[user5994461]

>>> I actually am surprised that services like Steam, the Apple App Store, and Google Play are able to command as high a margin as they do for sales commission.

What makes you think that they have high margin? It's not like each game creators could run a worldwide distribution and payment operation with just a few percent more of revenues.

[michaelmrose]

"It's not like each game creators could run a worldwide distribution and payment operation"

You mean like a website? I think it's more fruitful to imagine multiple merchants competing to sell devs wares and lessor commissions as a result of competition.

[adanto6840]

Payment processing is a big part of it, but it's not just that. The deployment framework, testing branches, the workshop/user content/mods support, etc. That stuff could certainly be replicated, but the exposure to the existing user base of active customers is the tough one.

Admittedly it is supposedly lower value now, with Steam Direct replacing Greenlight, but it shouldn't be overlooked -- it's the same reason that tons of products are sold on Amazon even though you can also purchase the same product directly via the brand's website...

FWIW, I'm lead dev of SimAirport[0] which is in Steam's Early Access program. The 30% has been tough to swallow, but without Steam (and given our lack of internal marketing/spend) we probably wouldn't have sold a quarter of what we have thus far. And while we wouldn't qualify for any of these tiers had they been in place previously, it's still a solid upside "just in case" your game blows expectations out of the water.

I'd love to see them add a tier around $2-5M at 27-29%, even if just as a "bone" to indie developers; it'd make developing a 'game as a service' (ie long & consistent feedback-driven dev cycle) more palatable and likely result in demonstrably better games.

Tangentially related at best, but sometimes I wonder what Steam _actually_ optimizes for -- if their algorithms always show the "best" games (ie ones that players spend hundreds++ hours playing) then I'd expect that to actually hurt their revenues short term. In theory they'd be better off marketing/optimizing to push games that satisfy users but that have low play-time/hours on average, so that they can sell the player a different game that much sooner. It's a strange set of incentives & it's hard to tell how aligned they really are (with either players or developers).

[0] - https://store.steampowered.com/app/598330/SimAirport/

[yellowapple]

I probably wouldn't have bought SimAirport if it didn't show up in my Discovery Queue or whatever on Steam, and I'm glad I did because it's filling a void in my soul left behind by Air Mogul. (And by the way: awesome job!)

Valve's rather enthusiastic and concrete support for Linux gaming certainly doesn't hurt, either. Coupled with the discovery features above, it makes it a lot easier to figure out which developers I'd like to keep supporting.

[Dextro]

I just created an account to thank you for making this game. I have been looking for a game just like this after reaching all the limits in Airport Tycoon ages ago.

And I mean literal limits. That game had a bug where flights were limited by an internal variable that was smaller than the capacity you could build so after a while the game would just stop and you would be unable to get any more use out of your airport. You could easily test this by cancelling one contract which would immediately make a new offer pop up.

Anyway your game looks just the thing I've been looking for since that old early 2000s game. I'll be throwing some money your way for sure.

[user5994461]

You realize that it takes a lot of work to make a website to accept payment from a hundred countries in dozens of currencies and handle customer support and chargeback and fight fraud?

You can try to run your own website, to save 10% fees on a minuscule userbase, it simply doesn't cover the costs.

[azhenley]

Serious question: isn’t this what services like PayPal are for? Along with customer service services. Certainly not trivial, but it seems doable.

[richardknop]

What about billing support? You need people on the phone to handle complaints and issues from customers, deal with chargebacks, refunds and thousands of various weird requests from people that will keep coming. Also you need a software engineer team to work on the payment processing system / website. It's not "build it once and leave on autopilot". These things need continuous maintenance, bug fixes and improvements. All of that costs a lot of money and you have to have a really large revenue to be able to handle this yourself.

[mschuster91]

Paypal only handles payment. You still gotta do customer support, CDN infra (with games running at over 60GB each, that's not easy!), fraud detection, client dev and technical support for over three platforms (Win with 3 major versions, OS X with probably the same, and a myriad of Linux distros/kernel versions/GPU drivers), social networking/messaging stuff and a whole lot of small-ish stuff to get at half the functionality Steam offers.

[notSupplied]

What handling refunds? Some are legit, some will be fraudulent. What a out dealing with foreign currency? What if your game becomes popular in a country where PayPal isn't prevalent?

[pnloyd]

Don't companies like stripe aim to make packaged solutions to problems like these?

[user5994461]

Definitely not. It's quite the opposite actually.

Stripe gives you a basic solution to accept payments in some locations and under some circumstances. Once a company reaches in the tens of millions in yearly turnaround or expand internationally, it has to move on and run multiple payment providers.

[scarejunba]

Minecraft did it when it was tiny and it scaled all the way up.

[yellowapple]

Just because one game managed to pull it off a decade or so ago doesn't mean that sort of success is the norm.

[scarejunba]

I just mean it’s possible.

[michaelmrose]

I would be interested in data but logically wouldn't most of revenue at present come from 12-18 countries?

[user5994461]

That's the point. Doing internationalization and payments for 12-18 countries is a pain.

Steam helps you with that. You could try to do better yourself but the effort is not worth saving a few percent of fees (on a lot less sales).

[michaelmrose]

You are making assumptions. 30% is not a few percent. You are also assuming that merely being on steam and having users encounter your game while browsing will be the primary method people encounter your game and decide to buy it thus the "on a lot less sales" People encounter games via many means. If you only sell it via steam or steam is merely the most convenient means of acquisition then the fact that the buyer bought it on steam isn't proof that they found it via steam or further that they wont buy again if you aren't available via steam.

[user5994461]

It is a few percents. All online marketplaces, steam, apple store, airbnb, booking are 20 to 30% commission.

It takes at least 10% commission to be able to run a company of this type. It's possible to run with as low as 5% in some niches, given a very lean operation and a billion dollar scale to amortize fixed costs. Eventually most of the company will be devoted to customer support and billing related tasks.

There is really not that much that can be shaved off. Small studios could never make a platform any efficient. A small group could spend all their time working on distribution and billing, never shipping an actual game. It's a really good deal to just use steam instead.

For AAA games it's annoying to pay 30% and they're rather make their own platform, that's why steam is dropping commission to 20% for top selling hits.

[kbwt]

Steam certainly won't internationalize your game for you.

[user5994461]

Steam is translated and comes with support for many languages. It takes all currency and it has region settings for pricing, currency and release dates. For the anecdote, it's maybe the only US service that sells well in Russia.

It certainly won't translate the game for you, not that translating a bunch of text files is the hardest part, but it will help with everything else.

Ask international users what they think of other platforms. Like the one they couldn't use because it didn't accept their names with an accent or couldn't enter a billing address without a state.

[kbwt]

Can't something like Stripe + Braintree provide the same at a fraction of the cost?

[user5994461]

Not at all. For starter Stripe is only usable if you are a small US company selling to a US user base. It also restricts your audience to customers with a card and willing to enter it on your website.

It's better than nothing but it's in no way comparable to what steam offers.

[gomox]

That's a dramatic misrepresentation. Source: operated startup selling to LATAM customers, used Stripe.

[rblatz]

Lyft uses stripe, I wouldn’t consider them small.

[redisman]

It's also a major sales channel. Valve has over the decade rounded up a huge chunk of the people who buy PC games into one place.

[MattRix]

uh, see Itch.io or Humble, which do the exact same thing for a fraction of the cost

[ehsankia]

Does itch.io have a world wide CDN delivering high enough speeds to handle 50GB games? Do they provide match making, voice communication, game hub, cloud saves, workshop, achievements, stats, and so on? Steam provides a huge amount of services behind the scenes.

[MattRix]

This is the whole point. Indie devs don't need a CDN that can handle 50gb games, or most of those other services you listed... Yet we're stuck paying the full 30% that those mega studios that actually use those features are paying.

[ehsankia]

Steam still brings a lot more traffic that they would get if they sold directly. Most people who do both Steam and direct report that Steam consists of more than 95% of their revenue.