animlboogy said:

Except the overal DD market isn't shrinking, it's growing. And the revenue from full priced games is growing, too, which is what this thread is about if you read the OP.

If you're talking about the overall market, you'd have to really put some numbers together to blame that decline on Steam sales. I'd wager, purely based on conjecture, that it has more to do with the long console generation and enthusiasm waning.

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And I also think you should really think through the business of iOS more than you have. You'll hear of these crazy massive viral successes, but those are very rare. Most games don't sell at all. Then you'll hear some developer whine that their game didn't move any units, when they didn't promote it. It's a young market, it's still getting figured out, and I don't think it's a coincidence that when small guys like Spiderweb and large companies like Square Enix put out their games at fair prices that are higher than average (10-15 bucks, which, compared to a physical game with all the overhead going for 30, seems expected), they do very well within their expectations. The people failing on iOS are expecting the games to just up and sell themselves like they did when the App Store opened and stuff like Doodle Jump was the only option. Those days are over, yet devs still act like they deserve that with no effort.

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Chinner said:

lol @ ea drones trying to spin this.

"b-b-b-ut valve are evil and ea are the bastion of gaming!!!!"

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Xilium said:

To play devils advocate, aren't they specifically talking only about the "hardcore" gamer in this instance. Those are the people that pre-order and buy games within a week of release. They are also the type to purchase or re-purchase a game on Steam simply because it's on sale, with no intention to actually play it.

It seems like a lot of games now (especially on PC) are getting a significant chunk of their sales in the later months. Save for a handful of releases, it does seem like more and more people are willing to wait for games to go on sale before making a purchase. We're frequently getting news articles/press releases on this site about how x game sold 1M/2M/ect. copies months later despite it selling 400-500k in it's first month.

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walking fiend said:

Yeah, there is no long term obviously; every developer who doesn't make series with an annual releases like CoD or Fifa is going to make only one game for the rest of their life, or at least once a decade... and of course in retail game prices don't go down as the time passes...

Valve defense force is amazing

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ciridesu said:

I have to come and white knight walking fiend. This years game sales suck. New IP's performance has sucked for a while now. Games no longer have legs. I don't know the reason and it is not sales only for sure, but it is something to consider that huge discounts, rented games etc. decrease the value games have with consumers.

Sales do reinforce the mindset that 'unless it's a game I desperately want, I'll wait for the sales in a few weeks that are bound to come' I know I'm one of these people and I now much prefer finding a cheap gem and playing it through instead of buying a just released game.

I'm not saying the interviewed is wrong, but his statistics are very circumstantial and you shouldn't outright dismiss the other opinion.

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The_Technomancer said:

I literally do not understand the point you are making any more. There are not less people buying games at full price. Do you acknowledge that or reject it?

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walking fiend said:

We do not have enough data to go either way;

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demosthenes said:

Because they're more concerned w/ the short term than the long term.

EA was alleging that yes the sales get you money now but they were devaluing games for the long term.

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Stumpokapow said:

What long term? EA shuts down their servers long term. EA releases more annualized titles than anyone in the business long term. EA shuts down more of their developers than any other publisher long term. EA changes corporate and franchise strategies every year or two long term. There is literally no one at EA who is making even the slightest overture towards the long term.

And you know what else cheapens intellectual properties? Releasing positively putrid XBLA (Dead Space), iOS (Mass Effect), and Facebook (Dragon Age) titles in a terrible attempt to advertise your product. Bulk-garbage discounting your entire iOS catalogue to 0.99 regardless of original price simply to monopolize the top 100 sales on iOS during a sales chart freeze. Killing off developers (Bullfrog, Origin, Maxis, Westwood, UK, Japan, Pandemic, Bright Light). Reviving classic franchises in totally unrelated properties (Syndicate). Masking tons of content behind DLC paywalls (Well, pretty much everything, but I'll pick Family Game Night because I haven't slagged their family stuff yet). Making abominably bad licensed content to turn a buck (Monopoly, Harry Potter 7/8). Turning your multiplayer into Gachapan (FIFA, Mass Effect) or using IAP as powerups to break game balance (Flight Control 2). Pushing out your 3rd party titles with no marketing support whatsoever (Shadows of the Damned, Alice, Syndicate). Launching your own PC DD service that's not ready for prime time and abandoning a vastly superior platform, creating a fragmented less coherent marketplace for a few ounces of lucre (Origin).

The emperor has no clothes and a tiny penis.

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Interfectum said:

"But our pre-orders are bigger than they used to be." Read the OP.

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Xilium said:

The funniest part is that they sound exactly like Valve fanboys.

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VVIS said:

Whoever is running Steam needs to figure out how to get more of the people on the margins of gaming into their club. My buddy plays Wow off and on, and rents a few console games a year. Plays a few free iphone games every 6 months. He would love Steam, because of the sales and maybe one full priced purchase a year.

If publishers only want your money if you are a hardcore $60 payer, then they are going to miss out on the margins.

Haven't they read The Long Tail?

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Xilium said:

The gaming audience is also bigger than when Valve was first introduced. That says nothing to me without any numbers.

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Derrick01 said:

Well they are saviors of PC gaming whether you want to believe it or not. 2004-2005 era PC gaming was deader than the PS Vita currently is and was only getting worse.

Ironically enough as much as I love Steam and will champion it to the death I can't stand Valve games. Never enjoyed a single one.

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walking fiend said:

1. Valve:
"Our competitions are retail for PC and HD consoles in general; what can we do?"
"We have the advantage of DD having no cost; so what we do is that once we made our money back, we sell at very low cost that retails can't afford"

The problem: You may get a bigger share of the market, but you are shrinking the overall revenue of the market;

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Boerseun said:

Sales numbers for PC games are massively inflated. Units sold mean nothing at this point as discounting have completely broken the PC sector. Anyone who uses PC game sales numbers to indicate the "popularity" of the platform is a complete moron.

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Dave Long said:

The funny thing about talking long term about video and computer games is... THERE IS NO LONG TERM! Most games have a shelf life of three months at full retail at the very best. Without the Steam sales, many of these titles would be forgotten in quite literally less than a year.

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patapuf said:

actually steam sales help if you make a sequel to your previous game... because people buy your game for cheap and if they like it they are more likely to buy your new game at a higher price.

aditionally there is no way you make money at retail with a game that is over a year old and wasn't a blockbuster. Steam sales give you much more revenue that way.

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Why does 'overall revenue' matter?

If publishers and developers make more money from games via DD than they do via retail, how does that in any way make things worse for the industry?

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walking fiend said:

There are many questions that need to answered to actually defend against the EA accusation properly; I am not saying they are right, but simply that Valve answer is far from adequate; they are basically saying "we are growing, so go hate as much as you like

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walking fiend said:

We do not have enough data to go either way;

let's say the reason people aren't buying HD consoles games as much as the used to is that they are moving to PCs, for example because of better graphics or that Steam is a very robust platform [shift+tab overlay, etc.]

Now let's say

1 The rate of convergence is 5m per year;
2 Of those 5m, 2m pre-ordered games for their console
3 On steam only 1m pre-orders
4 Steam pre-orders are increasing 1m per year
5 game industry pre-orders are decreasing 1m per year

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There are many questions that need to answered to actually defend against the EA accusation properly; I am not saying they are right, but simply that Valve answer is far from adequate; they are basically saying "we are growing, so go hate as much as you like


I don't believe the overhead cost of retail [as seen by publishers/developers] being much different than Retail, as long as sales over a certain minimum are concerned;

let's say 60% of the games sold at retail goes to the publishers and 70% for the DD through valve; the market shrinking like 10%, or 15% will be quite expectable; but for example in the case of handheld, the decrease is revenue is more than this

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walking fiend said:

Yes, but there are many other ways than selling your game at $5 that can get people to play them; that's what demo are for

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walking fiend said:

Then for example for established franchises, the chances of even giving free copies to everyone will probably not help the installed base grow for your next sequel at a high price; some games don't sell much, just because only a minority like them; on the other side, people who want CoD just buy it and for example releasing BOps II at $5 won't change the MW III sales noticeably at all

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SparkTR said:

Based off my own anecdotal evidence I'm agreeing with Valve. I bought Borderlands for myself and three friends while on sale, we're all getting Borderlands 2 day 1 now.

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animlboogy said:

Look at his post above, too. He's just shuffling numbers around in his head.

In the end, it comes down to this: A market where people buy more games at all prices is good for Valve and developers who publish on Steam.

A market where fewer people buy fewer games, but when they do, they get a few $60 AAA titles, is good for EA.

For a lot of the games I care about to exist, a market more like Steam and some of its competitors like GOG is far better to me: older games are still available and even advertised to bring attention to them, small and mid-budget games have an actual consumer base instead of being beholden to a purchaser at Walmart and how much space she has to work with, and more full-priced games from more companies are able to sell more.

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walking fiend said:

I don't believe the overhead cost of retail [as seen by publishers/developers] being much different than Retail, as long as sales over a certain minimum are concerned;

let's say 60% of the games sold at retail goes to the publishers and 70% for the DD through valve; the market shrinking like 10%, or 15% will be quite expectable; but for example in the case of handheld, the decrease is revenue is more than this

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Dr.Acula said:

Okay, don't ban me, but when I was a teenager I used to *gasp* pirate 90% of the games I played. Now? I don't. There may be a thousand reasons for why that is, but Steam did get me into the habit of buying games. The big thing is that Steam is a lot faster then torrents. I think my ISP was throttling me or something, but it would take overnight to pirate a game. Steam, I could get a game in a couple of hours. Plus, mounting ISOs, installing cracks, running key gens, sometimes there'd be viruses, sometimes the game wouldn't work properly, it was just a mess. If I could buy a game for five bucks? Yeah, five bucks passes the pain threshold. I'd rather spend five bucks then wait for a torrent, and deal with cracking.

Now, older games. Try and find Vampire The Masquarade In a store. Try finding it with enough seeds. Steam has old games, and they're usually pretty cheap. The only reason I bought Vampire, WAS because it was five bucks. Hell, I doubt I would have ever even bothered pirating it. Plus, being on Steam means I know it's compatible with Windows7, not all old games are.

Now I'm used to paying for games, the value is the convenience, the support, and the safety. How much is EA making off a five year old game? Valve can put a five year old game up for sale and advertise it on the front of its store, plaster a preorder link for its sequel, and get thousands of downloads for a game that otherwise no one would buy, and generate interest for the sequel at the same time.

The proof is in the pudding. How many people have Steam games they've paid for and not even played?

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VVIS said:

EA should be pissed, after all, there is so much crap out there for me to play, I find it doubtful that I would pay $60 for more than one or two games a year. That's where we are at. It's not that Steam is pushing down prices, it's that the world of gaming has exploded outside of EA's kingdom, and Steam is a scapegoat.

P.S. I pay full price for all Valve games, because I know they are good. I tend to wait on EA games since you never know. Reap what you sow, bitches.

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sflufan said:

Dear Developers:

I'm well and truly sorry to tell you this, but the "cheapening of your IP" is PRECISELY what I want to happen because I'm a consumer.

Your product isn't a Rembrandt painting that I hope will appreciate in value over the course of time. It's an entirely disposable piece of entertainment whose worth to me is utterly arbitrary based on my relative desire for it, so maybe I'll pay $60 for it or maybe I'll pay $5 for it. Who the hell knows?

Once again, I apologize if this offends you, but that's the industry you chose to work in so deal with it.

Sincerely,
Wade W. Steel

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patapuf said:

we have the numbers of current steam users, they are nowhere near enough to be a significant factor in the decrease of the overall market.

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what an odd choice of a series to pick for a thread on steam sales. The CoD series gets like 25% off at most every single major Steam sale. It's a horrible example to bring into a thread about Steam sales.

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walking fiend said:

I explained in my previous post, that why CoD doesn't need sales and actually while sales aren't the only way people will buy sequels they wouldn't otherwise

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LobLob said:

Valve saved PC gaming.

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sflufan said:

Dear Developers:

I'm well and truly sorry to tell you this, but the "cheapening of your IP" is PRECISELY what I want to happen because I'm a consumer.

Your product isn't a Rembrandt painting that I hope will appreciate in value over the course of time. It's an entirely disposable piece of entertainment whose worth to me is utterly arbitrary based on my relative desire for it, so maybe I'll pay $60 for it or maybe I'll pay $5 for it. Who the hell knows?

Once again, I apologize if this offends you, but that's the industry you chose to work in so deal with it.

Sincerely,
Wade W. Steel

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walking fiend said:

That is not what I was implying;

EA accused Steam of reducing intellectual value; Valve says Steam pre-order are going up [we don't know by 1k/y or 1m/y or 10m/y]; I say their argument is weak and idiotic, because it doesn't contradict the the EA claim

The reality may be in their favor, but their argument is weak; of course one may actually say that the reason the rest of the market is going weak is because they are not following the Valve model, but that doesn't make their argument strong or valid.

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patapuf said:

a big reason steam (and games on the PC platform in general) can offer their games for so much less than the console space is easy: no royalties (7$ of a 60$ dollar game is a lot) and no retail costs and despite the price PC games still have better margins than console games.

if retailers and platform holders loosing out on money is shrinking the market revenue wise then yay for us!

it means cheaper games for the gamer and more money for devs/publishers. The middlemen loosing out is a good thing.

(and the preorders going up suggest that the numbers aren't going down despite frequent sales. In other words: sales don't stop people from preordering games, they buy games on sale on top of them, not instead)

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walking fiend said:

That is not what I was implying;

EA accused Steam of reducing intellectual value; Valve says Steam pre-order are going up [we don't know by 1k/y or 1m/y or 10m/y]; I say their argument is weak and idiotic, because it doesn't contradict the the EA claim

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walking fiend said:

Steam is doing a lot of things right, even if 75% isn't [which even it may be, but they aren't providing a good argument for it]



Wade W. Steel:
"Dear programmers, I don't get why the fuck you want this much money for working on games, you think games worth this much? your job is important?"

Programmers "You think we can only make money programming AAA games for you?"

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walking fiend said:

Wade W. Steel:
"Dear programmers, I don't get why the fuck you want this much money for working on games, you think games worth this much? your job is important?"

Programmers "You think we can only make money programming AAA games for you?"

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MrNyarlathotep said:

Based on this article, a publisher will receive 30% of a console game sold at retail.

By contrast they will receive 70% of a sale sold via DD.

So yes, there is a big difference.

EDIT:
Or of course in EAs case, for EA games via Origin, they will receive 100%.

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Stumpokapow said:

What long term? EA shuts down their servers long term. EA releases more annualized titles than anyone in the business long term. EA shuts down more of their developers than any other publisher long term. EA changes corporate and franchise strategies every year or two long term. There is literally no one at EA who is making even the slightest overture towards the long term.

And you know what else cheapens intellectual properties? Releasing positively putrid XBLA (Dead Space), iOS (Mass Effect), and Facebook (Dragon Age) titles in a terrible attempt to advertise your product. Bulk-garbage discounting your entire iOS catalogue to 0.99 regardless of original price simply to monopolize the top 100 sales on iOS during a sales chart freeze. Killing off developers (Bullfrog, Origin, Maxis, Westwood, UK, Japan, Pandemic, Bright Light). Reviving classic franchises in totally unrelated properties (Syndicate). Masking tons of content behind DLC paywalls (Well, pretty much everything, but I'll pick Family Game Night because I haven't slagged their family stuff yet). Killing a product's secondary market lifespan by introducing project $10 (Dragon Age: Origin, Saboteur, ... every game released since then). Streamlining the shit out of your game design with absolutely no regard to the heritage of the IP (Dragon Age II). Making abominably bad licensed content to turn a buck (Monopoly, Harry Potter 7/8). Turning your multiplayer into Gachapan (FIFA, Mass Effect) or using IAP as powerups to break game balance (Flight Control 2). Pushing out your 3rd party titles with no marketing support whatsoever (Shadows of the Damned, Alice, Syndicate). Launching your own PC DD service that's not ready for prime time and abandoning a vastly superior platform, creating a fragmented less coherent marketplace for a few ounces of lucre (Origin).

The emperor has no clothes and a tiny penis.

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MrNyarlathotep said:

Based on this article, a publisher will receive 30% of a console game sold at retail.

By contrast they will receive 70% of a sale sold via DD.

So yes, there is a big difference.

EDIT:
Or of course in EAs case, for EA games via Origin, they will receive 100%.

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If you bought a game in the run-up to Christmas and it cost £39.99 to buy, approximately £7 (17.5 per cent) went on VAT (that figure increased to 20 per cent as of 4th January), while £10.50 (27 per cent) went to the shop and £12 (30 per cent) to the publisher.
The rest goes on what's called cost of goods: the nuts and bolts of videogame publishing. 65 pence (two per cent) goes on distribution, £1.75 (four to five per cent) on marketing, and an £8 (20 per cent) licence fee goes to the platform holder (Microsoft, Nintendo or Sony). All these costs are paid for by the game's publisher. If a third-party is behind the game, approximately £3 goes to the developer, or 25 per cent of the publisher's revenue after deductibles, although developers are often paid in a series of advances as they meet milestones.

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So many programmers just get fired when a game is complete, no matter how well it does. I'd be hoping for an industry that didn't promote that sort of boom/bust hiring pattern, not worrying about whether the project that just laid off me and my friends is going to sell well in the short term.

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And when the evidence we DO have points to people spending more on games regardless of price on Steam (their top sellers list perpetually confirms that new games or hyped games sell the most regardless of price), I'm not sure how you can justify this comment.

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