In a keynote at DICE 2009, Gabe Newell made some interesting comments about the new way of entertainment as a service. Gabe believes the old way of entertainment: Indirect customer relationships, product orientation.
Valve aims to touch its customers in some way every three weeks, not every three years when a new game is shipped.
Through this perspective, Gabe and Valve have observed the following:
- 30-year old songs with a little service (Rock Band, Guitar Hero) generate huge profits
- Pirates are ahead not just on price, but on service
- DRM appears to increase, not decrease piracy
- Privacy and transparency
- Shrinking distance to customer empowers content creators
Gabe doesn't believe that pirates are really seeking to get things for free. They are people that spend thousands on their PC's and Internet service. He believes that pirates are beating companies on service. He cites TV shows not available in certain parts of the world. Pirates have TV shows up on the Web minutes after they have aired.
RM decreases service value for customers. It also makes pirated copies of games look more appealing. Anecdotal evidence appears to suggest that DRM is increasing and not decreasing piracy.
As far as privacy goes, Gabe believes that people are willing to give up system and personal information if they feel it's being used to get a better service. Steam's hardware survey is an example of this. Rather than spying on users for nefarious reasons, Gabe believes things like its hardware survey helps with better sales of products and service. As long as companies are transparent, he feels that customers will accept this.
As far as the shrinking distance between Valve and its customers, Valve didn't find any service in existence so it made its own: Steam.
abe thinks that the movie industry would benefit from incremental products. Toy Story 1.1! Just make the graphics better!
Steam stats time:
- 20 million people connected
- All major PC publishers on board
- 350+ of the best PC games
- Worldwide in 21 languages
- 100% Year-over-year growth since 2004
There are competitors, but they are all trying to do the same thing. These include services like Games for Windows Live, Direct2Drive, iPhone App Store, Stardock Impulse. Gabe was very modest , not mentioning that Steam is wildly more successful than any of the other services. But that's why he's giving the keynote. No need to brag.
From a customer's perspective, they want things like portability of content and files, anti-cheating, auto-updating & version control, new games, old games, indie games, 24/7 availability, and community tools. Yep, Steam has all of those. I still think the groups need an upgrade, but they are definitely functional enough to get the job done.
Source: G4TV
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