alessandroIn 2018 a group of Valve staff tried to figure out just how efficient they were being—and found they were making more money per head than Apple, Facebook, and nearly every tech giant out there
resetbypeerAnd that for being a non-public company.
Non public should be more efficient from the labor cost savings of not having to file all the sec documents quarterly and legal costs of following public company regulations.
Not to mention that an obsession with increasing share price introduces massive inefficiencies.
Public companies focus on short term profit to keep share holders happy. Private companies can actually focus on long term profit, especially if it’s at the expense of some short term profit.
mercOr they can choose not to focus on profit at all. Probably most people with an ownership stake in Valve are fabulously rich now. Maybe they just want to focus on interesting R&D now.
Theoretically there’s a benefit to a publicly traded company that since a lot of your financials are visible to everyone and people get to “vote” by buying and selling shares, there’s a sense in which you can get feedback on how well you’re running the company that you don’t get when it’s private. But, as Reddit’s “wall street bets” and “superstonk” subreddits show, a lot of investors are morons.
This isn’t totally true. Private companies can still have shareholders that demand info. Their aren’t the same level of regulations, but it’s not nothing.
MacedWindowWe researched ourselves and found out that we are the best
I’d trust a group of employees doing this out of curiosity over, say, HR doing it.
Absolutely! I would do it too if I had access to the numbers.
I imagine each employee crunched their own numbers and compared notes.
If I recall correctly from a People Make Games video (great YT channel btw) all Valve employees have access to how much money Steam makes, so they can apparently just login and look at them anytime they feel like it. The profits of Valve might be shown in a similar way to employees.
☂️-thats the worst nightmare of most bosses
Tried to? Revenue per head and profit per head are very easy metrics. Not sure I would count that as efficient though.
Totally meta comment, but why is everyone here saying “per head” instead of “per capita”?
Probably because “headcount” is a common HR term for the number of employees, and when people are talking “per capita” it might be more about the number of users or customers. The meaning is the same though.
Business speak vs country speak.
What’s the efficiency in taking 30% of almost all game sales on a platform? I know we all love valve, but the efficiency here is having a store that everyone has to use if they want to make sales at all.
Chefdano3Which is exactly what Apple does with their iTunes store.
olicvbNot exactly, apple forces their users to use their stores whereas Valve just offers a better experience than the other stores out there. There is nothing stopping you from using other stores to buy your games on.
That has no impact on both of them taking a 30% cut.
0xDIn the case of Steam that’s because no other corpo run by parasites can create anything close to it. You’re completely free to get any other launcher or store that takes a smaller cut.
And now is where your misguided comparison completely falls apart: Apple users have no other choice than the AppStore. Even if someone wanted to create a better store, they just can’t.
Apple ties their hardware to iTunes with no competition. Steam offer a platform which is better than every other piece of COMPETING software on a variety of hardware.
Yes, it’s all massive profiting, driving the cost of everything up, or putting less money into the hands of the people who make the thing you like.
When I really love a game, it bothers me that valve, or apple, or Google, or Sony, take 1/3rd of the money. They don’t deserve it.
What if you could buy direct from the publisher or developer, but you could only download the game once? Let’s say you could still install it any number of times on any device so long as you had the source file in this scenario. Would you still be willing to pay $60 for a major title?
Would your willingness to buy a game change if you couldn’t get a refund in the above scenario, regardless of time played?
Fortunately thanks to steam allowing free key generation you can buy directly from the publisher and still get all the features of steam except refunds maybe.
That’s the same as buying from Steam. The publisher pays Steam and then gives the key to the customer. They get the same cut either way.
Steam doesn’t take a cut on keys.
That’s great if true. I’m seeing a lot of different information when searching for that though. Older sources say valve doesn’t get a cut, but newer sources are saying that deva can only issue 5000 free keys. Do you have a more recent source with a definitive answer?
Relevant sections from the official documentation: partner.steamgames.com/doc/features/keys
Steam Keys are single-use, unique, alphanumeric codes that customers can activate on Steam to add a product license to their account. Steam Keys are a free service we provide to developers as a convenient tool to help you sell your game on other stores and at retail, or provide for free for beta testers or press/influencers. Steam keys are a free service, so we ask you to use good judgment and follow basic guidelines and rules around requesting and selling them.
Games and applications launching on Steam may receive up to 5,000 Default Release Steam Keys to support retail activities and distribution on other stores. After that, all Steam Key requests are reviewed on a case-by-case basis. There is no guarantee that you will be provided additional keys.
When reviewing Steam Key requests, some of the things we typically look at include the level of customer interest on Steam, the total number of keys that have been issued and activated for the game and the additional number that are being requested. A request will usually be rejected if there’s an imbalance that suggests the developer is not making an offer to Steam customers that is comparable to what Steam Key purchasers are offered. For instance, a game with a few hundred units of lifetime sales requesting tens of thousands of keys, or more.
Q: Why was my key request denied?
A: When reviewing Steam Key requests, we typically look at the level of customer interest on Steam, the total number of keys that have been issued and activated for the game and the additional number that are being requested. A request will usually get rejected if there’s an imbalance that suggests the developer is not making an offer to Steam customers that is comparable to what Steam Key purchasers are offered.
It may also have been denied because the request was for Release State Override keys, which make the content immediately playable upon activation. In general, Release State Override (beta) keys are limited to 2,500 total.
There is no fee but you can be denied keys if you have already requested over 5000. I don’t know how often that happens but IIRC the 5000 limit was added to stop abuse by mainly shovelware developers.
… like a disk or cart? Yes that’s fine. I do that.
Sure, that’s fine for a release that has a physical edition, but many do not.
Also, when buying physical copies I’m guessing that the dev gets an even smaller cut, but it probably depends on the retail location to a large degree.
What percentage of the sales price do you suppose goes towards the outside companies that print the disks and make the packaging?
Plenty of games that make good sales numbers that aren’t on steam. Obviously it makes sense to go where the users are though
Some notable examples that aren’t overly old include Overwatch 1, Minecraft, LoL, and Tarkov.
Valve’s 30% is high, sure. But you’re not seeing the total cost of selling a game.
And yes, I’ve done this before.
Besides the user count, besides all other factors. Digital sales are kinda hard.
You need to offer the actual game. If you’re selling an indie game that’s a few hundred megs, well you get to go sign up for a service to deliver it. Could be as simple as a google drive link, but because this is business use you get to pay business prices.
Are they charging a flat rate per month, per gig? Per download? Some combinations?
Now there’s updates and patches that need to be delivered. Same deal as before, but also now you need to handle the actual patching. Do you ship one big patch that checks for previous patches? Small individual patches that your users have to figure out what one they need?
Does your game have multiplayer? Well damn have fun with that.
What about support and refunds and GDPR stuff? Gotta factor all of that in too.
Now we get to do payment processing. You get to pay a company to accept payments on your behalf because you are NOT doing that yourself you WILL get stuck on inane and silly laws.
That’s part of it. Paying steam 3 bucks on my 10 dollar game to handle ALL of that? Yeah that’s fair. Could it be cheaper? Sure. a lot of things could. I don’t spend months on a game and then cheap out on the most important part: sales.
My time is valuable and worth 30%
Let’s not describe this as “paying valve three bucks” because that’s not accurate and is misleading.
It’s paying valve 30% of your revenue.
They didn’t frame it as “paying valve three bucks”. They said “paying valve 3 bucks on my 10 dollar game”. The phrase “paying pennies on the dollar” comes to mind as a common idiom for saying you’re paying a small fraction of the total, and neither literally means nor implies paying actual pennies.
Usually it does refer to paying less than 20% or so, yes. Not literal pennies, though.
What if it’s a ten cent game and you’re paying steam three cents each sale?
VinnyboilerIt is misleading. It is 30% of the entire revenue of the game. And it is objective whether Valve deserves 30% of that revenue. It’s also true that games aren’t locked to the Steam platform and can absolutely make money outside of Valve’s influence. History has shown though that it is less profitable then being inside the Steam ecosystem.
Except that Steam allow their keys to be sold on other platforms and don’t take a cut on those. So it is 30% on the key sold on steam, but 0% on the other storefront.
So there is no reason to not go on steam because it doesn’t restrict you to steam.
You still need Steam on your computer to install it which means if your computer no longer supports Steam you are out of luck.
If your computer doesn’t support Steam, there’s really no reason to install Steam, because better chance than not your computer doesn’t support almost any game you’d want to play on Steam.
JohnEdwaThere are still plenty of stubborn people that cling to Windows 7, Steam dropped support a few months back when they upgraded the… Electron version, I believe? Had something to do with chrome/chromium dropping win 7 support.
Steam is 20 years old so we have now reached a point where people have retro gaming machines where parts of their libraries come from Steam.
It is not a great trend, but you need a launcher anyway today be it Steam, Origin or any other launchers.
Only GOG offers DRM free games but it is not the norm.
Some games on steam are DRM free, meaning that you can run the game without opening Steam.
I’d rather have physical copies of my games, but it doesn’t exist anymore unless you pirate it.
With that said, Steam is the most convenient and feature complete and that is why it is so widespread. Epic games with their money printer Fortnite could not reproduce a fraction of Steam dev tools and functionality.
ky56If your computer is incapable of even running Ubuntu. Then I don’t think it’s worth using.
You’re better off never learning how little of what you pay your food actually goes to the producer, then…
Shockingly I’m also mad about that. I suppose you support that situation?
Nobody is arguing that valve shouldn’t be compensated for the value they provide. Many of us do, however, argue they are taking too much. Their revenue per employee being so much higher than anyone else in the market supports that argument.
Uh huh, and I’m sure you’re privy to the exact financial breakdowns?
If someone could actually provide a better service than steam at a better price point, they would. The epic games store is shit, uplay is shit, origin is shit.
I agree with you, but its not an argument in Valve’s favor, that is unless you support monopolies. “They should take whatever they can, because no one else is competition.” Yeah, great. Capitalism at work. I agree that’s what they should do if we’re talking pure capitalist ideology, maximize profit at any cost. Is it the right thing to do though. They obviously (from the topic of this thread) make more than enough to pay every employee extremely well and then have a ton left over. They don’t need to charge 30% to get by.
RTFA, it is right there ffs
noobdoomguy8658Not to mention Valve’s effort with Proton, allowing non-Windows gamers enjoy what they pay for on multiple platforms with great ease; their efforts have been massive for gaming on Linux, and without it, I wouldn’t have paid for a lot of games, earning their developers a whole lot of absolutely nothing.
Also the community hub, the workshop, the review system, the cloud saving, the functional wishlist, the gifting system, the shopping cart, the anti-cheat (you’re better of with it than without it), the discovery queue, the sales dedicated to specific types of games that actually help people discover games and drive the revenue up for the developers, the (I think) complete transaction history, the refunds system, the friends and the chat and profiles - and probably many more things that I’m either not aware of or couldn’t list off the tip of my tongue, combined with internal works that, again, do help the devs in the end.
Steam is much more than a place where one pays for a game to then simply download and play it. It’s much greater and more functional than that. None of the developers have to put their games on Steam - nobody forces Epic Games Store or GOG to be this subpar in comparison. Same way nobody forces gamers to use Steam. People use Steam because they love it - or because there’s no good-enough alternative, but that’s hardly Valve’s fault.
Steam charging 30% is not just worth it, but also surprising, given what putting your game on Steam gets you as the developer, and what it gets us, the players.
Not to mention Valve’s effort with Proton
And their VR efforts. VR seems to have lost popularity lately, but I was really glad that someone out there was competing with Palmer Luckey, especially once he sold out to Facebook.
And… holy shit, I just found out he’s Matt Gaetz’ brother in law. That explains a lot.
30% is more or less the standard. Not just in the games industry, but everywhere.
The status quo is rarely a good reason for anything
It’s actually not the standard, the standard is 70% for in-store.
and Nintendo, Sony, and Microsoft charge the consumer extra for features like online play and cloud saves.
Personally, I think the standard should be reduced but Nintendo, Sony, and Microsoft should start.
Epic is 12%. Yeah, Epic store sucks and all that. Whatever. There’s two marketplaces that aren’t first party. One takes 30% and one takes 12%. How is there a standard? You can’t look to other markets or other distribution methods to compare it to, because they’re all different with their own things.
Edit: GOG is 30% for indie developers (there’s a little more to it than that, but basically that). It sounds like with other publishers/developers they negotiate contracts on a case-by-case basis and don’t say what they get.