Valve Corporation became the subject of a new lawsuit this week that accuses the game developer and Steam founder of abusing its dominance in the PC gaming market. According to the Steam Distribution Agreement, developers working with Steam must sell their games on other storefronts at the same prices, effectively eliminating any competition these storefronts may have otherwise had. This has also allowed Valve to keep Steam game prices high.
Valve launched Steam in 2003 as a platform for the developer to release automatic updates on their own games, but it soon grew to host games from third-party publishers. Steam is now the largest online dogota; distribution platform for PC games, with more than 30,000 titles available. The platform also continues to break its own records in terms of user count year after year. Most recently, in early 2021, Steam broke its own concurrent player record with more than 25 million users. That record came only weeks after the platform hit another record for 23 million users on Christmas day alone.
Of course, the title of the largest online distribution platform for PC games comes with a lot of power, and Valve is allegedly taking advantage of that power. According to the lawsuit provided by The Hollywood Reporter, the "Most Favored Nations [MFN] clause" of the Steam Distribution Agreement "has the effect of keeping prices to consumers high, as price competition by platforms would cause the prices of PC games sold to consumers to decrease." In other words, the game prices on Epic Games Store or Microsoft Store must be the same as they are on Steam, presumably leaving virtually no room for competition.
CD Projekt Red, Ubisoft, kChamp Games, Devolver Digital and Rust LLC are also named as defendants in the lawsuit. These developers were all said to have "unlawfully contracted, combined, or conspired to unreasonably restrain trade" by agreeing to not sell their PC games at lower prices on other platforms. As the lawsuit noted, Epic Games Store and Microsoft Store take a smaller cut of sales than Valve, but they are required by the Steam MFN to keep prices the same across all platforms. If these developers were not restricted by the Steam MFN, they would be better off charging lower prices for their games on platforms with lower commission charges.
All in all, the lawsuit seeks to prove that Valve is hindering competition and illegally monopolizing the digital PC game market. Valve has not commented on the lawsuit, but it hasn't exactly been a great week for the studio; Valve is also currently engaged in a trial for allegedly plagiarizing the design of its Steam Controller back in 2014.
Source: The Hollywood Reporter
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