Between articles here at the site and some of our recent podcasts, we at NHS have been rather hot and bothered about the prospect of next-gen consoles, for all practical purposes, wrecking the used games market by locking retail discs to specific user accounts (or consoles). Despite not being much of a purveyor of trafficing in used games I’ve already noted that maybe, just maybe, if the big boys go this route I won’t be all that interested in playing their product anymore. I’m probably full of it, but we’ll see what happens. Regardless, we’re not talking about that today. Today let’s talk about the elephant in the room in this discussion – Steam. I’ve been on Steam for years. I rather like Steam. But how much different is what they do, and that we largely accept, from some of the ideas rumored to be attached to next-gen consoles? This is something Matt, Brian, and I discussed at some length on JTS 118, but I think it’s also worth writing about here too…
The big conclusion I’ve come to, the reason I view Steam differently, is that motivation matters. Steam’s model evolved to solve a problem. Valve wanted to start a digital game distribution service as an alternative for PC gamers to the ever-shrinking stock of PC titles on retail shelves. Whatever your feelings about DRM, I think you have to agree that without some type of security measure Valve was never going to get Steam off the ground with other publishers. The idea of locking purchases to a user account, in this case, is a logical solution to a very real problem. (A problem based on the illegal practices of far too many individuals and not on the completely legal practice of buying or selling used games.) Let’s also acknowledge that at the time Steam launched there were no big game franchises that were digital-only product. Steam expanded the market and gave people a choice. That’s a huge difference between what several publishers and console manufacturers are talking about. They don’t want to stop selling discs at retail, but they do want unprecedented limits on what you can do with those discs once you bring them home.
Steam also remains incredibly convenient. You put Steam on any PC or Mac hardware you like, log in to your account, and you have access to your full library of games; granted, sometimes with a lengthy download. It’s ridiculously simple, and if I want to play a game of Civ on my desktop PC at home and then continue it on the road on a laptop, that’s pretty easy to do. Now, I suspect one thing Sony and Microsoft will get right, should they go down this road, is that they’ll make the process of playing your game discs on different consoles relatively painless. It’s not all that hard, on the 360, to import your user account when, for example, playing a multiplayer session of Rock Band at your buddy’s house. I imagine any account locking system for the next gen will operate on a similar idea. But the question remains of where the benefit is to consumers relative to the current model. Steam offered multiple tangible benefits to consumers. Locking purchases to accounts was part of that trade. Give something, get something. What convenience are we being offered in trade for giving up the right to put a legally purchased game disc in any compatible console of our choosing? Don’t spend a lot time waiting for an industry answer to that question.
Another big difference here is that Steam offers a much more flexible, much fairer pricing model. Yes, there’s plenty of $60 price point games on Steam. As I look at the top seller list right now I see Skyrim sticking around in that top 10 at that very price point. It’s also one of only two titles in the top 10 list right now that costs more than $35 (the other being Sniper Elite V2). Also in the list are Arkham City (at #1 and discounted to $15 right now; a steal at twice the price), War for Cybertron at $7.50 (again, discounted), The Walking Dead at $25 and Torchlight II at $20. What does that tell you about how much PC gamers are willing to pay for a decent gaming experience. It’s very much by design that Steam, on a day-to-day basis (nevermind their constant weekend and holiday sales), makes bargain shopping incredibly convenient. Not a month goes by that there isn’t a AAA, highly-regarded title for sale for far less than $60. Sure, you can find deals at Amazon and on the shelves of Best Buy too, but none of it is remotely as convenient as Steam, which goes back to the previously discussed question of, “what do we get for our trouble?”
Quick, those of you who play both PC and console titles, how much bargain shopping do you do at retail versus Steam? How many console games have you purchased that you don’t get around to playing versus games purchased on sale at Steam for a rainy day that hasn’t yet come? I don’t know about you, but the list of unplayed games on my Steam account is flat out embarrassing. It’s larger than the total number of console games I own. (And don’t even get me started on my GoG purchases.) Now, there are legit arguments to be made about whether or not Steam sales are good for the industry, but I don’t hear very many gamers complaining.
What it all ultimately comes down to, what separates Steam from all this industry talk about cracking down on the used games market, is that one of these players operates on a reasonably fair principle of give and take. Some of the heads of certain development studios –the guys whining to press about used games– along with the larger publishers and console manufacturers are in full-on take mode. They’re not remotely interested in offering something for something. They think the very act of you engaging in a completely legal act, one that’s commonplace across industries, is taking from them. And they’re out to prove they can take right back, whether it’s in the form of higher price points, withholding content for DLC, or making sure that the next generation of consoles can’t play a game disc that you, and you only, paid full-price for. Steam is as in it to make money as any other business, but at least their model operates on a basic principle of fair play for which, the record suggests, plenty of consumer are willing to sign up.
12 thoughts to “Steam, The Next Gen, and Account-Locked Gaming”
It’d be ironic (not to say kinda “great”) if they did implement some anti-used games solution for next gen, and shortly before they hit the shelves, Steam enables long rumored option to sell/gift games from your library 😀
They’re taking enough control to placate publishers, but still giving enough features and functionality to users to justify giving up a little control. I think Steam is walking that line almost perfectly. The sales and convenience factor are huge, don’t underestimate them.
This whole idea of Steam sales devaluing games is bollocks as far as I can tell. I’ve seen many developers say that when their game went on sale on Steam, their revenue increased by orders of magnitude. Even at 25% of the original price, they’re selling far more than four times the number of copies. Maybe the market is saying that their game is worth less money, but there are more people buying it, so they’re actually making more money. Sounds win-win to me.
I’m surprised Origin didn’t get mentioned at all. This is about money, but it’s also about control. EA wanted control of the entire game process. Origin allows them that. It’s on everything now, PC, Xbox even iOS games. Blocking used games is another example of that.
I actually have an interesting (to me anyway) story about Steam, used games, and locking content to a single user.
A couple years back I bought a used copy of Modern Warfare 2, not realizing that it had to be authenticated through Steam. Once I found this out, I contacted Steam’s customer support to try to get them to switch it over to my account. I had everything — box, disc, original manual, everything. Their initial response was, unsurprisingly, “Sorry, we can’t do that.”
I’m a lawyer. So, being interested in the question of digital property and ownership, I decided to take issue with this. I told them that their response was unacceptable: I owned the software, I had the right to access the software, I could prove all of it, and that if they took action to prevent me from accessing my legally purchased and owned software, that I’d be happy to take them to court for conversion (basically civil theft) and whatever else I could think of.
Here’s the interesting part: they caved. I’m not even sure it was a particularly great legal argument on my part, but I get the feeling that somebody there recognizes this as an issue and did not want to deal with it.
Part of me wonders if this isn’t going to blow up somewhere, maybe with Steam, maybe with Origin.
That is a great story I feel like you got a win for all of us.
I think you have touched on many of the things that make Steam a great way to get games. I literally can’t remember the last game I bought that wasn’t on Steam.
I think you nailed this whole question with this line, “What it all ultimately comes down to, what separates Steam from all this industry talk about cracking down on the used games market, is that one of these players operates on a reasonably fair principle of give and take.”
I am not bothered at all by Steam’s DRM for several reasons. First, they are honest about it. On the store page for every game it will tell you if there is 3rd party DRM and what it is. Second, there is the convenience factor and support. Steam remembers all of my CD Keys. It keeps copies of all of my games accessible to me at any time. It allows me to install my games on as many computers as I want. It keeps all my games up to date and allows easy integration of DLC. Many other, more draconian DRM schemes are harder to deal with but offer no benefits in return. They only serve to make the purchased copy of the game inferior to a DRM free pirated copy.* The last reason I don’t mind is the pricing. Steam, more than any other company, seems to get the idea of price discrimination. There are many games that I will simply never pay $60 for. So if the publisher wants to sell it at $60 forever they will never see a dime of my money. However, I would very happily spend $20, or $30, or $40 (it depends on the game). By dropping the price Steam captures sales that many other publishers seem willing to give up.
*I do not pirate games and I argue strongly against those that do. However, this statement is true. There are games where the pirated, DRM free, version works better and runs smoother. That seems to indicate that something went horribly wrong along the line.
“There are games where the pirated, DRM free, version works better and runs smoother.”
I have no idea why this fact doesn’t have game publishers crapping themselves with fear all the live-long day. Ubisoft, I’m looking at you.
Steam is fine by me, and Origin seems to chugging along smoothly on mu laptop as well.
“Not a month goes by that there isn’t a AAA, highly-regarded title for sale for far less than $60”
I do laugh when people talk about cheap AAAs on Steam though. I’ve never bought a AAA title directly off Steam. Why? Regional pricing is why. Skyrim is currently $60USD and Modern Warfare 3 is at $99USD. At the $NZ-$USD exchange rate that is just not worth it.
More and more of my boxed product is going to come from online retailers who import from places like the US and UK. In the age of digital distribution I’m hoping for a stop to this regional pricing crap. But, as long as people are willing to pay….I’m not too optimistic.
try “nzgameshop” some guy in the UK runs it, sells games in NZD, but at USA prices (skyrim was 60 NZD on release etc)
I firmly believe that the massive Steam sales exist purely because there’s no used game market, it essentially fills the same niche, but still gives money to the developers and publishers. If you offered me a Steam console, or something similar, I’d be far more likely to get it.
Over my many years of gaming, I have physically lost or broken far more games than I have ever resold. I look at GoG’s top seller list and I have in the past bought virtually all of them, but I have none of them in my possession now. If you told me right now I could plug in a Wii and legally play every game SNES I ever bought, or that my GoG account included the Baldur’s Gate 2 Collector’s Edition I had and never even got a chance to play (yay divorce), I would be ecstatic.
Getting that at the cost of not being able to resell my games, or not being able to buy slightly marked down used games, would be well worth it. Not to mention that it would be better for the industry and perhaps encourage things like the Steam sales on the console side of things.
The other nice thing is that Steam is free to download and the online is free. The deals are also for anyone. Compare that to XBLA, where there are deals that only apply to Gold members. I don’t have a Gold account, but I sure would love those sales, and more frequent ones at that. Sure there are games that I pay the 10 or 15 dollars for, but I have plenty on my wishlist that I would get for 5, but they hardly ever go there. Steam does.
As an economist, it is my opinion that the only reason retailers are able to sell games at the $60 price point is because there is a used game market. Even though they aren’t worth full price, being able to sell your games once you have finished them adds to their value. The fact that publishers are concerned about the used games market says that a large number of gamers buy games with the intent to sell; these consumers would not buy a lower value product at the current price. I predict that publishers already know this and will bring down the price of their games significantly (this is evidenced by Steam’s generally lower prices); otherwise, I imagine they will try a $60 price, nobody will buy, everyone will complain and they will drop the price.