Five reasons why Steam will destroy the PC games industry
I had suggested that it made sense for a developer making PC games to work hard to get on all the distribution platforms. Not just Steam, but GamersGate, Metaboli, Direct2Drive and so on.
Bollocks came the resounding response.
No-one wanted to be quoted. But Steam seems to account for by far the majority of the revenue of every single company who came back to me. People were suggesting that Steam outsold, by a factor of 10 or more, all of the other sites combined.
Steam logo
All kudos for Valve for building this service organically to be so dominant, but this is terrible news for the PC games industry.
We’ve sleepwalked into letting Valve be the dominant platform holder for core PC games. And they did it without having to provide the marketing muscle, financial support and hardware innovation that Microsoft and Sony needed to give us to get their consoles of their ground.
In short, Valve is becoming a dangerous monopoly.
Why does that matter?
Reason 1: Monopolies stifle distribution innovation
In a free market, innovation and improvements are encouraged by competition. The problem occurs when one company is so far-and-away ahead that no-one else can catch up. Think of Google. Think of Facebook. And now we should be thinking of Steam in the same way.
Reason 2: Monopolies stifle creative innovation
I keep hearing that is getting harder and harder to get onto Steam, and if you don’t, then your game won’t sell. The PC has always been an open platform on which it is easy to distribute games. If Steam becomes a de facto monopoly, Valve decides which games we see. A bit too competitive to Half-Life? No distribution. We don’t like Match-3 games? No distribution. We’re not sure that anyone will want a game based on farming? No distribution.
Reason 3: The little guys don’t get a look in
Helping the little guys is hard. When you’re big, and profitable, and important, it’s easy to prioritise the big publishers over the little guys. The little guys are already struggling on the console (although PSN provides one route to market), but the PC has been their lifeblood. A megalithic monopoly could rationally decide that it is no longer cost-effective to support the little guys.
Reason 4: Steam has all the pricing power
Retailers won’t work with indies: it’s not worth their while and, more importantly, indies don’t give them marketing support.
What if that becomes true of Steam? Valve is in a position to say “your game won’t sell without us. We want a bigger cut, or upfront marketing commitment, or some form of guarantee.”
Reason 5: Valve doesn’t need to promote the platform
For all their weaknesses, Microsoft, Sony and Nintendo spend a lot of money promoting and improving their platforms. Steam doesn’t improve the PC as a gaming device. I am a lot more comfortable about oligopolies when there is something in it for the consumer (like subsidised home consoles, for example).
Aren’t Valve the good guys?
To be clear, I’m not saying that Valve is doing any of these things right now. They are a great developer that has created, from scratch, a dominant digital distribution platform, mainly through making it so damned good that consumers don’t want to use anything else.
I am pointing out the risks of letting one company completely dominate a market.
Are there any silver linings?
Sure. As PC games disappear almost entirely from High Street stores, Steam is an incredibly valuable distribution platform. It may, in fact, be the only thing stopping the PC games market from abrupt extinction.
Elsewhere, social and online games (i.e. service games, not product games) are not dependent on Steam in the slightest. In fact, they pose a great threat to Steam, as gamers start playing free-to-play MMOs monetized with virtual goods, rather than spending £29.99 on a game in a virtual box from Steam.
So we’re in this weird place. Steam’s dominance is, in my view, bad for the industry. Yet the emergence of new service-based business models is a terminal threat to Steam.
How Valve chooses to react to that threat will show whether they are PC gaming’s saviour or its monopolistic exploiter.
Which do you think?
I'm a developer. I am working on a title on Steam. There are other factors. Valve provides a lot of tools and add-ons game developers can choose to take advantage of. If all they use is the steam overlay then that is basic and really easy. They can do that and still easily sell their game at other sites.
However, if they want to integrate with steam achievements, leaderboards, friends list, inventory system, and many other things those become deeply embedded in the code of the game.
It is obvious none of that stuff would be functional outside of Steam. So if they want to go outside of steam they essentially have to have two builds or one really complex build that basically runs another branch if not on Steam. This is a lot of extra work.
Steam is great. It is voluntary. It is gobbling up all of the developers not for nefarious reasons but simply because it is good, it has the market share, and it has awesome tools for developers.
In my case I wouldn't mind sticking my game I make on GoG in addition to Steam but that will require me forking my game and stripping out and replacing code that Steam API handles for me. It can be done, but it is not easy... especially in situations like mine where I am the lead developer, programmer, and wearing many other hats and I have two artists working with me.
It is not killing the industry. It is CHANGING the industry.
It may be harder to make it stinking rich making a game unless you happen to make a game everyone loves. It will be possible for more people to make games and make a living without having to bow to the big publishers.
So is it going to kill the industry.... not at all.
Has it changed the industry. Hell yes.
It's too late now too... you want to tell people like me that we have to ditch our 1300+ game libraries (and I am not rich) and move to another platform. It ain't gonna happen.
I thought I'd tell you a little more. Valve takes the equivalent of about any publisher or store. The same percentage as pretty much everywhere. They do not tell people what price to sell their product. They do not tell people when they have to do a sale or for how much.
It is 100% voluntary. What features people want to use they can choose to use in making their game.
Furthermore, you can buy cheap game keys that will activate on steam from other places like www.bundlestars.com, www.humblebundle.com, etc.
Steam doesn't make a dime on those. That is NOT MONOPOLY. It is very much the opposite.
People may not like how so many developers will choose to only publish on Steam. That is not due to Valve or Steam dictating that. So again it is not monopoly.
It is the choice of the developer.
Is making a version to sell on a smaller market something they want to do? If yes, they can. They are not locked into any exclusivity contracts with Steam.
In fact if you want to compare Steam and call it a monopoly, I've never seen it get an exclusivity deal from developers outside of Valve. People are free to do what they want.
Steam is 100% a FREE MARKET and it is thriving!!!
You may not like that people prefer it, but that doesn't make it a monopoly and it doesn't make it a bad thing.
I was going to make my game for Android and iPhone too but those markets kind of suck now IMO. Steam is a great deal for an Indie like me.
I still may publish to GoG or something at some point, but I'll have to fork my code first and that means if I update my Steam game with new code I won't be able to instantly update the GoG code as I'd need to go make changes to the forked version for GoG too and they likely would have very different parts since I couldn't use stuff that I am using from the Steam API on the GoG version.
I am pointing out the risks of company completely dominate a market.and the person who want to boom up the gaming industry but they don't do it lonely so if we want to safe the gaming industry then we must be think about each other but i think it is not possible every person think about him self.