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Valve: Steam Is Really Good For Retail Sector!

In a recent interview with MCV, Valve Software's director of business development and legal affairs Jason Holtman was asked his opinion about traditional brick-and-mortar retailers refusing to stock PC games bundled with Steamworks. Ultimately he and VP of marketing Doug Lombari said that Steam was actually good for retail despite fears that digital distribution will one day drive Main Street shops out of business.

"From time to time, we have people react to us in that way," Holtman said. "But the proof in the pudding is when you look a few months after those articles and those flare-ups happen. Retailers are still stocking those games, they are supporting them. And the reason they are stocking those games isn’t because someone won a war, it’s because these products are successful. It’s good to stock a game with Steamworks integrated. It’s good business. People want them. It makes customers happy."

According to Holtman, all the work Valve has dumped into Steam ultimately makes the PC and Mac better platforms for retailers. It's also a given that Steam users will ultimately purchase something through the digital store, but Steam clearly drives players into stores thanks to offerings of demos, free weekend sampling and advertisements of physical special editions from publishers.

"Steam is good for retail," he said. "If you look at some examples of things we’ve done in the past, it shows that. One thing we did with Left 4 Dead was have a free weekend, so every one of our customers were able to play the game. At the end of the weekend, we give people the option to buy the game, and the Steam sales went up. But something that people didn’t see was that retail sales spiked, too. And of course this happens. Everyone is talking about the game, but not everyone has a credit card, or credit on their card. Not everyone wants to make a purchase right away and lots of people are heading into the High Street anyway."

Holtman pointed out that Steam is also used to fulfill offers of virtual goods, typically in Special Editions sold only through retailers like GameStop and Target. He used Left 4 Dead as an example again, saying that Doug Lombardi was behind an exclusive Special Edition pre-order deal with GameStop featuring the in-game baseball bat. Steam was even used as a advertising platform to promote the pre-order prize.

"At the end of the day, everyone likes a fight," Holtman said. "Everyone likes to have a diametric opposition, and when we look at it, this is not a fight, this is about people getting their product out to as many people as possible. Retail and digital, they’re both awesome channels. They’re both very important for games companies. Publishers should absolutely have their games in stores, and should absolutely promote people going to retail. The idea is to get more copies out to people so they can play."

Valve says Steam is on the retailer's side. It's not out to trample the Main Street shops. After all, the industry is focused on the console sector and right now, retail is the biggest outlet. But the industry has seen the future, and it clearly points to the cloud-- that forecast was made clear last month during the East Coast Game Conference. Still, as long as gamers have a special place for physical special editions, there will always be retail doors open to greet them, with or without Steam pushing them in.

  • cburke82
    When I first heard of Steam I was very sceptical. I mean there is a possibility of not having access to game you paied for. But I have sense purchased many games from steam and not one has offline mode not worked. If there is no connection on start up I have the option to start in offline mode and it has worked every time. The plus for me is steam sales, I purchased Borderlands for $7.50. Thats great for whatever profits they can get because unless it was that cheap I would not have purchased it. Also love not having to change disks to change games :).
    Reply
  • bustapr
    Steam isnt good for retailers at all, christmas sale for example is hell for retailers. And the fact that sales go up doesnt at retailers take away the fact that most of the sales are made on steam. Steams is the reason retailers are weary of stocking up on games. I believe this because every game Ive bought in the last 2 years has been on steam...
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  • Camikazi
    I'll be honest, I have bought many games of Steam that I would normally just pirate because of the sales they have. My guess is this is the same for many others, either not pirating cause the prices are low or actually buying instead of skipping games cause of the sales, Steam is great far as I'm concerned.
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  • alidan
    cburke82When I first heard of Steam I was very sceptical. I mean there is a possibility of not having access to game you paied for. But I have sense purchased many games from steam and not one has offline mode not worked. If there is no connection on start up I have the option to start in offline mode and it has worked every time. The plus for me is steam sales, I purchased Borderlands for $7.50. Thats great for whatever profits they can get because unless it was that cheap I would not have purchased it. Also love not having to change disks to change games .
    metro 2033 didnt work offline last night, little brother ripped apart the eathernet cable, so his own fault and i didn't put any time into figureing out the problem.

    bustaprSteam isnt good for retailers at all, christmas sale for example is hell for retailers. And the fact that sales go up doesnt at retailers take away the fact that most of the sales are made on steam. Steams is the reason retailers are weary of stocking up on games. I believe this because every game Ive bought in the last 2 years has been on steam...
    retailers deserve to get screwed. you know why games cost 60$ now? because retailers want a bigger profit margin. 14$ go to retailers alone on game sales. they get the biggest cut of anyone. if all games were digital, they would be closer to 50$ or even 40$ new because you can cut the big publishers out. but because retail is around, you see games cost the same online as in store, even though online IS cheaper.

    i personally want to see retail for games DIE, because it holds everyone back as a whole. and if you seriously want to say not everyone can go digital only, THINK AGAIN. realistically speaking, a 32 gb thumb drive is 45$, how many games take more than 32gb compressed, and that aren't online only (excludes mmos, because they can be huge). if you cant get a high speed internet (300kbps + down) than you would go to a store, and plug it in there to get it. because lets be honest, a store wont support online only because you can buy from home, but if a store has a 3-5mbps down stream, and home only has 300kb, people will buy there. a computer costs less than 5$ a day to have run, and the internet costs less than 100$ a month 1 month you are looking at 200$, as only as 40 games are bought in store than you have a service that is doable. and if games were online only, there would be a method for this, trust me, no store will give up a 5$ profit with no risk involved at all.
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  • dontcrosthestreams
    lol metro 2033 doesnt work well no mater what. try taking off your gas mask...
    Reply
  • randomizer
    I don't know about being "good" for the retail sector, but Steam certainly doesn't harm it. Publishers jack up the prices on Steam to compensate for their excessively high margins in store, so if anything it's actually "really good" for publishers.
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  • deltatux
    Problem is that with digital distribution, it's a lot easier to make massive sales which is a lot harder with physical distribution because with physical distribution, you have to pay people at each juncture of the distribution ... you don't need to do that with digital distribution and unlimited copies can be made without cost unlike physical distribution.

    This is what hurts these stores since Valve and other digital distributors are undercutting them. The main barrier in the future won't be credit cards barring people from buying online, it'll be bandwidth caps. Personally, that's the only thing that keeps me going back to EB Games (owned by Gamestop). My 60 GB/month cap is tiny and ain't cheap since my family pays $46.95/month for it. Each GB over the limit is $2.
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  • 11796pcs
    I always get physical copies if I can because of the faster installs, cool packaging, and I don't burn up a bunch of my bandwidth for the month. For me it just makes sense, but I will admit that these stores are fat pigs and now that they aren't making a killing they're whining. Quess what stores! If you don't sell a game with Steamworks then I'll just go somewhere else and buy the game. No big deal, your loss for being so stuck-up.
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  • XD_dued
    Well...most retailers have a very poor variety of pc games. So why complain about people abandoning you from the industry you don't support?
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  • dalauder
    I haven't bought retail outside of last minute gifts in years. I don't think Steam's gonna stop my Mom from going to Best Buy for Christmas gifts.
    Reply