
Valve has mutated from a game developer into a financial middleman - howard941
https://theweek.com/articles/844962/how-capitalism-killed-best-video-game-studios
======
riotnrrd
I worked at Valve a few years back, and I could write a book about what's
wrong there. I think the biggest problem they have -- which the author of this
article touched on -- is that "success is the worst teacher." Valve have
discovered that cosmetic microtransactions are big money makers, and thus
every team at Valve was dedicated to that vision. When I was there (before
Artifact started in open development) there were essentially no new games
being developed at all. There was a small group that were working on Left for
Dead 3 (cancelled shortly after I joined), and a couple guys poking around
with pre-production experiments for Half-Life 3 (it will never be released).
But effectively all the attention was focused on cosmetic items and "the
economy" of the three big games (DOTA, CS:GO, and TF2). One very senior
employee even said that Valve would never make another single player game,
because they weren't worth the effort. "Portal 2," he explained, had only made
$200 million in profit and that kind of chump change just wasn't worth it,
when you could make 100s of millions a year selling digital hats and paintjobs
for guns (most of which are designed by players, not the employees!)

I joined Valve because I excited to work with what I thought was the best game
studio in the world, but I left very depressed when I found out they're merely
collecting rent from Steam and making in-game decorations for old games.

~~~
johnvanommen
> "Portal 2," he explained, had only made $200 million in profit and that kind
> of chump change just wasn't worth it, when you could make 100s of millions a
> year selling digital hats and paintjobs for guns (most of which are designed
> by players, not the employees!)

All of the most successful tech companies are platforms:

* Facebook is a platform for it's users to make posts

* eBay is a platform for it's users to sell items

* Amazon is a platform for retail companies

* Even Google is a platform, because it's taking the Internet itself, and re-packaging it

From that perspective, you can see how things wound up like this at Valve.

~~~
shrewduser
they've made a huge mistake, their competitive advantage, somewhat like
Nintendo, is that their platform has / had valve games on it.

~~~
kbenson
Well, given that now Epic is trying to cut into that with Fortnite as the
killer/gateway app that gets the Epic marketplace on your system, maybe Valve
will be forced to focus on shipping some good new games to retain their
position? If that's the case, yay for competition! :)

That said, I think part of what people are missing about Valve is that they
are also seem to be focused on what they see as the next big thing in gaming,
which is VR. They're supposedly shipping their own VR hardware (headset plus
new hand controllers) soon (Aug 1st), and have publicly committed to launching
a "Flagship VR" game this year. Probably not what most people want, given the
cost of VR equipment (not mentioning the cost of the computer hardware to run
it).

Personally, I'm kinda amped up about the Occulus Quest. A hands free (~3 hour
charge, can play while charging), self-contained (no PC required), $400-$500
(depending on internal storage) device? I might actually be willing to pay for
that as a first VR device. That the games are all $30 or less is a bonus.

~~~
nordsieck
> Well, given that now Epic is trying to cut into that with Fortnite as the
> killer/gateway app that gets the Epic marketplace on your system, maybe
> Valve will be forced to focus on shipping some good new games to retain
> their position?

We'll see. There have been a number of game marketplaces over the years that
have tried to compete with steam. For the most part, they're all gone, and the
games they hosted are gone too.

At this point, it would take something pretty unusual for me to spend any
money on a non-Steam game. I just don't believe other platforms will be around
in 5-10 years.

~~~
kbenson
> At this point, it would take something pretty unusual for me to spend any
> money on a non-Steam game. I just don't believe other platforms will be
> around in 5-10 years.

I agree, but I think it's important to consider that they can succeed even if
they don't get you or me. There's hundreds of millions of people that have
installed it (approaching 250 million a couple months ago), tens of millions
playing each month (almost 80 million as of a few months ago) and over 10
million people playing _concurrently_.[1]

How many of those are young players that might want to try a new game they see
some youtuber play, and see it on sale in the epic store they might use to
launch Fortnite? That's a hige captive audience, and this battle won't be won
by swaying you or me, but by swaying the huge number of new gamers coming onto
the market, which are mostly our kids. I know my son who's 9 probably wouldn't
care about Steam if I wasn't sharing my library with him. Then again, his
computer can't play much and he plays Fortnite on the Switch.

Steam is entrenched, and does have it's own user base, but given that Fortnite
along as of a couple months ago has ~66% of the concurrent users of Steam
_overall_ [2], I wouldn't count it out. That's a _lot_ for Epic to make
something out of.

1: [https://www.pcgamesn.com/fortnite/fortnite-battle-royale-
pla...](https://www.pcgamesn.com/fortnite/fortnite-battle-royale-player-
numbers)

2:
[https://store.steampowered.com/stats/](https://store.steampowered.com/stats/)

~~~
tuzemec
I buy something from Steam only if it's not on GOG. Games from GOG let you
play them without the headaches of the launcher.

I don't play very often and when I finally find time for it, it looks like
this: \- clicking on the game icon \- the launcher starts updating \- the
launcher restarts and asks for my account, because why not? \- the game starts
updating, often downloading patches above a GB ... and so on. And that applies
for Steam, Bethesda Launcher and the rest of the bunch. And don't let me get
started on the Bethesda Launcher because that thing alone takes 500MB of
memory.

~~~
StavrosK
GoG is amazing, my preference is GoG, Steam, and piracy is a distant third to
the point where I haven't pirated a game in a decade.

------
adnzzzzZ
From the perspective of allowing more and more games to exist and do well on
the market Valve is doing amazing. This talk goes over some of it
[https://www.gdcvault.com/play/1025672/2014-vs-2018-The-
Shape](https://www.gdcvault.com/play/1025672/2014-vs-2018-The-Shape) but
essentially there are 1000+ games right now on Steam with over 100 concurrent
users. One of my games got about 80 concurrent users at its peak and it made a
small but fair amount of money (especially for someone's first game), so it's
easy to see how 1000+ games with that many players means a lot of financial
success to a lot of people, way more than ever happened before for game
developers.

One of the things that amazes me about Valve and the way they run Steam is
that I released my game, had thousands of people buy it, pushed updates,
communicated with users, got paid, and I had to speak with 0 human beings at
Valve. It all just happened in a very predictable, clear and highly automated
way. This lack of friction is absolutely amazing for developers, especially
people like me who live in a third world country and would otherwise have more
difficulty going through these processes for any number of reasons. So IMO
they're doing something extremely valuable which is properly acting as a
platform so that other game developers can succeed and make more and better
games for everyone.

~~~
chaostheory
The PC game revival probably would have taken much longer without Steam. The
things that Steam does seamlessly like installing required frameworks, a
regular update delivery system, cloud saves, and a cloud-based library with a
low price is really easy to take for granted now that it's everywhere. Before
Steam, it was a chore to play a game on PCs.

Also being able to stream a PC game to any device is really cool.

I liked their games, but I like Steam better.

~~~
pjmlp
Don't think so, most of the gamers I know, even today rather buy their games
in physical mediums at places like
[https://www.gamestop.de/](https://www.gamestop.de/)

~~~
ionised
Console gamers sure, PC gamers mostly buy digital and have done for a long
time.

~~~
pjmlp
I am speaking about PC gamers, not everyone is in love with Steam.

~~~
ionised
Your personal anecdote doesn't match the data. You and your peers are the
exception.

[https://www.wepc.com/news/video-game-statistics/#pc-
gaming](https://www.wepc.com/news/video-game-statistics/#pc-gaming)

 __ _74% of all the video games and computer sales were sold in digital format
form._ __

That 's just one source. You'll find similar numbers confirmed elsewhere.

PC gamers overwhelmingly buy digital, either from Steam or other digital
storefronts like GOG, Greenman Gaming, Epic Games Store, Origin etc.

~~~
pjmlp
Apparently no, from the same report

 _" 29% of Steam sales revenue was attributed to Western Europe according to
Valve. (GeekWire, 2018)"_

The typical US == The World view.

~~~
ionised
I'm not American mate.

Don't be so presumptuous, it's arrogant.

And you are cherry-picking stats by stating only sales on Steam. Steam is not
the only digital delivery platform on PC. There are many.

From 2014 worldwide:

[https://www.kitguru.net/gaming/matthew-wilson/92-percent-
of-...](https://www.kitguru.net/gaming/matthew-wilson/92-percent-of-pc-game-
sales-are-digital/)

92% of game sales worldwide were digital.

From 2019 in the UK:

[https://www.eurogamer.net/articles/2019-01-03-uk-video-
game-...](https://www.eurogamer.net/articles/2019-01-03-uk-video-game-sales-
now-80-percent-digital)

80% digital sales for games in the UK alone.

And it's not just the UK and US.

[https://business.financialpost.com/technology/gaming/digital...](https://business.financialpost.com/technology/gaming/digital-
sales-to-account-for-nearly-93-of-all-game-sales-by-2021-report)

The number of physical sales is declining everywhere, some quicker than
others.

------
bartimus
It's ridiculous how this article is displaying Valve's strength as a failure.
Valve is exactly the poster boy of a successful agile organic company that is
run by software engineers. A company able to reinvent itself to meet demands.
They have been pioneering the concepts of the app store and micro-purchases
making it the most profitable company per employee. Things that Apple and
Google get applauded for. What's amazing is that those profits didn't come
from the demands of profit seeking shareholders. It came from the demands of
the people, the software engineers, themselves who work at the company.

So they stopped producing games. So what? Valve is probably in the most
optimal position to quickly reinvent itself yet again if new demands and
opportunities arise.

This article is an attack on software engineers. Where non-engineers try to
swoop in and take their power positions because they "know" better what a
company should be doing. This is where engineers get pushed down in the power
chain. It's exactly how great products get killed.

~~~
sametmax
I'll also add, as a regular dota player, that they don't just "get rent" out
of it.

First, the game is free to play and very deep as-is. There is no missing
feature or add-on to pay for in order to have the full game experience, and
the experience is amazing.

Second, they update it every month and managed to keep it interesting through
the years. It's an incredible feat.

In the end, it's one of the few places where I'm more than happy to pay micro
transactions for virtual hats and idiotic gimmics. Because they do a hell of a
job.

Of course I would love a portal 3. But I'm not disapointed of what they are
doing right now. They still rock.

~~~
wocram
I mostly agree with you, but DotA plus is a shift towards subtly pay-to-win
features. It's always surprising when a subscription lapses and I find out
something is a DotA plus feature and not just part of the game.

~~~
sametmax
I have dota plus. It doesn't give you any advantage on the current game. It
merely lets you learn more about the current meta on the long run, faster than
keeping up with all youtubers. Even pick stats and suggestions will not make
you win more. It just teaches you.

Teaching is not unfair in my book, and worth money so I find it a very well
balanced paid feature.

I played LOL before, and their rune and pick system is definitely pay to win.

All in all, given the size of dota, I'm actually amazed that so much of it is
free. I played it years before spending a cent, and wondered how they could be
sustainable.

~~~
de_watcher
> I have dota plus. It doesn't give you any advantage on the current game.

ranked roles

------
6cd6beb
We could have a small handful of new great games from valve and an unknown
number of crappy ones, or we could have steam.

Steam provides more value to me on an order of magnitude that makes the
article laughable. Steam is like netflix before licensing fractured their
content between 20 different streaming services. It's not perfect but I'm not
crying over the loss of a few more valve games. Better to burn out than fade
away anyway.

~~~
yocheckit
Yea, I'm amazed at the criticisms of Steam. Do you all not remember buying
computer games before it? Having friends on all different programs, no
integrated chat, cds everywhere, this is defintely rose-tinted googles.

~~~
scbrg
I suppose I'm in a minority, but for me, all I want is the games. And those
existed, in non physical form, before (or at least alongside) Steam. There
were several stores that would simply let you buy the ability to download an
installer, install a game and play it. No "portal", no "platform", no - thank
the Gods! - integrated chat or friends lists. I could chat with people (who
were not even on Steam!) very well on ICQ or whatever, thank you very much. I
_don 't_ want anybody to know what I'm currently playing, or how many hours
I've played it.

I'm trying to imagine apt-get with an embedded, proprietary chat client and
full name registration system - popcon mandatory. I wonder how many would see
it as an improvement.

------
Strom
This feels like another sour grapes article by someone that wants Valve to
focus on their favorite games instead. Dota 2 is Steam's most played game [1]
and has been so for most of the last decade. I have spent thousands of hours
playing it during that time and I know dozens of people personally who have
played it even more. We are happy that Valve is providing unprecedented
support for the game. The kind of support which is rare. Just look at new
games like EA's Anthem, where players are complaining about barely receiving
any updates, although they were promised a bunch.

Dota 2's success doesn't come from a release dump in 2013 and then just an
influx of hats. There's continuous development that's happening on the game.
There are new features added all the time, game mechanic changes, new heroes,
new items, map changes etc. The whole engine was swapped out from Source to
Source 2. There was a year where there were two branches of Dota 2 being
played concurrently as this transition happened. Very few games in history
have received this kind of attention.

On top of that Dota 2 has one of the best executed e-sports scenes. Valve has
been directing the scene structurally, supporting it with unrivaled prize
pools [2], and building a lot of features into the game to support e-sports,
e.g. in-client spectating with both observer camera and player perspective.

So no, Valve has not mutated into a financial middleman. They're hard at work
at supporting one of the most successful games in history. The kind of success
that other game developers can only dream of. Sure that means they can't also
be working on a bunch of other games, but that doesn't make them any less of a
game developer.

\--

[1]
[https://store.steampowered.com/stats/](https://store.steampowered.com/stats/)

[2] $179,702,427 have been given out in prize money (mostly from Valve) thus
far.
[https://www.esportsearnings.com/games](https://www.esportsearnings.com/games)

~~~
noxvilleza
'$179,702,427 have been given out in prize money (mostly from Valve) thus far'

Come now, this part of your response is totally misleading. Valve contribute a
base $1.6M for TIs, $3M for the old majors, $150k for the current minors and
$500k for the current majors. The vast majority of the $179M is crowd-funded
money: money which Valve facilitated the collection of but which many people
only gave to boost the prize pool of The Internationals.

~~~
Strom
All the money paid for compendiums is for services provided by Valve. Valve
also pays all the taxes that come with this fact, e.g. VAT. Yes they promise
to give 25% of the revenue to prize pools and thus far have done so, but from
a legal standpoint it's no different than buying skins in League of Legends.

Contrast this to an actual crowdfunding site like Kickstarter which does not
pay VAT on the collected money. [1][2]

However perhaps you didn't like that my point could be viewed as if Valve is
transferring money from non dota related profits to dota. That's of course not
true, Valve is a business and profits from dota. I fully admit that and
thought it didn't need mentioning.

\--

[1] [https://help.kickstarter.com/hc/en-
us/articles/115005139493-...](https://help.kickstarter.com/hc/en-
us/articles/115005139493-Are-creators-based-in-the-UK-and-Germany-responsible-
for-VAT-)

[2]
[https://www.kickstarter.com/help/taxes](https://www.kickstarter.com/help/taxes)

------
dejaime
Valve created the digital game stores as we know today, away from the
expensive physical copies into the digital distribution.

Before that, to release a game, one would need a publisher, a distribution
deal, a ton of money wasted to get the game into the player's hard drives.

What Valve did is much much more significant for the gaming industry and
sparked a ton of indie developers. That's much more impactful than half life 3
could have ever been.

------
shmerl
Whatever they evolved to, their contribution to Linux gaming is outstanding,
so thanks Valve for doing it. Without Valve, we wouldn't have such rapid
progress of Wine/dxvk, radv, OpenXR and other gaming related open stack.

------
stcredzero
An og prospector looked around, and realized that the future was opening a
store to sell backpacks and pickaxes to all the young newcomers who were
coming in droves to stake their claim. Og prospector can't prospect like he
used to. He's lost his chops. No matter. He's in the prospecting supply
business now.

------
Dowwie
By focusing on the Steam platform rather than on its own creative game
productions, Valve has shared more creativity with the world than it could
ever had accomplished on its own. It is a creativity multiplier. It's a
tremendous success in business and the arts.

------
lenova
One day I would love to see an article or podcast on how Yaris Varoufakis
changed Valve's direction:

[https://en.wikipedia.org/wiki/Yanis_Varoufakis](https://en.wikipedia.org/wiki/Yanis_Varoufakis)

[http://blogs.valvesoftware.com/economics/it-all-began-
with-a...](http://blogs.valvesoftware.com/economics/it-all-began-with-a-
strange-email/)

~~~
mattmanser
He managed a total of 4 of those weekly blog posts, it looks like they drifted
apart fairly quickly.

------
intellix
I think one of if not the best is Naughty Dog. They're consistently outputting
masterpieces.

~~~
sjwright
The Last of Us was a masterpiece. It deserves a place in gaming history up
there with Doom and Half Life 2.

The Uncharted series was gobsmacking production values, a great story, some
nice adventure aspects, a bunch of lame puzzles, and at the core a mediocre
hand-holdey shooter based on arcade style bullet-sponge mechanics made absurd
by the parallel universe of endless cut-scenes where death is consequential
and killing is bad. Why are we (the supposed good guys) gleefully murdering so
many people? It doesn't make sense.

I absolutely loved the Uncharted series, but that contradiction never sat
right with me. And it became all the more obvious in the later games as the
production values improved to ever-greater feats of realism and the cut-scenes
increasingly humanised the enemy.

~~~
sandov
Uncharted is a "don't think, enjoy" kind of game, and a pretty good one at
that.

~~~
ionised
I wouldn't call it a masterpiece in that case.

------
sandov
I can't feel upset about Valve's success. I think their existence has done a
net good to the industry, the games are cheap, the system works well and they
support Linux better than any other big name in the creative industry, they
even employed thr DXVK developer. We could dream with Netflix supporting Linux
the way Valve does.

------
User23
Valve is not perfect, but making them out to be rent seekers is a lie. They
revolutionized the PC games market to the benefit of developers and consumers,
and they are actively improving their platform and driving adoption of new
technologies like VR.

Also this “reporter” evidently knows nothing about how Valve actually does
things internally.

------
nraynaud
every sufficiently big company will eventually want to move into
payment/banking. Apple, Microsoft, Google, Car manufacturers, supermarkets,
airplane manufacturers, etc.

It's the dream of every MBA to skim on top of transactions instead of directly
producing value.

------
stevage
I really don't see the problem here. It's not like there's a shortage of
games, or game developers in the world. If one of them has gotten out of that
market, to develop a shared platform that everyone (developers and consumers
alike) want and need, isn't everyone better off?

------
stupendousyappi
One day, someone is going to write a fantastic magazine article about what
happened to Valve.

~~~
xtracerx
You should check this thread out.
[https://www.reddit.com/r/valve/comments/8zmp07/former_valve_...](https://www.reddit.com/r/valve/comments/8zmp07/former_valve_employee_tweets_his_experience_at/)

~~~
VintageCool
That all sounds terrible, but to some extent I wonder if those problems are
driven by the "self-organizing company" aspect or if they are the result of it
being in the gaming industry.

I think that every company in the gaming industry has the problem of not
needing to treat their developers very well. There are so many CS students in
college dreaming of building computer games that there are always a dozen
people outside the door trying to get in. That gives the company a lot of
leverage over its employees.

------
timavr
Making hit/innovative games is super hard.

Not only from a financial perspective but from an emotional/personal as well.
You need people who can dedicate years of their life developing new tech and
actually making the thing, knowing that there is a large chance to fail.

As per Valve handbook, each "co-worker" should think about the risks to the
company and it is not surprising that as a group they work on less risky
things which can generate profit. (Steam, existing titles).

But as competition in storefronts increases, I think they will be forced to
innovate, either through VR, their own games or some other way.

------
EugeneOZ
They should not forget that their money-making games are getting older every
year - better to start creating some new "money-maker".

------
runn1ng
I find it funny how this article casts Steam as something _easy to do_ , as if
its success has been random and just first mover advantage.

Making Steam and making it work is hard. Steam does not have the advantage of
a platform monopoly like Apple or Sony stores. They earned their place in the
market. And as other said here, Steam is more important for gaming history
than Half Life 3 would be.

~~~
gnode
I think to a large extent it is first mover advantage, but that's not
something to be taken lightly. They invested in developing an internet
distribution platform at a time when broadband penetration was relatively low.
I couldn't get anything other than dial-up internet access, and Steam seemed
more of an inconvenience than a revolutionary idea.

------
Cypher
EA, Square, Activision, Ubisoft have killed atleast 100 good studios

------
otikik
I understand all this and yet even a hit of a rumour of Valve working on Half
Life 3 makes my heart pump and brings butterflies to my stomach. On the other
hand, "so and so company made millions selling hats on a videogame" means
nothing to me.

I understand that making money is a very powerful drive for a lot of people.
But what's another million when you have 100 million?

Valve can afford to implement Half Life 3 (or pay someone to do it for them).
It would, at the very least, make a profit, even if it wasn't a huge success.
Instead they are letting the IP die a slow death. That would make me sad. The
101 million would help, for a while, but the pain would return.

~~~
raphaelj
Something the author didn't address in the article is opportunity cost. It
might be that the employee supply at Valve is limited, and that as a for
profit company, it has to allocate this limited resource the most profitable
way. Making 50 employees work on HL3 might get you $100M in profit, but why
would you do that if you can make $150M more on hats with the very same team?

------
walbold
I’m surprised that Valve stayed so heavily entrenched in just
microtransactions. I wonder how much money they could have made if they also
focused on licensing out a newer source engine, and funneling source engine
games into their platform.

------
GershwinA
Personally I like steam, and I don't mind them being a current monopolists of
gaming platforms. All of the gaming market has been capitalized and we see
companies like EA pushing their teams to the limit just for a release before a
fiscal year. Results in half-baked product. Big publishers, including
Blizzard, are having a tough time, and steam is a great platform for smaller
devs to promote their content (Darkest Dungeon is a good success story). Sure
Valves economic policies are profit oriented, but IMHO there's a good side to
steam.

------
partiallypro
I'll honestly be shocked if Microsoft doesn't buy Valve in day for Steam.
Obviously current ownership would be against it, even with Nadella, but one
day it just feels like a guarantee.

~~~
anxman
Valve and Gabe have explicitly said if will never happen. I met someone that
once worked at MSFT in corporate development. Said they spent months working
on a pitch to acquire Valve and Gabe kicked them out of the building after 15
minutes.

~~~
ClassyJacket
Valve was founded by ex Microsoft devs wasn't it?

~~~
anxman
Yes. Gabe was the PM for Windows 95.

He and Michael Harrington founded Valve a year afterwards. I asked Gabe over
email if it was because it was the 1 year anniversary of Windows 95 launch but
he said Valve was actually founded on his wedding day.

------
rocky1138
I can see a future where the games portion of Valve is spun off as a separate
company or even possibly licensed to a trusted game development house.

~~~
ehsankia
Unlike what the article implies, I don't think Steam is the reason hasn't put
any new great single-player games, but rather their big 3 micro-transaction
games (TF2, CS:GO and Dota 2).

From what I understand, the Steam team isn't even that big, most of Valve
employees work on games, but again, it's mostly those 3 that bring all the
money. Therefore, splitting out the game company won't solve the real issue,
which is that they are more focused on addictive games people play for
thousands of hours, over quality award winning story telling.

------
thefounder
Let's hope Blizzard won't follow the same path. I have hope for one game
there...

------
jjdredd
> June 4, 2019

They're 10 years late with this article.

------
taurath
I think they misspelled casino operator.

------
Mugwort
Capitalism killed Portal 3 and Half-Life 3.

~~~
doomjunky
Capitalism made Half-Life and Portal.

------
rufusroflpunch
This is a really disappointing article. Valve has changed the PC gaming
industry in multiple ways, actually keeping the market alive and rejuvenating
it.

First, they broke the traditional publishing model with Steam, offering an
entirely new way for developers (especially independent developers) to deliver
their games to consumers without needing a publisher.

Second, their current project is clearly geared toward breaking the Windows
monopoly on PC gaming and they have done a tremendous job so far. Thanks to
Steam and Valve's efforts, more games are available than ever on Mac and
Linux.

What is the author's take on Valve's interesting and revolutionary innovations
on the business side of PC gaming? "Capitalism bad." It is an ideological
piece with nothing interesting to say.

------
baron816
>How capitalism killed one of the best video game studios

Ahem, no. Capitalism didn't kill it. Had Valve tried to maximize
revenue/income, it would either hire more people to develop those profitable
franchises, or contracted the development out to another studio. At the very
least, they could have sold off the rights to Microsoft or Sony and allow them
to butcher sequels and movies.

Had capitalism won, we'd be seeing Half-Life 12, Portal 7, TF 10, CS 8, LFD 6,
etc. There's a lot of creative property there that could have been developed
to death. That they didn't do that says they'd give up on revenue (at least in
the mid term) to protect those properties.

~~~
anoncareer0212
Capitalism lost, the structural profits of a platform make a rational actor
choose not to incur the costs of licensing core IP

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jibanes
Paid content, Valve is an awesome company.

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tomcam
> One factor is that a capitalist business mindset is badly corrosive to an
> artistic temperament.

Not sure I agree. In fairly recent memory I can think of a number of artistic
successes that were huge risks. It’s easy to forget that the first “Pirates of
the Caribbean” movie scared the shit out of Sony, and with good reason. It had
a blockbuster budget and starred a contentious, commercially unproven actor
doing an incredibly risky performance. To this day I suspect that Johnny Depp
fully expected the movie to tank, and would have been quite happy if that had
happened.

Marvel’s investment in “Iron Man” wasn’t too far off that mark either. Its
star had only recently been in the throes of drug problems so severe that at
once point he wandered into a neighbor’s house and feel asleep naked in their
bed. IIRD correctly the director’s biggest movie up to that time was
“Swingers”.

To me there were a couple of watershed moments in hip-hop that could have
destroyed the careers of the people who finally said “yes”. Rap before
“Straight out of Compton” was pretty much just supercharged melodic R&B with
talking. Whoever signed Eminem was taking a serious risk as being guilty of
the next Vanilla Ice.

The XBox wasn’t greeted with any sense of inevitability. Microsoft had to deal
with game developers in ways it had never worked with companies before. Its
relationship to hardware was spotty (though I loved just about everything they
tried). It was not at all clear that an accomplished systems/app company had
any expertise at all in the Byzantine politics, personalities, and economics
of the game world.

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gamblor956
Pirates of the Caribbean was a Disney film from a director with a record of
past successes, a team of actors largely pulled from blockbusters, and an
executive producer of some of the most memorable and (at the time) highest-
grossing crossover blockbusters. It was not a risk to Disney at all.

Dr. Dre, one of the most successful rap producers of all time, signed Eminem
after watching him perform. By then, Eminem was already well-known in local
circles for his rap skills, and there was no risk of him being seen as Vanilla
Ice (a joke, incidentally, which worked its way into _8 Mile_ , which was
loosely based on the life of Marshall Mathers).

~~~
mschuster91
>Pirates of the Caribbean was a Disney film from a director with a record of
past successes, a team of actors largely pulled from blockbusters, and an
executive producer of some of the most memorable and (at the time) highest-
grossing crossover blockbusters. It was not a risk to Disney at all.

It certainly was, the first PotC movie basically established pirate movies as
a blockbuster genre. And while the Mouse was already rich back in 2003, even
for them $143M budget _is_ a risk.

Even movies that made them a small but solid _profit_ like Tron Legacy (400M
box office vs 170M budget) get chucked into the bin (most unfortunately, as I
really liked the movie and had hoped for a sequel).

~~~
gamblor956
Tron Legacy was a gamble, as it (a) did not have an all-star cast, (b) a
director with a string of successful movies, or (c) a popular IP (the first
_Tron_ was a box office failure, which is why it took several decades to make
a sequel). Legacy did well on an absolute basis...but Disney barely made back
its total budget. $170m was just the _production_ budget; marketing was
roughly another $150-$170m. While the movie did well-ish overseas, much of
that revenue was split with theaters or local distribution partners, so from
Disney's point of view, they barely broke even. (Dmoestically, studios only
get the lion's share of ticket price for the first 2-3 weeks of ticket sales
which is why they heavily front-load their advertising.)

PotC was most definitely not a gamble for Disney. PotC was always expected to
be successful--it just turned out to be _even more_ successful than they
thought it would be.

Note: the same thing that happened to _Legacy_ happened to the _Solo_ movie.
_Solo_ more than made back its production budget but did not make back its
total budget including marketing, which is why at first glance it looks silly
than Disney killed the _Star Wars Story_ franchise. Both _Legacy_ and _Solo_
actually ended up being decently profitable for Disney when partner tie-ins,
DVD sales, and streaming rights are included, but those income streams aren't
known until long after the movie is deemed a success or failure and for most
box office "failures" these long-tail income streams don't usually bring the
movie into the black.

TLDR: A movie has to make back more than its production _and_ marketing
budgets to be profitable to the studio, and since they split ticket sales with
theaters and distribution partners, the movie has to do a lot better at the
box office than just matching its budget.

