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Gabe Newell's keynote speech at DICE Summit 
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Minor Diety
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Post Gabe Newell's keynote speech at DICE Summit
Some highlights, and finally some steam numbers (even though they are percentages, not actual hard numbers :roll: ).

http://g4tv.com/thefeed/blog/post/69334 ... tware.html

Quote:
Gabe doesn't believe that pirates are really seeking to get things for free. They are people that spend thousands on their PC's and Internet service. He believes that pirates are beating companies on service. He cites TV shows not available in certain parts of the world. Pirates have TV shows up on the Web minutes after they have aired.


Quote:
DRM decreases service value for customers. It also makes pirated copies of games look more appealing. Anecdotal evidence appears to suggest that DRM is increasing and not decreasing piracy.

As far as privacy goes, Gabe believes that people are willing to give up system and personal information if they feel it's being used to get a better service. Steam's hardware survey is an example of this. Rather than spying on users for nefarious reasons, Gabe believes things like its hardware survey helps with better sales of products and service. As long as companies are transparent, he feels that customers will accept this.

As far as the shrinking distance between Valve and its customers, Valve didn't find any service in existence so it made its own: Steam.


Quote:
Steam stats time:

* 20 million people connected
* All major PC publishers on board
* 350+ of the best PC games
* Worldwide in 21 languages
* 100% Year-over-year growth since 2004


Quote:
With Team Fortress 2, Valve shipped the game as a service and not a product. Valve uses "updates" to create more value for its customers. Updates can be bug fixes, new achievements, maps, and unlocks. There have been 63 updates to Team Fortress 2 since its release. This is also why the PC version is so much better than the Xbox 360 version.

Gabe brings up an excellent point that successful entertainment companies will realize that fans of properties like the property, not the specific product. They are Harry Potter fans, not just fans of the books. The team that's making the TF2 character videos (which are awesome!) are going to be working on comic



Quote:
Valve has seen a great turnaround rate on guest passes. Friends invite their friends to play a game they already own. Game invites that also walk a gamer through a purchase process are also effective.

Time to look at the sales of Team Fortress 2 to see the impact of the updates on revenue. Holy s#!%. The sales spike by huge amounts everytime there's a sale or major update. Steam sales went up 106% after a free update. Player minutes went up by 105%. Gifting has thrown a 71% sales increase. Surprisingly, sales from retail stores also went up by 28%. Finally, it saw 75% increase in new users. Knock knock. Who's there? Steam. Steam who? Steam is so successful it hurts.


Quote:
Price changes in the retail world don't allow for much freedom. Steam and other services offer flexability. In fact, users apparently respond to pricing discounts within five minutes.

Valve was afraid that too many price changes would "confuse and anger" customers. It isn't the case.

Last weekend, Valve decided to do an experiment with Left 4 Dead. Last weekend's sale resulted in a 3000% increase over relatively flat numbers. It sold more last weekend than when it launched the game. WOW. That is unheard of in this industry. Valve beat its launch sales. Also, it snagged a 1600% increase in new customers to Steam over the baseline.

Worried retailers, fear not. The weekend sale didn't canabalize sales from retail. In fact, they remained constant. Well, constant isn't a 3000% increase, but it's still pretty good, right?


Quote:
Looking at a third-party game, it saw increases of 36,000% with a weekend sale. Oh. Em. Gee. Okay, Gabe is starting to convince me that PC at retail is going to die very soon.

Oh, more data. I'm such a data nerd. Here's some data!

During the Holiday sales:

* 10% sale = 35% increase in sales (real dollars, not units shipped)
* 25% sale = 245% increase in sales
* 50% sale = 320% increase in sales
* 75% sale = 1470% increase in sales

At 75% off, they are making 15% more money than they were at full price.


Quote:
When prices are dropped, Valve sees a lingering increase in sales. Valve has hired an experimental psychologist to come up with new ways to excite users with pricing models and sales. He suggested one in 25 users that buy Left 4 Dead get another Valve game for free. That'd be awesome!



Dang. Dang. Dang. Companies would kill for this kind of success. And success built on a great relationship with its 'users', too, not just EA-style evil empire mass marketing DRM domination.

If Valve were a woman, I'd be in love with her.



P.S. saw this on Steam yesterday:

Command and Conquer: Red Alert 3 Update Released
February 19, 2009, 12:00 pm - Valve - Product Update

Updates to Command and Conquer: Red Alert 3 have been released. The updates will be applied automatically when your Steam client is restarted.

This game was delivered with both Sony SecuROM and Steam digital rights management technology. This patch will remove the SecuROM technology from the game as well as remove the game-specific SecuROM license from your machine. The game will continue to be protected by Steam technology. To remove SecuROM files from your machine and for more information, see the EA support site at http://support.ea.com/cgi-bin/ea.cfg/ph ... aqid=20763.

:)

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Fri Feb 20, 2009 3:57 am
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Felix Rex
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Well, as ok as I am with Steam, it's still DRM and it still ties sales to a specific user. Is it possible to resell a game you bought from Steam? I don't think you can do that. So they've wiped out the first sale doctrine. They can also arbitrarily lock you out of your account, potentially cutting you off from dozens (hundreds?) of games you legally purchased. I don't like either of these. Also, playing offline is a bitch... and if Steam decides you need to validate, you're screwed until you find an internet connection. Not necessarily a huge deal for any of us, but if I had a job where I was traveling more, it would matter a lot.

It's nice they're stripping securom, but Steam isn't the be-all end-all of game sales. A completely open, completely DRM-free model would be superior. If someone created a Steam without DRM, I'd switch to it immediately.

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Fri Feb 20, 2009 6:10 am
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You can't resell or even gift your old games over Steam, nope. Which is too bad. But then you can't really give away most of your retail games either, because you'd run into problems with the MP and all that jazz. But I agree, not ideal. Because Steam is such a uniform system they could bypass those MP problems by just re-assigning the MP id to the new player's account...but of course they're not going to do that, from a sales perspective. :(

I don't mean to say that Steam is perfect, just that it's very much preferable over draconic Securom-style DRM. I do run into issues with Steam from time to time (connection lost or whatever) but I find they are rather rare (and often restricted to MP games like L4D). The last 3 games I bought that featured Securom, otoh, all frequently crapped out while playing offline or even locked uo my box. I have yet to see Steam do that.

Meh...I think we mostly are just saying the same thing. :) But perhaps I am more positive about Valve running the show and their success, as i believe it might lead to actual user-friendly innovations. And I feel their success is a reward for their attention to their clients, which in turn might cause other companies to look up and take notice. You know?

Btw - there is a steam-like system that caters to a part of your wish, namely playing your games without needing to be online. Stardock - the company that releases its own games completely free of any DRM - has created its own service named 'Impulse (Driven)'. The service is still fairly young but its catalogue is starting to look rather nice. Of course, whether the game still has any sort of DRM will depend on the developer...but at least you won't have to connect to the internet through impulse itself.

http://www.impulsedriven.com/

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Mon Feb 23, 2009 5:51 am
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Felix Rex
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yea, I think we're on the same wavelength. I'm just afraid of what might happen if Steam gets too popular. We need some competition. The impulse driven thing might be cool...can't really check it out from here.

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Mon Feb 23, 2009 8:13 am
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