How Valve’s ingenious digital store has taken over the gaming world
Currently, over 40 million people own a Steam account; that’s a tie with Xbox Live for user base. During the 2011 Holiday Sale, five million users were signed in to Steam simultaneously for the first time -2.5X the number of people who streamed the Royal Wedding last year.
In 2011, Steam delivered 780 petabytes of games to users. It would take more than 1 million MacBook Pros to hold that many games.
How it works:
- Users download the Steam client.
- Users buy & download games through Steam.
- Users can play the games they buy on any computer.
Today, 58% of PC games sales are made through digital distribution. Steam is by far the biggest player in the game, with an estimated 51% market share. Next comes Amazon, Gamestop, MS Games for Windows Live, EA Store and Direct2Drive with an estimated market share of 11, 10, 9, 5 and 5 percent respectively.
In 2012, according to Valve CEO Gabe Newell, Valve – fueled by Steam – brought in more money per employee than Apple or Google, employing 250 people and bringing in at least $87.5M in profit. That’s at least $350K/Employee!
Though it’s raking in major bucks, Steam offers game producers a much better cut than retailers. Via retailers, only about 30% of the cu goes to the game producer, while Steam gives 70% of the revenue to the game producer.