Valve: Pirates are potential customers
Valve's Jason Holtman addressed the business models behind the company's popular Steam service at the Game Business Law summit at SMU's law school today. He talks about steam not just being a distribution channel but an actual gaming platform, something I iterate every now and again:
"We're not just a way of selling game," reiterates Holtman. "What we are, actually, is a platform." As such, users have to be able to do more than just buy games, the reason Steam has achievements, and lets users talk to friends.
Holtman returns to this false idea that "Digital sales cannibalize retail," and this time he has proof. "Since Steam is actually a connected platform," he says, Valve can track activation for both retail and digital sales.
"We found that our piracy rates dropped off significantly," Holtman says, explaining that Valve makes sure their games are on the shelves in Moscow and St. Petersberg, in Russian, when they release it to North America and Western Europe.