Is Valve's Steam Anti-Competitive? 286
Absolut187 writes "Gearbox Software CEO Randy Pitchford says Steam's domination of digital distribution is 'dangerous,' and exploits small developers. '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. ... Valve is taking a larger share than it should for the service it's providing. ... There's so much conflict of interest there that it's horrid.' Pitchford's comments came as part of an interview with Maximum PC, and he thinks Valve should spin off Steam to its own company. Is he right? Is there a better answer?"
Update: 10/10 at 02:00 GMT by SS: Randy has clarified his remarks in a comment here at Slashdot. He makes it clear that he likes Steam a lot, and for several reasons, but thinks stronger competition would benefit the industry as a whole.
...should we be outraged? (Score:5, Insightful)
so do something about it (Score:4, Insightful)
Valve is exploiting a lot of people in a way that's not totally fair
So start a competitor with policies you consider to be fair.
And stop whining, btw.
are our brains leaking out of our heads? (Score:4, Insightful)
Well.. (Score:2, Insightful)
As much as I like Steam, they'll always be anti-competitive as long as you cannot unlink and resale games to other people. It ensures that Steam NEVER has to compete with itself for a sale, that is, no one can get a Steam-exclusive game and then resell it to another person, without selling their entire account off.
I have no issues with letting them dominate the market if they'd allow games to be resold or transferred between accounts. They haven't, to my knowledge, been anti-competitive towards other companies. There have been many attempts to set up a decent network like it, but many have failed. Why? They want to encrypt/encode your games, but limit their bandwidth to a T-1 that serves hundreds of thousands of customers, AND tell you to fuck off when the game doesn't work.
Voluntary = exploitative? (Score:4, Insightful)
How on earth is a voluntary service exploitative?
In the same way I guess that a story exploits people who voluntarily buy from them.
Is there something I'm missing here?
Re:are our brains leaking out of our heads? (Score:5, Insightful)
There's one other thing that's revived PC gaming for me, and digital distribution does it by default. Apart from games I bought on Steam or from GOG, only one of them doesn't force me to insert the %^&*ing CD in order to play. This is despite the fact that games load just about nothing from CD these days because it's too slow!
valve has done something right the rest havn't (Score:4, Insightful)
Unfair competition? (Score:4, Insightful)
Has Valve somehow managed to erect barriers to entry into the market, or in any way block competitors from starting a competing service? Is there in fact anything unethical or unfair going on?
Valve pioneered this area. Now they are reaping the rewards. Anyone who doesn't like it is welcome to start up their own, competing service.
But hey, he's entitled to complain about it if it makes him feel better. That's less work that trying to compete with Valve.
steveha
There's plenty of competition. (Score:2, Insightful)
But the only service from this list I like more then steam is gog.com. Steam offers a great service which offers very fast downloads, an easy to use steam app, weekend deals, plenty of community features, achievements... The only thing they seriously fuck up is their price ranges. Direct dollar to euro conversions make me feel ripped of. It also means that new games are always cheaper to get at a retail store. Steam is only useful for weekend deals.
If you offer a service with non intrusive drm, a good community and cheaper prices I'll be glad to buy at your shop. Direct2drive is an example of how not do it. It offers very little community interaction. Their games are country restricted. A £5 game seems cheap at first until you see that others pay $5, it's 40% cheaper and again makes me feel ripped of. And needing both serial codes and activation codes makes things a mess to install. I received 4(!) serials when installing titan quest. Compare that to gog.com where a game plus expansion is offered in one bundle with no DRM. Those games are guaranteed to work with xp & vista. They offer user reviews, fora for each games, advised mods to use... And a game costs $6 even if I live in Europe.
There's room for competition but you need to offer a better service. Not just throw your DRM protected crap at your customers. And while steam is a nice platform there's definately room for improvement.
Re:Expensive (Score:4, Insightful)
And there are alternatives (Score:5, Insightful)
He might have a point if Valve really had a monopoly. If they because the only way to do digital distribution, ok maybe a problem. However, that's not the case. My personal favourite for digital games is Stardock's Impulse (impulsedriven.com). Same idea basic as Steam. What I like about it is it is better on DRM. They don't apply their own DRM to all games, so some have none at all. Others use Impulse GOO, which is kinda like Steamworks but you don't have to be logged in or run the client, others use 3rd party DRM like on Steam.
Yet another option is Direct2Drive. I'm not such a fan of this one, but it works. I've bought a couple of titles from it.
So if a publisher/developer doesn't like Steam, well then don't use them, use one of the others. Nobody is making you use Steam. Or, for that matter, you could always use Steam but offer a better deal to the others if you like them better. Have your game for $50 on Steam and $40 on Impulse. That way you still get sales from Steam, but you can point customers to the platform you like better.
The other funny thing about the whining is that though the digital distributors take a cut, it is way less than retail. Retail is about a 50% markup. So if you buy a game at Target for $50 the publisher sees $25. Digital distributors don't take nearly that large a cut (it is more like 20%).
Re:Unfair competition? (Score:5, Insightful)
Sure and LOL, they were the first carrying titles like Counter-Strike and Half-life, pretty much forcing people to install Steam in order to play these highly desired games. NOBODY would install Steam without some good game already in. You can try to start a competing company with no such games, good luck.
Gimme a second here (Score:2, Insightful)
Re:...should we be outraged? (Score:1, Insightful)
A good example is Dawn of War II.
You could buy it in a shop, or on Steam, but part of being on Steam meant it had to be activated by Steam, including the shop bought version.
So here's the problem, Steam is an important channel and you'd lose a lot of sales if you didn't use it, but in using it you're also handing control of your software including activation of it to Valve even if you also want to distribute via standard hard copy retail.
Should games companies really be stuck with a choice between handing access control to their software to a competitor or losing out on a large amount of sales?
From the customers point of view Steam also takes away the ability to even sell games activated by Steam, but bought on physical media second hand. I can sell everything in my house on second hand, from my toaster to my toilet seat, I can even sell my naively bought rootkit DRM'd Sony music CDs second hand, but there is one thing I can't sell second hand due to an artificial restriction- my copy of Dawn of War II.
Quite why so many people on Slashdot are anti-DRM and are quick to slag off Sony for using it, Apple for using it, EA for using it but for some reason, give Valve a free pass, despite Valve's implementation being one of the most restrictive on the market. As with all DRM, the piracy excuse doesn't even come into play, because cracked copies of the games are always up before Steam has them up anyway. The fact is, Steam is anti-consumer, and is anti-competitive. Personally, I wouldn't mind so much if it even worked properly, but half the time I load up Defcon I'm forced into trial mode because it can't authenticate with Valve's servers.
Steam is a problem, it's anti-competitive and takes away fundamental consumer rights. Just because Valve makes good games, and Gabe tells us he hates DRM, doesn't excuse Valve or Steam from the fact that when it comes to DRM, their system is worse than just about all DRM that the music industry has churned out.
As Steam grows in marketshare the problem only becomes worse, developers will struggle with sales if they do not use it, and can we be sure that for example, if Valve releases Half-Life 3, the same day Gearbox releases a game, that Valve, knowing the activation servers will see heavy volume wont give priority to those activating Half-Life 3 over those activating GearBox's game?
It's a classic illegal abuse of monopoly situation, if Valve obtains (if it doesn't have already) a monopoly or near monopoly in digital game distribution, can we really be sure that Valve wont leverage this position to give itself an advantage over competitors which then depend on it for financial survival?
Is it acceptable if more and more games follow the path of Dawn of War II, such that even store bought games depend on steam, ultimately decreasing people's reason to even buy in store in the first place that Valve will siphon off, possibly even destroying in the long run retail software chains, becoming the soul or near soul provider of games?
Even if you disagree Valve and Steam's blatant potential for conflict of interest is not a problem now, you cannot disagree there is potential for major problems down the road. Gearbox is not the first to complain, Gamestop have refused to stock games that require Steam activation in the path for exactly the reasons in the last paragraph.
Slashdot, grow the fuck up for once, put your fanboyism away and take your morals back out the bag and treat Valve like you'd treat Sony or Microsoft when they fuck the consumer and act in an anti-competitive manner as Valve are.
Re:...should we be outraged? (Score:4, Insightful)
Actually it does, it provides an easier way to meet the mass market than the alternative, which is the main games distribution companies like EA. You want a conflict of interest, try doing business with them and releasing a game at Christmas when their flagship titles are coming out.
I know Steam has its detractors as they do not allow resale of titles, but it also has its benefits.
Re:so do something about it (Score:2, Insightful)
Monopoly is a specific word that has a certain meaning, and it's more than just market dominance.
Part of what gives a company a monopoly is that they have exclusive control over access to a resource, or near enough that it doesn't matter. This control alows a company with a monopoly to prevent competitors to be able to compete by restricting the resource outright or by charging fees that are so high the competitor cannot possibly provide a competitive service at a competitive price.
The obvious example is Microsoft, who had a monopoly on the browser market by virtue of the fact that businesses and consumers were entrenched in Windows. It is obviously not reasonable to expect millions of Windows users to change operating systems just to run a browser, so the ability to tie Internet Explorer in to Windows in such a way that no browser could perform at the same level, as well as coercing retailers into not including competing browsers with no recourse for competitors, was clear evidence that Microsoft was controling a limited resource - lower level access to Windows and the ability to bundle software with Windows - which gave them a monopoly.
Now, on the flip side, they do NOT have a monopoly in the OS market. There is nothing Microsoft directly controls about PCs that prevents someone from installing an alternative operating system on the same hardware.
Other examples of monopolies are telecom and cable companies - these are government enabled monopolies, whereby only certain companies are permitted to install new cable. A competing service would find it very very difficult to run new lines or use existing lines in an area with full coverage by a single provider. This kind of monopoly really disgusts me, since the government is supposed to prevent monopolies not create them. Note that the monopolies were originally used as incentive to build the networks that would not have been profitable to build otherwise, but that was ages ago and we have long since paid for it by now. The splitting of Bell helped, but frankly it has only reduced the monopolies to regional monopolies instead of a national monopoly. It isn't a whole lot better, as competition is only less stifled than it used to be.
Re:Comment from the source (Score:4, Insightful)
As a guy who reads, trusts and respects slashdot and the community here,
That is where you are going wrong, we are in fact 90% self righteous troll, fortunately I'm part of the 10% that responds to logic and completely agree that it would be better for everybody involved if steam/valve split. If they do not they will have to take great care to not end up running afoul of anti-trust laws as they are a major part of several markets distribution,PC FPS (particularly at a pro level),engine licensor.
Re:Well.. (Score:3, Insightful)
If you've signed an exclusive contract, then obviously you would be in breach of contract if you sold somewhere else. Duh.
That's actually you (the developer) creating an incentive for Valve to promote your software more than they would promote non-exclusive software. It's a business decision, and the company that has to live with it is the one that made the decision.
Re-selling is an entirely different beast. If you want to own a physical copy of a game you can sell to someone else, you should buy a physical copy. What you are doing with Steam is effectively purchasing a subscription to the game, rather than buying a copy. You can tell by the fact that you can download the game on any computer and play it, and have it installed on multiple computers at once. This is not possible with purchased copies, as you are violating copyright every time you install the game on a new computer. Of course you can break the law if you want, but I'm assuming you are an honest person.
There are competing services, by the way, which allow you to purchase digital copies of the software. If you don't like Steam, go with one of them. There is nothing limiting you to Steam except yourself.
Re:Use Impulse Instead (Score:4, Insightful)
I'm sure nobody has ever released a buggy game on Steam, right? Or in retail for that matter?
What a silly argument.
Re:...should we be outraged? (Score:4, Insightful)
That's a pretty weak argument for someone with a modern connection. It took me about 30 min to install the orange box (about 4.8gb) on my home connection. If you account for time spent looking for the original disk, it's about neck and neck for the physical install vs. the online download these days. If you're buying a new game (if you're me, that's about 90% of all games played) then it's usually preloaded onto your computer until release date. That means it's faster, in that you don't have to drive to gamestop, or swing by there on your way home from work, and run through a messy installer. You just click on it, and it runs, first time and ready to go.
Re:...should we be outraged? (Score:4, Insightful)
Steam is the best thing since sliced bread (Score:3, Insightful)
Well, for customers of Steam (read : anyone who might has a game he wants to market) it might be. But for customers of those customers (read : those who buy those games) its far from that.
I recently bought a copy of Fear 2. Alas, when I tried to install it I got a "Fear.dll missing" error-message, maybe because my game-machine is simple not connected to the 'Net ?
And pardon me, but there is, for me, absolutily no way I'm going to put money down for a DVD contaning some software I can't even use, everytime I want to install it (and maybe even more often ?), without contacting some far-away server from whom I can beg to please give me the content I allready payed for. Especially not when I'm known to enjoy games of yester-decade as much (or maybe even more) as the current games -- It would (most likely) be impossible for me to re-install games of a few years old onto my machine (and not because of hardware incompatibilities). Either the game will not be supported by Steam anymore (licence-to-play expired ?), I would have to prove I'm the first buyer probably by sending the origional bill to them, or even Steam has ceased to exist, leaving me with a "bought" game that has become worthless without me even knowing when it happens/has happened (throw a standard dice, divide by 2 or even 3 and add 2 to 3 years. That is, if you're lucky, as it could happen next week).
Oh yeah, I recently (last week) bought Fear I (the origional, first version) too (I allready played part of it on a friends computer). Too bad that it suddenly cried that there "is an update available", a message which won't go away (pops up every time I want to continue playing).
The funny thing is that an update will invalidate any saved-games you allready have. To add to this monkey business the site where the update should be gotten from is non-existant anymore. If this company can't even support its own product a few years (or, in my case, a week after I bought it (from a store) ) I allready have bad feelings about an external party like Steam ....
Re:And there are alternatives (Score:4, Insightful)
The only AD banner Valve has ever added to a game in Steam are the ADS in Counterstrike (the original) which was released near a decade ago now. I don't see ANYTHING nefarious in that given Valve STILL supports the game and I seriously doubt it's sales numbers in the past five years would have been enough to justify that to anyone in Accounting.
Re:Monopoly? (Score:3, Insightful)
While I agree that Valve is hardly a monopoly, companies like Electronic Arts [steampowered.com], 2K Games [steampowered.com], UbiSoft [steampowered.com], Rockstar Games [steampowered.com], LucasArts [steampowered.com], and iD Software [steampowered.com] are hardly indies.
Re:...should we be outraged? (Score:0, Insightful)
I can do the same because Steam lets me back the games up to disc. If you're still clinging to physical media in an era of digital distribution, you're backwards and afraid of change.
The DRM claim is misinformed because, thanks to Steam, I don't need to go through a disc check or activation step in the game. Sometimes there's a product key for non-Steam games that have been ported over, but Steam helpfully pops up an overlay with the key so I can type it in. There's less DRM getting in my way than what you have to deal with.
You just have a fear of progress. Installing from a CD seems slow and archaic today.
New business models (Score:2, Insightful)
Re:Comment from the source (Score:3, Insightful)
I can respect that you are coming from the perspective of a competitor, and commenting on how you would feel better about the distribution channel if it wasn't directly conjoined with one of your biggest competitors. I can really understand that concept.
As a customer, I hope Steam *never* separates from Valve. I trust them, as well as I can trust any corporation, as they have in the past demonstrated that they *really* want my cash, and are willing to prove it. They do it in a variety of ways, creating top notch games, having an easy method for purchase, letting me give away copies of games I already own if I get a second copy in a new bundle, allow me to re-download games regardless of me losing a disk, keep their DRM pretty much out of my way, and often have 50% off sales.
The only reason I know what Borderlands is, is because of the Steam advertisements. I work for a company who goes into retailers and services xBox displays, and evangelizes new releases. Last month it was all ODST, this month Modern Warfare 2 bundle. I haven't heard anything about Borderlands. I'm not suggesting that your game is too small to care about, I am suggesting that one of these channels is giving you more help than the other. That would be the one you think takes too much of a share.
Could there be more Steam like services? Sure there could be. I don't personally want another one. I don't need one. Not until someone shows me how that would benefit me. Stardock is ok, I have a handfull of their games. I prefer the Steam system, I actually like the unified friends lists. I'll buy more games from Stardock, but I'm in no rush to a 3rd, 4th or 5th service.
If you are worried that Steam doesn't earn it's share, then don't use it. If Steam sales are not good enough kick them to the curb. You won't get my dollars, but I'm only a single customer. If you are serious enough who knows, maybe Steam will change their policy towards developers. Those Steam folks seem to really like making money, and they tend to be pretty good at doing things customer would like, I suspect they would do their best even if the customer was another business and not an end user. As many people have said Gearbox can start their own. I thought Valve was weird when they launched Steam. They proved the value of their service to me. Can you do better?
One last note. I really would suggest you do not claim Steam is a "money grab" when you are essentially complaining that you should be making more money from me the customer. Your service is definitely not as valuable to me, at this point. I don't think I have played any of your previous games, but perhaps I am wrong. To say they are "exploiting" is really disingenuous.
Re:...should we be outraged? (Score:4, Insightful)
Re:Comment from the source (Score:2, Insightful)
Re:Comment from the source (Score:3, Insightful)
Re:...should we be outraged? (Score:4, Insightful)
Steam began as a way to distribute Valve software. It worked, other people wanted in. End of story. No antitrust. There actually ARE several companies with a front end similar to Steam, but they all came later, and haven't had as many or as big of titles as Valve has had to wedge their foot in the door.
More competition would be great, obviously. Lack of competition (which isn't precisely true, anyway) is not antitrust, it's that nobody came up with something like Steam before Valve (at least not in a way that was successful). Not a matter of monopoly, just a matter of being the biggest kid on the block. A bit like iTunes, except at its head is a big ol' fat guy rather than the hipster deity.
Re:And there are alternatives (Score:2, Insightful)
Exactly. I have nothing but positive things to say about Pitchford, but I don't agree with him on this one. At least to the extent that I believe I understand his point.
It seems to me that any argument out there is essentially centered around people not merely wanting their products on a digital download service, but _Steam_ specifically. And to do that, they have to give a bigger cut (apparently) to Valve and also compete with Valve's own games.
There's competition out there. I have about 100 titles from Steam, but I also have a few dozen titles spread over Direct2Drive and Stardock's _Impulse_. It doesn't seem like Valve has a monopoly on the business whatsoever.
So the real complaint here -- unless I'm missing something -- is "yeah, but I want my title on *STEAM*. . . but without the strings that are attached!".
It certainly is valid to complain about those attached strings, but suggesting that it is anti-competitive is a bit of a stretch, in my observation.
Re:...should we be outraged? (Score:2, Insightful)
How long will a download take when the server no longer serves it up?
Re:...should we be outraged? (Score:3, Insightful)
a rebuttal (Score:4, Insightful)
First, saying that steam is a money grab is as asinine as saying that physical media publishing is a money grab. Of course it is. It no more exploits small developers than 2K Games, Ubisoft, EA, or any other software publisher does. Which is to say, yes they all do. Attacking Valve specifically because Gabe and Doug had the foresight and vision to get a foothold in the digital distribution market before it became popular is just plain whiny. Valve's domination over the digital distribution realm is not due to anti-competitive behavior. It's due to a superior service which adapted to the market long before traditional publishers' white haired executives realized they were losing sales to steam. By then, the best option was to publish under steam. Does steam take a larger share than they should? Probably not, given the service they provide. Using physical media presented problems for consumers. Publishers, already wary of online piracy saw digital distribution as counter-intuitive. Valve presented steam as both an answer to piracy and a solution to issues with physical media. But for Valve it was much more than that. By publishing their own games, they effectively avoided issues with traditional publishers. Consumers wanted to get their games online. Traditional publishers wouldn't provide them. Blaming Valve for steam's popularity is both a compliment and ludicrous. The consumers wanted the service.
Second, there is plenty of competition out there for digital distribution. None of it provides quite the same value as steam. Traditional publishers tried their own flavor of digital distribution. Some were very difficult to use and offered only one download of the game. None offered the community features that steam did at the time. Steam continues to improve the service at no additional cost to either consumers or developers. Only Stardock is coming close to Valve. Stardock was offering community services long before their Impulse DD store launched. Other DD game stores are web-based and don't even come close to the services and value that steam provides. So forgive me if I don't share your disdain for steam.
I thought the idea was stupid when I first heard about steam in 2002. I didn't see the potential.
That being said, the only dangerous part is the faith we place in the service after investing thousands of dollars on games on steam. If steam shuts down or becomes defunct, our games go poof. Granted, we have the option to backup our games, though they only work if connecting to the steam service. So the dangerous part is also the most valuable part.
Re:why so many "not a monopoly" posts? (Score:3, Insightful)
I was bitching about the shear number of crap post, even giving you credit for a some sort of content in your post (as a reply completely OT though) out of 209 there are still less than a dozen posts with any content the rest are just going on about drm/not a monopoly/how much they love steam.
In reply to your points,
The issue is that monopolies are only bad when customers wind up with a sub-par product,
I do agree however I feel it would be better if steam/valve split before they did anything to make them bad. For example without any external regulation, most of the hedge funds in London voluntarily setup a code of practice to prevent stuff like conflics of interest. My point is that you don't need to be forced to do something good for customers companies can and do make changes themselves. In this case i think steam can and should be rolled off before any conflicts of interest arises and before they are a monopoly in any legal sense (let alone real sense)
people can just make another one. Don't have the cash for massive servers? Use bittorrent or similar.
It's not hard to set-up a web advertising (text adverts are low bw), search engine (there are many), webmail (there are just as many) and source code hosting (if you don't have the bandwidth use git or bittorrent) company, however that doesn't stop google being classed as a monopoly and being under the magnifying glass.
Re:...should we be outraged? (Score:3, Insightful)
I seem to remember having to spend a good long while waiting for every single file within Half-Life 2 to validate within the Steam network. That's not "less DRM". Just wait until Valve goes bankrupt, shuts down their servers, and all of your home-made backups are worthless because they're tied to Steam.
Re:...should we be outraged? (Score:3, Insightful)
Why go for digital distribution? (Score:3, Insightful)
I buy my games ate physical game stores for a very simple reason:
- If they don't work or they're not what's advertised I can bring them back and get a refund.
This is true for any game I buy: there's no need to investigate the Software License of a game before I buy it (like in Steam) to make sure I can get a refund
Try doing that with digital distribution or even online stores.