Valve issues scathing response to the facts behind Steam antitrust case

Valve released a scathing response to Wolfire’s lawsuit in April alleging anti-competitive monopoly practices on the Steam storefront. In this response, Valve argues that the lawsuit should be dismissed because it “does not allege the most basic elements of an antitrust case.”

There is no right to release Steam keys

Part of the focus of Wolfire’s case is that Valve requires free Steam keys generated by developers using Valve’s platform to be sold on other platforms at prices not lower than those offered on Steam. But Valve repeatedly argues in its file that it has “no obligation to distribute Steam keys, let alone allow developers to use Steam keys to reduce their Steam prices in other stores.”

The free key system, says Valve, is designed as a means of “[give] developers a free way to sell (or give away) a reasonable number of copies of their Steam games. With that in mind, the non-Steam price restrictions for these keys “prevent developers from profiting from Valve’s investment in Steam.” “Price and quantity guidelines” prevent developers from eroding large amounts of sales on Steam, which Valve covers 100% of the creation and maintenance costs, but provides users for free. “

Valve goes on to say that antitrust laws impose “no obligation on Valve to facilitate competition with itself” and points to case law to this effect. “Valve also does not have a duty to continue to offer [free keys], to grant them in unlimited numbers or to allow developers to use them to sell Steam compatible games in other stores less expensive than on Steam ”, explains Valve.

Wolfire’s lawsuit also alleges that Valve is trying to enforce price parity not only for generated Steam keys, but for non-Steam versions sold on other platforms. Valve, in its response, is not impressed with the factual basis of this claim, which it says relates to “a single anecdote from Valve allegedly telling an anonymous developer that he should not give away an incompatible game. Steam for free on Discord’s competitors. platform though it charges Steam users $ 5 for the Steam version of that game on Steam. “This narrow anecdote, according to Valve,” does not claim that it is applied market-wide or likely does. no effect on competition “.

Wolfire’s costume features evidence that many games are the same price on Steam and other storefronts that charge lower fees. But Valve argues that this kind of price parity between storefronts is commonplace. Even if it didn’t, Valve says, the lawsuit misses “any factual claim that Valve… did anything to affect, let alone coerce, developers to sell at the same prices in two stores.”

Competitive rates

Valve also criticizes Wolfire for failing to present any facts to support its claim that Steam’s base 30% reduction in game sales is greater than what would be available in a more “competitive” market. Instead, Valve says, “Complainants can only muster a generalization that the economy predicts Valve’s 30 percent commission should have declined over time.”

Valve points out that it has not increased its base costs since “the start of Steam when it had no market share, and therefore no power to charge anything other than a competitive price”. On the contrary, in 2018, Steam cut its fees for high-income games, a move the company suggests “let[s] the opposite of a supercompetitive commission. “

Here, Valve highlights a 2008 antitrust case against Apple and its iPod / iTunes music markets. In this case, Apple successfully pointed out that it had maintained the same cost of 99 cents per song “before and after obtaining a monopoly – and never changed that price, even after a big seller (Amazon) entered the market “.

The fact that Steam’s 30% fee is higher than competitors like the Epic Games Store reflects that “the market views Steam as superior … which is consistent with Valve’s ability to charge higher prices,” said Valve. In support of this, Valve cites lines from Wolfire’s own lawsuit describing consumer backlash when Borders 3 was not available on Steam.

“The Steam platform is much more than an intermediary but offers real added value to players and developers,” writes Valve. “Indeed, gamers would have appreciated Steam so much that Epic offers popular games exclusively on its Epic Games Store platform” caused negative reactions “and” boycott calls “from players being forced” to wait. a Steam compatible version or use a PC gaming platform. they don’t prefer. ‘”