245: Steam: A Monopoly In the Making

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I thought video games were classified as a luxury. I know that hand-in-hand monopoly laws do not apply to luxury products, and as far as I can tell this would classify as a hand-in-hand monopoly. A person can be competitive in the job market without video games, unlike computers or internet. I fail to see a legitimate comparison between Microsoft and Valve.

destroyer2k:
Nice article, but this only goes for north america. In EU most of the games on impulse can't be bought. So there is only steam and direct2drive.

Steam has monopoly in EU, but it can't be sued because there is no other company for digital games selling (except direct2drive witch can't give antitrust filling and win).

GamersGate is based out of Norway, and has a pretty respectable library. GoG.com is available, and I'm pretty sure GameTap is as well. GG is my personal favorite, because it doesn't require a client of any kind, and has newer games, unlike GoG. Plus, they carry a ton of Russian games that have excellent gameplay, if somewhat shoddy writing and voice-acting.

My point is, Steam, Impulse and D2D are not the only options available to us Europeans. Hell, you could even go for the Xfire store, or the online stores of individual publishers (EA and Atari come to mind).

The only reason Steam is gaining a monopoly anywhere is because most people who claim that they dislike it but use it out of necessity don't actively try to seek out alternatives.

Honestly, I dislike Steam because of my former experiences back when it destabilized the Source engine, but mostly because, when I game, I don't want a stupid client hogging memory/cpu power, I want max performance. Achievements be damned.

Impulse sells all it games in the EU (or at least the ones Ive bought) so I have no clue where destroyer is coming from

You know, I have no idea why anti-competitive practices are looked down upon. I mean, they are supposed to WANT people to take their loyal customers? What? If Steam becomes a monopoly, I'll be happy. Valve could take over the world for all I care, which makes them one of 2 corporations who I would support dominating humanity (the other is Bungie). Basically, D2D and Impulse are like "WAAAAAHHHHHHH!!!!! We suck and nobody uses us!!!!!! LETS MAKE BASELESS ACCUSATIONS BLAMING ONE OF THE BEST CORPORATIONS EVER!!!!!!! WAAAAAAAHHHHHHHHH!!!!!" Really, that's what I'm hearing.

RetroVortex:
The article raises a good point, but I still think the main problem is that competitors don't seem to be really be offering anything better.

I strongly agree. Even if there were 50 different game purchase and management options, it would make no real difference unless there were meaningful advantages of some over others. Regardless of how much you hate DRM, with Steam coming onto Mac, Valve are helping improve gaming.

capacollo:
Why not create a committee to derive a standard, with accompanying API, for digital distribution management that can provide the ability for multiple back-end digital distribution channels to provide content.

Well lets see. Since this would move some of the DRM responsiblity from Valve to the publisher (who could, after all try selling through a similar distro channel that doesn't use DRM) this would remove a lot of Steam/DRM resentment...

More choice for customers and publishers, less flak for Valve... this sounds like an excellent idea to me.

Sjakie:
Not to mention, what happens when your internet connection goes down or resets itself? So much for playing your games off-line.

This part is a lie... I had to travel on business and loaded Steam onto my laptop, and loaded up Torchlight (a game which uses the cloud for your settings and savefiles, I might add) and I was able to play the game on the plane when I had absolutely no internet connection at all. When it started, it said "play in offline mode?" and that was the end of it.

Sometimes I wonder if the Escapist Editors/Writers read my posts, turn them from rambling rants into more professional pieces, and then post them. Not a serious accusation, but I've been saying similar things for quite a while.

Strictly speaking though I do accuse Valve of "evil empire" type behavior. I compare them to Wal*Mart rather than Microsoft however, though you can draw analogies to both. Basically there is a desire for game companies to go digital so they can remove costs like packaging, shipping, and distribution and take the money they would use for that as pure profit. The Escapist ran an article interviewing the guys from 1C which spelled out exactly the differance in how much money they make digitally rather than with packaged products.

The thing is that Valve is smarter than a lot of it's competition, or seems to be. Where most companies and digital services are putting their products up for the same price as retail (and pocketing the savings as cash, contrary to what gamers were promised) Valve reduces their prices on games frequently. The holiday sale last year being a key example, but they also rotate sales twice a week (midweek and weekend usually) and those sales can range from 10% to 80%. Showing how much of a discount digital distribution could technically stomach if it wanted to (but doesn't).

The thing is though that these sales make Valve seem like the "good guys" and undercut the competition, what happens when Valve has effectively destroyed all the competition? Everyone is using it because of ease of development, and because it WAS cheaper. Now they can raise their prices and there is no one left to face them. Even if called "sell outs" and all kinds of bad things will it matter? Remember Wal*Mart dominated to begin with as a group of good guys where every employee was given stock in the company (to begin with) and had prices lower than anyone else because of what later were labeled predatory pricing practices.

Today I'd like to believe in Valve, but while I take advantage of it, I can't help but feel that I've seen this all before. Truthfully I'm one of those that sort of feels it's best for us as the users/consumers to stick with the Brick and Mortar "disc in hand" way of doing business. Albeit I can't see the gaming community rallying in any meaningful fashion around those lines.

-

To play Devil's Advocate however, I will also say that another Escapist article (Seamus Young I believe) made a point about how too many digital services being a liability. With everyone jumping on the bandwagon you can require 3 or more passwords and login credentials just to take advantage of all the features of a game (including communities and such). The alternative to having a "Monopoly" like Steam is of course everyone and their brother running their own service, which is going to result in chaos.

Arguably I feel that the ideal way for things to turn out would be for there to be 2 or 3 digital platforms which compete with each other, as opposed to engaging in cartel behavior which is similar to a monopoly (ie when groups that are supposed to compete coordinate so they won't have to compete). Cartel behavior being the biggest problem with the gaming industry as it stands now.

The bottom line is that a lot can be said for standardization.

-

Finally I will point out that a lot of the suits in other countries are basically attempts to nail American businesses. Understand that we have been involved in numerous trade wars with Japan (remember whent he price of RAM exploded through the roof?) and since the advent of the EU a lot of our staunchest allies have become our biggest competitors. Needless to say anything they can do to gimp American juggernauts like Microsoft is something they are going to do. It's hard to really use them as reinforcing examples of anything when they target by and large American interests using any excuse they can usually. That's just how things work with international economic competition, and we've been ridiculous ourselves with some things for similar reasons.

This is not to say that Intel or Microsoft were not monopolies, and didn't need regulation, but really you can't point to things done by rivals (note I do not say enemies) of the US as part of cutthroat international trade.

incal11:
I'm tired of people saying "offline mode, blablabla... and so yeah"
It still requires me to install a bloatware on my pc and Requires internet access at least once; that is too much for me, I respect only the publishers who put NO DRM at all (and won't give in to steam either).

Ok I'm gonna get mean here.

You are sitting there, honestly telling me that you're complaining about being required to have internet connection to download a game off the internet?

I love Valve but I don't like the idea of them owning my games still, even after unlocking them. I cannot stack them in my shelf, which I am very fond of.

It's like money, once it's all online and not in your hand, you might loose control and reality. I'd rather keep things in my hands than some service which achieves it's purpose admirably but is capable of taking away everything I have if I screwed things up.

zakski:

ark123:
Plus, you get to do shit like buying Team Fortress 2 for 5 bucks when those crazy sales happen. Steam is a monopoly because the competitors suck ass.

You can thank Impulse for that, ever since they started doing weekly sales steam and the other platforms jumped on the bandwagon

Sorry but that's just plain wrong. Valve did sales even before Impulse was brought up. They do sales because they know people will buy things.

People will go "Hmm it's only $5 so it's ok" and do this for several games.

It has nothing to do with Impulse joining the market or GoG.

As for this whole Steam becoming a monopoly. Honestly? I don't really care.

Valve actually cares about their community. They have released great games. Supported them for a long time and given support for Dedicated server and all that stuff.
So even if they control the entire online market I will not give a damn. Steam has worked wonders for me. Offline mode works when it should, you can just try it out. Pull out the cable and see if you can login in offline mode.

It's also fun to see people claim that MS are "EVIL" because they "FORCE" their media player onto the OS users.
Really? So they are evil when they make it easier for people who want to quickly listen to music or watch a video? You also have a choice. Find another program on the net and install that one. But would most people know about this? Nope.

No one is forcing you to use the basic ones too and it's only really the ones who know how to change it that whine.

Thanks to the Europe court or whoever it was, I'm now forced to pay the FULL price for the Windows 7 version. Unlike the $45 version upgrade that exist out there for USA. This version would be available for us too but Europe court put up some bullshit about that.

loremazd:

Ok I'm gonna get mean here.

You are sitting there, honestly telling me that you're complaining about being required to have internet connection to download a game off the internet?

I like to buy my game the old fashioned way, and when I do I am not happy when it absolutely wants me to have internet, not to mention installing a f*cking gaz engine, before letting me play, even if that's just the first time.

I also like it when the copy I buy is mine forever, that is, NO risk of all my games being taken away for any or even no reason.

Really, somehere look like thei've been brainwashed, "valve cares about us" "their services are the best"; I wish your accounts bite the dust and see how valve really care !
What if I want a game on steam and not the services ?
heh, I can't, that's the difference between a "service" and a noose.

Zefar:

It's also fun to see people claim that MS are "EVIL" because they "FORCE" their media player onto the OS users.
Really? So they are evil when they make it easier for people who want to quickly listen to music or watch a video? You also have a choice. Find another program on the net and install that one. But would most people know about this? Nope.

Actually you are right, it is not steam who is evil, it's all the fault of the legions of undicerning easily manipulated idiots and their uncanny will to delude themselves to the very end...

Even if I am proud owner of a lot of titles on Steam I am very afraid of the fact that they can ban my account and ALL games if they want to.. even if I bought them with REAL money.

Zefar:

Sorry but that's just plain wrong. Valve did sales even before Impulse was brought up. They do sales because they know people will buy things.

While steam did have christmass sales back in '07, as far as I can tell they did NOT do any weekly or weekend sales before march '09. However Impulse had its first weekend sale on the 12th of dec '08, the year that it came out. http://www.neowin.net/news/first-impulse-weekend-sale-is-on. If ya have any evidence that proves otherwise I would like to see it XD.

Edit: Not because I am provoking flames, but because I can't find anything that says otherwise

As long as it is legal to publish games without Steamworks, and it is economically viable to make a profit on a game that has no benefit of steamworks, then there is no monopoly.

Zephirius:
...

How does GameTap convert $ to €? There is no price point in € so does it take in account $=/=€ ?

And don't mention xfire this is one of the worst digital online store (maybe even more that d2d). I don't mind $=€ (got use to this bullshit), but I do mind that xfire had some games cheaper in $ that in € (one game was 30$ for US, but for EU the same game was 40€). Since then I don't even look at there game store.

zakski:
Impulse sells all it games in the EU (or at least the ones Ive bought) so I have no clue where destroyer is coming from

I am from Slovenia witch is part of EU. And I can't buy games from impulse it doesn't support my country (only about 5-10% games I can buy from them). The funny thing is that this started only a few months ago before that I could buy all games.

destroyer2k:

I am from Slovenia witch is part of EU. And I can't buy games from impulse it doesn't support my country (only about 5-10% games I can buy from them). The funny thing is that this started only a few months ago before that I could buy all games.

Im soz to here that. Well here In Ireland (Also part of the EU), everything works fine. have you contacted their tech support or posted in their forums and asked them why, they are always nice to me when Im getting my password recovered.

If steam is making a Monopoly, That's fine. Let them. As long as there is Free Parking. *grin*

What I wouldn't give to be valve right now. Anyways it's kind of hard to imagine valve being evil, even if they do get a monopoly. I mean they are quasi-independent still right? So it would be weird to see the little guy get such a huge advantage.

I'm looking into Steam as my next source of PC games so I would very concerned if it became pricey. I like Valve but if Microsoft assimilates it the gaming community will lose a great partnership. (No more Gmods... A bleak future indeed)

Wait just a damn minute. The guy from DIRECT2DRIVE is complaining about Trojan horses? The platform that effectively renders otherwise-moddable PC games extremely difficult to mod because of the blatantly verklempt way it handles content authentication?

Fuck him. Steam puts my game libraries where I can find them and tweak them to my heart's delight. If that's a monopoly, bring on Rich Uncle Pennybags.

In a nut shell : You cannot yell monopoly before the shait hits the hyper drive. Anti monopoly measures can be imposed only AFTER the market has been unbalanced.

As the other people mentioned before me this seems just a rant from the people who lost in the initial dick measuring competition. What is even more disturbing to me is the fact that people tend to bitch about how completion is kicking their ass instead of learning from others and applying in their own products. As a company that is worth millions how can you go crying to the state for help when the competition is kicking your ass? Ethics anyone ?

Khell_Sennet:

Install Steam or don't play the game - those are the only choices.

No words can better sum up why I so despise Steam, and Valve for creating it and forcing it upon my computer.

Anyone on the Escapist who knows me, knows I hate Steam for a multitude of reasons, ranging from totally valid to petty and absurd. I won't go into a thousand-word rant on it because it's something I've said many times before, but I will say it is nice to see an article by someone else which highlights some of the flaws in Valve's abominable DRM/Malware "service".

For real?

DRM/Malware? That's a bit much don't you think? You know I hate being able to see what my buddies are playing and the ability to jump right into a game with them very quickly. I hate my games getting automatically patched without me having to dig around for the proper install. I hate being able to access my games, save games and keybinds on any capable pc, that really sucks. I really hate the stat tracking too, it keeps telling me that I've played 13 hours of BFBC2, as if I really wanted to know that. Those achievement things are so stupid too, who does that! PC's aren't consoles! I much prefer to alt-tab to google something while I'm playing a game, screw that overlay bullcrap. Oh yea, and eff any game that wants to be protected from pirates, DRM is bad all around, even if the consumer gets some "minor" benefits from it.

From what it seems, I suppose you hate consoles too? Specifically Xbox 360/LIVE?

Unless a better digital distribution comes around I don't much care.

I proudly say there is a valve on the back of my head
Steam has never given me any problems and it makes online play even more simple and fun
If Steam dies I can bet all 25million + members will CRY ='(

Each time I buy a game on Steam I can't shake the feeling that I'm slowly digging my own grave.

I am for the most part a happy customer but there is one HUGE flaw that many people seam to forget. And that is it dosen't provide you with an installable backup of the game you purchase and now supposedly leagaly own.
Yes, you can download the game again and again for as long as you live , but beacause it's tied to your Steam account... what happens if for some unconceivable reason you get banned. Well then you can kiss all your games good-by. Not a customer friendly policy by any standard.

Now that some games force you to activate through Steam, they will become a monopoly in the
future.

I did another analysis based on monthly unique visitors which gives me a slightly different picture. While Steam still dominates with 50% there are quite a few others. Check the full analysis here: http://blog.deals4downloads.com/2010/04/07/market-shares-of-digitial-distribution-platforms/

I love steam. It represents the big guys.

I love impulse. It represents the little guys.

I run them both 24 hours a day, and buy things from both.

I get angry when I can't obtain a title from one or the other.

Steam sets the baseline for what other distributors need to follow.

Publishers don't sell through Steam because they want to (hypothetically, it would be more profitable to cut out the middle man and force customers into their own proprietary system, but in reality that just isn't feasible. Not yet anyway.), they sell on Steam because it commands the market in online distribution, and that's where the money is.

The major points I love about Steam:

1) When I buy a game, I don't have to play around with crippling DRM or limited installs. Yes, I know about Steamworks, but that's actually fair DRM, and adds a layer of accountability that makes publishers want to sell through Steam.

This is, in effect, the best compromise solution to the whole nasty DRM business I think we're going to see now.

2) It's easy to maintain my game file structure. If I get a bad install, I don't have to worry about finding a (possibly scratched) disc.
If part of my game becomes corrupted, I can do a file integrity check without having to uninstall and reinstall (most of the time).

3) Sales. It's cheaper, and Steam periodically uses sales as an incentive to try lesser known titles.

Steam gives you two options for an increasingly large number of games "do it our way or don't play". THAT, really pisses me off.

You know what the difference between successful bad guys and non-successful ones is? The former has good public relations, they make you think they're the good guys :)

While I personally love Steam, I do think this is a legitimate concern, but the platform with the biggest potential to be as successful would probably be Games for Windows Live, but I've seen firsthand that it's less of a 'digital distribution and game service' than 'Microsoft griefing people'. And not in the funny Team Roomba way either.

GoG.com is frequently cheaper, is beginning to get a huge library, and it's only a matter of time until new games are released through it like The Witcher 2 was. Also, with a strict no DRM policy, I hope gamers will speak with their wallet and use GoG.com over Steam wherever they can, even on more expensive games, but then again most game consumers are ignorant in their purchases or too young to know what is in their best interest.

Correct me if I'm wrong, but my understanding is that Steam's growth has been a result of market choice as opposed to nefarious practice on the part of Valve. Basically, they offered the best-of-breed in a digital distribution service, while everyone else simply sucked and continue sucking. Consequently, people voted with their dollars to choose Steam. This is not an unusual or sinister phenomenon in a free, open, and fair market. In such a circumstance, a monopoly is an inevitable consequence of successfully providing the best product or service offering over an extended period of time in the face of all other competition.

Further, having monopoly is not illegal, nor is it necessarily a problem. It's the abuse of being the position of owning a monopoly that is illegal and causes all the problems(i.e. the anti-competitive behavior such to maintain that monopoly). Our anti-trust laws do not exist to halt the formation of monopolies. They exist to halt the abuse of monopolistic power and position. Again, in a free, open, and fair market, even a monopoly can potentially be toppled by an upstart that provides a better offering.

Also, I think this author either needs to look up the definition of monopoly again or stop playing so fast and lose with that definition. Intent has nothing to do with a company being a monopoly.

geizr:
Correct me if I'm wrong, but my understanding is that Steam's growth has been a result of market choice as opposed to nefarious practice on the part of Valve. Basically, they offered the best-of-breed in a digital distribution service, while everyone else simply sucked and continue sucking. Consequently, people voted with their dollars to choose Steam. This is not an unusual or sinister phenomenon in a free, open, and fair market. In such a circumstance, a monopoly is an inevitable consequence of successfully providing the best product or service offering over an extended period of time in the face of all other competition.

Further, having monopoly is not illegal, nor is it necessarily a problem. It's the abuse of being the position of owning a monopoly that is illegal and causes all the problems(i.e. the anti-competitive behavior such to maintain that monopoly). Our anti-trust laws do not exist to halt the formation of monopolies. They exist to halt the abuse of monopolistic power and position. Again, in a free, open, and fair market, even a monopoly can potentially be toppled by an upstart that provides a better offering.

Also, I think this author either needs to look up the definition of monopoly again or stop playing so fast and lose with that definition. Intent has nothing to do with a company being a monopoly.

Steam comes with a lot of games from the shelves even if you don't want it. I'd rate that as kind of nefarious, but not unusual biseness sadly. It's successful for a reason at least.
A monopoly can never be a good thing since it is abusive by nature, because it will want to stay a monopoly sidestepping the law one way or another. Without concurence there is no reasons to make better offers, while the temptation is great to makes offers discretely and gradually worse. Steam isn't a monopoly yet but it, or something like it, may become too hard to topple for any upstart if things go down a certain path.

Happy new year :)
Still pondering your answer to my last pm I hope. Currently I'm doing my best to see things your way and corner myself.

ps: noticed my old post not too far above yours ? lol was I angry, but I still think that way.

incal11:

Steam comes with a lot of games from the shelves even if you don't want it. I'd rate that as kind of nefarious, but not unusual biseness sadly. It's successful for a reason at least.

That is not nefarious. Nefarious would be for them to use their position to restrict game developers from distributing their games via any manner other than Steam.

incal11:

A monopoly can never be a good thing since it is abusive by nature, because it will want to stay a monopoly sidestepping the law one way or another.

A monopoly is not intrinsically bad, however, the abuse of monopoly position and power is. There is a very high probability for this abuse to occur only because the monopoly is controlled by human beings, hence the reason we have laws against such abuse but not against the existence of the monopoly(a lot of companies would have long since been dissolved, by law, if this were the case).

In fact, monopolies are a natural outcome of pure capitalism. If one wanted to eliminate the occurrence of monopolies, one would probably have to change to a more socialist or communist economic system.

incal11:

Without concurence there is no reasons to make better offers, while the temptation is great to makes offers discretely and gradually worse. Steam isn't a monopoly yet but it, or something like it, may become too hard to topple for any upstart if things go down a certain path.

Sorry, I have no idea what you mean here. It's coming across too garbled, to me. I think you may be using some words incorrectly here.

As best as I can tell, Valve has created a best-of-breed offering. Other companies are free to compete with that, but, to my knowledge, their offerings pale in comparison. One could possibly argue that Steam's insane promotional sales are actually anti-competitive in the sense it may be the case that no competitor enjoys a sufficient percentage of the market to be enabled to make such offers to counter Steam. In that sense, Valve could be being subtlety nefarious through pricing, which is, in fact, one of the anti-competitive practices of monopolies, setting prices so ridiculously low that no competition is capable of making a counter-offer. We, as customers, enable and encourage the practice when we purchase games during moments of such extreme discounting(it would be stupid not to, to be honest; the deals are seriously sweet).

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