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Gearbox's Pitchford: Steam Is 'Exploiting A Lot Of Small Guys'
by Chris Remo [PC, Console/PC]
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October 7, 2009
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Randy Pitchford of Gearbox Software, one of the industry's major independent developers, thinks Valve should spin off its Steam digital distribution service into an independent company, to reduce existing "conflict of interest" issues.
Pitchford, who co-founded Gearbox in 1999, told Maximum PC in an interview that while he "personally trust[s] Valve," the Seattle-area company is also a development competitor -- and in that capacity, "as a guy in this industry, I don't trust Valve."
"It would be much better if Steam was its own business," the CEO said. "There’s so much conflict of interest there that it’s horrid. It’s actually really, really dangerous for the rest of the industry to allow Valve to win."
In addition to the dangers of a potential monopoly, Pitchford warned that the company is already taking advantage of developers smaller than Gearbox, although he did not provide specific details. "Valve is taking a larger share than it should for the service its providing. It’s exploiting a lot of small guys," he said, adding, "For us big guys, we’re going to sell the units and it will be fine."
Gearbox has a long history with Valve. Its first completed game was the well-received Half-Life: Opposing Force, an expansion pack for Valve's original Half-Life, and it later developed a second expansion, Half-Life: Blue Shift. Gearbox also contributed to several ports of Half-Life to various non-PC platforms.
The company's Brothers In Arms series is also available in full through Steam. And preorders for its upcoming shooter/RPG blend, Borderlands, are currently being sold by Steam as well as by competitors Direct2Drive and GamersGate, but not Impulse.
"I love Valve games, and I do business with the company," Pitchford said. "But, I’m just saying, Steam isn’t the answer."
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So what exactly is Valve taking? If its at 60% or less then its no worse than a box publisher will gouge you for the opportunity to be distributed (except of course you dont need to worry as much about returns or inventory reductions at stores).
The former of these is potentially an issue, but no more so than it is on any of the consoles (people have raised this spectre about Nintendo before, IIRC). The latter is a concern, but something in his power to help resolve, by choosing to distribute through multiple vendors.
There's some history in the casual games space about the power wielded by portals and/or major distributors. Perhaps there are some lessons there in how developers and publishers have managed to survive and in some cases even thrive?
But his comments give me no indication of the degree to which his claims might be accurate or not.
Personally, I'm more concerned about the unspoken implications of having these major consoles trying to 'own' gamers and force them to choose between one system (Or selection of games) and another (Yeah, I'm assuming the gamer is on a budget and can't afford 3, sorry, 4-6 systems).
I have played alot of great indie games thanks to Steam. The marketing of the Steam platform itself would justify a 5% increase over the other digital distribution platforms. Direct2Drive, GamersGate, Impulse, Steam. Of those vendors, which do you think the overwhelming majority have heard of?
It is an obvious fact that Valve will favor their own titles on Steam and for other developers it's not the best thing but it happens almost on all other platforms. Look what Microsoft is doing on Xbox, Sony on Playstation and Nintendo on Wii. Its crystal clear that they heavily promote their own games. It is their platform and they can do whatever they want...
Luckily PC has more distribution channels than consoles do so Valve can't become too greedy because developers will simply go to other platforms (promoting them in the same time with their games).
There are a number of indie-focused distributors out there, but it's hard to get press time without flexing some star-power, which Valve has.
In all honesty, spinning steam off as a separate company might look good on paper, i doubt that steam would then just be completely objective with valve titles... there would still be plenty of close relations and politics involved. I doubt gabe would turn over the keys without some say/stake in how steam operates.. no reason not too.
Bottom line is that yes, if steam is doing this well.. and are making an unrealistic profit, another compeditor will come along offering developers a better deal and consumers a better price. The market will produce more competition if there is money to be made.
Valve doesn't hold the key to PC gaming. They simply were wise to invest their extensive success from Half Life to do more than just produce another game.
"There isn't much substance or facts in his statements."
http://en.wikipedia.org/wiki/Non-disclosure_agreement