This claim is pretty rich. Could 30% be considered excessive? Sure, you can declare any value excessive. But 30% has been an industry standard for a while, it's not like Valve was scheming in a...
Wolfire's lawsuit also claims that Valve uses its near-monopoly to charge an excessive fee to sellers—30%—that wouldn't be sustainable in a competitive marketplace.
This claim is pretty rich. Could 30% be considered excessive? Sure, you can declare any value excessive. But 30% has been an industry standard for a while, it's not like Valve was scheming in a corner about how best to rip developers off. (And Valve even gives publishers who sell a lot on Steam better cuts, but let's ignore that for now.) I'm not saying that "it's normal, therefore good", just that it's not an abnormally high cut, either.
For some historical context, keep in mind that before Steam took off, many, if not most, game sales were through retail outlets, which typically took a 50-60% markup. A $60 game being sold would result in <$30 to the publisher. 30%, by comparison, was an absolute windfall. And the best part is that Steam key sales are free - that is, Valve takes a 0% cut. And one-third of Steam activations are for keys - Valve could make bank if they even took a 1% cut of the game's non-sale price for each key activation, but instead, they allow anyone to set up a storefront and sell keys (even ones acquired through dubious means), with the only cut being that of the payment processor.
In the US (where this case was filed), antitrust laws are written with damage to the consumer in mind. Whether or not you think these laws are just (I think they need some major updates), the fact remains that Valve didn't conspire to wipe out the competition and have Steam become the only storefront - they got to the top by sucking less than the competition (GFWL, anyone?). Now, the network effect does a lot to keep them on top, despite them not doing much to remain competitive. Valve doesn't pay publishers for exclusives like Epic does - the only true Steam exclusives are Valve's own IP, the rest are just games from companies that don't feel like selling elsewhere.
And furthermore, Valve isn't harming the consumer with a 30% cut. Nor are they benefiting them. There's probably an economics term for this, but basically, it's a cost that is transparent to the consumer. Because this lawsuit harps on the cut so much as being detrimental, clearly a <30% cut would mean games would be cheaper, right?
The answer is no. Go on IsThereAnyDeal and look up a game that is available on multiple launchers, such as Far Cry 5. Since Ubisoft takes a 0% cut when selling on their own launcher, logically it should be cheapest there, right? Ignoring the current sale going on, the normal price is exactly the same as it is on Origin, Epic, etc. The cut has no bearing on the price of the good.
That this lawsuit was even filed is hilarious, I cannot think of any way to demonstrate consumer harm when the cut - which appears to be the only real point in the lawsuit - is simply a cost of doing business that only affects profit margins. Maybe Wolfire Games just wants a bigger cut from the platform they sell the most on, and they figure Valve would be more likely to give them that in an out-of-court settlement than actually let the case go to trial. Regardless, this is basically the definition of a frivolous lawsuit. Valve is not perfect by any means, but antitrust is just about the dumbest thing you could try and criticize them for.
Edit: I just read through this article, which OP's article links to. It has some very good points, but ultimately, even though I think Valve is certainly deserving of criticism, what they're doing seems unlikely to be actionable under current antitrust laws (in fact, it sounds like they've taken inspiration from retail pricing agreements), which makes me wonder why these suits were even filed (besides the cynical answer of getting Valve to give a better cut without needing the high sales volume to qualify for it).
Previously: Humble Bundle creator brings antitrust lawsuit against Valve over Steam Valve argues anti-Steam suit lacks “the most basic elements” of antitrust case
Let's remember some history: Valve developed Steam to distribute patches, anticheat, and DRM for its games. DRM didn't even come into play until Halflife 2. The social components came next (I...
Let's remember some history:
Valve developed Steam to distribute patches, anticheat, and DRM for its games. DRM didn't even come into play until Halflife 2. The social components came next (I think), and only after did 3rd parties start being able to sell on Steam.
Many have tried to compete with Steam and failed. GoG does ok by doing something a bit different. Epic so far seems closest to making major inroads, by bruteforcing marketshare via Fortnite and giving away free games, which isn't any less anticompetitive than what was alleged here.
Humble Bundle, founded by Wolfire Games, also had its own unique value proposition until they decided to compromise on every single one of their original principles and become a Steam code...
Humble Bundle, founded by Wolfire Games, also had its own unique value proposition until they decided to compromise on every single one of their original principles and become a Steam code storefront. They still get by selling their monthly subscriptions but the irony is palpable.
(I've made clear on the previous thread that I stand with Valve here, even as I'd like to see more viable competitors.)
This claim is pretty rich. Could 30% be considered excessive? Sure, you can declare any value excessive. But 30% has been an industry standard for a while, it's not like Valve was scheming in a corner about how best to rip developers off. (And Valve even gives publishers who sell a lot on Steam better cuts, but let's ignore that for now.) I'm not saying that "it's normal, therefore good", just that it's not an abnormally high cut, either.
For some historical context, keep in mind that before Steam took off, many, if not most, game sales were through retail outlets, which typically took a 50-60% markup. A $60 game being sold would result in <$30 to the publisher. 30%, by comparison, was an absolute windfall. And the best part is that Steam key sales are free - that is, Valve takes a 0% cut. And one-third of Steam activations are for keys - Valve could make bank if they even took a 1% cut of the game's non-sale price for each key activation, but instead, they allow anyone to set up a storefront and sell keys (even ones acquired through dubious means), with the only cut being that of the payment processor.
In the US (where this case was filed), antitrust laws are written with damage to the consumer in mind. Whether or not you think these laws are just (I think they need some major updates), the fact remains that Valve didn't conspire to wipe out the competition and have Steam become the only storefront - they got to the top by sucking less than the competition (GFWL, anyone?). Now, the network effect does a lot to keep them on top, despite them not doing much to remain competitive. Valve doesn't pay publishers for exclusives like Epic does - the only true Steam exclusives are Valve's own IP, the rest are just games from companies that don't feel like selling elsewhere.
And furthermore, Valve isn't harming the consumer with a 30% cut. Nor are they benefiting them. There's probably an economics term for this, but basically, it's a cost that is transparent to the consumer. Because this lawsuit harps on the cut so much as being detrimental, clearly a <30% cut would mean games would be cheaper, right?
The answer is no. Go on IsThereAnyDeal and look up a game that is available on multiple launchers, such as Far Cry 5. Since Ubisoft takes a 0% cut when selling on their own launcher, logically it should be cheapest there, right? Ignoring the current sale going on, the normal price is exactly the same as it is on Origin, Epic, etc. The cut has no bearing on the price of the good.
That this lawsuit was even filed is hilarious, I cannot think of any way to demonstrate consumer harm when the cut - which appears to be the only real point in the lawsuit - is simply a cost of doing business that only affects profit margins. Maybe Wolfire Games just wants a bigger cut from the platform they sell the most on, and they figure Valve would be more likely to give them that in an out-of-court settlement than actually let the case go to trial. Regardless, this is basically the definition of a frivolous lawsuit. Valve is not perfect by any means, but antitrust is just about the dumbest thing you could try and criticize them for.
Edit: I just read through this article, which OP's article links to. It has some very good points, but ultimately, even though I think Valve is certainly deserving of criticism, what they're doing seems unlikely to be actionable under current antitrust laws (in fact, it sounds like they've taken inspiration from retail pricing agreements), which makes me wonder why these suits were even filed (besides the cynical answer of getting Valve to give a better cut without needing the high sales volume to qualify for it).
Previously:
Maybe adjust the second link to https://tildes.net/~games/xvn/valve_argues_anti_steam_suit_lacks_the_most_basic_elements_of_antitrust_case ?
Ah, thanks
Let's remember some history:
Valve developed Steam to distribute patches, anticheat, and DRM for its games. DRM didn't even come into play until Halflife 2. The social components came next (I think), and only after did 3rd parties start being able to sell on Steam.
Many have tried to compete with Steam and failed. GoG does ok by doing something a bit different. Epic so far seems closest to making major inroads, by bruteforcing marketshare via Fortnite and giving away free games, which isn't any less anticompetitive than what was alleged here.
Humble Bundle, founded by Wolfire Games, also had its own unique value proposition until they decided to compromise on every single one of their original principles and become a Steam code storefront. They still get by selling their monthly subscriptions but the irony is palpable.
(I've made clear on the previous thread that I stand with Valve here, even as I'd like to see more viable competitors.)