Is Steam good for dev profitability *spawn

[Billy Idol]

Most games launches have the exact same curve, you make a huge amount of money in the first initial weeks, and then drop off to essentially nothing (at least compared to those first few days/weeks) On most platforms, that's it. The difference with Steam, is that it does these constant sales and promotion slots, and the people tend to buy in droves. That gives you a much nice tail for the 2years post launch, and allows you to generate a bunch of extra revenue that you couldn't otherwise. As a concrete example: * We had launched 5mths ago, and sales were down to around $1000/mth. * We decided to do a 1week, 60% off sale, in the Steam Admin Console ($5 to $2) * Steam featured us for 3 days in the "Weekly Sales" section, but the sale lasted for 7 days. Results: $11,000 in extra revenue! For the time it took to click a few dropdown menus and submit a form. And no other platform _really_ offers a similar ability to boost your own sales. So that's pretty damn cool. We have another sale schedule for a couple months down the road. If we add Workshop support we may be able to get featured again on the front page, and that would be huge. I figure at the end of the day, we'll probably make about 50% of our money post-launch on Steam, which is crazy compared to other platforms. I can only imagine what bigger titles are able to do. Must be nice

Thank you very much for your infos, very appreciated and very informative...and congratulations to you and your team!

 

[Pixel]

As I understand, there is no flexibility on the fees. You end with quite a lot of flat fees on disks, from printing and fees to distribution and any buy-back offer you have for retailers. Below a certain price, physical media has to be pretty worthless to the publishers. That's why download titles offer a significant price advantage potential - it's in a position to go $20 cheaper than a disc title but still make as much money for the platform holder and publisher, and can go cheap and still make some money.

I knew distribution would be a flat rate, but for retail cut, but I'd be surprised if for Game Stop it didn't vary. You see puiblishers purchasing varying amounts of wall/rackspace for their new titles. I've noticed some older games don't even have any spot anywhere on the salesfloor. For some of the older games you'd be surprised that they have them because not a single empty jewel case exists on the sales floor signalling they have copies of that game. Happened to me once with and again with Katamari Damacy Witcher2 where I just inquired after spending several minutes looking for the jewel case and finding nothing and assuming they didn't have it in stock because they were older games, then just on a whim before leaving thought I asked.

Just doing the math, I think royalty rates must be lower for those old Xbox Platinum hits and Playstation Greatest hits.

 

[Shifty Geezer]

Yeah, they'll be discount rates for certain types of games. However, the standard box that gets price reduced over time will have a fixes fee, paid up front when the disc was pressed. If that's $7 on the disc, it'll be $7 paid up front whether that disc sells for $60 on day one or $30 some months later. As the publisher owns the disc, they will have room to reduce their price to the stores. So a game disc could be sold to a retailer for $40, say, on day one, but then sold to the retailer for $20 some months later which the retailer passes on as cheaper to the consumer. However, the flat fees will still be the same on the cheap copy.

I think I get your question now. You're saying, "Do publishers charge less for cheaper games?" That'd be 'yes', because they own the disc and sell them to the retailer with whatever profit margin they charge and they'll be flexible with that to shift old stock.