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

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

#181

Post by sbuttgereit »

e12e wrote: post #179
sbuttgereit wrote: post #147

Earlier quoted context omitted.

Back when I was in the retail industry, we saw nowhere near those kinds of gross margins (100% that is) on average (I worked in corporate management with ~4 chains and consulted to a few dozen others of varying size over a little more than a decade). More typical gross margins were in the ~40% ballpark. Some higher/some lower; the entertainment retailer I worked with was averaging around 35%. That's not to say it cou…

Just to be clear, when you say 35% you mean you bought inventory at 10 dollars and sold at 13.5? And everything covering rent, pay other costs and profit you made off those 35%?

Actually, I didn't read the message I commented on closely enough.

In retail, we think of gross margin: (retail price - cost of goods)/retail price.

So, in your example we'd be just under 26% gross margin, not 35%. Regarding the original message I commented on, I looked at the percentages, ignored the example amounts, and presumed gross margin. So in reality, the gross margin there is 50%. Still higher than the averages I saw while I was in the industry (and I was mostly with B&M retail) and higher than the break even point for reasonably well run and conceived retail businesses. That's not to say those more common margins are comfortable for the retailer... more often than not they are cutting it pretty close to the edge much of the time.

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

#182

Post by eropple »

cheez wrote: post #93
Retric wrote: post #85

Earlier quoted context omitted.

Revenue is fairly useless it’s profit that you care about. Having less employees also means less effort managing them.

Ah I see.

They also made more money, even with Steam's cut.

People are expensive. (Hence the whole "oncoming economic doom" thing.)

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

#183

Post by MattRix »

ehsankia wrote: post #165
MattRix wrote: post #153

Earlier quoted context omitted.

uh, see Itch.io or Humble, which do the exact same thing for a fraction of the cost

Does itch.io have a world wide CDN delivering high enough speeds to handle 50GB games? Do they provide match making, voice communication, game hub, cloud saves, workshop, achievements, stats, and so on? Steam provides a huge amount of services behind the scenes.

This is the whole point. Indie devs don't need a CDN that can handle 50gb games, or most of those other services you listed... Yet we're stuck paying the full 30% that those mega studios that actually use those features are paying.

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

#184

Post by MattRix »

user5994461 wrote: post #122
michaelmrose wrote: post #74

Earlier quoted context omitted.

You are making assumptions. 30% is not a few percent. You are also assuming that merely being on steam and having users encounter your game while browsing will be the primary method people encounter your game and decide to buy it thus the "on a lot less sales" People encounter games via many means. If you only sell it via steam or steam is merely the most convenient means of acquisition then the fact that the buyer b…

It is a few percents. All online marketplaces, steam, apple store, airbnb, booking are 20 to 30% commission. It takes at least 10% commission to be able to run a company of this type. It's possible to run with as low as 5% in some niches, given a very lean operation and a billion dollar scale to amortize fixed costs. Eventually most of the company will be devoted to customer support and billing related tasks. There i…

You say this, but there are already services like itch.io and humble that charge ~10%.

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

#185

Post by MattRix »

kkarakk wrote: post #180
MattRix wrote: post #152

Earlier quoted context omitted.

It's not a steal at all. Those things (especially stuff like hosting and bandwidth) cost a small fraction of the price. You can argue that it's worth it because of how popular Steam is, but it's getting harder and harder for smaller devs to even get seen by that large audience in the first place.

As a layman gamer who has only used steam as a consumer - This comment ignores the ground realities of Steam having a seemingly endless amount of trash. i logged on and wanted to play a game with wallrunning and a cyberpunk aesthetic and i only found ONE that was worth playing out of the seemingly thousands of options. Game developers on steam seem to release what they want to not what the audience wants in the vast…

> it's actually easy to be seen if you choose to cater to the non oversaturated categories imo.

You're wrong, but sure.

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

#186

Post by bytematic »

doyoulikeworms wrote: post #160
ksec wrote: post #159

So what exactly is "Valve" now without Steam? They don't have new games any more ( And none of the the "newer" ones were anywhere as good as CS ). They don't improve or compete in Game Engine any more, which they did in the Golden Era between Unreal, DOOM, and Source. What have they got left? Steam OS and Gaming Machine got no where. HTC Vive doesn't look like they can compete with Sony or Oculus.

Valve is still a quite an admirable game studio. Not only do their top games CS:GO and Dota 2 have large and healthy player bases, but they also have large and vibrant competitive scenes. I don’t compare Valve to the likes of Nintendo or Bethesda anymore wrt game development, but instead to companies like Riot and Blizzard. These studios revolve around franchises-as-services and don’t release new IP often. Their core…

Haha Valve comes nowhere close to Blizzard or other developers. Blizzard at least updates their most popular games more than once every 6 months and doesn't leave them to die.

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

#187

Post by swift532 »

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?

Don't forget exposure and people like me who can't be bothered to buy a game if it's not on Steam or GOG.

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

#188

Post by baroffoos »

nostalgiac wrote: post #173
baroffoos wrote: post #167

Earlier quoted context omitted.

Essentially steam has created an almost walled garden. You already have all of your games on the steam client so if a game is sold on another store its inconvenient. Another part is steam has a lot of eyes looking at their store. Everyone checks steam for new games so if you are not on that store then people wont see you. Its an unfortunate system because steam isn't actually providing that much value but they have j…

> Its an unfortunate system because steam isn't actually providing that much value I have to heavily disagree with that. Other than as you mentioned, the huge amount of eyeballs on all of their library content which you just won't get anywhere near close to. Along with people already having credit on their steam account so they can instantly buy a product without entering payment info. There's also the distribution a…

>Other than as you mentioned, the huge amount of eyeballs on all of their library content which you just won't get anywhere near close to.

We should have had search engines like google for games.

> Along with people already having credit on their steam account so they can instantly buy a product without entering payment info.

Browsers these days have a payment API and stores the users credit card details which can be used on any website.

>There's also the distribution and update mechanisms which are such a huge win for the customer as well as developers.

This could have been done without centralization similar to how package managers work, the games repo would just be added to your client and downloaded from that.

So I guess I could put it yes valve has added value from what there was before but its totally possible to replicate all the value easily without centralization.

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

#189

Post by ehsankia »

MattRix wrote: post #183
ehsankia wrote: post #165

Earlier quoted context omitted.

Does itch.io have a world wide CDN delivering high enough speeds to handle 50GB games? Do they provide match making, voice communication, game hub, cloud saves, workshop, achievements, stats, and so on? Steam provides a huge amount of services behind the scenes.

This is the whole point. Indie devs don't need a CDN that can handle 50gb games, or most of those other services you listed... Yet we're stuck paying the full 30% that those mega studios that actually use those features are paying.

Steam still brings a lot more traffic that they would get if they sold directly. Most people who do both Steam and direct report that Steam consists of more than 95% of their revenue.

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

#190

Post by kbwt »

dageshi wrote: post #141
mindslight wrote: post #135

Earlier quoted context omitted.

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". Ev…

I'm assuming Steam handles the application of regional sales tax/VAT based on country of purchase (that would apply in the EU I think?) that alone might be worth it? Not to mention they have a really good/fast distribution system.

Worth more than the entirety of the VAT? I think not.
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