Blizzard and Valve reaction to Windows 8
If you follow the Windows 8 news regularly as I have you'll have noticed a trend in the past few days. Both Valve and Blizzard are ripping into Microsoft over Windows 8. To be honest, I get where they are coming from, but their concerns are unfounded. And at least as far as Gabe Newell of Valve is concerned, outright ridiculous. As a result I felt the need to blog about this.
When Microsoft released Windows Phone 7 they adopted "the Apple approach". They implemented an app store, provided it as the only legit means of getting software on their devices and took a percentage of the sales. At the time, there was a similar outcry, but mostly from smaller publishers as there were very few big players in this market and all of them have already lived under this while working on iOS applications. The model has both upsides and down sides. And this is just an opinion but I think that there are more upsides than downsides. Yes, you cannot distribute the application directly or process payment directly for your website or store front. But many developers either don't have a decent website anyway. If their application became popular overnight they would be unable to keep the site up. Etc... not to mention that there would be ongoing costs associated with implementing and maintaining that infrastructure.
For many people, most likely the majority, unless your application is incredibly successful, Apple's cut is probably less than you would have paid to maintain that infrastructure yourself meaning most people make more money this way than if they had to hock their wares themselves. And since everyone is forced to operate the same way, no one has an unfair advantage in that department. Also, a single store front means more virtual traffic. Again, most applications in a unified market like this will have more people see and potentially use/pay for their application. So again, more money than without Apple. You may point out how little money developers actually make on average, but that is actually a ridiculous statement. I'm going to take this to extremes, but lets say you built a Fart Soundboard application. There are literally tens of thousands of these applications. No one would go looking for yours if it weren't on the website. Thousands of your competitors are giving theirs away free. And you get some guaranteed visibility when you first release as it will show in the new release section. If you struck it out alone... you may get zero hits on your website. Money in the app market sucks because competition is FIERCE.
This model of course doesn't benefit everyone. A well enough known company in this model, especially one which might already have the store infrastructure in place would likely make far less money than if they sold it themselves. A flat percentage cut off the sales means that at some point if they sell enough the cut Apple (or Microsoft) would be taking is more than your overhead would be to sell it yourself. They would also need to close their own store, fire employees etc.... Blizzard and Valve are in this boat. Sounds like a pretty grim picture.
I'll start my rebuttal by playing the RIAA and MPAA card. Times change. Adapt or die. I'm not saying everyone will convert to this model and the current business model for software will die. Only time will tell that, and I seriously think if that if we look back one and try to figure at what point in time this model started taking over it will be seen as some time well before today (IE, the movement has already started, even if it isn't guaranteed to succeed). Which means companies like Valve and Blizzard who have no plan on how to operate in that economy may be too late. Instead of whining they should thinking about how, if necessary, they can get into that business model successfully. Whining shows me they lack the foresight or any plan. And my thought on businesses like that is, you had your time in the sun and let it get to your head, bye-bye.
My next point is the irrelevance of their concern. Today, both companies host primarily games written primarily in Win32 API's. The games will NOT run on WinRT or in the Metro interface and WILL run EXACTLY the same as they do today. Now Valve is a different animal, so I'll come back to them in a second. Blizzard has an army of developers. You want my guess on how many know the WinRT SDK? 0. You want my guess on how many use .Net? Probably a fraction if any of their workforce. Blizzard has a MUCH larger barrier than the Windows Marketplace. They don't have an employee base at the moment that could even produce an application to get them in there. They also have no experience in writing touch based games which for them would be the primary driver to wanting to get into that scene (leverage ARM tablets). I'm sorry Blizzard, I loved your company and your games growing up, but your point is moot. For Windows 8 you will continue to write Win32 based applications and sell them in your web store and nothing will change.
Now, back to Valve. Yes Valve also makes a game here and there so they share in that same problem Blizzard has. But Valve is all about Steam and hasn't put out a serious new title in ages. They make their money from their store. Basically they are a direct competitor with the Windows Marketplace when it goes live. They have real cause for concern. Like Blizzard they can probably ride out their legacy framework for some time just sticking to what they already do on the Win32 side with their own store. Eventually Microsoft will kill Win32 though, or ARM may take a bigger chunk of the market cannibalizing the sales from x86 devices. Before this happens Blizzard will have plenty of time to think of a strategy and adapt (though if you can't tell, I think their whining indicates that they won't). On this topic... they should probably think about looking into an antitrust investigation.
Point #3. Have any of them actually talked to Microsoft? Microsoft likes to make deals with big players. Blizzard produces titles that draw and keep a lot of people on Windows. Steam is affiliated with dozens of their hardware partners. Before even talking antitrust suit, these people should be reaching out to Microsoft and discussing deals. And they should be doing this BEFORE this model has a chance to destroy them and they lose their bargaining power. If talks fail, then see if you can get an antitrust suit going. I'm surprised that with Apple as a monopoly in the tablet business we haven't seen one there yet. Both companies (Apple and Microsoft) should start thinking about a certification process and contract terms for 3rd party marketplaces sooner or later they will need to pry those walls open.
And my last point is reserved for Valve. I'm paraphrasing because this is from memory, but Google "Gabe Newell Windows 8" and you'll find the exact quote. "Linux is just missing some good games to be popular". I died. Of laughter. I LOVE Linux. But let's face it, Linux has issues that stem far beyond games. It has driver support issues. It has branding issues (who can tell me how many distributions there are now?). It has software partner issues. Grab the wrong distro and it has usability issues. I would argue all Linux distros have usability issues. These issues aren't "real" issues, except that they are many end users. That is why I think Linux will stay more or less where it is.
It isn't that Linux is hard to use... Windows 8 isn't hard to use, in fact from an end user perspective the changes are mostly cosmetic and yet Windows 8 has legions of YouTube videos show casing just how "hard" the new OS is to use. People who say Linux is easy to use over estimate the adaptability of the average computer user. Many people who switch from Windows to Mac have unending issues as well. One of the reasons Apple hires their Genius's is to assist people in transitioning from Windows to Apple and still there are people who never quite get the hang of it. I'm not saying they're complaining, but if I spent that much on a computer and didn't return it I would be afraid to complain as well. It's like buying a Ferrari and complaining about the lack of GPS or fuel economy, it doesn't do everything your Prius did but its a luxury item so people ignore or keep quiet about the flaws. Linux doesn't have that going for it either. Linux has prided itself on being the anti-luxury brand, and people don't seem to want to buy that, even when free.
When Microsoft released Windows Phone 7 they adopted "the Apple approach". They implemented an app store, provided it as the only legit means of getting software on their devices and took a percentage of the sales. At the time, there was a similar outcry, but mostly from smaller publishers as there were very few big players in this market and all of them have already lived under this while working on iOS applications. The model has both upsides and down sides. And this is just an opinion but I think that there are more upsides than downsides. Yes, you cannot distribute the application directly or process payment directly for your website or store front. But many developers either don't have a decent website anyway. If their application became popular overnight they would be unable to keep the site up. Etc... not to mention that there would be ongoing costs associated with implementing and maintaining that infrastructure.
For many people, most likely the majority, unless your application is incredibly successful, Apple's cut is probably less than you would have paid to maintain that infrastructure yourself meaning most people make more money this way than if they had to hock their wares themselves. And since everyone is forced to operate the same way, no one has an unfair advantage in that department. Also, a single store front means more virtual traffic. Again, most applications in a unified market like this will have more people see and potentially use/pay for their application. So again, more money than without Apple. You may point out how little money developers actually make on average, but that is actually a ridiculous statement. I'm going to take this to extremes, but lets say you built a Fart Soundboard application. There are literally tens of thousands of these applications. No one would go looking for yours if it weren't on the website. Thousands of your competitors are giving theirs away free. And you get some guaranteed visibility when you first release as it will show in the new release section. If you struck it out alone... you may get zero hits on your website. Money in the app market sucks because competition is FIERCE.
This model of course doesn't benefit everyone. A well enough known company in this model, especially one which might already have the store infrastructure in place would likely make far less money than if they sold it themselves. A flat percentage cut off the sales means that at some point if they sell enough the cut Apple (or Microsoft) would be taking is more than your overhead would be to sell it yourself. They would also need to close their own store, fire employees etc.... Blizzard and Valve are in this boat. Sounds like a pretty grim picture.
I'll start my rebuttal by playing the RIAA and MPAA card. Times change. Adapt or die. I'm not saying everyone will convert to this model and the current business model for software will die. Only time will tell that, and I seriously think if that if we look back one and try to figure at what point in time this model started taking over it will be seen as some time well before today (IE, the movement has already started, even if it isn't guaranteed to succeed). Which means companies like Valve and Blizzard who have no plan on how to operate in that economy may be too late. Instead of whining they should thinking about how, if necessary, they can get into that business model successfully. Whining shows me they lack the foresight or any plan. And my thought on businesses like that is, you had your time in the sun and let it get to your head, bye-bye.
My next point is the irrelevance of their concern. Today, both companies host primarily games written primarily in Win32 API's. The games will NOT run on WinRT or in the Metro interface and WILL run EXACTLY the same as they do today. Now Valve is a different animal, so I'll come back to them in a second. Blizzard has an army of developers. You want my guess on how many know the WinRT SDK? 0. You want my guess on how many use .Net? Probably a fraction if any of their workforce. Blizzard has a MUCH larger barrier than the Windows Marketplace. They don't have an employee base at the moment that could even produce an application to get them in there. They also have no experience in writing touch based games which for them would be the primary driver to wanting to get into that scene (leverage ARM tablets). I'm sorry Blizzard, I loved your company and your games growing up, but your point is moot. For Windows 8 you will continue to write Win32 based applications and sell them in your web store and nothing will change.
Now, back to Valve. Yes Valve also makes a game here and there so they share in that same problem Blizzard has. But Valve is all about Steam and hasn't put out a serious new title in ages. They make their money from their store. Basically they are a direct competitor with the Windows Marketplace when it goes live. They have real cause for concern. Like Blizzard they can probably ride out their legacy framework for some time just sticking to what they already do on the Win32 side with their own store. Eventually Microsoft will kill Win32 though, or ARM may take a bigger chunk of the market cannibalizing the sales from x86 devices. Before this happens Blizzard will have plenty of time to think of a strategy and adapt (though if you can't tell, I think their whining indicates that they won't). On this topic... they should probably think about looking into an antitrust investigation.
Point #3. Have any of them actually talked to Microsoft? Microsoft likes to make deals with big players. Blizzard produces titles that draw and keep a lot of people on Windows. Steam is affiliated with dozens of their hardware partners. Before even talking antitrust suit, these people should be reaching out to Microsoft and discussing deals. And they should be doing this BEFORE this model has a chance to destroy them and they lose their bargaining power. If talks fail, then see if you can get an antitrust suit going. I'm surprised that with Apple as a monopoly in the tablet business we haven't seen one there yet. Both companies (Apple and Microsoft) should start thinking about a certification process and contract terms for 3rd party marketplaces sooner or later they will need to pry those walls open.
And my last point is reserved for Valve. I'm paraphrasing because this is from memory, but Google "Gabe Newell Windows 8" and you'll find the exact quote. "Linux is just missing some good games to be popular". I died. Of laughter. I LOVE Linux. But let's face it, Linux has issues that stem far beyond games. It has driver support issues. It has branding issues (who can tell me how many distributions there are now?). It has software partner issues. Grab the wrong distro and it has usability issues. I would argue all Linux distros have usability issues. These issues aren't "real" issues, except that they are many end users. That is why I think Linux will stay more or less where it is.
It isn't that Linux is hard to use... Windows 8 isn't hard to use, in fact from an end user perspective the changes are mostly cosmetic and yet Windows 8 has legions of YouTube videos show casing just how "hard" the new OS is to use. People who say Linux is easy to use over estimate the adaptability of the average computer user. Many people who switch from Windows to Mac have unending issues as well. One of the reasons Apple hires their Genius's is to assist people in transitioning from Windows to Apple and still there are people who never quite get the hang of it. I'm not saying they're complaining, but if I spent that much on a computer and didn't return it I would be afraid to complain as well. It's like buying a Ferrari and complaining about the lack of GPS or fuel economy, it doesn't do everything your Prius did but its a luxury item so people ignore or keep quiet about the flaws. Linux doesn't have that going for it either. Linux has prided itself on being the anti-luxury brand, and people don't seem to want to buy that, even when free.
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