I think the headline of the article is pretty misleading as he means that Windows 8 is a catastrophe for Steam because of the Windows 8 app store. Looks like everyone's upvoting the article because they seem to think that Gabe meant that Windows 8 will be a failure.
Instead of having to go through Steam's distribution, games will have the option of going directly to the Windows 8 app store and get featured there, not to mention XBox Live coming to Windows.
Anyone know what Steam's cut for game devs is? Microsoft is charging between 20 to 30%, so Steam seems to be very worried about their revenue stream and thus supporting Linux as a hedge.
Of course the regular desktop Steam client will keep working, but not on Windows RT ARM devices. Also, doesn't the WinRT support full DirectX?
Says Pitchford, "It would be much better if Steam was its own business." If Valve spun off the content delivery system, it would also remove the perceived conflict of interest Pitchford takes umbrage with. "Steam helps us as customers, but it's also a money grab, and Valve is exploiting a lot of people in a way that's not totally fair," Pitchford says. "Valve is taking a larger share than it should for the service it's providing. It's exploiting a lot of small guys."
Steam's cut is 30%. However, for that 30% you get to update your game whenever you want, and virtually as often as you want. By that I mean they don't impose any direct limits on how often you update, but the general rule is no more than once a week aside from hotfixes and the like. I'm not aware of any digital marketplace that gives you this much control, especially as video game updates will often be hundreds of megabytes in size. Contrast this with Microsoft's Xbox Live Arcade, which charges you $40k for each additional update after the first free update. [1]
Edit: It is worth nothing that if a user's game was activated with a retail key, Steam takes no cut. This means that you are effectively getting service for that user for free.
You also get Steam Cloud, which allows you to store your users' configuration and saved game files to be accessed anywhere, their peer-to-peer networking API which provides NAT punching. Then there's matchmaking, stats/achievements, Steam Community (their social network), and several other "Steamworks" features. [2]
Edit: Microtransactions is another big one, also known as in-app purchases. The online brochure for Steamworks is worth a read if you're interested in any of this: http://www.steampowered.com/steamworks/index.php
I haven't read a lot about Windows 8's app store, especially concerning Xbox Live, but Steam still has a lot to offer to developers.
I believe this approach raises the overall quality of games in the Marketplace. A developer on Xbox Live Marketplace will be less inclined to rush out a broken game and release updates every day until it works. If they have to pay $40k/update, they have an incentive to do it right the first time, with some leeway to fix unforeseen bugs (the free first update).
That's not very good for small developers that may want to iterate over their games or provide extra content for their users. Developers who simply do not have the resources to test in a wide variety for hardware, or to get their game just perfect for the first update. And as a user, I love having access to games by these developers. Steam would lose a lot of value to me if it wasn't such a helpful platform for small devs.
And that's without even getting into updates that provide extra content. Steam's flagship game, Team Fortress 2, updates at least once a month with extra (free) content. That generates mayor amounts of good will towards the devs, and it would be completely unsustainable if the developers had to pay $40k to update, and another $40k to fix any bugs or imbalances in the update.
MS has pretty strict size restrictions on title updates, since they have to fit in cache for users with no real hard drives. This means you're not going to deliver new content through patches anyway - you have to distribute it through DLC instead. This leads to about a million other problems, primarily when it comes to compatibility between players online who may or may not have the DLC, duplicating content since you're required to not have dependencies between your DLC, and the fact that MS frowns on free DLC.
I was arguing that this policy would be bad for Steam or other PC marketplace services. It's possible than on a closed system such as the XBox some of the disadvantages of this are alleviated or solved. I still think charging the dev for adding extra content for his game is a very bad idea, though. Team Fortress 2 for the XBox sucks for it, for example. Regular updates is a good model for the user, and it hurts the user to charge for content that would otherwise be free. Alas, I know that helps greatly reduce the number of bugs in the system.
But there's still a major chokepoint: Apple's review process. Does Steam have a similar review/approval loop? I would guess not, since they don't allow just anyone to start selling on Steam like the "mainstream" app stores do.
It used to be that Valve had to approve and push your update out for you, though they did this typically within the same day you sent it to them. Now, you press the big red button so to speak. This also means you can push out updates outside of Valve's business hours. Great for emergencies...
They also have branches, so that you can release betas for your users to opt-in and test.
>Steam's cut is 30%. However, for that 30% you get to update your game whenever you want, and virtually as often as you want. By that I mean they don't impose any direct limits on how often you update, but the general rule is no more than once a week aside from hotfixes and the like.
I have a game on Steam; this information is not inaccurate. Although now there is a new system in place to allow for unlimited updates no matter how often.
What are you basing this on? The quote in both the linked article and the AllThingsD piece indicates that he said "I think Windows 8 is a catastrophe for everyone in the PC space." He isn't just talking about Valve.
Possibly even good for consumers in that case. It's not really an ideal situation that software distribution would be a high-margin business in the first place. Typically you want distribution and infrastructure businesses to be competitive spaces with prices driven down towards costs, since they're just overhead from the perspective of getting stuff from sellers to buyers. For example, container shipping and grocery stores are not high-margin businesses.
On the other hand, Microsoft's new 20-30% cut doesn't sound like very low-margin distribution infrastructure either...
It's not really an ideal situation that software distribution would be a high-margin business in the first place. Typically you want distribution and infrastructure businesses to be competitive spaces with prices driven down towards costs, since they're just overhead from the perspective of getting stuff from sellers to buyers.
Does "low-margin" for software really make sense? These aren't physical goods that have a inherent value. The "cost" of any given piece of software is the price you are willing to pay the people building it.
I was thinking just of margins on the distribution part, not the creation of software. Getting an app from the creator to the purchaser seems like a logistics/retail type business, like Wal-Mart is for physical goods, and high margins on that just means more overhead for everyone (except the operator of the distribution network).
You know what keeps people selling software in a market plagued by piracy and a confusing array of operating system versions and hardware configurations?
MARGINS.
If Microsoft takes that away, they'll bail in the biggest possible way. Good luck getting Adobe to retail through your app store. They'll probably make a Linux port as a big fuck you to Ballmer.
He also said "I think we'll lose some of the top-tier PC/OEMs, who will exit the market."
He's clearly not just talking about the app store cutting into margins. Why else would OEMs exit the market if not because of usability issues/market collapse?
The OEMS are in a tough place. They have to compete with actual HW innovation ( apple ) on one side, and with subsidized hardware on the other side ( amazon ). And if they succeed, all the margins go to Microsoft.
At least, in the case of Android, they can add value, or extra revenue streams. In the case of linux, the open nature, would provide a competitive edge.
Why would any OEM be interested in selling win8 devices? If microsoft is going the way of the console ( like apple and amazon are doing ), shouldnt microsoft be paying them instead of the other way around?
The reason why he thought it would be a business catastrophe is because Windows 8 is moving to be a closed ecosystem, instead of the traditional open ecosystem of the Wintel duopoly. (Which is what allowed Linux to flourish, and allowed an awful lot of innovation, including all of the Linux servers at Amazon, Facebook, Google, etc.)
You're right, and I also wouldn't trust anything he says about Windows 8 since he has a vested interest in keeping easy distribution restricted to Steam. He will face no such competition on Linux.
The headline is misleading. He was talking very much, from his vested interest point of view. He was not dismissing the quality or value of win8 for consumers.
But he is allowed to be a bit upset: Steam is effectively not allowed on Metro.
And there was loyalty between Valve and Microsoft. In general, he dislikes the verticalisation in the market; how consumer devices will all be (media,game,app) consoles. But to see Microsoft make this move, just hurst more, when your company has invested so much in the windows ecosystem. And lets not forget that without Steam, pc gaming would have died completely 5 years ago.
Personally, i dont like it either. I think its anticompeteive in nature, and bad for innovation. Appearantly operating system vendors are becoming the new cable companies, charging for access to consumers.
But unless one of them (apple, google, microsoft, amazon) has a monopoly, its not illegal to operate in this manner.
Nitpick:
without Steam and without any equivalent of it, PC gaming would have (probably) died 5 years ago.
Your sentence is like saying that without Internet Explorer, we would still be paying for internet browsers. It's praising Microsoft for what it did and mysteriously assuming that in absence of it, no one else would bring the cost of browsers down.
This is my nitpick with "what if X didn't exist" scenarios: people imply that nothing would fill the vacuum.
Another example I just made up: "If Linux didn't exist, we wouldn't have a free, open source OS". I'm pretty sure FreeBSD or something like that would grow like Linux instead. Not saying it would be better or worse, because, frankly, I don't know.
Linux brought a large new demographic (hobbyists, students) to Unix at a time that it was expensive, little used and dying. The Linux movement, as opposed to the Linux software, was a true revolution and not easily replaced. Effective movements are a lot harder to build than effective software.
Another counterexample would be the internet itself. It could very easily have gone wrong and we would have been stuck with the likes of Compuserve and AOL.
If anything he risks footing a lot of the effort to get developers onto Linux (see: Valve openly talking about working with GPU manufacturers to improve the quality of Linux drivers) only to have it benefit people that choose to distribute outside of Steam.
I was going to reply that UBC doesn't support paid apps, but apparently now it does.
That said, Valve appears to be going for a play based on being a cross-platform app store (Windows, OS X, Linux). It's not obvious to me that they can add much value that way (after you've gone to the work to implement support for three platforms, submitting to three app stores is not a lot of overhead) but we'll see.
If you're using multiple platforms, I could see the benefit of not having to enter your credit card multiple times. But honestly, if you're going to buy a program on your PC, then walk over to your Mac and buy it again, do you really care if you're buying it from the same store both times?
I know that Steam lets you take your games from one machine to another, but I don't expect that to be the norm for most app stores.
This is not how that works -- if you buy a game for windows on steam, the mac version is free. I've tried this personally, and I expect the same will be true for linux as well. In other words, pay once, get the game for all OS', updating automatically, and all connected to the same account so you can chat to windows and mac players through the steam client
There are actually some pretty decent alternatives on Linux, most obviously distro package management, some of which is now a platform for proprietary software too, but there are other competitors. Additionally, Steam works great with WINE and most Linux gamers use it without issue -- the main benefit from a native version would be inclusion in package managers or first-class distribution as a pre-installed app in e.g. Ubuntu or "Ubuntu's Gamer's Edition" or something like that.
I see no reason to infer that Newell's comments are limited specifically to app platforms. I also wouldn't be surprised if there's more to this than just a Steam-for-Linux download; they could be working on something like the old Phantom project to really bridge the gap between console and PC, and take advantage of Windows 8's almost inevitable initial poor reception to gain marketshare.
I would be more afraid of Xbox Live than the app store.
Buying is just a one time deal. Achievements and other social features of Xbox Live are constant and, if shared with the large Xbox network, will be very desirable for consumers.
They are not afraid of losing the competition, they are afraid of not being allowed to compete.
Steam cant be on Metro, and the x86/classic-desktop will likely end up, only in the high end of the market.
Just like Apple, the common win8 consumer device will be in the 200-600 dollar range .. running on ARM, and completely block any competition from selling content. The privileges of backwards compatibility and "side-loading" will be available only on 800+ dollar devices.
Unless the video game developer is creating a game only for metro then the Windows Store will not cause any harm to Valve. Although it is possible to list a non metro application in the store (http://blogs.msdn.com/b/windowsstore/archive/2012/06/08/list...) users will not be able to purchase or directly download those applications from the store and MS does not take a cut of non metro apps.
You bring up a good point about the WinRT ARM devices. These devises are very closed off similar to the IPad, the only option for WinRT tablet users will be to go to the Windows Store but I don't think Valve even cares about this market too much ( I don't think you can download games directly to your iPhone from the steam app, can you?). Steam in my opinion is geared towards the PC desktop gamer not the (ARM) tablet* user, so Valve has nothing to worry about.
*x86 tablets will most likely be able to download steam.
> Steam in my opinion is geared towards the PC desktop gamer not the (ARM) tablet* user, so Valve has nothing to worry about.
The problem is that the PC desktop-gamer market is shrinking, and may shrink further if a large population adopts WinRT tablets. I'm sure there are many edge-case customers out there that would rather pay <$500 for a PC in exchange for not having access to the few indie games they or their children purchased on Steam.
While most avid PC gamers will keep with the desktop model, this sort of fork in the road for PC buyers is in essence also a narrowing of accessibility for future generations of would-be PC gamers.
I'm pretty sure Microsoft will end up doing to Steam what Apple tried to do with Amazon, and not allow them to sell games anywhere but in their store in the future.
To lure in would-be developers, Microsoft is establishing an attractive revenue-split model that trumps what Apple delivers to its App Store and Mac App Store software partners. The Microsoft split starts at 70-30, between developers and Microsoft, respectively. This is the same ratio Apple offers, but once an app has proven its success by garnering $25,000 in sales, the split shifts further in the developer’s favor to 80-20.
Also I am 90% sure that this only applies to metro apps, non metro apps will be featured in the store but users will be directed to a website (chosen by the application developer) to purchase/download the product from.
Store fees are calculated on a per-transaction basis as well. These fees are based at 30% of the app price, until your app reaches $25,000 or equivalent of lifetime sales (aggregated across app sales and in-app purchases) when they change to 20% of the app price.
Instead of having to go through Steam's distribution, games will have the option of going directly to the Windows 8 app store and get featured there, not to mention XBox Live coming to Windows.
Anyone know what Steam's cut for game devs is? Microsoft is charging between 20 to 30%, so Steam seems to be very worried about their revenue stream and thus supporting Linux as a hedge.
Of course the regular desktop Steam client will keep working, but not on Windows RT ARM devices. Also, doesn't the WinRT support full DirectX?
Ref. http://www.joystiq.com/2009/10/07/randy-pitchford-on-steam-v...
Says Pitchford, "It would be much better if Steam was its own business." If Valve spun off the content delivery system, it would also remove the perceived conflict of interest Pitchford takes umbrage with. "Steam helps us as customers, but it's also a money grab, and Valve is exploiting a lot of people in a way that's not totally fair," Pitchford says. "Valve is taking a larger share than it should for the service it's providing. It's exploiting a lot of small guys."