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Valve Updates its Revenue Sharing Structure to Get AAA Studios to Keep Publishing to Steam

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Valve has made a major amendment to its Steam Distribution Agreement for all publishers on Steam, which changes the way revenue sharing happens between Valve and the publishers. According to the new system, the revenue sharing system will be done such that 75% of the revenue goes to the publishers and 25% of the revenue goes to Steam once the game hits more than 10 million dollars in revenue. Once the game crosses 50 million dollars in revenue, the revenue is split with 80% going to the publishers and 20% to Valve.

          What has not been mentioned is the fact that any game not reaching the 10 million dollar threshold still has to shell out 30% of the revenue to Valve.

                                                                                               This had irked quite a lot of indie game developers who are not happy with the predicament. In their words, indie games will suffer the most, since indie games will almost never cross that 10 million dollar threshold proposed by Valve.

                                          There seems to be some truth in the argument that Valve’s actions have been inspired by AAA developers like EA, Ubisoft and more recently, Bethesda and Activision, who have shifted the publishing of games over to their own distribution platforms instead of choosing to publish on Steam. The new revenue sharing structure seems to be a feeble attempt at wooing big developers back to Steam. However, this also does mean that the new structure is highly discriminatory in nature, especially towards indie developers.

                        Another major update is that publishers now have the freedom to share relevant data related to the sales of their products published on Steam with the buyers or other publishers as they wish.

                                           This update indicates that not everything is going well at the Valve HQ, since this move seems to have been a knee-jerk reaction to other publishers shifting focus to their own distribution platforms. It seems that Valve is keen to eliminate the competition and ensure Steam remains the platform of choice for all gamers.

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