Steam’s sweeping influence: for better or worse?
Protector of itself or overbearing parent?
Steam is an interesting beast. The platform debuted 20 years ago and has spent the last two decades as the darling of the PC game market, the annoying and stingy partner of AAA publishers, and a capricious enforcer of self-created rules. Those rules—normally no more than short-term policies protecting Steam’s time and money—have often been read by gamers as proactive stances on the art of game development and the very nature of gaming, since they come from a company that is seen as very “pro gamer.” Yet, with this conflation of commercial consideration with gamer support—and amid a bevy of innovations in gaming—Steam’s “policies” are increasingly getting applied broadly and taken to heart by gamers whose best interests may actually be served by these new technologies. Nowhere is this more greatly felt than web3 and AI.
While I fully agree that Steam’s (and when I say “Steam’s,” I mean Gabe Newell’s) chokehold on PC gaming and a certain subset of “PC master race” gamers (oh, hey, nothing problematic with that term…) is sizeable, it is not total. It must also be contextualized:
On the high estimate end, Steam owns about 70% of PC gaming.
Mobile gaming = 91B
Console gaming = 52B
PC gaming = 36B
This means that Steam is running a max of $25B through the platform—without a doubt impressive—but which accounts for only 14% of the global games market, and via a segment that is seeing slower growth than other categories. That leaves at least 86% of every gaming dollar flowing through other places, including first party stores like EA Origin, Battlenet, mobile app stores, Playstation, Xbox, and more. Yet Steam’s influence through its stance on all things gaming has often had ripple effects into gamer sentiment more broadly.
But applying these stances with consistency and logic has been an issue for the company. In 2018, amid several controversial and dangerous games launching on the platform, Steam said its new policy was come-one-come-all, as long as the game wasn’t outright illegal. This was in the face of a title that allowed a gamer to play as a school shooter. The stance? TL;DR: Who are we to judge, we want what’s best for gamers and we won’t impinge on first amendment rights in the process. Many players applauded the move, since censorship sounds dirty, right? But the reality is that this just kept Valve from needing to do extra curation work, where an open-season policy was easier than taking the time to have a nuanced policy on content enforcement. Basically, a bandwidth decision on Valve’s part was seen by many gamers as gospel for how gaming should be. Such is the power of the Cult of Steam.
Then, a year later, the platform was tested again when it walked back its laissez faire policy and banned a game that wasn’t illegal, but merely—in their mind—presented a risk to Steam’s business. So censorship free seems great for gamers, except when it happens to potentially hurt Steam.
Fast forward to 2021, when—after a brief stint of accepting crypto for payments on the platform—Gabe Newell went in the opposite direction and banned all games built on blockchain technology. In an interview, he said it was because what people were doing in the space was “sketchy” and the people in web3 were “not people you really are wanting to be doing business with.” Sketchy as in kids-killing-their-classmates sketchy? Nothing that a decent content review process—which otherwise catches games Steam thinks are issues for it—couldn’t solve. [To his credit, Gabe did say that the blockchain was a valuable technology.]
Gabe also cited fluctuations in crypto prices as an added—yet knowable and predictable element of crypto—reason for the decision. He noted that players’ salaries are not in crypto, and the translation in price would basically be confusing for them. Players’ wages are also not in Call of Duty Points or any other of the 1000s of in-game currencies used by titles on the platform, and we gamers manage just fine.
Again, a decision meant to shield Steam from burdensome accounting and the possibility of bad actors distributing scams through the platform resulted in a sweeping decision and a ban on a technology that even Gabe himself identified as useful. The headlines, of course, were that Steam was standing up for players against the evilness and cash-grabbiness of NFTs.
Censorship: bad. Censoring monetization models and underlying technology: good.
Years on and Steam’s policies on web3-based games have softened from complete ban to a confusing and tenuous situation that puts developers, players, and even Steam itself at a disadvantage. While advances in web3 infrastructure mean that things like crypto price fluctuations are no longer relevant, buying items with a regular credit card and payment flow is possible, and a plethora of games from respected and tenured game developers exist, Steam continues to eye these games with distrust. The result? A formerly laissez faire content policy is now an overwrought and confusing half-baked concept which requires significant extra development work, confuses gamers, and leaves money on the table for Steam.
The policy, in short, allows for some web3-based titles to exist on Steam, but no NFTs can be sold through it. Nor can the game use terms like wallet (which plenty of web2 games use), say NFT, or even use any visual distinctiveness that would alert a Steam user to an item’s on-chain existence. It’s a policy that evokes a two tier system that says to gamers “web3 games can play here, but we never want you to be exposed to actual web3ness.”
It’s one thing for Steam to protect itself legally against quickly changing regulatory guidance—those policies are fine—but it’s an unnecessary additional layer to try to whitewash the basic terminology and movements of web3-based games to prevent its players from even seeing it. Policy becomes sentiment.
Given the lack of distribution options for web3 titles, this stance does little more than mean that web3-based games struggle for access to players, and Steam loses out on its aggressive revenue split on NFT sales. In the meantime, the signal trickling down to gamers is that web3 games are perhaps worth abiding in the same room, but we won’t help users understand or navigate the on-chain elements of the game.
The Epic Games Store, Google App Store, and other platforms, meanwhile, are quickly adopting specific policies for games with NFTs, giving clarity for gamers and developers and setting these stores ahead of the curve in being able to benefit from this new technology. And signaling to gamers that these titles are worthy of existing in the space places as the games they already know and love.
The most recent example of Steam’s uncertain policies on new technology is artificial intelligence, specifically generative AI. The kerfuffle started from a game that was rejected from the store for using AI-generated content. The hot topic of late, AI has been used in games for decades. But generative AI, which creates content by using data from models that have been trained on copyrighted material, is newer. Everyone from AAA publishers to indie studios has said that AI will be crucial to development in the future, but Steam has currently thrown a rather impossible burden of proof back on developers using AI in a way that it doesn’t for other content on the platform. For a vocal minority of gamers, this has been another win against outside evil forces.
Essentially, the policy states that Steam will not allow games that do not have adequate rights to the content in the game. I’m 100% onboard for that, as anyone should be who wants to protect artists’ works and income. But being able to prove that no copyrighted works were involved in the training of AI is near impossible, especially when developers are using one of the thousands of newly sprung gen-AI resources. And, again, Steam does not apply a similar audit on all the other tools that developers use to create their games. If it finds copyrighted material used without approval in, let’s say, the music of a game, it will reject that game, which makes all the sense in the world. But it’s currently taking a proactive stance that AI obviously does use copyrighted works, and that derivatives of those copyrighted works, as AI art is, not allowable.
To summarize, what we’re seeing is a platform that is willing to be detailed and nuanced when it comes to protecting itself and haphazardly rejecting games even if allowable under its policies. But with new technology, it flips the script. A single issue or one or two nefarious examples leads to a blunt approach to moderation. This reads to gamers as technology is evil, but content itself is fine, so long as we’re cool with it today.
To be fair to Steam, it said in its statement that it is not meaning to discourage the use of AI in game development. But its blanket ban does create a two tier system for AI images vs all other content used to make a game, which right now leaves developers and gamers in limbo.
Ironically, AI and web3 go together. When the provenance for sources are crucial and a system of being able to enforce royalties for original creator’s work is required, web3 is the solution, and some AI companies are already planning for how the blockchain supports these needs. As more and more games integrate AI for the purposes of user generated content, narrative decisions, and more, Steam can’t reliably scale its process on an uncertain policy and a hefty burden of proof that goes down to source material.
Steam has every right to protect its business, but unfortunately has used—sometimes proactively, sometimes passively—its stance as arbiter of what’s kosher in gaming to apply sweeping declarations that have seeped down and reverberated through gamer sentiment broadly. My hope is that Valve begins to take a more nuanced approach to the technologies that are undeniably shaping the future of gaming, and use its influence to educate and excite gamers about what’s to come, rather than make developers or players feel ashamed of the experiences they want to play and enjoy.