6 ms·

Valve CEO: 'Pissing off the Internet costs you a million bucks in just 2 days'

76 points by alexcasalboni 11y ago

deathhand 11y ago
There is no such thing as bad publicity
bontoJR 11y ago
I don't really get why giving only 25%? I mean, as a service I don't see any high cost to justify a 75% retain fee. The idea was definitely great, but execution was very poor. I would have been furious with them if I was a modder investing time and, sometimes, money to only get 25% on the price I was deciding for my mod. This was a huge failure at so many levels... I hope they learned from this lesson.
- clinth 11y ago
  > I don't really get why giving only 25%? Valve took their ~30% platform charge, and left the remaining amount to be split per the discretion of the publisher of the game, in this case Bethesda. Bethesda chose to give mod makers roughly 1/3 of the money left, resulting in a final split of Valve 30 / Bethesda 45 / mod author 25.
  - bontoJR 11y ago
    It was more a financial question honestly, I know the split was btw Bethesda and Valve, but I can't justify why a 75% should go to Valve and Bethesda. That's the key point, I can understand the 30% of Valve, it's actually a samilar rate of other stores/platforms, but what's the financial necessity of the publisher? I mean, the game has been already released, it's making money and mods are usually a very high sales pusher (if well made, e.g. Counterstrike for Half Life). Why keeping 45%? I can't see any financial justification for such a higher rate, I would understand a 10%, max 15%, but no more.
    - Alphasite_ 11y ago
      Valve provides hosting, advertising, support, billing etc. Bathesda is essentially providing licensing for the ip and taking a risk they you mod won't harm their product or users, also a little bit of plain old capitalism. Frankly I'm okay with this, it creates a monetary incentive for publishers to create modding Apis etc which can only help in the long run.
  - masklinn 11y ago
    Ah that explains the 25%, I saw references to it but had no idea how that had come to be. So Valve's base offer was a standard 30/70 cut, the issue is the game publisher got to decide of the split for the 70%, and Bethesda decided they deserved the vast majority of it.
  - ohitsdom 11y ago
    Honest question- why should Bethesda get any money from mod sales? You need to have purchased the game to use the mod, and mods add something to the game experience that Bethesda didn't have to pay for themselves.
    - probablyfiction 11y ago
      Because modders are using Bethesda's copyrighted intellectual property as the base for their mods. Bethesda deserves a cut because it's their IP.
      - speeder 11y ago
        Still, Bethesda is notoriously greedy... I think many people still remember their Horse Armour DLC.
        nazgob 11y ago
        This silly item kickstarted whole DLC market. I'm not saying its a good or bad thing but its a very big market now.
      - stevejones 11y ago
        They already got their cut for the use of their IP.
      - LMAlVvQjSGj 11y ago
        How are all mods using Bethesda IP? Surely one could make a simple sphere, import it to the game (and any other game) and call it a mod.
        donatj 11y ago
        It's the same as making a remix of a song. The base of your new version is still the original authors work, so the author deserves a cut. A mod is akin to a remix of the game, and that remix is still mostly Bethesda assets, not to mention running atop their engine.
- swalsh 11y ago
  I can see why Valve deserves a cut, as distributor there are costs associated (though probably not anywhere near 75%). However I don't see why I need to give Bethesda a cut simply because it runs on their platform. If I develop a Windows application, I don't owe any money to Microsoft. If I make a cocoa app I don't owe money to Apple, There's countless examples of people writing software that runs on top of other peoples copyrighted software. I don't think you can make an argument that it makes your work a derivative work. It's pure crazy to think that I would have to give a substantial cut of my revenues for that "privilege".
  - pliny 11y ago
    In a free market you rarely have to justify rent seeking. If Bethesda are 'rational' then they estimated how much they'd make at various royalties and decided that they make the most when they take ~45%, so 'deserves' never entered into their decision and it's reasonable to assume that it never entered into Valve's decision to take 30% either.
  - eli 11y ago
    There's no rule that says what you charge people for a product or service has to be commensurate with your costs.
- JibberMeTimbers 11y ago
  The game publisher, Bethesda, determined that amount. I think everyone would agree it's steep but that's what the games publisher wanted. If they rolled out these mods for different games, those publishers could choose a different percentage for splitting it.
venomsnake 11y ago
Hmm ... the problem is that Bethesda were getting 45% ... which is absurd. I already paid for the game, the publisher should get at most 5-6% ... if the scheme was 10% valve, 10% bethesda, 80% mod creator - it would have been a different reaction.
- DanAndersen 11y ago
  Why should Bethesda get anything at all? Unless they're going to the trouble of making sure their official patches don't interfere with popular mods or something like that, they aren't providing additional value beyond providing the game that was already paid for. I think one of the issues in this wasn't just that mod creators would have gotten a small fraction of profit, but because Bethesda's behavior was somewhat rent-seeking -- attempting to normalize publishers getting a cut of sales that they hadn't gotten before, for doing no extra work.
  - jagermo 11y ago
    I can see why they should get a cut - they provide not only a very moddable game but also pretty good tools. I would be ok if Bethesda has an incentive to design their future games with modding capabilities in mind. But they should not get more than the actual modder, imo.
    - saint_fiasco 11y ago
      One of the reasons their games sell so well is because of the mod support. People are willing to pay lots of money for Bethesda games because they know they can have fun with them for years, on account of all the mods. Bethesda was already benefiting from the mods in the form of increased sales.
      - nazgob 11y ago
        Lots of money for Bethesda games? Are their games more expensive then competition that does not provide modding? Are their games expensive at all? Giving how much gameplay game like Skyrim gives, price seems fair.
morsch 11y ago
Gabe said that just the additional email they received over a few days cost them a million: "That's like 1% of the cost of the incremental email the program has generated for Valve employees (yes, I mean pissing off the Internet costs you a million bucks in just a couple of days)." That seemed preposterous to me. It can't be the additional hardware expenses to store/process the mail, those are negligable. I suppose it's simply the time the support staff have to spend to weed out all the irate mails. But can that really amount to a million dollars? Existing solutions for combating spam must be sufficient to classify those mails and throw them away or send out the boilerplate message the support staff would have sent otherwise.
- reitanqild 11y ago
  > Existing solutions for combating spam must be sufficient to classify those mails and throw them away or send out the boilerplate message the support staff would have sent otherwise. Except maybe (I haven't tried contacting them) Valve isn't the kind of company that annoys customers even more by bulk classifying their mails and sending generic spam back?
  - Lockyy 11y ago
    Well based on their support system I would be surprised if they were opposed to sending out automated messages on principle. From what I've heard however the emails may have been answerable/seen by non-support within the company meaning expensive developer time may have been used on reading and replying to emails.
    - speeder 11y ago
      The thing is: Gabe Newell put his personal e-mail account on some games (I remember seeing it in HL2), and promised to read all those he can, even if he does not reply... I think that mass deleting e-mails would be noticed by the people e-mailing Gabe...
      - ceejayoz 11y ago
sleepyeng 11y ago
Relevant Forbes Article: http://www.forbes.com/sites/insertcoin/2015/04/24/valves-paid-skyrim-mods-are-a-legal-ethical-and-creative-disaster/ http://www.forbes.com/sites/insertcoin/2015/04/24/valves-pai... My big hangups were: -Bethesda gets a cut, but offers no guarantees concerning compatibility and user support. -Mods usually use other mods for back-end functionality or as an augmentation. i.e. using a new cloud generation mod for an overall weather mod. It generally devolves into a legal tangle of who owns what and who gets what. -The steam green light and early access marketplaces are becoming clogged with low-effort garbage that unscrupulous devs are trying to make a quick cash in. Steam has no structure in place to stop that from happening in the paid mod store. -They poorly and shoddily introduced monetization in a model that didn't have one already in place, skewing incentives and placing the community under tension.
donatj 11y ago
I really don't understand being mad at having the option to buy things. Don't like it? Don't buy it. What makes me mad is the inability to buy the apps I want as in the Apple App Store.
- tehbeard 11y ago
  Most people weren't against the idea of paid mods. They were against the poor execution of it, including but not limited to: * Stealing free mods and either directly uploading them or making a knockoff paid variant. * The revenue split (30/45/25 to valve, Bethesda and the modder respectively) * Resistance to change. Skyrim is old, it's modding scene established and entrenched around nexusmods.com and a certain culture. Valve/Bethesda disrupted it.
- ihsw 11y ago
  That's short-sighted -- one of the largest complaints was nefarious users profiting off of the works of others. From day 1 there were free mods being sold by random jackasses whom have no affiliation with the project. The only remedy Valve offered was DMCA takedown notices or similar self-directed policing.
  - ItsDeathball 11y ago
    Considering that Bethesda's mod tools give Bethesda ownership of any content created with them, would a mod maker even have legal standing to file a DMCA takedown?
jebblue 11y ago
The whole Valve team are doing a great job with Steam, I hope gamers get on board with supporting companies that push the realm of gaming platforms, or at leave Valve.
logfromblammo 11y ago
~ When asked how much it would cost to piss off the Internet for 3 days, GabeN was unable to answer, until it was explained to him--yet again--that 3 is the number that lies between 2 and 4. At that time, he replied, "Now you're just making up fake numbers. The only thing I know of that goes between 4 and 2 is 'Dead'." Thus, the Internet remained pissed off, and Valve failed to earn a million bucks. ~

76 points by alexcasalboni 11y ago

There is no such thing as bad publicity

I don't really get why giving only 25%? I mean, as a service I don't see any high cost to justify a 75% retain fee. The idea was definitely great, but execution was very poor. I would have been furious with them if I was a modder investing time and, sometimes, money to only get 25% on the price I was deciding for my mod. This was a huge failure at so many levels... I hope they learned from this lesson.

clinth 11y ago
> I don't really get why giving only 25%? Valve took their ~30% platform charge, and left the remaining amount to be split per the discretion of the publisher of the game, in this case Bethesda. Bethesda chose to give mod makers roughly 1/3 of the money left, resulting in a final split of Valve 30 / Bethesda 45 / mod author 25.
- bontoJR 11y ago
  It was more a financial question honestly, I know the split was btw Bethesda and Valve, but I can't justify why a 75% should go to Valve and Bethesda. That's the key point, I can understand the 30% of Valve, it's actually a samilar rate of other stores/platforms, but what's the financial necessity of the publisher? I mean, the game has been already released, it's making money and mods are usually a very high sales pusher (if well made, e.g. Counterstrike for Half Life). Why keeping 45%? I can't see any financial justification for such a higher rate, I would understand a 10%, max 15%, but no more.
  - Alphasite_ 11y ago
    Valve provides hosting, advertising, support, billing etc. Bathesda is essentially providing licensing for the ip and taking a risk they you mod won't harm their product or users, also a little bit of plain old capitalism. Frankly I'm okay with this, it creates a monetary incentive for publishers to create modding Apis etc which can only help in the long run.
- masklinn 11y ago
  Ah that explains the 25%, I saw references to it but had no idea how that had come to be. So Valve's base offer was a standard 30/70 cut, the issue is the game publisher got to decide of the split for the 70%, and Bethesda decided they deserved the vast majority of it.
- ohitsdom 11y ago
  Honest question- why should Bethesda get any money from mod sales? You need to have purchased the game to use the mod, and mods add something to the game experience that Bethesda didn't have to pay for themselves.
  - probablyfiction 11y ago
    Because modders are using Bethesda's copyrighted intellectual property as the base for their mods. Bethesda deserves a cut because it's their IP.
    - speeder 11y ago
      Still, Bethesda is notoriously greedy... I think many people still remember their Horse Armour DLC.
      - nazgob 11y ago
        This silly item kickstarted whole DLC market. I'm not saying its a good or bad thing but its a very big market now.
    - stevejones 11y ago
      They already got their cut for the use of their IP.
    - LMAlVvQjSGj 11y ago
      How are all mods using Bethesda IP? Surely one could make a simple sphere, import it to the game (and any other game) and call it a mod.
      - donatj 11y ago
        It's the same as making a remix of a song. The base of your new version is still the original authors work, so the author deserves a cut. A mod is akin to a remix of the game, and that remix is still mostly Bethesda assets, not to mention running atop their engine.
swalsh 11y ago
I can see why Valve deserves a cut, as distributor there are costs associated (though probably not anywhere near 75%). However I don't see why I need to give Bethesda a cut simply because it runs on their platform. If I develop a Windows application, I don't owe any money to Microsoft. If I make a cocoa app I don't owe money to Apple, There's countless examples of people writing software that runs on top of other peoples copyrighted software. I don't think you can make an argument that it makes your work a derivative work. It's pure crazy to think that I would have to give a substantial cut of my revenues for that "privilege".
- pliny 11y ago
  In a free market you rarely have to justify rent seeking. If Bethesda are 'rational' then they estimated how much they'd make at various royalties and decided that they make the most when they take ~45%, so 'deserves' never entered into their decision and it's reasonable to assume that it never entered into Valve's decision to take 30% either.
- eli 11y ago
  There's no rule that says what you charge people for a product or service has to be commensurate with your costs.
JibberMeTimbers 11y ago
The game publisher, Bethesda, determined that amount. I think everyone would agree it's steep but that's what the games publisher wanted. If they rolled out these mods for different games, those publishers could choose a different percentage for splitting it.

venomsnake 11y ago

Hmm ... the problem is that Bethesda were getting 45% ... which is absurd. I already paid for the game, the publisher should get at most 5-6% ... if the scheme was 10% valve, 10% bethesda, 80% mod creator - it would have been a different reaction.

DanAndersen 11y ago
Why should Bethesda get anything at all? Unless they're going to the trouble of making sure their official patches don't interfere with popular mods or something like that, they aren't providing additional value beyond providing the game that was already paid for. I think one of the issues in this wasn't just that mod creators would have gotten a small fraction of profit, but because Bethesda's behavior was somewhat rent-seeking -- attempting to normalize publishers getting a cut of sales that they hadn't gotten before, for doing no extra work.
- jagermo 11y ago
  I can see why they should get a cut - they provide not only a very moddable game but also pretty good tools. I would be ok if Bethesda has an incentive to design their future games with modding capabilities in mind. But they should not get more than the actual modder, imo.
  - saint_fiasco 11y ago
    One of the reasons their games sell so well is because of the mod support. People are willing to pay lots of money for Bethesda games because they know they can have fun with them for years, on account of all the mods. Bethesda was already benefiting from the mods in the form of increased sales.
    - nazgob 11y ago
      Lots of money for Bethesda games? Are their games more expensive then competition that does not provide modding? Are their games expensive at all? Giving how much gameplay game like Skyrim gives, price seems fair.

morsch 11y ago

Gabe said that just the additional email they received over a few days cost them a million: "That's like 1% of the cost of the incremental email the program has generated for Valve employees (yes, I mean pissing off the Internet costs you a million bucks in just a couple of days)." That seemed preposterous to me. It can't be the additional hardware expenses to store/process the mail, those are negligable. I suppose it's simply the time the support staff have to spend to weed out all the irate mails. But can that really amount to a million dollars? Existing solutions for combating spam must be sufficient to classify those mails and throw them away or send out the boilerplate message the support staff would have sent otherwise.

reitanqild 11y ago
> Existing solutions for combating spam must be sufficient to classify those mails and throw them away or send out the boilerplate message the support staff would have sent otherwise. Except maybe (I haven't tried contacting them) Valve isn't the kind of company that annoys customers even more by bulk classifying their mails and sending generic spam back?
- Lockyy 11y ago
  Well based on their support system I would be surprised if they were opposed to sending out automated messages on principle. From what I've heard however the emails may have been answerable/seen by non-support within the company meaning expensive developer time may have been used on reading and replying to emails.
  - speeder 11y ago
    The thing is: Gabe Newell put his personal e-mail account on some games (I remember seeing it in HL2), and promised to read all those he can, even if he does not reply... I think that mass deleting e-mails would be noticed by the people e-mailing Gabe...
    - ceejayoz 11y ago

sleepyeng 11y ago

Relevant Forbes Article: http://www.forbes.com/sites/insertcoin/2015/04/24/valves-paid-skyrim-mods-are-a-legal-ethical-and-creative-disaster/ http://www.forbes.com/sites/insertcoin/2015/04/24/valves-pai... My big hangups were: -Bethesda gets a cut, but offers no guarantees concerning compatibility and user support. -Mods usually use other mods for back-end functionality or as an augmentation. i.e. using a new cloud generation mod for an overall weather mod. It generally devolves into a legal tangle of who owns what and who gets what. -The steam green light and early access marketplaces are becoming clogged with low-effort garbage that unscrupulous devs are trying to make a quick cash in. Steam has no structure in place to stop that from happening in the paid mod store. -They poorly and shoddily introduced monetization in a model that didn't have one already in place, skewing incentives and placing the community under tension.

donatj 11y ago

I really don't understand being mad at having the option to buy things. Don't like it? Don't buy it. What makes me mad is the inability to buy the apps I want as in the Apple App Store.

tehbeard 11y ago
Most people weren't against the idea of paid mods. They were against the poor execution of it, including but not limited to: * Stealing free mods and either directly uploading them or making a knockoff paid variant. * The revenue split (30/45/25 to valve, Bethesda and the modder respectively) * Resistance to change. Skyrim is old, it's modding scene established and entrenched around nexusmods.com and a certain culture. Valve/Bethesda disrupted it.
ihsw 11y ago
That's short-sighted -- one of the largest complaints was nefarious users profiting off of the works of others. From day 1 there were free mods being sold by random jackasses whom have no affiliation with the project. The only remedy Valve offered was DMCA takedown notices or similar self-directed policing.
- ItsDeathball 11y ago
  Considering that Bethesda's mod tools give Bethesda ownership of any content created with them, would a mod maker even have legal standing to file a DMCA takedown?

jebblue 11y ago

The whole Valve team are doing a great job with Steam, I hope gamers get on board with supporting companies that push the realm of gaming platforms, or at leave Valve.

logfromblammo 11y ago

~ When asked how much it would cost to piss off the Internet for 3 days, GabeN was unable to answer, until it was explained to him--yet again--that 3 is the number that lies between 2 and 4. At that time, he replied, "Now you're just making up fake numbers. The only thing I know of that goes between 4 and 2 is 'Dead'." Thus, the Internet remained pissed off, and Valve failed to earn a million bucks. ~