Part of the reason why this is happening is because Twitch and Discord are going to compete for this market. This is good news for game developers and I am glad Steam is doing it.
Valve creates new revenue sharing tiers to give big sellers a break
111–120 of 190 posts
Re: Valve creates new revenue sharing tiers to give big sellers a break
#112It seems obvious to me that Valve should have a micro tier for the small indie space, by effectively making everyone else subsidize them. Something like 5% until crossing $30,000 in revenue.
This can be a life-changing difference for individuals couchsurf-hacking while trying to break into the game industry on their own; 28.5k vs. 21k. I highly doubt this would move the needle at all on Valve's end.
Do they already have anything like this or are the little guys paying the ~30% I see being thrown around?
Re: Valve creates new revenue sharing tiers to give big sellers a break
#113* First $10M = $3M Valve + $7M GameDev
* Next $40M = $10M Valve + $30M GameDev
* Next $50M = $10M Valve + $40M GameDev
Assuming your game is expected to generate $50M in revenue, is giving up $13M (26% of revenue) for bandwidth + servers + store handling credit card info + credit card fees + technicians + support staff worth it over rolling your own? Or $23M if it's expected to make $100M?
Re: Valve creates new revenue sharing tiers to give big sellers a break
#114I don't know if anyone's noticed the unprecedented price-slashing that's been happening in AAA games this year but I think we may be in for another AAA game crash. For indies I don't think it's much better unless you're one of the Big Names in that space.
(Incidentally, getting into making games professionally through any means other than self-funding seems basically impossible at the moment.)
Any other perspectives on this?
Re: Valve creates new revenue sharing tiers to give big sellers a break
#115I actually am surprised that services like Steam, the Apple App Store, and Google Play are able to command as high a margin as they do for sales commission. I mean, it's obviously possible because it's reality, but it's nonintuitive. I wonder if it will continue to be that way. For iOS, you don't really have a way to install apps outside the app store without jailbreaking, but you do for macOS, and I've seen a number…
Then you have the privilege of having not been in independent game development before Steam then! Steam takes about 30% and that comes with little to no stipulations. You can go put your product on other platforms, you can generate steam keys and then sell those keys off platform (and take 100% of the revenue), and from the very first sale you get ~70% of the revenue.
In the age before Steam you had to approach a publisher to get your product out there. And in those days getting a 70% deal would have been amazing. Except back then 70% meant something rather different. The publisher was getting 70% and you received 30% in "royalties" (and generally substantially less than 30%). Oh and you received $0 in "royalties" until the publisher cleared 100% of their costs. And finally of course you had to relinquish nearly every right to your IP as well.
I wouldn't underestimate the value that Steam adds. They take care of all financial related issues including trust, facilitate 'advertising', provide a captive audience upwards of 125 million, take care of data hosting (which can be a very significant issue in large-size products), and more. I'm sure they could get by with a smaller margin, but at the same time I think 30% is a pretty reasonable rate for the value they add.
Re: Valve creates new revenue sharing tiers to give big sellers a break
#116I don't know if anyone's noticed the unprecedented price-slashing that's been happening in AAA games this year but I think we may be in for another AAA game crash. For indies I don't think it's much better unless you're one of the Big Names in that space. (Incidentally, getting into making games professionally through any means other than self-funding seems basically impossible at the moment.) Any other perspectives…
Despite how the industry likes to try to pitch it games aren't as disposable as developers want you to think they are.
At least for me, I'm spending more time playing titles I've owned for years today than on new releases. And every year adds more games to that backlog / history of games to get around to. And some games never get old - I still revisit probably twice a year Quake and Doom (the original) to play all the new community map packs and mods for a week.
There really needs to be some sea change in the industry away from disposable properties and towards ongoing refinement and iteration on proven titles. I'm sure publishers would love it - there is a lot less investment risk if you can establish regular revenue from game updates like how MMOs work - but the consumers have for the longest time seen value in gambling how good a new title in a series will be over seeing the last one just made better over time.
Re: Valve creates new revenue sharing tiers to give big sellers a break
#117Earlier quoted context omitted.
Most stores keep their numbers private, but I'd wager that Steam has most (if not all of them) beat by a large margin. Presumably these companies believe that the higher margins and control they get from running their own stores are worth the customers they lose by not being in Steam. As the Steam Tax lightens however, the results of that equation could change.
The major publishers aren't trying to "beat" Steam, they're just trying to release their games without paying the Steam Tax. The point is, it's too late to do the math on the Steam Tax now, those R&D dollars are spent. Steam was too slow.
> they're just trying to release their games without paying the Steam Tax.
By not paying the Steam Tax, publishers are paying Engineering Tax and risks for fails in their distribution platforms.
I have Vietnam flashbacks from Origin and Uplay. EA fixed their's in 2015, but latter is still a bughole and the reason I don't even look at Ubi's games. Latest Bethesda release is a clear example of that problem.
Re: Valve creates new revenue sharing tiers to give big sellers a break
#118Earlier quoted context omitted.
The major publishers aren't trying to "beat" Steam, they're just trying to release their games without paying the Steam Tax. The point is, it's too late to do the math on the Steam Tax now, those R&D dollars are spent. Steam was too slow.
> they're just trying to release their games without paying the Steam Tax. By not paying the Steam Tax, publishers are paying Engineering Tax and risks for fails in their distribution platforms. I have Vietnam flashbacks from Origin and Uplay. EA fixed their's in 2015, but latter is still a bughole and the reason I don't even look at Ubi's games. Latest Bethesda release is a clear example of that problem.
RDR2 sold ~800MM. 25% of that is 200MM, which is far more than it takes to set up a basic digital storefront. I doubt Valve bothers with a fraction of that for ongoing operations given how terrible the steam UX really is.
Re: Valve creates new revenue sharing tiers to give big sellers a break
#119Earlier quoted context omitted.
You realize that it takes a lot of work to make a website to accept payment from a hundred countries in dozens of currencies and handle customer support and chargeback and fight fraud? You can try to run your own website, to save 10% fees on a minuscule userbase, it simply doesn't cover the costs.
Serious question: isn’t this what services like PayPal are for? Along with customer service services. Certainly not trivial, but it seems doable.
What handling refunds? Some are legit, some will be fraudulent. What a out dealing with foreign currency? What if your game becomes popular in a country where PayPal isn't prevalent?
Re: Valve creates new revenue sharing tiers to give big sellers a break
#120Earlier quoted context omitted.
As an entrepreneur in this space, I'd be okay with 20%. The issue is the current thresholds. I'd want it to be 20% over $1M not $50M. Around a million it starts being worth it to handle credit card processing, chargebacks etc.
As there’s more competition from studios entering the publishing space you should be able to get a better deal, with better and more current tech. The up side is Steam gives you visibility to a large player base with new publishers won’t have on day one, but it’s coming.
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