[jrockway]

Collecting money is an important part of a business, but also not trivial. It therefore makes sense that people would outsource this. If you get big enough, you probably don't want a middleman in the way; this is why companies like Blizzard have their own store/launcher app. For everyone else, whatever they take is cheaper than having their own army of software engineers, lawyers, billing phone support, etc. In a world with Steam, as a game company, you don't have to worry about collecting money (and the associated customer support) and distribution. You can focus on your game. That is valuable, which is why people pay for it.

I work at an ISP. Billing is a constant influx of "interesting" requests that I would love to outsource so our software engineering team could focus on stuff specific to our business. But we never found a service that could do it better than our homegrown system.

Every week there are several one-off issues like "I overpaid because I didn't see the service credit" or "I would like to pay for the next 3 months in advance" or "my accounts payable department sent the wrong check, can you shred it and we'll pay with credit card". These things have to be handled manually. Not to mention people calling to change their payment method because they don't remember their password to the website, or just want to chat. All that is a drain on actually running the business, but unavoidable. You can't just say "nah we won't shred your check", so someone has to go find it and deal with it. While they're doing that, they're not making our product more innovative or reliable. They're running a check through a shredder. Anyone could do that, but unless you have 8 hours of check shredding to do a day, you are spending CFO salary on the task instead of check shredder salary on it. Therein lies the problem.

If this could all be outsourced, I'd pay a lot of money for it. So would any business. Billing is something you have to do if you want to collect money, but it's a time sink. Game developers don't have to worry about this, and generally seem OK with that. I don't blame them. They are lucky Steam exists.

[reitzensteinm]

I've sold 7 figures worth of game copies over my career, through Steam, the App store and my websites in roughly equal quantities.

This completely misses the value proposition of Steam. Collecting a million dollars of game sales through Stripe or PayPal is not hard, nor is dealing with payment issues a large overhead, even if you're paying the people replying to the emails programmer salaries.

Supporting the game itself is an order of magnitude greater even if it's decently written. Steam doesn't prevent that support, it just obfuscates the customer's connection to you so if you don't care you can mostly get away with ignoring them (at your peril, as it will invite bad reviews).

Steam puts you in touch with an immense audience. That's the value they're bringing to the table, and it's a big one.

[baroffoos]

Essentially steam has created an almost walled garden. You already have all of your games on the steam client so if a game is sold on another store its inconvenient. Another part is steam has a lot of eyes looking at their store. Everyone checks steam for new games so if you are not on that store then people wont see you.

Its an unfortunate system because steam isn't actually providing that much value but they have just managed to centralize everything on their platform.

[nostalgiac]

> Its an unfortunate system because steam isn't actually providing that much value

I have to heavily disagree with that.

Other than as you mentioned, the huge amount of eyeballs on all of their library content which you just won't get anywhere near close to. Along with people already having credit on their steam account so they can instantly buy a product without entering payment info.

There's also the distribution and update mechanisms which are such a huge win for the customer as well as developers.

I can also guarantee you, if Steam didn't exist, there would be other 'central store/repo's' that would absolutely be trying to enter this space. Providing an easy location for gamers looking to find new content. It's a win/win/win for all of Valve, Developers & Customers.

[baroffoos]

>Other than as you mentioned, the huge amount of eyeballs on all of their library content which you just won't get anywhere near close to.

We should have had search engines like google for games.

> Along with people already having credit on their steam account so they can instantly buy a product without entering payment info.

Browsers these days have a payment API and stores the users credit card details which can be used on any website.

>There's also the distribution and update mechanisms which are such a huge win for the customer as well as developers.

This could have been done without centralization similar to how package managers work, the games repo would just be added to your client and downloaded from that.

So I guess I could put it yes valve has added value from what there was before but its totally possible to replicate all the value easily without centralization.

[mindslight]

I don't disagree with your gist, but does Steam actually manually solve the examples you gave? It seems like part of the value add of outsourcing comes from the negativity of a policy not directly reflecting on your own business. If you refuse to hunt down a check (or even stop accepting checks altogether), a customer might switch to another ISP. But if your third party mechanically refuses, it's "nobody's fault". Even if the customer expends the effort to escalate and they're a big enough customer for you to listen, you can still salvage it as a positive CS experience.

[dageshi]

I'm assuming Steam handles the application of regional sales tax/VAT based on country of purchase (that would apply in the EU I think?) that alone might be worth it? Not to mention they have a really good/fast distribution system.

[kbwt]

Worth more than the entirety of the VAT? I think not.

[whatshisface]

Why not hire a customer representative whose main qualification would be diligent attention to detail? You shouldn't have specialized engineers spend their time dealing with issues that are not only one-off, but that also don't require any advanced qualifications. There aren't eight hours a day of check shredding to do, but there is a level of capability between "can only shred checks for eight hours a day," and "spent ten years getting a PhD in computer science."

[JumpCrisscross]

> * a customer representative whose main qualification would be diligent attention to detail?*

Flexible problem solvers with attention to detail and solid communications skills are about as expensive as engineers.

[whatshisface]

What about those rumored thousands who are graduating with "unemployable degrees?" If the market for capable individuals was the same as the market for specialized knowledge then STEM would not be so much more economically attractive to students.

[JumpCrisscross]

> If the market for capable individuals was the same as the market for specialized knowledge then STEM would not be so much more economically attractive to students

Most people, including those with advanced qualifications in STEM, could not be described as flexible problem solvers with attention to detail and solid communication skills. This confluence, essential for quality customer support, is exceedingly rare, and tends to describe those whom our societies remunerate most richly.

[jjeaff]

I don't know many customer service reps making 150-250k a year.

[JumpCrisscross]

They aren’t called customer service reps. They’re account executives, investment bankers and CEOs. That skillset—socially-aware problem solvers—is ridiculously rare.