mass market stores where it can get the widest possible distribution outside of the hobby core (where you can safely assume that gamers are teaching gamers without the need of a special product to do it). It must be priced correctly vs. the other games it is shelved with, and it must be packaged and presented in a way that a mother would be comfortable buying as a gift for the son or daughter of a friend.
The "red box" looks like a nostalgia product designed to be sold to 40 year-olds who want to relive a moment of their childhoods. I don't get the art or the font - neither will appeal to either kids or moms in CE2011. It doesn't look like any other products in the 4E line so how will people know that it connects? Doesn't even matter what's inside the box - this is one of those things that has to sell on its presentation on the shelf.
I really think Oddysey is on the right track here. The red box is aimed at young gamers, but by way of selling to their parents. It may be an odd direction to take, but it does, in a clever sort of way, outflank the whole "isn't that the game my dad used to play" issue.
The really interesting part comes at the end:
Three years ago I told people that it didn't matter if 4e was successful or not, because it was likely to be the last version of D&D that would be based on paper based tabletop gaming. I've seen nothing so far that changes my opinion about that. How it can become a digital product and still compete with MMOs is something I'd be happy to have Wizards pay me a lot of money to research but again, nothing I've seen yet shows me that they're on the right path so far.
Before he says that, he spends a lot of time talking about why the digital initiative doesn't really seem to work. He's got a lot of good points there. Like Mr. Dancey, I also assume that the end goal is a D&D built around a subscription model and with dead-tree paper books as loss leaders. It doesn't appear that WotC has the tools in place to make that happen yet, but if they build the digital tabletop correctly (and, unlike Mr. Dancey, I see this as an excellent idea) it could serve as the tentpole for a series of fifth edition online tools that will themselves form the core of a new digital offering.
This is all commentary under the first of a new series of articles the Mr. Dancey will be writing for ENWorld. The theme is going to be expanding the infamous "20 minutes of fun crammed into four hours." Considering previous topics he has been exploring lately, it'll be interesting to see what sort of suggestions he makes.