Are Steam Sales Good for the Industry?

I know it’s not kosher to criticize Steam or Valve at all, no less Steam Sales, but something has been bothering me about the wonderful mass of sales we get on a regular basis. Now, before I begin, I love Steam Sales as much as the next guy. I buy all sorts of games and enjoy the fact that many great games can be gotten for almost nothing. I also encourage the practice spreading to other platforms like the PlayStation and its flash sales. However, I don’t think the prospect of Steam Sales is inherently good for the industry. There’s actually a darker side that I’m particularly worried about. You see, internet, Steam Sales are a wonderful boon for indie development, but have a nasty side effect of making AAA development even harder and more expensive than it actually is. While I fully endorse the indie-propping side of the practice, AAA development doesn’t need any more obstacles to being profitable.

I wonder if Gabe Newell likes being a PC messiah? I really hope he thinks it's ridiculous.

I wonder if Gabe Newell likes being the PC messiah? I really hope he thinks it’s ridiculous.

Steam Sales and the like are beneficial, at least in the short term, for consumers. And why wouldn’t they be? Consumers get a regular set of sales for games that they either wouldn’t buy or have been waiting to go on sale. The sales are so popular that they have led to the modern phenomena of gamers buying a huge swath of games because they are on sale and then never playing them, or forgetting they even have them. While strange, having more games than you can play is a welcome phenomenon. I have a friend that just last week wanted to buy a game off of Steam, for full price no less. He clicked on it, ready to set down money, but, to his surprise, he already owned it. He’d bought it in a Steam Sale sometime in the past and simply forgot about it. That’s insane, but also amazing.

futurama-steam-sale-robbed

There’s going to be a lot of memes in this post. Just accept it.

For indie and small-scale developers, Steam Sales are also great. You see, these developers don’t have a massive advertising budget promoting their games ad nauseum, nor do they have brand recognition. And trust me, there is no better advertisement than being on a list of heavily discounted games during a Steam Sale fever. As such, though each individual sale is less profitable, the volume more than makes up for it. Additionally, gamers who never would have touched the game have now tried it and might come back for a sequel, or another game the developer made. After buying Europa Universalis IV on a Steam Sale and loving it, I’m definitely interested in buying other games from the developer.

Steam_-_BUY_GAME_DURING_SALE_NEVER_PLAY_IT3

So, what’s the problem? The problem lies with the fact that Steam Sales have become routine, predictable, and common as dirt. People know there will be massive sales every year and they will wait before purchasing anything unless they can be convinced that they simply cannot wait. Enter the AAA game. These games are the most expensive games there are, and, unfortunately, most of them aren’t worth the price tag. People know this and are often perfectly content with waiting until the games go on sale. Once again, this is great from the perspective of consumers since they can wait, but it’s not so great for AAA developers and innovation in AAA games.

hB0747723

AAA games cost a lot of money. I don’t think anyone is in the position to argue that point. As such, there is a lot more red tape involved in creating them. Publishers often get their hands in game development, giving notes and ideas so as to ensure maximum profitability. Unfortunately, this leads to a more conservative approach with little risk being taken since too much money is at stake. Do you know why sequels are so all-encompassing in the industry? That’s why. The sure thing of a recognized brand is worth more to a publisher than a whole host of innovative and brilliant new ideas. Even when developers want to move on, more often than not, they will be pressured into continuing the same series ad infinitum until it is no longer profitable.

Assassin's Creed - playing it same to the EXTREME!

Assassin’s Creed – playing it safe to the EXTREME!

You see, what Steam Sales do is inherently reduce the amount of AAA games that get bought at launch. People will wait, especially for second or third tier games, which most AAA developed games fall into. While sales will increase when the Steam Sale comes around, these units are highly discounted, and assuredly not a major part of the initial calculation as to whether the game was successful or not. And games that aren’t successful enough don’t get sequels, and the developers don’t get as much creative control from publishers.

Example - Waiting for sale.

Example – Waiting for sale.

Of course, there are many ways of combating this problem. The most obvious solution involves being a massive series with a total monopoly such as Madden. This isn’t an option for most developers. The more common solution is to increase the advertising budget. Make sure everyone knows what your game is and show them that they cannot afford to wait until the game goes on sale. Destiny is a great example of this. The advertising budget on that game must dwarf the GDP of some countries. You can’t go two feet on gaming sites without seeing banners, new videos, news stories or general advertisements of the upcoming behemoth. The major problem is that increased advertising costs greatly increase the budget of the game. This leads to even safer choices being made. Additionally, most AAA developed games simply can’t afford to keep up. This is the kind of thing that leads to situations like when the Tomb Raider reboot was considered a failure despite selling millions due to the massive investment Square-Enix put in the game.

And then Microsoft swept in and offered to absorb some of the cost. Hard times in AAA encourage patronage leading to exclusivity.

And then Microsoft swept in and offered to absorb some of the cost. Hard times in AAA encourages patronage leading to exclusivity.

I believe Steam Sales are a contributing factor in the decline of AAA development. These sales are like clockwork, allowing people to hold off on any game they might want to purchase unless a publisher convinces them otherwise. The costs of combating this effect, namely advertising, are going up. And this leads to an increased pressure among AAA developers to succeeds, leading to more stifled games. While gamers are benefitted by the cheap games, the greater cost to the industry, especially to the AAA sector may not be worth it. I’m not suggesting that Steam Sales go away, or anything even remotely like that. I love sales in all their forms. I’m simply suggesting that there is a cost paid for having these sales. They aren’t simply benevolence with no consequences attached.

– Mistranslations for the Modern Gamer

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2 thoughts on “Are Steam Sales Good for the Industry?

  1. While i agree with your idea that the Steam sale leads to less games being bought for full RRP, i feel that there is also the other side to the coin, games that wouldn’t normally be bought by a gamer all of a sudden become desirable because of the discounted fee of entry.

    I like every gamer, go a bit nuts during the steam sale, and i do have games that have only had their surfaces scratched…which is a shame but i’ve played games that i would never, ever dream of paying £30-£50 on…and really enjoyed them (simcity for example) and bought the next game in the series for full RRP.

    • I very much like the fact that otherwise ignored games get to be played. That is, in my opinion, the best part of large sales including Steam, Games for Gold, PS+ and the like.

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