We reached out to nearly half a dozen sources within the games industry (as well as the game retailers directly) in order to get the actual numbers on what cuts most major retailers take. While many of these sources prefer to remain anonymous, they paint a picture that could be surprising to some players, one where Valve’s now infamous 30% cut isn’t actually out of the norm. In fact, it's pretty much the industry standard.
Agreed. But they way they have it set up, it will look great to investors. They can easily increase profits 10% each year by upping the % for many years before they hit 30% of steam (like 10% increase next year would be 13.2% taken). Since they aren't in a massive need of cash right now, they can easily keep is low for a while to get dev's on board. (I think I did that math right...)
-Not all 30% cuts are created equal either, I’m told. One source explained that although Steam only takes 30%, other fees and deductions mean they are usually collecting closer to 65% on their end, while they say console sales return much closer to the full 70% but are stingier with refunds and the like. Meanwhile, GOG.com also takes a 30% cut, but requires publishers to invoice the site manually for the sales made to actually receive payment, something one source explained was a more time-consuming process than Valve’s regular automatic payouts.
The primary difference here being that Valve operates on an open platform, perhaps one of the last to exist in this scenario. If there was anywhere in the retail industry that we should see an actual challenge to a fee this high it would be in the PC space, yet it exists in large part to one large sized player. The notion that hosting a game sale requires 30% of the sale itself is ridiculous. Literally the only legitimate challenge we have to this is Epics store, yet somehow they are the bad guys here. Everyone is somehow accepting of the notion that hosting a digital transaction requires this tremendous cut of the revenue, yet is up in arms over companies willingly signing exclusivity agreements for a larger portion of the revenue literally generated by the sale of their product.
I dont see how any publisher or developer in the industry can look at these numbers and find them acceptable and given the only legitimate challenge to the "norm" is an aggressive publishing company they seemingly do not. The 30% cut is not new information its simply that the gaming communities are just now taking notice, there has been numerous statements against speaking out against it over the years.
Industry standards at 30%? I'm shocked it's not 50/50. Don't make me laugh. So a bunch of scrooge Cyril Sneer types set the industry standards and we must obey?
The smartest thing these companies can do is rent or set up a small server network and sell their own games with a DRM free executable. You download the game and take care to save and back it up somewhere and play it to your heart's content. Even better, go back to selling a boxed game. At least you're spending that 30% on the logistics of the box and not feeding into a soulless enterprise. Heck, it could save jobs and those brick and mortar stores as well.
It's now obvious that the promise of savings from buying digital games never came to fruition because of this parasitic 30%. Go back to boxed games. Oh, for the none hoarders, install the game and throw away the box if you're so inclined.
AAA games will always be priced the way they are. Steam or no Steam. Uplay games will still cost just as much now they have their own subscription service and launcher. The only publishers hurt by Steam's 30% are the smaller ones and for most they gain more from being on Steam then that 30% anyways. Being on Steam is probably 30% of their sales if not more.
The biggest thing Steam has is it's user base. Putting a game in Steam means it's seen by millions. For that alone Steam has earned a %. Maybe not as much as they take for the smaller companies but the big ones can easily pay it.
Besides if Epic's model was so great they wouldn't have to bribe to get exclusives.
I hope consumers wake up and realize that EGS buying exclusive titles, timed or not, is bad for consumers. We shouldn't be rooting for limited choices, and in the end these companies only care about one thing. I personally hope the EGS fails.
Steam may take a bigger cut, but at least they never resorted to EGS nonsense.
Steam didn't have to resort to EGS tactics because they got in real early when there wasn't really any competition in the digital game distribution space as people still mostly bought boxed copies, and steam provided an avenue there as well to activate the game on steam using the cd-key.
The outrage of EGS is no different than when Uplay or Origin came up, its annoying to have another application installed just to launch games when you already have one that does the same thing, but it all comes down to the money and i don't blame the other publishers from wanting to avoid steams 30% cut. When you have titles with big names like Battlefield etc it doesn't matter if its not on steam, people will buy it and use whatever launcher is necessary to play it. Smaller publishers with lesser known games or new IPs entirely aren't so lucky and are forced to use steam because of the exposure they get on there.
I actually dont think 30% cut is outrageous, however when its a digital product and theres no upkeep for a brick and mortar store then yeah 30% is a big cut when you dont have to deal with physical boxed copies and store space. Steam, or more specifically Valve are big SOBs for just sitting around and collecting whilst not making real games anymore. Their two latest products were artifact a TCG no one asked for, and more recently a dota "chess" game. Woohoo....
Yeah, I'm sure it has nothing to do with the millions Epic pays them for timed exclusivity. It's purely because they'll get 88% of the revenue instead of 70%.
If there was no cut from the distributor, I'm sure games would still cost about the same. Prices are usually dictated by what customers are willing to pay more than anything else.
Exactly this. AAA publishers have entire teams dedicated to seeing how much they can push the price up of their games while enough people still buy their games for them to make an enormous amounts of profits. Notice how recently, special editions of games are close to and in some cases exceed $100 whereas a few years ago they were $10, maybe $20 more than the normal editions?
People are looking at this completely the wrong way.
It should read like this:
"Games are Sold From Distributors at a 30% Mark-Up"
Unless you are making a commission or own Best Buy, Steam, Epic, Windows Store, etc. etc. The only thing that matters is the final price you as a consumer pay and who all is on the take on the back side is irrelevant.
If there was no cut from the distributor, I'm sure games would still cost about the same. Prices are usually dictated by what customers are willing to pay more than anything else.
Valve isn't just sitting around collecting money, they've just changed their business model. They have full time developers that work on improving the performance of AMD's open source GPU drivers and Windows game compatibility on Linux (WINE, Proton, DXVK) plus other open source projects. They've also ventured into hardware, Steam controller and Valve Index.
I dont know but this is just making Epic games store more competitive, having much lower fee many developers would prefer to sell their game on epic games store rather other stores..
Not sure if you have opened the epic games store or your region has no discounts but.
Charge higher prices on stores that take higher cuts and lower for lower. Let the consumers decide if the launcher/store features are worth the disparity. Bonus if the amount isn't hidden.
Not sure why there is a debate over infrastructure costs... Steam charges 30% because it can, not because it has to and clearly that 30% is worth it, because the market has yet to provide a decent alternative.
If 30% was needed to setup some servers to host steam functions, we wouldn't see so many other game makers building their own online stores to get around it. Clearly there is a lot of profit to be made from selling digital content. Remember this is all digital content, there no manufacturing costs or anything. The fact that a digital store would charge the same cut as a physical store is absurd on its own.
i'm curious how folks think they have their data centers setup, etc.
do they 99% rely on AWS type services? or do they have their own datacenters with their own racks, with their own techs, etc etc?
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