Didn’t Steam essentially create the “standard” for 30% price point for digital distribution in the first place? While a 30% margin makes sense for physical retail, it’s never made sense for digital distribution.
Comment on Epic reduce their cut to 0% for the first $1 million in revenue for devs on the Epic Games Store
9point6@lemmy.world 4 weeks ago30% has been industry standard across any digital storefront until Epic found out they couldn’t beat steam by just paying for exclusivity deals. Then they decided to go down this race to the bottom strategy.
Steam is good because of that 30%.
Firstly, data transfer and storage isn’t free and is an ongoing cost for Steam even after purchase. How many times can you think that you installed a game, then deleted it and ultimately downloaded it again—Steam doesn’t get any more money, but that costs them. They could have done all the limited number of downloads or transfer speed limiting shit that used to be more common.
The profit they make on top goes straight back into Valve. They are a private company without shareholders to please and pay dividends to. This has allowed them to keep reinvesting into Steam and making it the best experience for the consumer they can—they’ve been rewarded with a load of goodwill and market share following that. You can guarantee that we wouldn’t have proton or the steam deck without the money valve made from steam sales.
Epic doing this is just another attempt to try and tempt developers to choose their store and not list on Steam. They have no interest in actually improving their offering, their only strategy is to try and find ways to put Steam users at a disadvantage and hope that people go “well I guess I’ll go for it on epic if I have to”. They don’t have any problem getting companies to list their games on Epic, this is 100% about manipulating developers to not list on Steam.
GoG is the alternative to Steam, and offers something that benefits consumers to compete with Steam in DRM free games.
Friends don’t let friends reward Epic for anti-consumer business practices.
halcyoncmdr@lemmy.world 4 weeks ago
9point6@lemmy.world 4 weeks ago
I’d argue it makes more sense for digital distribution, once the sale has been made in a physical store, there’s no ongoing cost for them.
A digital storefront has the ongoing cost of downloads and updates, as well as the distributed storage costs (Steam many copies of games all over the world to mean downloads are quick)
Data transfer costs back in the mid 00s mean that every install of a game like HL2 cost them a dollar or two. If a user ever uninstalled and reinstalled more than a couple of times (a lot more common back then with the limited storage everyone had), couple that with ongoing update transfer costs and most of the profit from a full price sale could be gone. If they never made any profit from the sales, Steam never makes it past its awkward years.
Data transfer is definitely cheaper these days, but then games are bigger and they probably spend a lot more on datacenter space than back in the day
halcyoncmdr@lemmy.world 4 weeks ago
A physical storefront has to deal with asset depreciation however. A product can sit on the shelf and reduce in value as it ages, there is no such thing with digital distribution.
Based on estimates, and various reports, leaks etc. since they aren’t a public company… Steam makde an estimated $10.8 Billion in 2024. They made $780,000 per employee as of 2018 based on an internal report, more than nearly every other company on the planet. They’re not spending anywhere near that on operations.
9point6@lemmy.world 4 weeks ago
Surely the sales are an equivalent there? Both ultimately mean the total price goes down and the store’s cut goes down accordingly.
Don’t get me wrong, they’re definitely profiting these days. $11bn is a massive amount of revenue* for a company with the number of staff they do. But Steam are going to have disproportionately high datacenter costs compared to most other companies. As a rough comparison: Watching an hour of netflix at HD quality is about 1GB of transfer or so, Call of Duty is something like a quarter of a terabyte. Someone who downloads call of duty once would have to watch 250h of netflix to cost them the same.
Then remember they’re likely paying their staff very well, I would not be surprised at all if well over half of their revenue just goes to operational costs before any reinvestment.
*Checked the figure was revenue and not profit.
FartMaster69@lemmy.dbzer0.com 4 weeks ago
Also killed physical media for PC games, carving out a near monopoly for themselves.
halcyoncmdr@lemmy.world 4 weeks ago
Eh, I would argue that the expansion of broadband internet and the increased expectation of instant gratification by consumers made it a perfect time for Steam’s expansion. The death of physical media is a side effect of the ability to near instantly download anything you want.
rtxn@lemmy.world 4 weeks ago
Physical media died when games expanded beyond their capacity. Optical discs are physically fragile, they have a limited shelf life, they have to be reproduced by specialized equipment (not considering piracy here), they have to be physically transported to the customer, some regions are financially unviable (imagine the Helldivers 2 situation but with every game), and production has to end at some point. Having to set up a physical supplier also severely limits the ability of indie or solo developers to have any kind of success or even presence.
Physical media is obsolete, and people clamoring for its return are nostalgic for a world that doesn’t exist anymore.
spankmonkey@lemmy.world 4 weeks ago
By offering a far better experience for the vast majority of people. Like how DVDs killed VHS, where some people who couldn’t afford to upgrade were left behind.
DeathsEmbrace@lemm.ee 4 weeks ago
Simple just use short term oriented goals because that’s what the company is focusing on. Steam was always long term oriented from the beginning Gabe literally said CD less gaming.
Grimy@lemmy.world 4 weeks ago
Steam makes a shit load of money. The server fees are basically a joke and they have 80 employees in the steam division.
The only things that is being invested in is Gabens fleet of mega yatchs, worth an estimated 1 billion, and costing between 75 and 100 million annually to maintain.
Valve has been fined in the EU for anti-consumer practices and received an F from the better business bureau. They are currently in the middle of an other lawsuit.
30% is way too high and it’s a joke to see actual consumers defend it.
jatone@lemmy.dbzer0.com 4 weeks ago
This is likely 100% misinformation. Only EU lawsuit i found was clone about geo blocking games. Which is a game developer/publisher decision not valves.
From there we can extrapolate the rest of their comment is nonsense.
Grimy@lemmy.world 4 weeks ago
Geo blocking is anti-consumer. It was a 16 million euro fine if I remember well.
BBB giving them an F (granted, this one is old) : kotaku.com/valve-is-not-psyched-they-got-an-f-in-…
Billion dollar yatch fleet and maintenance : luxurylaunches.com/…/gabe-newell-luxury-yachts.ph…
80 employees (only came out because of an other lawsuit against them) : lavegagames.com/steam-is-run-by-fewer-than-80-sta…
Gaben isn’t your friend and probably mocks you during his high seas coke parties.
jatone@lemmy.dbzer0.com 3 weeks ago
oh no, a person at the head of a company that has created a great environment has profited from it! the horror.
Gabe’s wealth isnt a problem. if you dislike his yach the problem is in the taxation system of the country not the individuals wealth.
BBB hasnt been relavant for decades its a dead ratings system that was bought out years ago by corpo interests. citing them is like citing donald trump on medical treatments for covid.
oh no! 80 employees? the horror. thats literally what software is about. its economics of scale are insane. you dont need more than a couple dozen people if they’re competent.
finally: geoblocking is a feature developers enable. they don’t have to. steam doesnt force them to. if you dont like it don’t by those games. I promise you there are plenty of games you can buy that dont have it.
really if this is all you have as complaints thats pretty small time. compared to google/apple/microsoft/EA/nabisco mistreatment of their employees, funding of fascist politicians, etc. quite frankly I have bigger concerns than gabe being wealthy.
Delphia@lemmy.world 4 weeks ago
I do wonder just how much a policy like this would effect Valves bottom line though.
This would be pretty amazing for small studios.
FMT99@lemmy.world 4 weeks ago
Hey don’t mistake that comment for a defense of Epic. I am a fan of Steam in general (in so far as I can be regarding “license selling” companies.) I think Gabe did many great things for game distribution. I’m working on an indie game myself and if it ever gets to the point that I can release it, it will be on Steam no doubt. I do dread the day Gabe has to pass on the torch though.