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The digital game store wars: Who are the players?


It's getting crowded

A litany of new digital gaming stores have sprung up over the last few years, in commensurate response to the growth of the video games market. That market, according to research firm Newzoo, is expected to hit $180.1 billion in revenue for 2021, adding roughly $15 billion per year from now until then. The group also claims that the market is 91% digital, meaning there's a huge electronic money pie for these stores to chase, though the fastest growing and largest portion is for "mobile" gaming. 

For the PC market, consumer reactions have been generally critical of the publishers that opt to create their own alternative stores instead of Valve's immensely popular Steam. Many are annoyed about the need to have multiple applications installed to access their games, not to mention stores that lack some of the features that Steam offers. Others complain about exclusivity and incompatible multiplayer between versions. Others just simply hate change. 

Regardless, this subject has been a hot topic over the past few years, and the controversy appears to only be growing. As we approach the completion of the first one-fifth of the 21st century (I know, where did the time go?),  here are the major (and minor) players in the online games store market and where things stand today.  

Valve's Steam 

Really, there is no introduction needed for Steam. Launching way back in the olden days of 2003, Steam is now processing billions of dollars USD in sales per year. Steam also includes the Steamworks API, which is a collection of functions developers can integrate into their games such as matchmaking, achievements, cloud saves, user created content, and more. It has easily the largest feature list of any of the digital stores, with unique options like big picture mode, curation, user reviews, wishlists, custom gamepad mapping integration, and much more. Mobile apps for the store have made their way to millions of Android and iOS devices, as well. Steam also was among the first to allow sales of pre-release software with its love-it-or-hate-it "Greenlight" program (which is now defunct).  

Though well ahead of its time and by all measures wildly successful, in recent years Steam has endured quite a bit of criticism. Issues include high costs to publishers, a languishing UI (it took way too long for high-DPI support), censorship drama (not enough or too much, depending on who you ask), the failed SteamOS platform, and a perceived general corporate arrogance. 

Regardless, Valve's baby has remained far and away the top digital storefront, and there has been little movement among users to abandon it even when competition has popped up. With over 150 million accounts, Steam is a gaming behemoth.  

Back in the Half Life 2 days, when Steam was new and forward-thinking, both server and internet costs were vastly higher, and as such it might have made more sense for a digital store to employ a significant cut of revenue. These days, those costs are drastically reduced, while Valve's cut has remained roughly the same, and now developers are largely paying only for the ability to be available on the platform for access to those users. 

For PC gaming to thrive, one could argue that we need more of the funds to go to the people actually making the games, not to the people hosting these games on their servers. Valve is barely even a game studio these days, and the costs to distribute these titles have fallen exponentially over the years. Many people view Valve as abusing its dominant position to extract monopoly profits, while others believe the company is a benevolent overseer. Either way, prices seem to be well above the marginal costs of running Steam, which means the market is ripe for competition.   

In December of last year, Valve announced changes to the revenue split. Historically, Steam has taken 30% of sales, but now that percentage will vary depending on how much revenue a given product has generated. It now starts at the same 30% for the first $10 million in sales, then drops to 25% between $10 and $50 million, and then it drops further to 20% once a game reaches above $50 million. Clearly an attempt to stop publishers from making their own stores, the new model appears to be currently failing, as game exclusivity on other platforms seems to have only increased since Valve enacted this new policy.  

As for future plans, Valve keeps its secrets close to the vest—an advantage of being a privately held company. It's announced better curation and improved purchase suggestions, Steam China, new mobile chat, an updated library, and improved cheat detection. VR development is almost certainly continuing, but any other amazing future technology or serious enhancements to gaming as a whole are not publicly known to be under development at Valve at this time, although there almost certainly is some kind of work being done.