The UK specialist competition tribunal has certified the £656m legal claim against Valve brought by children’s rights campaigner, Vicki Shotbolt. This marks a significant first victory for the class of around 14 million PC gamers against Valve – the owner of popular gaming platform, Steam.
The claim alleges that Valve has abused its dominant position in the PC gaming market under UK competition law by imposing excessive commission charges and anti-competitive restrictions on game developers selling gaming titles on the Steam platform.
These excessive commission charges are passed onto consumers by way of increased prices for PC games and in-game content.
Ms Shotbolt, the class representative, asserts that Valve’s conduct has increased the prices of games across the entire market. Therefore the class is not limited to Steam users but also includes purchasers of PC games and downloadable content on other gaming platforms and distribution channels.
The post button did you dirty.
I don’t know, I can only speculate. EGS makes a lot of decisions where they lose money on purpose in order to try to grow their business so their practices don’t always fit neatly into a simple economics model. For example, giving away games for free isn’t a rational business decision on the face, but they’ve decided that the future benefits will outweigh the costs.
If I had to guess a single reason. I would say that this is likely because AAA games have all essentially coalesced around specific price points. If a game is selling for 59.99 everywhere, then you’d certainly try to sell your game for 59.99 also. If you’re selling with 12% fees ($52.80/unit) and they’re selling with 30% fees ($42/unit) then your company is making more money and you’re in a more favorable position should the competition try to lower prices to take your market share.
Selling for less than the market prices wouldn’t make sense and the market price for all of this is primarily based on how Steam operates. Since Steam is the largest distributor, all price decisions are going to be primarily based on a market where prices include the 30% fee because the largest volume of, most, games’ sales are through Steam.
This lawsuit may not go anywhere, but there is no world where we, the consumer, are hurt by Steam being challenged on their pricing model. The only outcomes here are pro-consumer and pro-indy developer (the people most price sensitive and so most affected by these fees as a percentage of total revenue).