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Where does all the money go if it isn't being reinvested into the business? Are the massive profits immediately syphoned out by the execs and owners? It's int

Where does all the money go if it isn't being reinvested into the business? Are the massive profits immediately syphoned out by the execs and owners? It's interesting there isn't a well-known real competitor to Steam (the Blizzard and Ubisoft stores, etc, don't count, because so few external parties publish there). My gut says the lack of reinvestment could be someone else's opportunity, especially considering many of the longstanding VAC and other quality issues which have persisted on Steam's platform for more than 15 years. However, because of all the necessary catch-up, such an enterprise would be tricky to bootstrap and get to critical mass. Even then, where is the moat?

dangrossman 2y ago
At $1.3 million per employee in payroll expenses, it seems like much of the profits are being distributed to the employees that work there.
- metadat 2y ago
  Agreed, that's generous. TFA also states Valve still makes $15m/employee p.s. thanks so much for hnreplies.com, Dan! It dramatically increased the utility of HN for me. Your creation is fantastic.
- awwaiid 2y ago
  Iiuc the payroll comes out before profit.
bobthepanda 2y ago
There is Epic and Itch. The problem is that Steam for all its faults is DRM, anti-cheat, and a well functioning store rolled all in one. Most of the alternate stores are bad in one way or another; Epic launched without a cart, and it still doesn’t have user text reviews. Itch had to redo its whole UI after that one bundle they did that had thousands of games in it. Notably Valve doesn’t really use its position to make competing games. This is an unknown for most publishers, and Epic pretty blatantly pivoted Fortnite to eat PUBG’s lunch after working with them. If anything the leading platform for competition as an indie store is the Nintendo eShop. Which is probably why the Steam Deck exists.
- metadat 2y ago
  > There is epic. How is Epic a serious competitor or alternative, then?
  - bobthepanda 2y ago
    It is one of the most serious, in that it exists, and probably has one of the biggest catalogs next to Steam, which is not true of say whatever Ubisoft or EA is doing. at the very least there is substantial enough catalog overlap that one can price compare.
- Aerroon 2y ago
  There's also Nutaku that's supposedly as big as Steam (they are focused on NSFW games). Imo Epic is the only competitor to Steam that tries to offer a similar service to Steam. It's just popular to hate on it among pc gamers. Many people cite a lack of features on Epic's store as the reason, eg no forum feature, but then turn around and decry Steam forums as the worst place on the internet. I don't think the problem is a lack of features (for players, devs have a point), but rather the Epic Games Store isn't cool enough.
  - bobthepanda 2y ago
    I think that a lot of features on Steam don’t need to be copied, but I think Steam does have a giant moat in terms of actually useful features. Steam for example, allows user submitted ratings with explainer text. This is huge for online shopping decisions. Steam Workshop is easy to integrate mod distribution for games. Etc.
    - Aerroon 2y ago
      >Steam for example, allows user submitted ratings with explainer text. This is huge for online shopping decisions. I don't know anyone who actually relies on Steam ratings/reviews to make purchasing decisions. I've always assumed that rating systems on the platform that is selling you the product are not trustworthy. But then again, I find reviews for media to generally be useless. >Steam Workshop is easy to integrate mod distribution for games. That's a developer feature rather than a player one though.
lkramer 2y ago
There are plenty of competing stores, all of which pales in comparison. I don't know what their secret sauce is, but for me personally what makes a difference and why I keep preferring them is their dedication to Linux as a platform and a general feeling that they are not just driving me towards rent seeking. I know that last bit is slightly absurd, and I can't quite explain, but I think the fact that they are private means their priorities don't just exists as quarterly goals.
- doix 2y ago
  > but for me personally what makes a difference and why I keep preferring them is their dedication to Linux as a platform and a general feeling that they are not just driving me towards rent seeking For what it's worth, I have the exact same feelings. They provide so much value on-top of just being a store, and it does feel like they take the money and re-invest it into their ecosystem to make it better. They made gaming on Linux as easy as gaming on windows. They improved the controller situation in games. They do the whole remote-play stuff so you can play local-coop games online. They do the family sharing stuff. They do the steam link stuff. And they don't lock any of it down to their first party offerings. e.g. * They could have easily made steamlink only work with their set-top box, but they just made it an android app. * They could have limited the controller bindings and tech to only their controller, but they made it work for all controllers. * They could have forced you to use their VR headset with steam, but they let you use any headset. I can't think of any other company off the top of my head that has done something similar.
- GuB-42 2y ago
  Steam is actually made with their users in mind. So much that they managed to beat piracy. It is no easy feat, you can't beat piracy on price, and it is hard to beat in convenience when all you have to do is download a torrent and run an exe file. Piracy is like the final boss of software distribution platforms, but they beat it. To play a game, select it on the store, pay (with all sorts of payment options), download (from damn fast servers), and press play, that's all. The game sucks or crash, click a button and you are refunded, no need to be always online just for DRM check (eventually you'll need internet, but you have enough leeway so that it is rarely a problem), ads are very unobtrusive and maybe even desirable (suggesting games you may actually like or announcing sales), they don't usually force an update just before you want to play a game (a much too common occurrence), dark patterns kept to a minimum (or at least subtle enough), generally good software quality (in terms of bugs, broken UI/UX, etc...). You bought a game, it stays in your account, Steam has 20 years of history of not screwing you, and to play it, just install Steam on any PC (it it doesn't already have it), log in to your account, download and play, it is that easy. You can even share games (with some reasonable limitations). Others just have some annoyance here and there. Some always-on DRM, bugs, dubious UI choices, annoying ads, etc... Only Valve seems to understand the importance of not getting in the way between gamers and their games and do the appropriate amount of effort (which is a lot). Not even in the name of profit, because they understand that it is not worth it, if gamers are satisfied, profits will come. Remember, they have piracy as a competitor, and it is hard to compromise against such a powerful competitor.
upon_drumhead 2y ago
GOG is a compelling option for a lot of content. DRM free and a huge library available
- djhaskkka 2y ago
  I never even considered buying games again until gog. pay. download. run in dosbox or something. done. steam is just a crap I refuse to put up with. and that's the store. imagine the drm.
  - tokai 2y ago
    Almost all games can be run without steam.
    - BlueTemplar 2y ago
      This varies wildly depending on their level of DRM : https://www.gog.com/forum/general/how_to_run_steam_games_offline_forever_tutorial/page1 https://www.gog.com/forum/general/how_to_run_steam_games_off...
      - tokai 2y ago
        Yeah exactly. Its up to the individual game and not a steam thing.
JSteph22 2y ago
Steam is like any network effect based business. It's extremely difficult to dethrone when well entrenched.
- infecto 2y ago
  I believe this is largely the case and I would add that there general pro-gamer attitude would make it quite difficult to dethrone.
lkdfjlkdfjlg 2y ago
> Are the massive profits immediately syphoned out by the execs and owners? Have you actually looked at the numbers or are you just parroting memes? In the numbers I'm looking at some divisions are $1M per employee.
blackhawkC17 2y ago
Gabe Newell has a nice superyacht. Part of the profits surely went there :) https://www.superyachtfan.com/yacht/rocinante/ https://www.superyachtfan.com/yacht/rocinante/
- metadat 2y ago
  Think he named The Rocinante after the one from The Expanse? Knowing that a not insignificant part of the thousands I've spent on Steam over the years went to fund that.. isn't a great feeling.

dangrossman 2y ago

At $1.3 million per employee in payroll expenses, it seems like much of the profits are being distributed to the employees that work there.

metadat 2y ago
Agreed, that's generous. TFA also states Valve still makes $15m/employee p.s. thanks so much for hnreplies.com, Dan! It dramatically increased the utility of HN for me. Your creation is fantastic.
awwaiid 2y ago
Iiuc the payroll comes out before profit.

bobthepanda 2y ago

There is Epic and Itch. The problem is that Steam for all its faults is DRM, anti-cheat, and a well functioning store rolled all in one. Most of the alternate stores are bad in one way or another; Epic launched without a cart, and it still doesn’t have user text reviews. Itch had to redo its whole UI after that one bundle they did that had thousands of games in it. Notably Valve doesn’t really use its position to make competing games. This is an unknown for most publishers, and Epic pretty blatantly pivoted Fortnite to eat PUBG’s lunch after working with them. If anything the leading platform for competition as an indie store is the Nintendo eShop. Which is probably why the Steam Deck exists.

metadat 2y ago
> There is epic. How is Epic a serious competitor or alternative, then?
- bobthepanda 2y ago
  It is one of the most serious, in that it exists, and probably has one of the biggest catalogs next to Steam, which is not true of say whatever Ubisoft or EA is doing. at the very least there is substantial enough catalog overlap that one can price compare.
Aerroon 2y ago
There's also Nutaku that's supposedly as big as Steam (they are focused on NSFW games). Imo Epic is the only competitor to Steam that tries to offer a similar service to Steam. It's just popular to hate on it among pc gamers. Many people cite a lack of features on Epic's store as the reason, eg no forum feature, but then turn around and decry Steam forums as the worst place on the internet. I don't think the problem is a lack of features (for players, devs have a point), but rather the Epic Games Store isn't cool enough.
- bobthepanda 2y ago
  I think that a lot of features on Steam don’t need to be copied, but I think Steam does have a giant moat in terms of actually useful features. Steam for example, allows user submitted ratings with explainer text. This is huge for online shopping decisions. Steam Workshop is easy to integrate mod distribution for games. Etc.
  - Aerroon 2y ago
    >Steam for example, allows user submitted ratings with explainer text. This is huge for online shopping decisions. I don't know anyone who actually relies on Steam ratings/reviews to make purchasing decisions. I've always assumed that rating systems on the platform that is selling you the product are not trustworthy. But then again, I find reviews for media to generally be useless. >Steam Workshop is easy to integrate mod distribution for games. That's a developer feature rather than a player one though.

lkramer 2y ago

There are plenty of competing stores, all of which pales in comparison. I don't know what their secret sauce is, but for me personally what makes a difference and why I keep preferring them is their dedication to Linux as a platform and a general feeling that they are not just driving me towards rent seeking. I know that last bit is slightly absurd, and I can't quite explain, but I think the fact that they are private means their priorities don't just exists as quarterly goals.

doix 2y ago
> but for me personally what makes a difference and why I keep preferring them is their dedication to Linux as a platform and a general feeling that they are not just driving me towards rent seeking For what it's worth, I have the exact same feelings. They provide so much value on-top of just being a store, and it does feel like they take the money and re-invest it into their ecosystem to make it better. They made gaming on Linux as easy as gaming on windows. They improved the controller situation in games. They do the whole remote-play stuff so you can play local-coop games online. They do the family sharing stuff. They do the steam link stuff. And they don't lock any of it down to their first party offerings. e.g. * They could have easily made steamlink only work with their set-top box, but they just made it an android app. * They could have limited the controller bindings and tech to only their controller, but they made it work for all controllers. * They could have forced you to use their VR headset with steam, but they let you use any headset. I can't think of any other company off the top of my head that has done something similar.
GuB-42 2y ago
Steam is actually made with their users in mind. So much that they managed to beat piracy. It is no easy feat, you can't beat piracy on price, and it is hard to beat in convenience when all you have to do is download a torrent and run an exe file. Piracy is like the final boss of software distribution platforms, but they beat it. To play a game, select it on the store, pay (with all sorts of payment options), download (from damn fast servers), and press play, that's all. The game sucks or crash, click a button and you are refunded, no need to be always online just for DRM check (eventually you'll need internet, but you have enough leeway so that it is rarely a problem), ads are very unobtrusive and maybe even desirable (suggesting games you may actually like or announcing sales), they don't usually force an update just before you want to play a game (a much too common occurrence), dark patterns kept to a minimum (or at least subtle enough), generally good software quality (in terms of bugs, broken UI/UX, etc...). You bought a game, it stays in your account, Steam has 20 years of history of not screwing you, and to play it, just install Steam on any PC (it it doesn't already have it), log in to your account, download and play, it is that easy. You can even share games (with some reasonable limitations). Others just have some annoyance here and there. Some always-on DRM, bugs, dubious UI choices, annoying ads, etc... Only Valve seems to understand the importance of not getting in the way between gamers and their games and do the appropriate amount of effort (which is a lot). Not even in the name of profit, because they understand that it is not worth it, if gamers are satisfied, profits will come. Remember, they have piracy as a competitor, and it is hard to compromise against such a powerful competitor.

upon_drumhead 2y ago

GOG is a compelling option for a lot of content. DRM free and a huge library available

djhaskkka 2y ago
I never even considered buying games again until gog. pay. download. run in dosbox or something. done. steam is just a crap I refuse to put up with. and that's the store. imagine the drm.
- tokai 2y ago
  Almost all games can be run without steam.
  - BlueTemplar 2y ago
    This varies wildly depending on their level of DRM : https://www.gog.com/forum/general/how_to_run_steam_games_offline_forever_tutorial/page1 https://www.gog.com/forum/general/how_to_run_steam_games_off...
    - tokai 2y ago
      Yeah exactly. Its up to the individual game and not a steam thing.

JSteph22 2y ago

Steam is like any network effect based business. It's extremely difficult to dethrone when well entrenched.

infecto 2y ago
I believe this is largely the case and I would add that there general pro-gamer attitude would make it quite difficult to dethrone.

lkdfjlkdfjlg 2y ago

> Are the massive profits immediately syphoned out by the execs and owners? Have you actually looked at the numbers or are you just parroting memes? In the numbers I'm looking at some divisions are $1M per employee.

blackhawkC17 2y ago

Gabe Newell has a nice superyacht. Part of the profits surely went there :) https://www.superyachtfan.com/yacht/rocinante/ https://www.superyachtfan.com/yacht/rocinante/

metadat 2y ago
Think he named The Rocinante after the one from The Expanse? Knowing that a not insignificant part of the thousands I've spent on Steam over the years went to fund that.. isn't a great feeling.