I see I'm the seventh reply, but I don't think anyone has yet correctly explained why Steam gets away with it. The reason Steam gets away with it is that their prices reflect the fact you can't sell the game.
Watch any simultaneously Steam and console release you like, for a decent game that doesn't immediately crash in value everywhere because it stinks. Watch the prices over the course of the first six months. Watch them both start out at $60, but watch the Steam price come down first, and more often. It's the usual pattern.
Watch Steam have their sales where something goes on sale for $5 or $10 while the consoles are still charging $25 on average.
I played Mass Effect 2 for $5 on the PC, when it was still ~20$ on the consoles. At that price, I don't care that I can't sell it. The abstract ethical arguments still theoretically apply, but in practice it's not worth worrying about. That's already approximately the delta between buying and selling used anyhow.
Based on history, Microsoft isn't going to work this way. For some reason, Steam is still the only digital retailer that has figured out the true supply/demand relationship and tweaked the price curves to maximize their returns, based an a rational model of the economy. Almost everyone else would seem to rather sell nothing at $20 than sell lots at $5.
(Nintendo's even worse than Microsoft at this, actually. EA's Origin seems to have at least partially absorbed this lesson. What's really weird to me is that rationally, the lower prices almost certainly maximize revenue; holding on to higher prices is probably based more in politics than economics.)
I believe this is the real reason that Steam doesn't get flak for it. If Xbox One games saw the same price fluctuations that Steam games do, I don't think anyone would care about lending games out.
I am basing my expectations on the pricing on XBox Live. The XBLA stuff fluctuates and there's been a couple of sales (got El Shaddai for ~2$ so I know it's non-zero), but mostly everything stays pretty high relative to what the market can bear. If they change behavior, so be it, but let the record show it's not groundless speculation; the digital download market for Xbox 360 has been around a while.
It's true that we can't speak on how pricing will work for Xbox One games, but we can certainly comment on consumer opinion regarding the inability to lend games out on Xbox One vs. Steam.
Consoles don't have to compete with alternative publishers (MS takes a cut off of every new Xbox game sold regardless of the store, Valve doesn't get a cut of every PC game unless it is sold via Steam).
They also don't have to compete with the scariest publisher of them all, bittorrent; who sells everything for $0.
Console games are probably priced quite well to maximize marginal revenue. I know people who will drop $40 on a console game but who would not be willing to spend $20 on the same game for PC simply because there is a pirate version available.
Well it's how anything digital works now. I can only think of a few exceptions that are truly exceptional (Amazon Book Lending).
You can't have a purely digital content item and not have it bind itself to some kind of purchaser. Why? Because then you'll have one person buying the item and distributing it for every family and friend out there. You might then try to argue that physical items like books and DVDs are subject to this exploitation. Obviously the physicality of the items make them unfit for mass sharing. It takes a lot of time to swap around a single book or DVD. It takes 5 seconds to whip up a dropbox link to my giant email list.
Aside from the above, Steam started off with a "all sales are final and permanently tied to the account purchaser" model. No one expects to be able to buy a game on Steam and then share it with a friend.
> Well it's how anything digital works now. I can only think of a few exceptions
Well, the exceptions are not that exceptional. Do you buy digital music that you cannot lend? Are you not able to lend a game purchased on gog without paying? All the ebooks I bought I share with my family (and I have the legal right to do so, admittedly, I live in a country where DRMed ebooks are not the only solution).
If you created an eBook that I then purchased and shared with my family and friends, how would you feel? That eBook will then be shared with your families friends and your friends families and friends. See how that works? Is that fair you to you? What if it took you a whole year of unpaid time to produce this book?
I don't get this entitled view people have on creative content they purchase. Yes, you certainly own the content in the sense that you can now consume it and enjoy it forever. No, you cannot go and take this content and essentially sell it for $0 to everyone because it's now in your possession.
I would be very happy if you found my work good enough to share with your family. I would find it unfair for you to pay twice for you and your daughter to read a book I would have written.
I have always shared some books with my family, and I continue to do so with ebooks. It also happened that I watched DVDs with my family or with friends. This is legal and this is totally reasonable use. And I am entitled to share and copy creative content with my family (close circle) by the law of my country as long as I do not break copy protection, which is why I do not buy DRMed goods.
Yes. Except I'm not even sure you can activate a Steamworks game's disc multiple times - I think it's one key per disc and you might have to buy a second copy off Steam/at retail and download it yourself.
Yes, that's how it works. In exceptional circumstances, you may be able to get Steam support to revoke a key and apply it to your account, e.g. if you purchased a brand new game, the key had already been activated, and the retailer won't take it back.
This argument often appears. The simple answer is that Valve can get away with due to the immense goodwill they have gathered (also steam has the benefit of being the first online service)
Valve is a small company (compared to the publishers/sony/MS) that has track record of amazing games and a company that groks gaming and gamers. While Steam is indeed some form of weak DRM the value the platform adds is substantial. Steam workshop and other mod tools are important.
Also while you are on a PC you control what steam can do and not the other way around.
MS lack good will with PC gamers (the communities overlap). They deliberately stagnate the platform, GFWL was terrible ...
There's also the price aspect. Unless you are impatient for a particular game you can build up a massive library of games on Steam very cheaply by taking advantage of the sales which are often 50% off or even 75% off.
Even pre-owned/discounted console games cost substantially more than this unless the game is very old or unpopular.
One of the nice goodwill things I liked about Steam was that when I registered my original copy of Half-Life, they gave me all the extension packs for free. Might have been because they couldn't tell by the CD key whether I had just Half-Life or the pack that included them, but I didn't care.
I do expect it. It should be codified into law (and there were some european court decisions). The licences should be anonymous and transferable - same as goods.
It basic customer protection and it is good if you have healthy secondary market. There should be some basics customer rights that should not be able to be waivered and the licence seller should not be allowed to offer less.
The questions is, how many times can something be transferred and how often?
Since digital licenses can be so easily transferred, I could buy a game/movie/book and then when I'm done with it for the day just sell it straight into the global marketplace. When I want it again (either the next day or in a years time) I just go back to the marketplace and buy it back again.
You could probably satisfy global demand for something with a relatively small number of original copies this way, especially for something like a movie. It would also mean that nobody would want to be the person paying full price for the original.
Finding an exact line is tricky, but I can confidently say that renting on a per-day basis has been accepted for decades. I don't forsee any showstopping problems along that route from enforcing first-sale doctrine on digital goods.
That is not entirely true. First - some content is worth holding the licence to. I will never sell some book I really like - i like to reread a few terry pratchett books every year(but soul music - I would resell that given half the chance). Same is with movies and games. If you expect your product to be treated like a rental because it is generic/substandard quality - then just put a rent licence for a fraction of the price.
Second - being able to resell means that more people will be willing to take a chance on day 1. And for licences to be resold they have to be bought.
Also not everyone works trough content with the same speed - Reading the last song of fire and ice could take a month for a busy people. So for an item with strong demand it could take a lot before sufficient copies can emerge on the secondary market.
And humans are not uber efficient creatures. They don't always look for the min maxing behavior.
Also reselling digital licences will be digital in nature. So this is income that have to be declared, payed taxes on it and some more paperwork. So it won't be that efficient for the retail customer to resell everything at the earliest possible moment.
Also it will have positive effect on fighting piracy - a lot of people stopped pirating when the steam sales became the norm. With the insane backlogs people are amassing - they have no inclination to pirate.
Under this model , the license itself is effectively a commodity since they are interchangeable. So you can think about the economics as such.
Say a new movie is released. Now, how many people want to watch this movie? Let's say 1,000,000. How many people want to watch it at exactly the same time at peak? Maybe only 10,000.
So once 10,001 copies have been sold there is now a surplus of movie licenses. This means that A) The price to buy a license will drop and B) You will always be able to buy a license if you want one and C) There is no reason to buy a "new" license.
Under that model it makes sense to always sell something that you are not using for longer than the period it takes for the transaction to complete (which would probably only be seconds).
Pause the movie to go to the bathroom; Sell. Sit back down; Buy.
More or less. One key difference is that Steam is relatively open compared to the console market.
Except for a few major titles, most stuff gets discounted eventually, sometimes even substantially. This leads to decisions of buying it now for a lot or half off later. Console games take forever to get discounted by comparison.
Combine with a locked up marketplace and it's bad aspects of both worlds: Full price downloads with no disk sharing.
Watch any simultaneously Steam and console release you like, for a decent game that doesn't immediately crash in value everywhere because it stinks. Watch the prices over the course of the first six months. Watch them both start out at $60, but watch the Steam price come down first, and more often. It's the usual pattern.
Watch Steam have their sales where something goes on sale for $5 or $10 while the consoles are still charging $25 on average.
I played Mass Effect 2 for $5 on the PC, when it was still ~20$ on the consoles. At that price, I don't care that I can't sell it. The abstract ethical arguments still theoretically apply, but in practice it's not worth worrying about. That's already approximately the delta between buying and selling used anyhow.
Based on history, Microsoft isn't going to work this way. For some reason, Steam is still the only digital retailer that has figured out the true supply/demand relationship and tweaked the price curves to maximize their returns, based an a rational model of the economy. Almost everyone else would seem to rather sell nothing at $20 than sell lots at $5.
(Nintendo's even worse than Microsoft at this, actually. EA's Origin seems to have at least partially absorbed this lesson. What's really weird to me is that rationally, the lower prices almost certainly maximize revenue; holding on to higher prices is probably based more in politics than economics.)