Comment by chii
19 hours ago
> And the cut can't be lower?
why should it be lower (or higher)?
steam's cut should be whatever they set, and the market responds. The natural equilibrium would get reached. The value steam provides, imho, certainly justifies their cut imho. There's plenty of other platforms to release games on - including free ones (such as itch.io, or your own website).
> The natural equilibrium would get reached
Except somehow they managed to get it right from the beginning and there was never any real market pressure to change it. Had Valve (or Apple of that matter) decided to charge e.g. 20% due to whatever reasons or conditions that existed in 2007 (but might not anymore) that would still somehow be the "natural equilibrium" even today in the exactly the same way.
The fee is also very sticky, platforms can't really increase without a massive amount if backlash, therefore reducing it becomes much riskier since they can never go back. Given a competitive market doesn't really exist a variable fee based on "market conditions" can't really be a thing either.
It's very hard for someone to undercut Valve just because of the scale. They might sill be very profitable if they charged 15-20% while other smaller stores might not be able to afford that. Same mechanics have always applied to most other monopolies or oligopolies in other industries.
The equilibrium has been reached and it's more studios going bankrupt, less games getting made, gamers spending more for less, and Gabe owning over $1B in yatches
> more studios going bankrupt
studios that don't make good games correctly should bankrupt - ala, those so called AAA studios.
> gamers spending more for less
gamers buying overpriced games from bad publishers/studios that overspend and under-deliver are learning finally.
There has never been more indie games, and the selection has never been more diverse, and those available games has also been cheaper.
If you got time, this video outlines the evidence and the coming trends: https://www.youtube.com/watch?v=XigPD8BCkho
You seem to be missing that I'm describing the effects of Valve's massive %30 tax on the game industry. There are studios that would've survived and continued making games people enjoy if Valve had less market power and charged %10-%15. There are dollars gamers would've saved instead of spent if that tax was lower.
The main claim here is that it is a defacto monopoly, and that there are not "plenty of other platforms", since none of those platforms actually have any reach. It results in most games smaller than Fortnight or Blizzard having literally no choice but to use steam regardless of policy or cut.
Any time you have no choice it at least makes for a very warped market.
> since none of those platforms actually have any reach.
so really, this is about getting reach, and that a 30% cut for said reach is too high. I am arguing that this price is a market price, for which it is justified by mere existence. If this price was too high, then these other platforms that you claim have no reach will get some reach, since the PC platform is not locked down (yet).
Unlike in the model of apple's app store (until recently at least?), which has no alternative possible. Even android's supposed alternative is somewhat going to get locked down by google looking at the trend. Then the claim would be that those platforms hold not only a defacto monopoly, but an actual one, and their cut is therefore not a real market price. That makes it possible to claim that they're unfairly pricing their platform. Steam doesn't have this issue at all.
That's not exactly how markets generally work ("free market" is more of a theoretical concept than something that has ever existed outside of commodity markets at least).
In a way it can be justified in the sense that developers would rather get 70% than not make a sale at all if their games were only available on less popular platforms. But effectively that's what allows Steam to charge charge as much. They certainly have a dominant position in the market due to very little competition.
It's like retail/supermarket chains in certain countries being able to extort better conditions from their suppliers because they have very little choice. Or e.g. real estate agents being able to charge disproportionally high fees due to how the market is structured.
Whether someone considers that fair or not is of course rather subjective...
> Steam doesn't have this issue at all.
IMHO it's a matter of degree but fundamentally the same thing. The barriers to switching to a different store are just much lower than not having an Apple/Google phone but they still exist.
Platform economics create monopsony problems. If you don’t play ball with steam, you don’t get access to most customers. End of story. These things are winner take all.
Imo 30% is disgusting and needs regulation.
Edit: see also, credit cards