Valve creates new revenue sharing tiers to give big sellers a break • Hacker News Board

Re: Valve creates new revenue sharing tiers to give big sellers a break

#131

Post by vatueil » Sun, Dec 02, 2018, 10:01 PM UTC

TangoTrotFox wrote: post #115

PakG1 wrote: post #32

I 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 pub…

> you can generate steam keys and then sell those keys off platform (and take 100% of the revenue)

Which is significant, and missing from most of the discussions about Steam's revenue share. Game creators can generate as many keys to activate their game on Steam as they want at no cost, and sell them however they want. If you buy a game from Humble, Amazon, or any other website and receive a Steam game key, Valve doesn't receive any money from that purchase.

Re: Valve creates new revenue sharing tiers to give big sellers a break

#132

Post by user5994461 » Sun, Dec 02, 2018, 10:03 PM UTC

nimish wrote: post #118

chupasaurus wrote: post #117

Earlier quoted context omitted.

> 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.

Damn. That's not enough to cover Amazon network fees for transferring 100M copies of 100GB.

Re: Valve creates new revenue sharing tiers to give big sellers a break

#133

Post by tgsovlerkhgsel » Sun, Dec 02, 2018, 10:05 PM UTC

dogma1138 wrote: post #52

PakG1 wrote: post #32

I 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…

Brick and mortar stores pay about $45 for a $60 dollar game, and have additional bonuses for sales targets. Some larger publishers operate on a different scheme similar to the large DIY and big box stores in which they “rent” shelf space, pay for promotional services and share a smaller percentage of each sale revenue. A lot of times there are other restrictions such as game stores need approval for things like unoff…

> you’ll download it from the Publisher via their own client.

And the main reason for pushing their own clients is because all of these publishers would love to a) avoid some of the cost of Steam in the future b) have a sufficiently big customer base to be an attractive platform for third parties to sell their games on, so that EA/Activision/Ubisoft/Blizzard can become the next Steam and squeeze others for 30% of their revenue.

Because 30% of everyone's game sales is a lot more (and more easily earned) than 70% of your game's sales, especially since in the latter case you actually have to develop (and market etc.) a game...

Re: Valve creates new revenue sharing tiers to give big sellers a break

#134

Post by spatz » Sun, Dec 02, 2018, 10:06 PM UTC

Zren wrote: post #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?

> for bandwidth + servers + store handling credit card info + credit card fees + technicians + support staff

You're forgetting exposure and huge player base. That's got to add some revenue...

Re: Valve creates new revenue sharing tiers to give big sellers a break

#135

Post by mindslight » Sun, Dec 02, 2018, 10:09 PM UTC

jrockway wrote: post #87

PakG1 wrote: post #32

I 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…

Collecting money is an important part of a business, but also not trivial. It therefore makes sense that people would outsource this. If you get big enough, you probably don't want a middleman in the way; this is why companies like Blizzard have their own store/launcher app. For everyone else, whatever they take is cheaper than having their own army of software engineers, lawyers, billing phone support, etc. In a wor…

I don't disagree with your gist, but does Steam actually manually solve the examples you gave? It seems like part of the value add of outsourcing comes from the negativity of a policy not directly reflecting on your own business. If you refuse to hunt down a check (or even stop accepting checks altogether), a customer might switch to another ISP. But if your third party mechanically refuses, it's "nobody's fault". Even if the customer expends the effort to escalate and they're a big enough customer for you to listen, you can still salvage it as a positive CS experience.

Re: Valve creates new revenue sharing tiers to give big sellers a break

#136

Post by whatshisface » Sun, Dec 02, 2018, 10:12 PM UTC

jrockway wrote: post #87

PakG1 wrote: post #32

I 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…

Collecting money is an important part of a business, but also not trivial. It therefore makes sense that people would outsource this. If you get big enough, you probably don't want a middleman in the way; this is why companies like Blizzard have their own store/launcher app. For everyone else, whatever they take is cheaper than having their own army of software engineers, lawyers, billing phone support, etc. In a wor…

Why not hire a customer representative whose main qualification would be diligent attention to detail? You shouldn't have specialized engineers spend their time dealing with issues that are not only one-off, but that also don't require any advanced qualifications. There aren't eight hours a day of check shredding to do, but there is a level of capability between "can only shred checks for eight hours a day," and "spent ten years getting a PhD in computer science."

Re: Valve creates new revenue sharing tiers to give big sellers a break

#137

Post by JumpCrisscross » Sun, Dec 02, 2018, 10:16 PM UTC

whatshisface wrote: post #136

jrockway wrote: post #87

Earlier quoted context omitted.

Collecting money is an important part of a business, but also not trivial. It therefore makes sense that people would outsource this. If you get big enough, you probably don't want a middleman in the way; this is why companies like Blizzard have their own store/launcher app. For everyone else, whatever they take is cheaper than having their own army of software engineers, lawyers, billing phone support, etc. In a wor…

Why not hire a customer representative whose main qualification would be diligent attention to detail? You shouldn't have specialized engineers spend their time dealing with issues that are not only one-off, but that also don't require any advanced qualifications. There aren't eight hours a day of check shredding to do, but there is a level of capability between "can only shred checks for eight hours a day," and "spe…

> * a customer representative whose main qualification would be diligent attention to detail?*

Flexible problem solvers with attention to detail and solid communications skills are about as expensive as engineers.

Re: Valve creates new revenue sharing tiers to give big sellers a break

#138

Post by ineedasername » Sun, Dec 02, 2018, 10:18 PM UTC

PakG1 wrote: post #32

I 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…

Think of it like having your food brand be in the supermarket. Sure you can open your own stand alone stores but then you have to build and manage that infrastructure yourself, and your audience is a very small fraction of the traffic the supermarket gets. Practically no one sees your product without even more overhead in advertising and marketing.

Re: Valve creates new revenue sharing tiers to give big sellers a break

#139

Post by spir » Sun, Dec 02, 2018, 10:19 PM UTC

georgeecollins wrote: post #111

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.

Came here to say this. 15 years of Steam monopoly is coming to, well not an end, but a transition point. Great news for game devs!

Re: Valve creates new revenue sharing tiers to give big sellers a break

#140

Post by whatshisface » Sun, Dec 02, 2018, 10:23 PM UTC

JumpCrisscross wrote: post #137

whatshisface wrote: post #136

Earlier quoted context omitted.

Why not hire a customer representative whose main qualification would be diligent attention to detail? You shouldn't have specialized engineers spend their time dealing with issues that are not only one-off, but that also don't require any advanced qualifications. There aren't eight hours a day of check shredding to do, but there is a level of capability between "can only shred checks for eight hours a day," and "spe…

> * a customer representative whose main qualification would be diligent attention to detail?* Flexible problem solvers with attention to detail and solid communications skills are about as expensive as engineers.

What about those rumored thousands who are graduating with "unemployable degrees?" If the market for capable individuals was the same as the market for specialized knowledge then STEM would not be so much more economically attractive to students.