Wolfire Games filed a lawsuit against Valve over abuse of their market position

This bit is also interesting from the lawsuit:

Valve blocks pro-competitive price competition through two main provisions—the Steam Key Price Parity Provision and the Price Veto Provision

Talk about being sneaky with words, in reality this is only about creating free steam-keys that you then can sell on other stores. So this have zero to do with abusing market dominance. Also the wording here is basically verbatim from Tim Sweeneys twitter from 2019: https://twitter.com/timsweeneyepic/status/1090663312814157824 so this does indeed sound like another Epic sponsored attack.

And I write attack since that is what it is, no one at Wolfire or Epic truly believes that this lawsuit will get any traction with the courts so this is just another PR attack against Valve. Not sure if Epic understands that they are fighting a well funded private company and not someone who needs to attract venture capitalists to raise funds.

I find interesting how Linux users which spread "freedom" loves a law to hurt the freedom of a corporation. Google, Apple, Valve...

Those three it's on a comfortable state because they make good services. Instead of make the state interfere, just praise the alternative one

How in the hell a large cut is bad for competition? Wtf? This means that the competition have a wider cut to work: 25, 20, 15...

Just go to another store there's a bunch of them: itch, GoG, EGS, Windows Store, Humble, Origin, uPlay...

Having antitrust laws is not to "hurt the freedom of a corporation", they are there to prevent monopolies from abusing their market dominance. Just as we have say criminal laws that "hurts the freedom of the people with the largest capacity for violence", as a Linux user I "love" such laws as well.

[quote=Guest]

It's not just about a 30% cut, it's also about if you want to sell on Steam and another store, then Valve are (allegedly) forcing certain conditions related to using the other store. ...

Sorry but no. Shadow of Mordor as Exemple: on Steam you had to pay for the Goty the full price and on Bundlestars you could buy the Shadow of Mordor Goty first for 15,- € and later for 5,- €. On Steam in this time: full price.

The same is on Gamesplanet and Gamersgate. In both Stores you can get Games in Sale. In the same time you can buy the same games on Stem for the full price.


Last edited by LinuxGamesTV on 30 April 2021 at 11:27 pm UTC

Steam is the Amazon of PC games.

That's not the whole story of the lawsuit though. It's not just about a 30% cut, it's also about if you want to sell on Steam and another store, then Valve are (allegedly) forcing certain conditions related to using the other store. That puts a different perspective on the matter - it is (allegedly) using the market share of Steam to keep other stores from offering better prices.

I would imagine, this, if true, is the crux of the issue. I know of what I assume are other "non compete" clauses in other industries, but most I've heard of are smaller, face to face businesses (like doctor's and such).

You can't force being popular. No algorithm in the world can change that.

Fun fact, you can do that actually, to some extent. The best name I've seen for it it the "Brain Dead Megaphone" but I'm sure there's better one from the marketing world. It's not complicated in theory, but not easy in practice. Luckily, Valve is in a rather unique position to actually be able to do it with minimal effort. Most examples I've read about are political or marketing, so I think the premise fits:

Presume popularity = communication (how much is talked about, mentions, if you will)
The idea of that you saturate the "media" with that message. Eventually, because it's every where, other people start talking about the message. It's a natural effect of it being "in your face" all the time.

A more practical example would be Valves game Artifact. They put it on everyone's steam page. Even have it that announcement window. For days. Every time you open steam. Valve has the shear numbers to get a large number of people to engage with ita, start talking about it and then you see it on gaming websites (most likely coupled with a Press release). And we can see the result. Fairly high player counts which causes it to remain on the charts for some time (possibly further increasing counts). Now obviously, we know the counts fell off a cliff, but popular doesn't have to be forever. Most fads aren't. Remember Pogs?

Another example is from another store. I really believe you cannot find a single webpage on GOGs domain that doesn't have CP2077 on it. Similar saturation idea. By my understanding, also fairly good sales?

These are fairly easy examples, as both outfits have a lot of resources and eyeballs to achieve this effect pretty easily. Almost in a unique way as they reach millions rather effortlessly due to thier market position. It's much harder for a smaller outfit (think like a more traditional PR blitz) because the ability to grab eyeballs is more limited.


They key here is that it is forced, as opposed to other things, like the Among Us craze, which, as far as I understand, was mostly "word of mouth" via streamers and social media. Similar function, the reputation, seeing it everywhere. Just a different genesis; more organic.

--source: I was forced long ago to take a cooperate organization and messaging class... 10 weeks... I'm glad I finally got to use it... Thanks for letting me sound smart!


Last edited by denyasis on 1 May 2021 at 2:54 am UTC

Of course this lawsuit is meritless like similar lawsuits before it. If a developer doesn't like Valve taking a 30% cut and not allowing the developer to undercut Valve on another platform, then they are free to sell through another store. If an indie developer wants better sales then they need to take it on themselves to do some marketing rather than thinking all they have to do is dump their game on Steam.

That's not the whole story of the lawsuit though. It's not just about a 30% cut, it's also about if you want to sell on Steam and another store, then Valve are (allegedly) forcing certain conditions related to using the other store. That puts a different perspective on the matter - it is (allegedly) using the market share of Steam to keep other stores from offering better prices.

I need to read more on it to form my own opinion on right or wrong, but the lawsuit is about it not being a simple matter of being free to sell through another store.

Again, Valve simply says upfront that if you want to use their platform to sell your product, then you agree not to then take your product to a competitor and undercut Valve. In other words, Valve doesn't want a developer using them as a promotional tool to gain exposure and then the developer driving business to a competitor by offering the competitor a lower price, and that's perfectly reasonable. If a developer doesn't like those terms then they are free to sell elsewhere.

Now if a competitor wants to sell at a lower price -- in other words, dip into their own profit margin -- then that's their business, and Valve can't do a damn thing about it. But the developer can't initiate it per his agreement with Valve.


Last edited by Mountain Man on 1 May 2021 at 12:37 am UTC

Wow... why do you think I keep repeating it?? Maybe because people are constantly parroting the same tripe counter-argument that "it must be competition" or "their game must be crap", ignoring the fact that these devs were previously selling in the thousands, then a day later selling almost nothing. Literally a day, btw. Quite a few devs shared sales graphs of the month it happened.

So why do you quote a post with none of those arguments in it? You say publishing an indie game on Steam isn't worth bothering any longer, I tell you this is true, but it doesn't mean the 30% cut is the issue here, which is the real subject at hand in the lawsuit.

I'm making this argument (on behalf of the Indies I follow) on multiple threads, so I might have lost track of who I was quoting. Sorry. But in any case, my point is that a 30% cut is only justified if Valve add value. They used to, but with the algo changes, they now see no value at all. Honestly, I'm losing track of the various attacks on this position, so genuinely, apologies if I've misread what you're saying.

I feel now that my money should rather go to Valve than to them for sure.

They haven't been a part of Humble Bundle for years.

Rosen and Graham have been CEO and COO of Humble Bundle up until 2019, and are still in the company today as "advisors" after stepping down. Source

I think the confusion is that Wolfire sold Humble Bundle to IGN in 2017, even though the CEO's of Wolfire stayed on the Humble board as advisors, while also being CEO of Wolfire. A bizarre arrangement.

These aren't popular games, but they're solid games that used to get exposure. Now they don't. So the 30% cut by Valve, for these devs, is particularly insulting, because Valve is adding precisely no value. Indeed, many of these indies saw (for the first time, ever, over years) greater sales via Itch, than on Steam.

The algorithm is a real problem indeed, but it doesn't mean the cut is unfair. People these days want to get everything for free and they realise later on why it was so cheap. Steam does take 30% but they inject it back in functionality, infrastructure and (sometimes open source) development.
Epic spend most of their money into buying exclusives, which are AAA games. In the end both consumers and indie developers get screwed but no one seems to care.

I'm tired of arguing this on behalf of the various indies I follow on Twitter, but I'll say it one more time - these Indies used to (past tense) get great value from Valve, by way of large customer base and a tiny bit of exposure to engage that customer base. As of the 2018 change, that is no longer the case.

There's simply no point in justifying a 30% cut by promoting services that will never be used... because no-one knows these games exist, since the algorithm doesn't give any exposure. It used to be a tiny sliver. Now it's not even that.

Personally, I suspect that Valve realised that a non-curated store was a terrible mistake - it led to uninteresting, fringe and plain "bad" titles being surfaced on its front page. Therefore this is simply a way to push those titles to the bottom of pile without actually taking the bad press that shutting them out would generate.

Just a shame it pole-axed the indies at the same time.

Andyou still speak in past terms, still referencing the 2018 stuff.

And now you talk abot the non-curated store that led to "uninteresting, fringe and plain "bad" titles being surfaced on its front page" - what? How many of those unsatisfied devs are actually the ones that people complain about?

What's your point. What are you asking me? I'll do my best to answer on behalf of the devs I'm now apparently defending.

The point is how they get popular. If the algorithm was fairer for new titles, then indies would have a better chance at leveraging Steam and becoming the next big thing. But since it doesn't, they never hit the front-page and the same tired (but popular) games are constantly regurgitated on the carousel and in the discovery queues.

My carousel:

Total War: Rome - Ark - Rimworld - Under Leaves - Last Epoch - Poly Bridge - Rain on Your Parade - Space Haven - 7 Days to Die - Universim - Project Hospital

Quite a mixture I'd say...

Discovery New Releases:
Battle in the City - ADD - Lair Hockey - Neon Nights (Boooobs!) - Creatura - ....

An endless stretch of indie titles. And in all honesty: neither do I pay attention the carousel (never) nor do I care about the queues. Must have been the first time that I clicked through the first couple of entries.
Interestingly are all those successful indie titles not only successful but also f*cking good. Hundreds of them: Dead Cells, Everspace, Limbo, Factorio, Mindustry, Opus Magnum, Stardew Valley, Terraria, Among Us...
One could say: That's the reason. And not because they got a popular spot on the carousel.

Ah! That's the reason ! That's why these devs, who got thousand plus sales before the algorithm change, suddenly experience less than a hundred sales afterwards? Good to know. Quality of games. Quality... that... suddenly, within weeks... deteriorated exponentially...?

Okay.

The same argument and frustration is often voiced around Play and Apple's store - they take their 30% cut but unless you magically put out the next minecraft, factorio or limbo, you're gonna languish with pitiful sales until you go out of business.

I'm sorry but that is the case for all creative industries. Most musicians do not make it and will never be able to make a living out of their music career. Same goes for actors. Video games on PC are a very open market, the barriers to entry are getting lower and lower, you even have free game engines nowadays, so anyone can jump in and try his luck. That necessarily means more and more people will not make it, there isn't enough market for everyone. Even if Steam drops their cut (and I think they should), allowing devs to get extra 10% or so won't solve people going out of business due to poor sales.

Yeah, totally true. My only point, which I'm fast-beginning to regret making, is that if a bunch of (for the sake of argument,50) musicians were on Spotify and making lets say £10,000 a month that's great. Rosy. But then Spotify notifies them that they're making a change to how recommendations are made to listeners. They say the change will be made at the end of the month. The following month, those 50 artists are now gobsmacked to discover that £10K a month has become £1K a month.

Ach, no big deal. Probably just increased competition, right? It's an expanding marketplace. Or maybe those artists were just a bit shit all along? Somehow?

That's the argument being made here. I don't buy it.

I follow a lot of indies on Twitter who genuinely despise Steam. Not just for taking a 30% cut, but for taking that cut and giving almost nothing back. They argue that the lure of the biggest audience for gaming is useless when Steam's algorithms are geared to only highlight AAA or "popular" content.

The same argument and frustration is often voiced around Play and Apple's store - they take their 30% cut but unless you magically put out the next minecraft, factorio or limbo, you're gonna languish with pitiful sales until you go out of business.

So, good luck to the lawsuit. It's doomed though, for sure. I'm no lawyer, but I'm pretty sure that you have to have some fairly hard evidence that Valve actually abused their market position to suppress competition. And the clauses in question have already passed muster in other law suits... so I'm not sure the point to all this is.

LOL, I can't even think why this was brought to the table, the 3 stores/services have something in common, they'll leave almost every game these "poor" devs dare to submit to be there.
SO of course these guys want more attention to their game. Of course, they would like to be in the front all the time. Of course, they hate Steam because Valheim and other quality games appear in the front Store.
Damn Steam showing me Fall Guys, Valheim, or any Total War game in the front store instead of the spinning toy game or those hentai VN's with furry characters, or that horror game where the player gets stuck at doors.
That doom algorythm that show me quality indy games instead of the buggy and trashy ones. OMG please Steam put whatever trash this poor devs submitted so I can complain again Steam is not doing quality checks.

Oof. Okay, you're the third, or fourth/fifth, whatever, to make the "they were shit all along" argument. So... fuck no. They were making thousands.... THOUSANDS... pre-algo-change. Then hundreds post-algo-change. Explain it.

I follow a lot of indies on Twitter who genuinely despise Steam. Not just for taking a 30% cut, but for taking that cut and giving almost nothing back. They argue that the lure of the biggest audience for gaming is useless when Steam's algorithms are geared to only highlight AAA or "popular" content.

Valve implemented the discovery queue and curators recommendation. And during the sales, you have to explore the discovery queue in order to get a trading card. At least in my case, I was able to discover many nice games with the DQ.

Yeah, honestly, me too. I think the point is far wider than one or two experiences though. I certainly find many, many hidden gems by following the many, many "hidden gem" curators on Steam. I also get offered a lot of free keys as a contributor to this site, but none, preceisly zero of these gems/keys ever appear on the hundreds of times a week (is that an exaggeration... maybe, but not by much) that I visit the Steam front page.

Hrm. My feelings on this are complicated.
1. I kind of like Valve. They're not as evil as most companies their size and for reasons of their own they do nice things for Linux.
2. I kind of hate Epic, who certainly have a hand in this lawsuit. Their "competition", as some have pointed out, is really just a strategy of operating at a loss to force competitors to also operate at a loss, so they can use their (and their sponsors') deep pockets to outlast the competition, drive them out of business, and thereby get a monopoly of their own, at which point they will jack up their cut. Anyone who thinks they won't jack up their cut the moment they have marginalized the competition, is naive. Luckily, I think they will fail.
3. The lawsuit is unlikely to succeed, very likely has little merit in US law, and is largely a sort of publicity stunt, an attempt to blacken Valve's name in the media.

However.

1. Valve is in fact a monopolist, and if the world had a level of antitrust protection ideal for fostering a competitive capitalist economy, they would be cut down to size (along with a bunch of others like Facebook, Microsoft, Google, Amazon et cetera). They didn't become a monopolist by being bad people (like, say, Microsoft did), they aren't even as nasty as most of their competitors (except Itch, who are sweethearts), but the fact remains--they dominate the space, their network effects and actions create barriers to entry, and this kind of thing causes problems for capitalist economies.
(1a. Not that I care in a sense, since I'm not a fan of capitalism anyway)
2. That thing Scaine is talking about with the algorithm, that's terrible, and very real, and everyone trying to persuade themselves the algorithm can't possibly be important is brandishing some major league denial. The basic facts Scaine pointed out make it utterly clear: If only one major, sudden change happens and immediately afterwards your sales get divided by ten, the causation is pretty obvious. It's about at the level of, someone hits you upside the head with a baseball bat and afterwards you have a headache. All the counterarguments seem to be less arguments as such than sort of instinctive rebellion against the idea that the world could work in a way they think it shouldn't.
So, to be clear: Stuff about gradual changes over years in the gaming world that could affect indie profits does not explain sales dropping by a factor of ten in a day. Stuff about "Oh, they must be lousy games because good games will magically get found" is not even relevant to sales dropping by a factor of ten in a day. Stuff about some good indie games occasionally still breaking through does not explain sales dropping by a factor of ten in a day.
(2a. A fair amount of the objection to the idea of the Steam algorithm having a very large impact on sales seems to be based on the idea that fair competition is some kind of law of nature, and so it's just inevitably the case that good quality games will sell well. It's like if anything seems to be unfair enough that it could make good quality things fail in the magical marketplace, that must somehow be an illusion. This is nonsense, and gives me vibes of "all's for the best in this best of all possible worlds".)
(2b. The relationship between quality, marketing, sales, and even sales potential is complicated, and sheer dumb luck also looms large in the equation. For example, something can be very good and yet have a very small potential audience--there are niches not many people are into, and if you do an excellent job filling that niche, it's a very good game even if it has low sales potential)
3. It's unclear whether 30% is too much, but frankly it probably is. And the idea that it must be OK because that's what Apple charges makes me laugh maniacally.

To sum up: Valve is a decent company, and Epic is crap, and this lawsuit is going nowhere and is probably bogus publicity bait, but Valve is a monopolist, the game economy would be healthier without a player that could warp the conditions of the whole market, Valve should really do something to the algorithm so it stops hosing indies, and 30%, despite a lot of uncertainties, seems a tad high.

Valve need competition against Steam. The reality is that it's the main place to get most games, and it's the primary point of purchase for just about anything. I've seen a good many comments on this very site that if a game isn't on Steam, they won't buy it. If a developer wants a game to be successful, they've practically no choice but to put in on Steam (exceptions exist of course, but for the vast majority this is quite true).

We buy only if it's on steam because valve is only one from them who seriosly invest into linux. When i say "game isn't on Steam, I won't buy it" i do it because i want to support drivers and proton development by purchoase. Which one store seriously supported linux? GOG dont heve linux build of their own Galaxy! epic sabotaging us by bribing devs to support only theyr store withou linux support and efectively cancle linux build by that!

We buy only if it's on steam because valve is only one from them who seriosly invest into linux.

There is also a lot of reason why people will only buy on steam. I'll take myself as an example.

Steam was the first in the market most other stores arrived far too late on the market when they finally caught with the reality that digital sell were juicy. Epic is the very last one, they will struggle to get people like me. My steam account is soon to be 15 years old I have hundreds of games on it all my friends are there. Epic like other stores before have nothing for me that steam don't have, and exclusivity deals only makes me hate them.

The only store that got me was GoG because they started with a very niche market. Old games and DRM free indies. No one had that. Steam only started to get serious on indies when GoG started to have success. So yeah for some years GoG was the only place you could get these games. Then they started to expand their offer. So, I got to buys there too because I already was a customer. They only started to lose me when I got 100% of my time on Linux and couldn't use GoG galaxy and had some online games that I couldn't play any more because they used the GoG API and forced the use of GoG Galaxy.

Where was epic games 18 years ago when steam was created? Where were they 15 years ago when steam started to get big? It's very rich from them to complain about a "monopoly" they participated to create and push other companies against Valve, when they are themselves very late to the party.

EDIT:

I'm sorry if I sound a bit harsh, but I'm really tired of people throwing shit at Valve for no good reason. Valve is far from being a saint, but some things need to be said. If Valve and Steam are in the position they are today it's because they were left alone for so many years without any real competition. And now a lot of people act all surprised as if that was new. Valve only have a de facto monopoly competition was always free to be created it just wasn't.


Last edited by DerpFox on 1 May 2021 at 2:01 am UTC

There is one more think. 30% is a misleading. Valve has their cut only if they sell it. But if developer generate key and sell it elsewhere (humble bundle,...) key is free, game has full support of steam store but valve has 0 money from it. So in 30% is also calculated usage of infrastructure for "black passenger" whom did not payed it. Devs did note use this? How it is Valve fault? Devs have this option!

https://arstechnica.com/gaming/2019/04/why-valve-actually-gets-less-than-30-percent-of-steam-game-sales/


Last edited by Arten on 1 May 2021 at 2:14 am UTC

That's why these devs, who got thousand plus sales before the algorithm change, suddenly...

That thing Scaine is talking about with the algorithm, that's terrible, and very real

While I agree with you, I think it's worth asking if the algo is really the main issue or is it control they have over a games potential success?

Valve basically can pick the winners and losers by what they decide to put on thier store front. Wether they use an algo or not to make those picks seems secondary. Would you agree that is more the core issue?

Valve sometimes uses an algo to put games on the store front. From what I can see they also handpick things as well (thier self promotion is pretty obvious to me). I'm curious how much active manipulation they do to the results beyond thier self promotion. I'm also curious how much extra a publisher or dev has to pay for that service. I'd expect it's the type of service that's only offered to certain clients.

There is one more think. 30% is a misleading. Valve has their cut only if they sell it. But if developer generate key and sell it elsewhere (humble bundle,...) key is free, game has full support of steam store but valve has 0 money from it. So in 30% is also calculated usage of infrastructure for "black passenger" whom did not payed it. Devs did note use this? How it is Valve fault? Devs have this option!

https://arstechnica.com/gaming/2019/04/why-valve-actually-gets-less-than-30-percent-of-steam-game-sales/

I think that's really interesting. Thank you for sharing. I did not know that. Great engagement tool. I assume the idea is to re-capture the consumer once they get back to Steam for the next and subsequent purchases?

I assume it's a great lock-in tool on the sales side too since a key seller doesn't need thier own infastructure, there's no point in investing in a full store/client/distribution system. Hence no full on competition to Steam since they need Steam for thier store?

Edit. Sorry for the double post. Im honestly not sure what I did.


Last edited by denyasis on 1 May 2021 at 3:58 am UTC

I feel now that my money should rather go to Valve than to them for sure.

They haven't been a part of Humble Bundle for years.

Rosen and Graham have been CEO and COO of Humble Bundle up until 2019, and are still in the company today as "advisors" after stepping down. Source

I think the confusion is that Wolfire sold Humble Bundle to IGN in 2017, even though the CEO's of Wolfire stayed on the Humble board as advisors, while also being CEO of Wolfire. A bizarre arrangement.

These aren't popular games, but they're solid games that used to get exposure. Now they don't. So the 30% cut by Valve, for these devs, is particularly insulting, because Valve is adding precisely no value. Indeed, many of these indies saw (for the first time, ever, over years) greater sales via Itch, than on Steam.

The algorithm is a real problem indeed, but it doesn't mean the cut is unfair. People these days want to get everything for free and they realise later on why it was so cheap. Steam does take 30% but they inject it back in functionality, infrastructure and (sometimes open source) development.
Epic spend most of their money into buying exclusives, which are AAA games. In the end both consumers and indie developers get screwed but no one seems to care.

I'm tired of arguing this on behalf of the various indies I follow on Twitter, but I'll say it one more time - these Indies used to (past tense) get great value from Valve, by way of large customer base and a tiny bit of exposure to engage that customer base. As of the 2018 change, that is no longer the case.

There's simply no point in justifying a 30% cut by promoting services that will never be used... because no-one knows these games exist, since the algorithm doesn't give any exposure. It used to be a tiny sliver. Now it's not even that.

Personally, I suspect that Valve realised that a non-curated store was a terrible mistake - it led to uninteresting, fringe and plain "bad" titles being surfaced on its front page. Therefore this is simply a way to push those titles to the bottom of pile without actually taking the bad press that shutting them out would generate.

Just a shame it pole-axed the indies at the same time.

Andyou still speak in past terms, still referencing the 2018 stuff.

And now you talk abot the non-curated store that led to "uninteresting, fringe and plain "bad" titles being surfaced on its front page" - what? How many of those unsatisfied devs are actually the ones that people complain about?

What's your point. What are you asking me? I'll do my best to answer on behalf of the devs I'm now apparently defending.

You continue bringing up the 2018 incident and not what happened after. That seems disingenous.

For what it's worth, the 30% (or any percentage) cut doesn't seem bad to me (even if they didn't "give back" anything to the community, but in our case, they do, and a lot). What does seem bad to me is the "clauses Valve have that prevent developers selling at cheaper prices on other stores" (because that improperly reduces competition among stores, and that likely is the point).


Last edited by s8as8a on 1 May 2021 at 4:54 am UTC

For what it's worth, the 30% (or any percentage) cut doesn't seem bad to me (even if they didn't "give back" anything to the community, but in our case, they do, and a lot). What does seem bad to me is the "clauses Valve have that prevent developers selling at cheaper prices on other stores" (because that improperly reduces competition among stores, and that likely is the point).

That sounds like a myth honestly. I'm sure I've seen games available elsewhere for less many times.

Which one store seriously supported linux? GOG dont heve linux build of their own Galaxy! epic sabotaging us by bribing devs to support only theyr store withou linux support and efectively cancle linux build by that!

itch.io