Valve? Are you okay, buddy? I know it's been a few years since you released a game, but did you remember… what? announcing? a game?
In case you didn't know, the owner of the Steam platform, Valve, developer of the Half Life, Team Fortress and Portal series, as well as DOTA 2 AND Artifactis finally releasing a new game: a hero shooter called Stall.
Or… is it? The game was initially discovered via Steam datamining and was not officially announced. Although it seemed nearly complete, there was every chance Valve would pull the plug and not release it.
Then, at some point, Valve invited players to a closed beta for Stallusing a key system that allowed players to invite their friends. The invitations proliferated so much that according to SteamDBThe game peaked at 18,000 concurrent players.
Such invites for unreleased games typically come with several NDAs, but as The Verge's Sean Hollister states discoveryValve's only attempt to discourage the sharing of any information about the game was a menu screen that said “do not share information” when opening the client, with a message asking the user to say “ok”.
Hollister navigated this screen by pressing the “Esc” key. After writing about this experience, Valve banned his account from matchmaking.
The Hollister ban set off alarm bells for me. Not only because taking revenge on journalists is against press freedom (I don't want to make too much noise, it's just being banned from a game's matchmaking), but because this series of events indicates that Valve's market power may be getting out of hand.
Is it a monopoly? I don't know, but since Valve owns and operates Steam, the platform that distributes Stall Thanks to this, it was able to market its game in a way that no other developer or publisher is able to do.
Let's try to understand why.
What other publisher could release a game like this?
Let's retrace the phases of Valve Stall launch.
Valve owns Steam, the platform on which it distributes its games. It funds the development of new games with revenue from Steam and its existing titles.
When Valve releases a game, it competes with other games on the Steam marketplace. Valve's market power is controlled by how many games it can provide, their quality, and its competitors' ability/decision to launch on other platforms.
Valve, like other developers, has decided to do a closed beta for StallUnlike most other developers, he has not announced the game Still. This closed beta is run with an invite-based system that is very open, where players can invite others. Valve has deliberately given up control over who joins the playtest because, for some reason, that fit into their strategy.
Valve could also have legally controlled who is allowed to discuss Stall and under what conditions, requiring the signing of an NDA or equivalent agreement activated in the game.
He didn't do it because, for reasons I don't know, it was part of his strategy.
We are already in a situation that most (if not all?) developers and publishers cannot afford to operate in: tightly controlling the information about a game, which is (allegedly) the key to its financial success. Valve has a disproportionate amount of financial stability to withstand any revenue loss that might result from an early leak. Stall.
The closest example of another publisher trying this strategy that comes to mind is when Respawn Entertainment and Electronic Arts accelerated the launch for Apex Legendsand invited a bunch of journalists and influencers to Los Angeles to play the game before launch. During this test, they still asked the press to sign NDAs (or at least accept embargoes, I never learned the specific terms).
Now we enter even more uncharted territory. Valve has put an unannounced game on Steam, and invited people to play it. Not just to invite them to play it, but to invite their friends to play it.
This is where Valve not only has a market reach that other companies don't have, but it does so explicitly benefits from its position. The company is not making money with Stallbut a beta version like this might one day entice people to spend money on Stall. Valve is benefiting from this strategy, like many other companies, so I'm just reporting it here as the beginning of its unusual position.
Here's the nail in the coffin for me as to why Valve's moves showcase its market power: when Valve gets people to share invites for Stallhas the potential to effectively create new users for all steam.
Some people are playing Stall can invite their friends who have never played on Steam before. It's not a far-fetched concept. If people have only played Fortnite OR Gamesor they've been mostly on consoles, or they've pirated software and not used Steam, whatever, Valve's efforts in this case could lead to the creation of new Steam accounts.
Every new Steam account benefits Valve in some way financially. If a player accepts an invitation to Stallcreates an account, then buys a game from its competitor on Steam, Valve gets a cut. If that player never spends a dime, but hops on other free-to-play games on Steam, they enter an ecosystem that leads to other players spending money on the game, which Valve gets a cut of. In the bigger picture, Valve relies on other companies to market Steam for this, because they’re the ones saying “hey, if you want to buy our game, join Steam.” Here, they can use their own product to do that marketing at a discount to their competitors.
And now we come to the “NDAs”, a point where I think Valve has seriously abused its position. Valve has not asked anyone to be invited to play Stall to sign a legally actionable NDA or have them accept a EULA. It posted a sign that didn’t even explicitly require the user to click “I Agree,” something that EULAs take pains to specify to ensure their legality (and even then, some judges and regulators are scrutinizing it).
Imagine that this notice, or any document, is a guard at the door. If the guard is called “NDA” or “EULA”, when a person asks to cross the threshold, the guard says “you can cross the threshold if you agree to X and Y, and if you violate that agreement, Z will happen”.
The person who wants to cross the door can express his consent or not, and the guard lets him enter.
Here, Valve has placed a guard at the door who when players ask to go through, says “don't tell anyone you went through this door”. If players ask “or what?” he doesn't answer. What will the guard do? Stop you from going in? Hit you next Tuesday? He'll open a trap door and you'll fall in and there will be crocodiles but the crocodiles are friendly and you'll have fun with them: okay, this is getting out of hand, I think you get the point.
This way a person can pass without saying “ok” to the guard.
This is the purpose of such documents: to create conditions for both parties to understand the results and to be able to agree on an equal footing to enter into a contract together.
Valve's menu is not an NDA and it is not an EULA. When Hollister wrote about the game, he did so without explicit knowledge of what Valve's response would be. When journalists accept embargoes or sign NDAs, we do so with the knowledge of what will happen when we violate that agreement.
Valve stepped in and banned him from matchmaking. It's a slap in the face, but Hollister had no way of knowing if that would be the only consequence.
Valve could have banned him from every online game on Steam. Valve could have disabled his access to various elements of Steam. Valve could have gone so far as to disable or suspend his entire account. They have the power to flip that switch and they chose to take what they felt was an appropriate response here.
But unlike every other gaming company on the markethe did it without first having entered into an agreement.
Actions like this invite scrutiny of Valve's market power
To date I have not been personally convinced by the lawsuits accusing Valve of running a monopoly through Steam. I'm not saying I think they're 100 percent wrong, I just think that as long as I can go buy a game on Xbox or PlayStation, I have a market of choices. The fact that I can play other games on PC without ever opening Steam is another factor.
In other words, I want to leave it up to the courts and regulators to figure it out. I'm just a writer, not a legal expert.
Valve's behavior with the launch of Stall changed my way of thinking. Some of the lawsuits against Valve have revealed details about how it “encourages” developers to keep price parity across all platforms, but then again, I'm not an expert on whether this is considered a fixed price. But as someone who is professionally obligated to follow the games industry, I know when I've seen something I've never seen before, and I've never seen a company impose a non-sharing order without some form of binding agreement in place.
This is a first. And it's a first because Valve has the market power to do so. That power manifests itself in its control over Steam accounts, its ability to withstand the damage of leaks, and its ability to benefit the entire ecosystem by allowing players to invite other players to Stall.
I still don't know if Steam is a monopoly! Again, I'm a writer, not an expert, and I'd rather the courts and the FTC intervene before putting such an argument into print.
I've been thinking a lot about market power and monopolies following the recent court ruling on Google's Dominance in Search Engine and the The FTC's Objection to Game Pass pricing changes following Microsoft's purchase of Activision Blizzard, especially around the concept of a “degraded product.” Valve has done nothing to make Steam worse (in fact, it regularly makes it better for developers and players), but the launch of Stall suggests the existence of some supreme form of Steam that other developers don't have access to.
Is this fair? Is this legal? I don't know. If anything, I think Gabe Newell should bring one of his $30 million yachts into the office and say “hey guys, what's going on here?” before someone from the government does it for him.
The game developer has reached out to Valve for comment on this story and will update this story when they receive a response.