4w ago

Debunking the grey market beyond Steam

www.gamesindustry.biz

Despite facing increased competition in the space, not least from the Epic Games Store, Valve's platform is synonymous with PC gaming. The service is estimated to have made $10.8 billion in revenue during 2024, a new record for the Half-Life giant. Since it entered the PC distribution space back in 2018, the rival Epic Games Store has been making headway – and $1.09 billion last year – but Steam is still undeniably dominant within the space.

Valve earns a large part of its money from taking a 20-30% cut of sales revenue from developers and publishers. Despite other storefronts opening with lower overheads, Steam has stuck with taking this slice of sales revenue, and in doing so, it has been argued that Valve is unfairly taking a decent chunk of the profits of developers and publishers.

This might change, depending on how an ongoing class-action lawsuit initiated by Wolfire Games goes, but for the time being, Valve is making money hand over fist selling games on Steam. The platform boasts over 132 million users, so it's perfectly reasonable that developers and publishers feel they have to use Steam – and give away a slice of their revenue – in order to reach the largest audience possible.

187 comments

The wolfire games lawsuit is so damn cringe.
No company is your friend, but there's a reason Steam is number 1. The reinvestment in the platform and breadth of features steam has is unrivaled.
Epic has been trying for nearly a decade now and their store doesn't even have 1/4 the features of steam.
I love GoG though. For me they offer something steam can't, installers for my games.
- My view is if you don't like a distribution platform taking 20-30% of the sale then don't use that distribution platform. It's a free market and a free internet. Use Epic, GOG, or host it yourself
  If I don't like what Comcast charges I don't do a class action lawsuit.
  
  If I don’t like what Comcast charges I don’t do a class action lawsuit.
  That's a poor example, because in many markets, Comcast (or another cable provider) is the only option, or there's only one other option with much lower top-end speeds (e.g. DSL). So a class-action against Comcast may be a reasonable idea, since they're an actual monopoly in many markets.
  The games industry is different. Steam does have a commanding share of the market, but there's no real lock-in there, a developer can choose to not publish there and succeed. Minecraft, famously, never released on Steam, and it has been wildly successful. Likewise for Blizzard games, like Starcraft and World of Warcraft.
  Maybe a better comparison is grocery store chains? Walmart has something like 60% market share in the US, yet I have successfully been able to completely avoid shopping there.
  
  if you don't like a distribution platform taking 20-30% of the sale then don't use that distribution platform
  Excuse my frank speech but that's absolute bollocks and lacks any understanding at all of how a monopoly works.
  E: It's so hilarious to watch the Lemmy idiots be like "lEaVe ThE mUlTiBiLlIoN dOlLaR cOmPaNy AlOnE!" when it comes to Nintentdo but when it's Valve, then it's totally cool for some reason.
  
  If you lose access to a vast majority of the market if you don‘t use a service, it’s a monopoly. Don’t defend monopolists.
- there's a reason Steam is number 1
  Monopoly, and Stockholmed G*mers
  
  The other competitors are kinda shit.
  GoG is dope for giving install files and being DRM free.
  But acting like steam isn't legitimately the best platform by a country mile is crazy.
- People talk about the "features" epic is missing but honestly the vast majority of those features are kinda pointless?
  I don't like epic's store because the layout is annoying and it likes to send me ads in the bottom right corner. It's not that complicated.
  
  I mean there's still no user review system lol.
  That is storefront 101 and they still don't have it.
  Congratulations for not using the other systems they have I guess?
  Many of steams users engage at least a little with a lot of what steam offers.
  Hell steam has integrated VR support, steam link for remote play, and fantastic 2FA account protection.
  Epic is way behind
- The reason Steam is #1 is because they were first to the market and everyone’s so invested into it.
  That’s why today’s business model is „dump VC money until you’re ubiquitous, once monopolised drive the prices up”. We see that with things like Just Eat / Glovo, Steam or YouTube.
  
  Nah mate, Steam is just the best game platform on PC. A game has access to so many features like cloud saves, community, workshop, matchmaking when it comes out on Steam, while the users have access to user reviews, curators, guides, sales, bundles etc etc. Epic doesn't have most of those features. And yes, a game dev can go out of their way to create those features for their game, on Steam they don't have to. Epic had all the time in the world to implement even half of them, but they still haven't. GOG is an alternative because it offers something Steam won't, and it's been going great for them. Epic is just a bootleg version of Steam. Their only claim to fame is their free game giveaways, but even then you're stuck playing the game without the features Steam users have.
  
  Steam has so many more features than any other platform.
  First to market or not, that's why steam is number one.
  None of its competitors offer the community, market, discussion boards, rating system, friend system functionality and overall reliability that steam does.
  It has competition, just not on PC.
  Epic is atrociously bad. From hampering system performance to a total lack of any of the above features, using epic sucks.
  The Xbox app is somehow seemongly always broken despite literally being developed by the platform holders and with a shit load of cash behind it.
  I don't love the idea of a steam monopoly but you gotta also give them their flowers, it's a fantastic storefront, arguably the best when considering all gaming platforms that exist even outside of PC.
So is the issue that Valve kicks you off the platform if you sell your game cheaper somewhere else? That does seem a little troublesome. I don't think Apple or Sony has those restrictions? Apple takes 30% as well, right?
- Only if you are selling a steam key elsewhere, they ask you to treat them equivalently but that doesn't mean you can't do sales for your products on other platforms.
  It's a little weird cause it would be like buying an apple app on android to use on apple but apple doesn't get the 30% anymore so they ask you to at least price it about the same so people don't avoid buying from them completely.
  
  Okay so if Steam takes 30% and Itch takes 5% then the same game could be sold for approx $64 on Steam and $47 on Itch and the developer would take the same-ish amount home? But if they priced them the same they would make more money from Itch 🤑
  And if you sell Steam keys separately then the user would still go to Steam to download and Steam would make sure that it goes to one person's library and a bunch of other jazz.
  
  Only if you are selling a steam key elsewhere
  No. That's not true. You're spreading misinformation. Read the fucking lawsuit.
- Yes. That is exactly the issue. It's not only Steam Keys either as some of the cultists would have you believe. Valve does require you to offer Steam Keys on other stores at the same price that you offer the game on Steam but that's not all. Now, while they don't specifically forbid you to offer different prices on stores that have nothing to do with Steam, they do reserve the right (do whatever the hell you want with this one simple trick!) to veto pricing on Steam for any reason. This has been historically used by Valve to block games that offer better pricing on competing stores. It goes something like this:
  I make a game and decide I want to make $7 per sale so I publish it on my site at $7.
  I want the game to be accessible to a wider audience so I publish it on other stores.
  Epic takes 12% so I price it at $8 there in order to keep making $7 per sale
  Steam takes 30% so I price it at $10 there for the same reason.
  Valve says $10 isn't a fair price and refuses to elaborate why, reminding me that they reserve the right to veto any price on Steam for any reason.
  I make my game $10 on all other stores
  Valve magically decides $10 was actually a fair price all along and finally publishes the game on Steam.
  
  Wait, not trying to be a "cultist" here, but if Valve requires devs/publishers to "offer Steam Keys on other stores at the same price that you offer the game on Steam", then why do I keep finding Steam Keys much much cheaper elsewhere? Like, all the time...
- Steam allows selling outside the platform.
  Apple is insanely restrictive to what you can do outside app store. You can't sell an app key. No signed apps will not work and you can only sideload in EU.
  Sony also disallows selling codes outside PSN
  Steam is more lax with steam keys.
- Most favored customer clauses are not uncommon in the retail world.
ITT: People saying Steam is bad and a monopoly, no I won't name reasons why. Do your research.
- …no I won’t name the reasons why. Do your research
  Oh. Oh no.
  I will explain the reasons why, because it’s important to understand this without sounding like the antivax equivalent of a white knight.
  First, forget the word monopoly. It’s a red herring. We are going to talk about trusts. A trust is any kind of organizational structure (one or more companies) that control or seek to control a market through centralized leadership. Trusts can lead to monopolies, but they are distinct and do not need to be (and rarely are) monopolies. The key defining feature of a trust is the use of market capture strategies that are unethical, anti-competitive, clandestine, underhanded, etc (“legal” or not).
  Valve is neither a monopoly nor a trust, by definition. While they control a huge portion of the PC gaming market, they operate with transparency, do not sabotage competitors, share their technology freely with potential competitors, and do not push any anti-competitive policies (like exclusives, rules preventing offering products cheaper on other outlets, etc).
  There is healthy competition in the PC game space, but Valve has held the lead by offering the best, most attractive platform for consumers. From social features and integrations, to regular discounts and sales, to a healthy and robust community review system, to automatically elevating great new content that might otherwise be missed, to enabling new platforms and technologies (VR, Steam Deck, Linux)… they provide things that customers and sellers love.
  Compare their competition. GOG is great but their DRM free policies (which are great) limit their use by sellers. Publishers all have their own stores now, but those are unattractive for a wide variety of reasons - splitting your library, using even more proprietary software to access your content (new stores and launchers), and for all that inconvenience you don’t even get a discount when Valve isn’t taking a cut. Finally, there’s Epic. Market share is Epic’s game to lose, and they are losing on their own merits. Their product lacks basic consumer features that Steam users expect (social features, performant storefront, trustworthy reviews, etc) and they have repeatedly engaged in anti-competitive behavior through the use of exclusives. At one point, Stardock’s Impulse platform was well on its way to becoming a legitimate competitor, but then came the fateful decision to sell out to GameStop, who destroyed it.
  Steam is no monopoly or trust. They are simply successful because they are well liked and they are well liked because they give customers and sellers what they want. Nobody else is even trying to compete with Steam right now. Epic could, but they aren’t, and only Tim Sweeny could tell you why.
  
  Very well put. Funny how pro steam arguments are being articulated in this thread very well...
Glad to see lawsuits against Valve.
I love them as a company and I buy my games on Steam first, (GOG is my second choice)... but we need their monopoly reigned in. If not by a viable competitor than by making Valve beholden to their clients and not vice versa.
- In what way are they not, or what actions should be taken?
  
  Plenty of explanation for this in this thread already, why waste this guys time too.

187 comments