For years now, Steam has been the largest digital storefront for PC games. Slowly but surely, competitors to Steam have been rising up, and to ensure that big publishers keep putting their game on the platform, Valve has decided to tweak its Steam Distribution Agreement. There are a few changes coming along with this update, but the most important are the new revenue sharing tiers.
Revenue sharing is something that’s common on pretty much all digital distribution platforms. Platform holders – Microsoft for Xbox Live, Sony for the PlayStation Store, Valve for Steam, so forth and so on – typically take somewhere around 30% of each sale made through their stores.
With these new revenue sharing tiers, Valve takes less money out of each sale as games become more popular. As explained in a post to the Steam Community, Valve’s standard 30% will remain in place until a game hits $10 million in sales. Between $10 million and $50 million, Valve will take 25% of each sale, then after $50 million, Valve’s cut drops to 20%. These changes, its worth pointing out, apply to everything – game bundles, DLC, and in-game purchases in addition to full game sales.
So, the name of the game is attracting and keeping big publishers. Not only does this change make Steam a more attractive store than other platforms that take a flat 30% cut, but it also potentially makes publishers think twice before making their games exclusive to first-party stores. Fallout 76, for instance, is only available through Bethesda.net, and Activision’s Destiny series is nowhere to be found on Steam.
These decisions were made, in whole or in part, to avoid the cut Steam takes out of each game sale, but these changes might make those publishers consider bringing their games back. After all, even though Valve will still be taking a cut, there’s no denying that Steam has a reach that few other platforms can match. We’ll see how this whole thing shakes out soon enough, so stay tuned.