Valve doesn't sell ad space on Steam so it can make room for surprise hits: 'We don't think Steam should be pay-to-win'
Valve doesn't sell ad space on Steam so it can make room for surprise hits: 'We don't think Steam should be pay-to-win'
"We're surprised all the time" by which games take off, says Steam's Erik Peterson.
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Valve seems to be the only company on this capitalist world that actually understands that company profits cannot and should not grow exponentially forever without eventually destroying itself. All other companies don't know or want to stop the greed ad are constantly pushing for more profits to see until where they can push the greed and milking without losing "too much" costumers. They even weight the amount of costumers lost vs the extra profits to see if its viable to lose those costumers and still profit, like Netflix. Valve does not work like this. Valve grew to a size, and that size is giving them stable and steady profit. And they are holding that size, slowly growing more here and there but nothing big. The biggest thing they did in like 10 years was the Steam Deck and they will not update it with a Deck 2 anytime soon. Valve plays the very slow, but steady profits game. This is how you win as a company. You try to keep yourself on a balance between good profits and good public perspective.
Being privately held helps a ton. Gabe is his own boss. Once a company's public they're beholden to the investors, and investors want big short term returns so they can dump their stock and move onto the next one.
Maybe that shouldn’t be possible.
Yep. Investing should tie you to a stock for at least a year - as soon as you decide to sell, the one-year timer starts.
Agree wholeheartedly, there should be risk.
Why is trading stocks even allowed? Seems like a net loss for basically everyone, except the ultra-wealthy.
Stocks = certificate of ownership in a fraction of a company. The basic principle is sound and goes back at least to the Renaissance, it's everything else around it that sucks and creates a plethora of perverse incentives that benefit the capital owners.
Company stocks are not unique there, it's the most common example but the principle extends to every commodity. You can buy virtual coal or gold right now if you want and sell later, without actually having coal delivered to your doorstep. This is actually a very important market mechanism when it works right because it allows the market to internalize external forces, reducing risk. European energy providers learned this the hard way when prices shot through the roof in 2022 and they were buying gas at "current prices", leading to funds drying up unexpectedly sometimes to the point of bankruptcy, rather than buying gas at "future prices", guaranteeing deliveries that were paid for months in advance. When it works well, speculation is actually an inescapable tool of complex modern economies. Without it you cannot maintain supply chains fit for the modern world, as speculation (when not abused) is the market's way of accounting and preparing for the expected future.
Even in a communist society, you'd need stocks: the disagreement then becomes whether the state should own (part of) the stocks, or if the workers should own all the stocks (legally equivalent to the means of production).
Oh huh, neat. Thanks for the write-up! Basically the only thing I know about stock trading comes from family members trying to convince others to buy meme stocks, so I don't really have a high opinion of the craft.
I truly fear the day Gabe passes on. Do we know who would own Valve if Gabe were to pass on today?
I think it is a little more complicated than that. You go to public markets to raise cash. Sometimes you can get the cash you want, sometimes not. The issue is when you are incentivized to make the stock price go up at all costs. If you don't need the cash, there is no point to having a higher stock price - lower is somewhat better.
Now, if you are a CEO, and you are paid in stock options, you are going to do whatever you can to maximize the stock price. Even if it is bad for thebling term health of the company. I don't think the public markets care either way.
Valve able to do that because they are private company, the exponential growth is only made mandatory because of the stakeholder. if the growth is stagnant(even with healthy profit), it's very unattractive to investor, hence growth is needed to keep the cog running.
I wonder, what actual benefits are there in publicly traded companies for society as whole? Benefits that are good for you, me and everyone else equally.
It's mostly the effect of expanding the company, like more job, better product, etc etc. sometime it help develop the society quicker because they get more capital to do bigger thing and put in research to do better thing or find new thing, but in return you have to promise growth and return to people giving you money to do that thing. i don't think it's meant to be altruistic cus it's not charity.
A bit like the difference between building bigger and unstable houses vs smaller and stable. No idea where you got the charity concept from, i dont think anyone has even mentioned it before.
Charity as in the purpose is purely for the good of society. Unless it's rhetorical, I merely answer your question.
Sorry, when word "charity" gets mentioned in this context tends to annoy me a lot as sentence "we are not a charity" seems to be like magic word to some that can be used to excuse any shitty behaviour by the company.
Gets you something to add to your 401k portfolio. Which I don't think is a great argument; there are plenty of other ways to handle retirement even in a fundamentally capitalist system.
There's a theory out there that as SP500 indices for 401k's become the dominant investment, that will convince publicly traded companies to think long term. Those indices don't jump in and out of stocks. They want to add a stock and then keep it for decades. Companies would change their thinking to match.
I'm not convinced of that, though. Starting with the fact that 401k's started as a tax loophole that got mistaken for a good retirement plan, while traditional pensions and Social Security have been eroded away (to say the least). But it's a possible outcome.
I think the initial idea of like "I have a great idea but don't have the capital to get it off of the ground" is a decent argument for public companies, or in the case where employees are shareholders and thus reap reward when companies are successful, but I think these are both mostly antiquated notions and the ills of how public companies are today are a net-loss, and there are generally better ways to accomplish both of these things.
Especially in tech, it's entirely common to charge nothing, make no money and burn investment money until they end up either so dominant they essentially have monopoly power (think: Amazon) or that the business plan is reach critical mass and hopefully sell. And then the very notion that every business has to grow forever leads to rather perverse incentives. Again, especially if you look at tech, basically all of the FAANG companies used to be a lot better/nicer until some critical mass is hit and then they have to enshittify everything.
Mark my word, once Gabe pass it's gonna be very very different. We have very different things to worried about, like climate change, but on software side and tech we shouldn't rely on monopolies. Valve was kept in that state because all the competition didn't actually put up a fight worth extra investment. The windows store pushed valve to develop SteamOS and Proton, they also back off on some revenue split policy because of EGS's deals. (Let's be honest, not all players care about which launcher they use, as long as they get better deals and can play the game they want.)
And to my experience, Steam's recent years' updates to store/client are not something I like as well.
- I don't like the gamification of sales event etc.
- I don't like the new unlimited scroll type, they backed off a bit and become like 3 pages long until you hit the top/popular/sales part.
- I also don't like some of the UI changes(ie the downloads/library mixed together and not separate item)
- I hated the auto start live streaming thing, if there is option to turn off that please let me know.
For EGS,
- their search sucks
- library page sucks, you can't really organize your free games/purchased games etc.
- auto updates are pretty on par so that's okay.
- their friends/etc also sucks.(not that I care much but at least it's far worse than steam one.)
- I like that they adopted Nintendo's gold coin reward type to encourage consumer to purchase there.
- games from other big publisher usually do require install their clients as well, which sucks. (it's similar on steam as well.)
I hated the auto start live streaming thing, if there is option to turn off that please let me know.
There is an option in the settings to turn that off.
edit: Account details -> Store preferences -> Broadcast preferences (at the very bottom of that page)
thank you very much, for people who don't know it's "checked" to opt out/disable. (<-- this should be illegal. )
I was actually thinking about this the other day, will be a very sad day. Valve is the only company I genuinely can say I'm a fan of.
There is a downloads page, right click on "library" at the top and there is a downloads button that gives you a view of all pending/queued/current downloads etc.
The sales have become less fancy than they used to be? I have seen lots of complaints that the events have gotten worse.
okay, that makes sense now, I don't know what I did now it shows all the menu items when I hover over the big item. Which is good, hope it stays that way. :)
I used to need to click around to find the download page, or unless I have updated game queued up then it show up at bottom of the UI.
If by live streaming thing you mean the "broadcast" thing, you can turn it off on options.
Settings -> broadcast at bottom of list -> privacy settings -> broadcasting disabled
also, thank you very much, but this one seems to be your broadcasting preference, the other user's option path is correct.
Ah, you wanted it gone from the storepage. I have them disabled too and didn't remember they even exist there
Valve seems to be the only company on this capitalist world that actually understands that company profits cannot and should not grow exponentially forever without eventually destroying itself.
Nah, they are many of them, maybe even the majority of companies are like that (think SMBs). The peculiarity of Valve is that it also managed to become and stay the world leader in its domain, so every nerd knows about it.
Tons of SMEs are world leaders in their domain, you just never heard of them because they produce giant ship propellers, fire hose couplings, surgical instruments, whatnot, not exactly things people not using them ever think about. And of course you don't have to be a hidden champion to be a SME that owns their market, say, Herrenknecht. Who would be unknown if tunnel boring wasn't so cool and impactful that there's tons of documentaries about them doing it.
What is a SME or SMB in this context? Mentioning @[email protected] in case you're not sure what they meant by SMB either.
Small to medium business/enterprise.
Thanks!
Thanks!
Coincidentally, I was just reading a news article about Chipotle doing exactly that - raising prices while losing customers.
Even companies that have seen customers pull back due to the higher prices reported higher sales, because those higher prices offset volume declines.
PepsiCo, for example, reported ... sales rose nearly 7% to $23.45 billion. The ... company said it increased prices globally by 11% on average... In that time, PepsiCo’s volume fell 2.5%.
Isn't that just price discovery?
I suppose so, but if everyone does it at once within every market sector it seems to just become inflation.
Nah, that's just actual inflation. You know the deficit that the government runs on now, and the bug private-sector and general-public bailouts of the last two decades?
Yeah, that's just printing money. Selling the overall value of the dollar to make ends meet today.
If companies are reporting larger profits after adjusting their prices for inflation then customers are met with inflation that is larger than the reported inflation rate.