Valve abusing the market power of Steam on game pricing according to a lawsuit

Quoting: Grazen

Quoting: Purple Library GuyHuh. Well, I guess if the allegation is true, that Valve's secret contracts involve making developers not sell their games cheaper anywhere else as a condition of being able to sell on Steam, that's kind of anti-competitive in that it stops other stores from trying to gain market share by underselling Steam. And if you foreclose on the whole concept of competition on price, that's likely to be bad for consumers.

Given the high hurdles in US antitrust law, even if the allegation is true that might well not be enough for Valve to actually lose the lawsuit, as noted by EagleDelta etc. But it's still a practice I'd find somewhat annoying--sure, you can understand why they'd want to do it, but then it's easy to understand why any company would do any anti-competitive practice . . . no company wants to be successfully competed against.

Of course if it ain't true then the filers are just assholes. And whether it's true or not, the filers could have questionable motivations and backing.

Anti-competitive means there needs to be harm to consumers (that's a brief legal description) not to competitors. Steam requiring that you keep prices LOWER so that their customers can benefit from LOWER PRICES on other platforms is a plus for consumers. I know it's a plus for me. It means that when I see a sale for a game on another platform, I can go to my platform of choice to get the same price. I win. That's a good thing.

I think you're mistaken on two levels here. First, on what "anti-competitive" is. Lots of tactics are anti-competitive without being anti-consumer. So for instance, if there are four airlines, one of them has more money than the other three, and so the one starts offering airline tickets at below cost in hopes that it will drive the others out of business before it runs out of money itself, that tactic gives consumers cheap airline tickets, at least in the short term. But it is certainly anti-competitive; it's an attempt to establish a monopoly. It also happens that in the long run it's probably not good for consumers, because that one airline did not start the price war just to return to the status quo prices afterwards--the point is that after there's no competition it can jack prices up and reap far more profits than it lost. Once it has the monopoly, jacking the prices up will not be anti-competitive (there already is no competition), but it will sure as hell be anti-consumer.

Second, on what this policy (if it exists) does. The arrow of causation goes in the opposite direction to what you're saying. It does not mean Steam has to match other platforms' sales (actually, it doesn't seem as if it's alleging that sale prices are involved at all, only the regular price or prices which are "on sale" for so long they are in effect the regular price). If it included sales in the first place, what it would mean is that no other platform could mount a sale unless Steam was doing it first.
More generally, Steam is the big player, the main marketplace. And, it charges a large cut, 30%. If a game publisher wants to make $14 per game, it must charge $20 on Steam. But on Itch.io, say, it could make $14 per game while charging $16, or even less if the publisher wanted to be a jerk to Itch. So normally, platforms that took a smaller cut than Valve does could undersell Steam and potentially gain market share via their lower prices, potentially forcing Steam to in turn lower its cut to compete, lowering game prices across the board.
The kind of agreement alleged would mean the publisher must instead charge at least $20 on Itch and other such platforms. At the immediate level that means you can never get a price break on another platform. I don't see any way in which it reduces prices to consumers, quite the reverse, even in the short term. In the longer term, by making competition on price impossible, it reduces pressure for Valve to reduce their cut, so that would keep prices higher in the longer term.

So yeah, I don't see where you get the idea that such agreements would lower game prices in any way shape or form.

Quoting: Purple Library Guy

Quoting: Grazen

Quoting: Purple Library GuyHuh. Well, I guess if the allegation is true, that Valve's secret contracts involve making developers not sell their games cheaper anywhere else as a condition of being able to sell on Steam, that's kind of anti-competitive in that it stops other stores from trying to gain market share by underselling Steam. And if you foreclose on the whole concept of competition on price, that's likely to be bad for consumers.

Given the high hurdles in US antitrust law, even if the allegation is true that might well not be enough for Valve to actually lose the lawsuit, as noted by EagleDelta etc. But it's still a practice I'd find somewhat annoying--sure, you can understand why they'd want to do it, but then it's easy to understand why any company would do any anti-competitive practice . . . no company wants to be successfully competed against.

Of course if it ain't true then the filers are just assholes. And whether it's true or not, the filers could have questionable motivations and backing.

Anti-competitive means there needs to be harm to consumers (that's a brief legal description) not to competitors. Steam requiring that you keep prices LOWER so that their customers can benefit from LOWER PRICES on other platforms is a plus for consumers. I know it's a plus for me. It means that when I see a sale for a game on another platform, I can go to my platform of choice to get the same price. I win. That's a good thing.

I think you're mistaken on two levels here. First, on what "anti-competitive" is. Lots of tactics are anti-competitive without being anti-consumer. So for instance, if there are four airlines, one of them has more money than the other three, and so the one starts offering airline tickets at below cost in hopes that it will drive the others out of business before it runs out of money itself, that tactic gives consumers cheap airline tickets, at least in the short term. But it is certainly anti-competitive; it's an attempt to establish a monopoly. It also happens that in the long run it's probably not good for consumers, because that one airline did not start the price war just to return to the status quo prices afterwards--the point is that after there's no competition it can jack prices up and reap far more profits than it lost. Once it has the monopoly, jacking the prices up will not be anti-competitive (there already is no competition), but it will sure as hell be anti-consumer.

Second, on what this policy (if it exists) does. The arrow of causation goes in the opposite direction to what you're saying. It does not mean Steam has to match other platforms' sales (actually, it doesn't seem as if it's alleging that sale prices are involved at all, only the regular price or prices which are "on sale" for so long they are in effect the regular price). If it included sales in the first place, what it would mean is that no other platform could mount a sale unless Steam was doing it first.
More generally, Steam is the big player, the main marketplace. And, it charges a large cut, 30%. If a game publisher wants to make $14 per game, it must charge $20 on Steam. But on Itch.io, say, it could make $14 per game while charging $16, or even less if the publisher wanted to be a jerk to Itch. So normally, platforms that took a smaller cut than Valve does could undersell Steam and potentially gain market share via their lower prices, potentially forcing Steam to in turn lower its cut to compete, lowering game prices across the board.
The kind of agreement alleged would mean the publisher must instead charge at least $20 on Itch and other such platforms. At the immediate level that means you can never get a price break on another platform. I don't see any way in which it reduces prices to consumers, quite the reverse, even in the short term. In the longer term, by making competition on price impossible, it reduces pressure for Valve to reduce their cut, so that would keep prices higher in the longer term.

So yeah, I don't see where you get the idea that such agreements would lower game prices in any way shape or form.

Well, we’ll have to agree to disagree on both points. On your first point, selling below cost, that’s called dumping and that is clearly not what Valve is doing and your example is completely irrelevant.

On your second point, it is (apparently) a term of service for Steam that publishers NOT sell their games for a lower price on a competing platform. They can of course choose not to sell their game on steam (or not to sell it for a while) as many do when they go on the Epic Game Store. In fact many or most publishers sell their games through their own online stores, including EA, Ubisoft and CDPR - cool, they can do that... BUT BUT BUT... if you want the benefit of selling your game on Steam you can’t position it as a higher priced store to make your own store look better in comparison. Can’t have your cake and eat it too... this cake is no lie! Publishers can also choose to sell games exclusively on their own platform like Blizzard or Riot or Epic does... in fact there’s lots of competition... because Valve keeps Steam’s rules simple and expansive.

Quoting: GrazenWell, we’ll have to agree to disagree on both points. On your first point, selling below cost, that’s called dumping and that is clearly not what Valve is doing and your example is completely irrelevant.

Are you for real? You made a claim about what it means for something to be anti-competitive. I refuted that claim. That's what it's relevant to.

And in the second point, you made a claim that these (alleged) license terms of Steam's would cause lower prices. I refuted that claim, and showed how it was in fact the reverse of that. So when you came back to me you sidestepped that whole thing to say that they're just good because Steam is good and letting other stores undersell them would be bad. Maybe, but that's not at all what you were saying before. You are not arguing in good faith.