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GOG to go through some reorganization after suffering losses

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While Steam continues to do well with it being the most popular games store, it seems CD PROJEKT Group's store GOG is really starting to struggle.

CD PROJEKT recently released their latest financial results, along with a call with investors that went over how the whole business is doing. It's not all bad news for them, since they saw overall 38% more sales revenue compared to the third quarter of last year. On the GOG side though, it posted increasing losses and so it's going to be restructured.

Over the current year to date it appears GOG has seen losses of about $2.21 million, which is pretty bad considering the 1.37 million they gained during the same period last year.

They've said that GOG "should focus more on its core business activity - which means offering a handpicked selection of games with its unique DRM- free philosophy" and so there's going to be some changes to the GOG team, with some moving over instead to CD PROJEKT RED. Additionally, they've "initiated reorganization of GOG’s operations" to focus on the "core business" and they're hoping this will "improve its financial effectiveness in 2022".

It's not really surprising, when you think that Epic Games continue to desperately try and turn a profit by pulling more customers to their store and even they don't expect to turn a profit until at least 2024.

Article taken from GamingOnLinux.com.
Tags: GOG, Meta
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104 comments
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kuhpunkt 1 Dec, 2021
Quoting: BlooAlien
Quoting: kuhpunktSteam is getting 20 years old soon. Has Valve ever exploited their situation? Did they ever raise the cut they demand? Did they ever make it worse for customers? No, they improved.

Because they have a philosophy that works and makes sense. They understand that this is a symbiotic relationship... and that's good.

In the vast majority of cases competition is great because in the vast majority of cases people almost always abuse a position of "power" or "dominance".

This competition often leads to awful working conditions, because companies need to cut costs to stay profitable (or because they are super greedy). Amazon (and many many others) abuse their position of power and that is with competition. They are dominant and they can do whatever they want.

The end goal doesn't need to be communism... that's not great either, but I'm not sure that competition is such a good thing. In a competition there are always losers - when there is no need for that in the first place.

Steam is the closest thing to a neutral market place. The only thing I wish they could/would do is open it up for other big studios with an API or whatever so that they all use the same infrastructure, but share the costs or whatever.
Mal 1 Dec, 2021
  • Supporter
Quoting: kuhpunktSteam is getting 20 years old soon. Has Valve ever exploited their situation? Did they ever raise the cut they demand? Did they ever make it worse for customers? No, they improved.

Because they have a philosophy that works and makes sense. They understand that this is a symbiotic relationship... and that's good.

If I understand something of USA laws, had they rised their cut over the years that would have indeed resulted into an illegal monopoly case right away. But when Epic arrived they felt the pressure to even lowered fees for large publishers. That closes any possible claim of monopoly in front of any court.

Though I would have much preferred if they instead walked the irreverent Apple way. Reduce indeed the fees but only for small indies.
kuhpunkt 1 Dec, 2021
Quoting: MalBut when Epic arrived they felt the pressure to even lowered fees for large publishers. That closes any possible claim of monopoly in front of any court.

Valve never lowered the fees for large publishers. They lowered the fees for EVERYBODY who made a certain amount of money - and that was announced before the EGS was announced. Maybe they heard some industry chatter, but there were no signs of that.
Mal 1 Dec, 2021
  • Supporter
Quoting: kuhpunkt
Quoting: MalBut when Epic arrived they felt the pressure to even lowered fees for large publishers. That closes any possible claim of monopoly in front of any court.

Valve never lowered the fees for large publishers. They lowered the fees for EVERYBODY who made a certain amount of money - and that was announced before the EGS was announced. Maybe they heard some industry chatter, but there were no signs of that.

"EVERYBODY who made a certain amount of money" doesn't make it large publishers? Without mass investments into commercials it's hard to consistently make "certain amount of money" in any business. Let alone a overcrowded business like VGs. And that is essentially publishers business and role in the industry.

I remembered that EGS was not open but already announced. I might be wrong. But if they did it before EGS was announced, that would make a monopoly case even weaker: there was already enough competition to put them under pressure even before Tim crusade. Now it might not even be worth considering.


Last edited by Mal on 1 December 2021 at 3:45 pm UTC
Ehvis 1 Dec, 2021
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  • Supporter Plus
Quoting: Mal"EVERYBODY who made a certain amount of money" doesn't make it large publishers? Without mass investments into commercials it's hard to consistently make "certain amount of money" in any business. Let alone a overcrowded business like VGs. And that is essentially publishers business and role in the industry.

Stardew Valley
kuhpunkt 1 Dec, 2021
Quoting: Mal"EVERYBODY who made a certain amount of money" doesn't make it large publishers? Without mass investments into commercials it's hard to consistently make "certain amount of money" in any business. Let alone a overcrowded business like VGs. And that is essentially publishers business and role in the industry.

Valheim or Stardew Valley... no big publishers or whatever. They made enough money to get a bigger percentage of sales numbers. Other big games fail. You say it like it's a default... that big publishers already get a bigger cut, when that's just not the case. Valve made no deals for anybody.

Quoting: MalI remembered that EGS was not open but already announced. I might be wrong. But if they did it before EGS was announced, that would make a monopoly case even weaker: there was already enough competition to put them under pressure even before Tim crusade. Now it might not even be worth considering.

It was before the EGS was announced. Just by a few days, but it was before... as I said, maybe they heard something through the grapevine, but I can't make a judgment there.

https://www.theverge.com/2018/11/30/18120577/valve-steam-game-marketplace-revenue-split-new-rules-competition

https://www.unrealengine.com/en-US/blog/announcing-the-epic-games-store


Last edited by kuhpunkt on 1 December 2021 at 4:08 pm UTC
Mal 1 Dec, 2021
  • Supporter
Oh come on. Don't point the exception to the rule and call it the norm. :D

I'm not saying that indies can't sell millions. Most of those who did I bought a copy as well so I know (including stardew). But they are not consistent. It's a combination of having a good game, healthy PR and be a little lucky with network effect. But just a 0.0x% of all of them makes it. They win the lottery.

While for big publishers it's the opposite. They run commercials everywhere and they sell millions even with a broken or boring game. Then they might call "underperforming title" and in extreme cases not even recoup the costs of the commercials. But to not hit the threshold is just a 0.0x% of all the titles they publish. Publishers are consistent, because that's how all business survives the "natural selection".


Lowering the fees for low sales titles would mean that more indies can have another shot to the moon or can have a less hard life while they try their best to make somethign good. Lowering fees for big sales titles may benefit the occasional Barone out there (and I'm happy for him, he deserves), but mostly help investors in large publishers. I don't think I have to come here and enumerate how many exceptional launches of AAA games resulted in mass burnouts and firings in the ranks in the last years.

And I say this with candid honesty. I too work with professionalism (hoping to not burnout or be fired after doing all I can to meet deadlines) and I too invest my little savings (in hope of largest return as possible). I'd hate to be exploited as a worker as much as being exploited as an investor.
Pit 1 Dec, 2021
Well, I hope everyone here is aware that the problems GOG has have absolutely zero to do with the (non)existence of a Linux client. The percentage of Linux users there is unlikely much different from the Steam one, and a 1% unhappy customers won't cause such a loss....

I myself don't care about Steam. Never used it - I was already Linux-only when they started business. But it's sad to see how they kill one store after the other. First the small ones (anyone remember ShinyLoot?) Then Humble. OK, they're not dead, they still lurk around like a Zombie, selling Steam keys. Pitiful fate for a former spearhead of DRM-free and platform-independent gaming....
So now it's GOG. I really hope they still last for a while. There won't be a new alternative I'm afraid.
kuhpunkt 1 Dec, 2021
Quoting: MalOh come on. Don't point the exception to the rule and call it the norm. :D

Even if true - it still has nothing to do with your claim that Valve lowered the fees for big publishers. They didn't. They still have a 30%/70% share.
Purple Library Guy 1 Dec, 2021
Quoting: PitWell, I hope everyone here is aware that the problems GOG has have absolutely zero to do with the (non)existence of a Linux client. The percentage of Linux users there is unlikely much different from the Steam one, and a 1% unhappy customers won't cause such a loss....
True enough. I think people are just sort of saying "I know I ought to be upset about the no-DRM store having problems, but this is why, from a Linux perspective, I don't much care."
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