Stores have nothing to do with "user bases." You just want people to buy stuff. As a publisher, you have all the leverage when it comes to pricing arbitrage. You can sell game X on your platform for $45 and sell the same license to Discord for $50. The consumer doesn't care where they buy it from, as long as it's cheaper. Obviously, they're incentivized to buy it on your platform.
I'm not saying that platform size doesn't matter, but funneling resources for a win there would be a Pyrrhic victory. Steam won that battle a long time ago.
> "Facing competition" as in they are now taking in only 90% of the revenue as opposed to 100%? That's just healthy
90% of what though? The big publishers are moving away from Steam presumably because the terms are crap and indies now have many more options.
> Discord is irrelevant to Valve's business, that's not where the money comes from. Valve is a store front, no indie can afford to just self-publish on PC without being on Steam. Factorio and Rimworld got popular through Steam.
Discord announced a storefront last month, they're absolutely a competitor. The obvious counterpoint to indies needing to be on Steam is League of Legends, though I'll also point out that I bought Rimworld well before it was on steam. Most indie circles talk about the tradeoff today for steam being pretty bad - you give 30% for almost nothing, and still have to do a ton of marketing because market saturation means just being on steam isn't enough. If you're already doing the marketing yourself, the storefront is much less of a factor.
> Plenty of developers sell through the Epic Store (having development funded by Epic), or GOG, or the Humble store, or on Itch.io, or even via microsoft store.
They do, and that's great, but rarely can they afford to not _also_ sell on Steam. Steam will still take their ~30% cut of the vast majority of revenue, still mostly thanks to its first mover advantage, and there's no self-interest-preserving move the developer has against that.
The only exception are exclusives like Epic's, and exclusives aren't exactly great for consumers either.
> You don’t speak for the rest of the market though
Do you?
> Steam comfortable holds its lead for good reason
Yes. One of those good reasons is that it allows people to purchase Steam games without buying them on Steam, thus avoiding having to subsidise Valve's 30% cut.
There's an absolutely gigantic ecosystem around buying Steam games from first-party (developer) and third-party (marketplace/bundle) sellers. I don't think you realise that it's a perfect example against the point you're making. There's enough competition from the ability to "side-load" games into Steam that it's very common to get some of the greatest games ever made for under a dollar, when their MSRP is up to two orders of magnitude higher.
>f you don't want to use steam you can put an ad in the back of 2600 Magazine and mail out CD-R or USB sticks like they did in the olden days.
you're free to. I will offer Itch.io as a modern alternative: https://itch.io/
almost zero restrictions on games you can upload, and they let you set your own share, even down to 0% if you so please. I think the default is 10%, which seems reasonable.
>Valve charges 30% because customers want all the stuff that comes with steam
not really. they charge 30% because they can leverage their 90% market share on small devs. In fact, they already relented and offer a lower share if you sell more than like, 25m copies. That suggests that they do need to work to keep AAA stUDIOS from making their own stores (again).
It's all about market dynamics. And I bet many steam users just use it for network effects.
> single digit percentages used to be a thing on platforms before Valve moved the Overton window with Steam
I think people really underestimate the customer value of Steam. I have a library of 20 years of game purchases. From numerous different game companies. I can install all of them on any computer, now including my Linux machines, or a Steam Deck. If a device can't run one of those games, I can stream from another machine with Steam Link, including now to my VR headset. If a game uses Steam's multiplayer networking, multiplayer just ... works. No worrying about ports, NAT, anything. It just works every time, unlike every other multiplayer system I've used. If a game uses Steam Workshop, mods are available right in the same program, no extra tools required.
Besides the hardware and the game purchases themselves, all of that was free for me, the consumer. I get that Valve takes a big cut, but the value add of Steam is almost immeasurable from the consumer end. I've bought games from GOG but the experience isn't even close. Every game I've had to buy through Origin or Ubisoft directly had made me grit my teeth at their bloated launchers. Most of the physical games I've bought outside steam have been lost, damaged, or deteriorated with time.
If someone had told me 20 years ago, when I was signing up launch week and it kept crashing, that Steam would be this ubiquitous, useful, and free, I wouldn't have believed you. Steam is an incredible value add that makes PC gaming a tremendously better experience than console.
> even though you can use GOG, Uplay, EA, Humble, BattleNet, Amazon Prime, MS Store and the countless other options on PC if you wish unlike on iOS and consoles
Note that if you're an indie developer and you want to make money, you pretty much are going to use Steam. The alternative is if someone like Epic sponsors development or something. But yeah, you can release on stores like itch. Nobody will buy it, but you can do it.
This can lead to a little bit of a chicken-and-egg problem. Ideally, devs will put up both a Steam version and an Itch/GOG version. But in practice they often don't; you sell on the store that brings in the vast majority of revenue. And then pretty soon your mods start getting managed through Steam Workshop, your input starts getting managed through Steam Input, your achievements/multiplayer starts getting managed though Steam's cloud. Because frankly, players want that. Steam players want to use Steam Workshop, and they don't really care if that means the mods are harder to use outside of Steam.
None of these services can be separated easily from the Steam platform. You can't pay Valve some money and integrate seamless workshop support into your game when it's booted up from GOG.
So users may try to avoid Steam for a while (I generally do), but you can only really do that if you're willing to skip games (still waiting on Spelunky 2, Ultrakill, Cruelty Squad, etc...). GOG and Itch are great and some devs are genuinely great about supporting multiple storefronts, but it's always going to be a subset. So eventually users get tired and just buy everything from Steam. I mean, if you buy from Steam you get input profiles set up out of the box, you get cached shaders, and importantly you never need to wonder whether or not a game is coming to the storefront you use. Never. And if a game ever doesn't come to Steam (hello Epic Games) you can have an existential meltdown and say that the devs are ruining PC gaming.
And as a consequence, if you're an indie developer, you are releasing on Steam. Because it's really difficult for users to avoid Steam because that's where the games are, and as a developer it's really difficult to avoid Steam because that's where the users are, and we go round and round until a nontrivial portion of PC players believe that PC gaming effectively means Steam, and anything that's not on Steam might as well just not exist.
You kind of saw this with the Epic Games fights around exclusives. I'm no friend of DRM and I'm no friend of exclusives, but not being able to get a game because it's not on the storefront I want to use is extremely common for me, and it was extremely weird seeing Steam users act like this was the end of the world when it happened to them. It really cued me in to how much power that Steam has, to the point where people basically treat it as a default platform. On some level it is on devs like me to support multiple storefronts, but people need to recognize that there's really not a lot of incentive to do so beyond trying to make the ecosystem healthy. Breaking Steam's stranglehold over the PC market would need to be a coordinated effort from both developers and players, it's not something developers can do on their own.
Why would a brand pay extra to be on a shelf in a supermarket? Isn't the store already making a markup? Does the store have a monopoly on food sales?
Everyone carries on about "monopoly" and thinks Apple pricing will plummet.
OK, explain Valve and Steam. With many stores, shouldn't the price be a fraction?
Here's a comment from July '23:
It's outrageous that Valve takes a 30% cut from every game sale on Steam without providing much in return.
We don't get marketing, PR, or advertising unless our game is already popular.If you're an unknown developer, you'll never get discovered.
Support? Hardly. Their mandatory return policy, while beneficial for customers, can actually harm shorter games. Aside from facilitating product returns, they provide minimal assistance in other areas.
Valve doesn't offer funding or act as a traditional publisher, providing guidance or support during development. Steam is the sole platform for distribution, limiting our reach and revenue potential.
They offer no help with QA or testing. Even with their new alpha/beta system, the burden of reviewing any data falls on developers. Valve's main contribution is distribution, but the process is frustratingly outdated.
We need to demand better from Valve: more value for their cut or a reduction in percentage.
Or, there's some value people aren't thinking about, and "the market [of developers] will bear it"...
“The value of a large network like Steam has many benefits that are contributed to and shared by all the participants. Finding the right balance to reflect those contributions is a tricky but important factor in a well-functioning network,” the company wrote in a statement on the Steam Community page. “It’s always been apparent that successful games and their large audiences have a material impact on those network effects so making sure Steam recognizes and continues to be an attractive platform for those games is an important goal for all participants in the network.”
> people would use Steam as a storefront to find games and then buy them on a different platform
FWIW I do that anyway whenever I can find a platform that lets me buy and own the game outright, rather than depending on Valve having then good graces to continue allow me to log into Steam.
>If they didn't do that, people would use Steam as a storefront to find games and then buy them on a different platform.
sounds good to me. If people want those advantageousfeatures or to stay in Valve's garden, they will pay more for that even if a cheaper pricing appears. Especially with so many complaining about non-steam releases and even claiming they will pay more just to say "fuck you" to EGS.
People who don't care (like me. I still have my game exe's on my desktop like a boomer) will research and find a better price, if possible. As is, Steam seems to discourage this.
>That being said, the indie developers could just set the game price to the same everywhere when they want to make a discount (which is what most do)
yes...because pricing parity. I'm assuming you can't just have a game on eternal sale on an alternative storefront as a loophole. I don't know the details of the sales period, but if GOG or Itch ever wanted their own fest, devs may be afraid due to risk of de-listing on Steam.
The most dangerous thing is that a lot of Valve is fast and loose behind the scenes. They are generally good enough to know when something is bad PR and let it slide. But there's plenty of old school Nintendo-style blurry lines when it comes to submitting.
> Steam is possibly one of the least worse monopolies that have existed. It doesn't block the products from being sold on other platforms, takes care of quite a lot for those who use it.
They do require that the price of your game on Steam be equivalent or lower than the price outside of it. That’s very anticompetitive, and IMO should be illegal as it doesn’t do anything but harm consumers.
This is a point I don't see mentioned often enough. I've wondered in the past if it's actually better to forego every other platform in order to increase visibility through Steam. Higher sales means that Valve will promote you more, which may offset whatever revenue you'd be generating from sources like itch.io. Would be interested to hear if anyone has any opinions or idea about this.
I understand his argument about gatekeepers, but Steam is a poor example. Steam itself provides so much more than a simple storefront as he describes it. By selling on Steam you also get
Steam API, which gives you
- Achievements
- Leaderboards
- Cloud save
- Steam Workshop - user generated mods and content
- Multiplayer infrastructure
Steam community, which gives you
- Forum
- Social network - user generated content such as screenshots, game guides and fanart
- Reviews - endorsements from several thousand actual players sells games far better than a flashy trailer
Whether these features are worth the 30% cut is arguable, but these services are far more valuable to independent developers, who don't have the time or ability to implement these, than to developers under large publishers, who may share these infrastructure within the games they publish.
> "if I can get something for free, why shouldn't I".
Convenience, pricing and social features. That's how Steam grew so big.
It takes much more effort to torrent something than to click "Add to cart" button in Steam. And even if the price is too high, one can always wait for a sale or a giveaway. Nor will a pirated copy give street cred in the form of achievements, "games owned" and "hours played".
The success of Steam, Netflix and Spotify has shown that there's plenty of money in the world, but you have to earn it by providing the best value.
The engineer bases his argument on an assumption that is usually erroneous:
The price of a product is related to its cost.
This is a logical assumption, but almost always false. It is far more commonly true that the price of a product is dictated by what consumers are willing to pay. If the PS4 version of game X sells for $59.99, it is more than likely that the Xbox1 version will sell for the same price, because people will perceive both versions as having the same value and be willing to pay the same amount for them both.
What Valve does with Steam prices is something different. New releases still cost roughly the same as traditional DVD copies bought in stores. Bargains start to appear on titles once they reach an age where a lot of stores stop stocking them. It is true you can get heavily discounted games on Steam, but this is totally unrelated to the lack of a used-game market. Somebody simply realized that a) A title nobody is selling makes no money and b) gamers will spend money they wouldn't have otherwise if they think they're getting a deal. Put a and b together and you have a recipe for profit. This also eliminates demand for used games. Why buy a skeezy dog-chewed box when you can get a steam-download for the same price or lower?
Don't get me wrong. If MS builds a curated steam-style store for the Xbox it will undoubtedly be a great thing for many (although not all) gamers. However, lower prices on new titles will not be one of the benefits this move brings. This is really just a grab for dollars that currently go to the used market, and it will likely work.
I'm actually pretty cynical when it comes to this kind of thing (for example, I don't think anyone can really compete with Google Search anymore), but I need to disagree with this article. It fundamentally misunderstands a few crucial elements of how game publishing (and consumption) works. Keep in mind that I am a long-time user of Steam (my account is 14 years old, having signed up literally the day it came out).
1. The gamers
Gamers are by definition quasi-technical and, by their very nature, will be welcome to (at least) trying out a new client or platform. I, and most of my friends, and probably most of Twitch, have not only Steam, but also GOG, and also the God-awful Origin, and Epic's launcher, etc. So installing a new client so I could play some games I like is really not that big of a deal. Steams social aspects were always secondary to its game delivery platform -- besides, most people use Discord to keep in touch, no one really takes Steam's "social network" seriously. I think that's a non-issue.
2. The developers
If you're an indie dev that's toiled for the past 3 years on a small game that you hope will make it big, you will release it on every platform -- let me say that again: you'll release on Steam, on Itch, etc. On every. Single. Platform. If you (really) want to sell AAA games, you can just be a run-of-the-mill distributor at first, and just sell keys. Worrying about developer friction I think is fundamentally misguided.
3. How to win
Imo, winning would look something like this: scout indie developers building the next big thing (they'll be a lot of false positives, so a lot of $$$ helps here). Make them sign contracts to only distribute through your platform. Do this for like 10 or 20 games, even if the contracts suck for you (hell, I'd give them > 100% revenue share). Now you're funneling people through your platform to play the newest "Cuphead" or "Super Meatboy" or "Dark Souls" -- obviously this isn't easy, but I do think you could hypothetically compete.and slow.
Stores have nothing to do with "user bases." You just want people to buy stuff. As a publisher, you have all the leverage when it comes to pricing arbitrage. You can sell game X on your platform for $45 and sell the same license to Discord for $50. The consumer doesn't care where they buy it from, as long as it's cheaper. Obviously, they're incentivized to buy it on your platform.
I'm not saying that platform size doesn't matter, but funneling resources for a win there would be a Pyrrhic victory. Steam won that battle a long time ago.
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