There’s a lot of money to be made as a middleman.
If there’s a gold rush, you want to be the guy selling shovels.
this post was submitted on 14 Mar 2024
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For a real comparison steam is the distributor, storefront, advertiser, and support. A bit more than just 'a middleman'.
A vertically integrated middleman is even more profitable.
Who wants to stand up all day though
That's why it pays so well
If there's a gold rush, you want to run the railroads, build the houses, sell the shovels and open the general store I guess
Fortunately, that's illegal now. If only those laws would be applied to modern things
You're missing the actual biggest key component. It's also a built in community forum with tons of user-requested settings. They mostly know how to cater and rarely backtrack a quality of life feature.
They're multiple middle men at once
I would make the comparison to the monopolized railroad instead of selling shovels. There is Vanderbilt level moneys in setting up a transport network that only you control and rent seek from.
IDK, retail can be a tough business, just ask GOG and Epic.
It's a lot of work becoming the de facto standard, but once you've made it, the money just rolls in.
At least gog has something unique in that they offer drm free games. Epic just buys fucking exclusives to try to force people over.
However, neither have learned the lesson from Valve: make it a really good experience.
GOG still doesn't have as good of support as Valve, and I don't think Epic is even trying with EGS. I'm happy to use a Valve competitor, but they need to make a good product first. GOG is close, and now that they seem to be sharing sales revenue with Heroic, I might buy more from them on my Steam Deck. But Valve just makes everything work so nicely that I'm hard pressed to find a reason to use another.
The thing with Valve is that they didn't just build a store for PC games and that's it.
Steam Input practically solved the issue of games not supporting your particular gamepad. There's Steam Remote Play, Proton for Linux compatibility, workshop for mods, well built systems for player to player trades, cloud saves that actually work...
Steam is what makes the PC a gaming platform, rather than a box capable of technically running games.
And yet Valve's competitors can't even make a halfway decent store. They can cry about monopolies and whatnot, but at the end of the day, they just don't have a compelling product.
I'm not expecting GOG or EGS to provide all those extra services, but they need to at least be a decent store, and that means better customer service and decent discoverability, yet they fail at actually being a store.
idk man, gog already has it pretty fucking good. Maybe it's not as nice as steam, but DRM free games that just fucking work is about as good as you're going to get really.
That fact that i can just stuff terabytes of games i own onto a disk and then fuck off is awesome. BTW, if you want a good gog interface, i've been using heroic games launcher for a bit with epic, it's pretty good, do recommend it.
Yeah, I'm trying it out on my Steam Deck. This might just be what gets me to start buying from GOG instead of Steam:
We also started a partnership with GOG and now every game you buy from the GOG store inside Heroic will give us a commission, so it is another way of supporting the project. :)
Before then, GOG just didn't support my platform of choice (Linux desktop and Steam Deck), so I always felt like a second class customer (though they did make installers, which was nice). Steam supported Linux since 2012 (I made my Steam account in 2013-ish because of that), and continue to support Linux through Proton enhancements.
However, now that Heroic makes something from GOG sales, maybe I'll actually buy a few. That's close enough to supporting me that I'll give them a shot.
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Your comment about guys selling shovels is in violation of my patent about commenting about shovels.
You'll need to pay me a license of $300 USD for every day this comment is left online.
And there's a lot of other guys selling shovels, too. It's not that anticompetitive when someone is selling better shovels than anyone else and also charging a premium for them. Anticompetitive would be having the best and undercutting everyone else on pricing in order to make sure no other sellers had a chance.
Gabe has known it his whole life, build a product that people want and they'll buy it. Seems more and more other big tech companies are trying to tell people what they want to buy, and people are hesitant about that.
The true meaning of "The Customer is Always Right". It's not referring to Karen trying to get 30 cents off shake n bake. It means if you make one product that you really believe in, but people don't want it, then you should build the thing they want.
Valve has done that with Steam. They built something that is easier to use than any alternative. They listen to their consumers and build products that people actually want and use. And it's turned into a cash cow.
The customer is always right, in matters of taste.
They seem to use the extra money to try to create new product categories too. Failed with the steam machine and steam controller, but that laid the way for steam input so people didn't have to mess with potentially sketchy software anymore for non Xbox controllers. And explored VR and tried a different take on the Steam machine with the Steam Deck the next go around.
Just to add: the Steam Controller may have been a commercial flop, but I still maintain that it is one of the best controllers out there, in particular for playing strategy games from the couch (right pad > mouse). I still use mine regularly and have a couple backups. The price of the Steam Controllers now reflects that it's technically a niche success.
Edit: and the dual trackpad setup plus integrated configurator technically does live on for the Steam Deck
Trackpads have been quite nice on the Steam Deck. I've used it for papers please so normal mouse games seem great for it. And touch menus for shortcuts have been handy.
I'm really sad I missed the chance to get a Steam Controller.
However, you rarely want to make the product customers ask for. If you asked customers what they wanted when Valve started, they would've said a better way to store CDs. Or for the iPhone, customers wanted a better physical keyboard (like BlackBerry), whereas Apple provided an on-screen keyboard to provide more screen real estate.
A good company should listen to what customers say, and then design products the customer didn't expect that solves the problem even better. But rarely should you build what the customers claim to want.
The customer knows the problems they have, they don't necessarily know what an effective solution looks like.
"Piracy is a service problem."
Customers always know they can resort to a hidden extra option. They choose not to because Steam makes it so easy and painless.
Streaming services are now going to learn that lesson the hard way.
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I mean… yeah no shit. You’re telling me the guys selling products other people make in an almost entirely digital system have a more profitability per staff than the people who develop their own products?
It’s always odd that people treat Steam like it’s this small almost indie company with it’s actually a gigantic monolith with a near monopoly in the PC gaming market
I feel like the people who think of steam as a small/indie company have that impression because it's not public and is shockingly uncontroversial for a company its size (at least in terms of revenue).
From what I garnered this is revenue, not profit. Also comparing the companies to Apple, FB & Microsoft is not really a fair comparison. I know it was the Valve employees doing this. Probably a better choice would have been something like a restaurant chain or store like Walmart.
Valve also makes ridiculous buck from their games. Every VR user wants to play Alyx, and Dota 2 with Counter Strike 2 are two of the most popular multiplayer games without being complete shitshows (like Fortnite, Roblox and whatever the hell goes on on mobile phones). Not to mention an occasional instant classics like Portal 2.
IDK, I think the Microsoft comparison is fair. Yeah, Microsoft has a ton of software development, but they also have a massive software sales side, perhaps bigger than the development side. Like Microsoft, hardware and ads are a very small part of their business, and software sales is a large part.
Comparing to Walmart or a restaurant chain doesn't make sense since they have physical locations and a high headcount to support that physical network.
Maybe Sony or Nintendo would be a better comparison since both make a ton of money from selling games on their platforms.
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