Sunday, October 16th 2011

Walled Garden Outfit Valve Accuses Apple Of Operating A Walled Garden

You've got to laugh at the hypocrisy of big companies sometimes. It's a well known fact that Apple operates a very closed and controlling walled garden eco system with all of their products, courtesy of the late Steve Jobs. Examples include the iPhone, which can only purchase apps from the official Apple apps store and the iPod, which can also only sync with iTunes, both due to deliberate vendor lock-in using a combination of hardware and software DRM (Digital Restrictions Management). Apple claims that this is to ensure a seamless, consistent and high quality user experience. Savvy users know this to be only half the story, instead it's there to shut out competition and lock you in to Apple for everything in order to charge high prices for allegedly "premium" product. The only way to avoid this, is to jailbreak the devices (break the DRM) which conveniently (for Apple) voids the warranty on these expensive gadgets. Thankfully, this process is no longer underground, due to a recent court ruling that said jailbreaking was legal, much to Apple's displeasure.

However, the equally closed Valve, with their Steam gaming platform and it's account-based DRM has accused Apple of being a closed system! They are also "concerned" about it. This happened in an interview between Bellevue-based Valve's Gabe Newell and leading games investor Ed Fries at the WTIA TechNW conference. This has been reported in The Seattle Times in Brier Dudley's blog.
The Steam platform gives the illusion of openness, because it allows such things as game backups to be made and also allows a game to be played on any number of computers (one at a time of course) simply by installing the Steam client, the game and logging in. Like Apple, you can also only purchase from its own store, of course. However, it's certainly one of the "best" DRMs out there as far as DRM goes, given the various features of the Steam client, such as auto updates and social networking. However, the huge "but" in all this though, is that Valve do not let you sell on your used Steam games as a matter of corporate policy(SSA section E,(i)), although the system to transfer game access from one account to another has always been present and correct. This removes an individual's first sale rights as defined in law, but makes games companies ecstatic, because they have complained bitterly about used game sales allegedly eating into their business, as if they have any right to that used game money in the first place. It's exactly like car companies stopping you from selling your used motor, alleging that it hurts the sales of new cars. Utter rubbish. One wonders if this unreasonable restriction would truly stand up in court if someone with money took them on?

In the interview, Fries asked if these were the best of times, or the worst. For the clearest answer to this question, let's quote from Dudley's blog. Newell replied:
"It's a very interesting time."
"Our business is growing very rapidly both on the content side and on the service platform side so in that sense, business has never been better," Newell said. "The challenges we see looking forward are very rapidly evolving model for how value is created for customers."
After broad pursuit massively multiplayer online games, the free-to-play model is emerging as "a really interesting opportunity," he said.
But there are dark clouds forming, Newell continued, raising concerns about the closed-garden approach of platforms such as Apple's iOS.
"On the platform side, it's sort of ominous that the world seems to be moving away from open platforms," he said.
Platform providers that used to use their role to enable developers "instead view themselves as more rent guys who are essentially driving their partner margins to zero," he said.
"They build a shiny sparkling thing that attracts users and then they control people's access to those things," he said.
Newell said that "very large structural investments and structural changes" are coming over the next few years that will threaten people who create value bulding things like the open Internet.
The conversation then moved onto consoles, but soon returned to discussion of closed systems. Notice how these closed systems act like the worst kind of monopolies, with the company running it squeezing their partners so hard that they make no money at all. Therefore, their greed ends up killing their golden goose and the business model fails for everyone. This is just the same as expecting people to work an average 9-5 office job without pay. Ridiculous. Dudley continues with:
Newell reiterated his concerns about a closed model being the "wrong philosophical approach" but one that people will emulate because of the success of Apple and Xbox Live.
"I'm worried that the things that traditionally have been the source of a lot of innovation are going - there's going to be an attempt to close those off so somebody will say 'I'm tired of competing with Google, I'm tired of compeitng with Facebook, I'll apply a console model and exclude the competitors I don't like from my world.'"
Fries asked Newell to clarify whether he sees Apple as being a closed platform.
"I consider Apple to be very closed," Newell said. "Let's say you have a book business and you are charging 5 to 7 percent gross margins. You can't exist in an Apple world because they want 30 percent and they don't care that you only have 7 percent to play with."
Doesn't Valve's Steam service also extract a "tax" on game companies that use the platform, Fries asked.
Newell said Steam gets a commission if games are sold through Steam, but developers can use its free tools and services and sell their games elsewhere and "we don't take anything."
If Valve were to make a hardware platform, it would open it up to competing distribution systems because openness is important to the future of the entertainment industry, he said.
So there you have it. Steam is wonderfully open in the sense that developers can use it flexibly and they don't charge high commissions, but the customer (gamer) is locked in tight, like a straitjacket. How is this an open system?

As the old saying goes, it's the pot calling the kettle black. Enjoy the picture.

As well as our primary news source, thanks also go to our secondary sources linked to in the article: Techdirt, TG Daily and Wikipedia.Source: The Seattle Times
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83 Comments on Walled Garden Outfit Valve Accuses Apple Of Operating A Walled Garden

#1
pantherx12
qubit said:
Dude, I'm ok with criticism, even the harsh sort like newtekie's above, but please don't stray into personal attacks, ok? And by that I mean accusing me of posting FUD. It's untrue and quite a nasty accusation, as if I deliberately was up to no good, so please don't accuse me of this again.
Dude I'm not trying to be nasty, by definition this is fud, you are essentially making valve look bad by posting this even though as I stated, they not letting you sell the games has nothing to do with them at all. ( It's law)

Also I didn't excuse you of purposely doing it.


"Fear, uncertainty and doubt"
F U D
Posted on Reply
#2
Kreij
Senior Monkey Moderator
laszlo said:
oops long time haven't seen mods posting so much and arguing in less than 50 posts
We mods like a good drawn out, bloody, fist-fight as much as the rest of you. ;)

pantherx12 said:
Dude I'm not trying to be nasty, by definition this is fud, you are essentially making valve look bad by posting this even though as I stated, they not letting you sell the games has nothing to do with them at all. ( It's law)

Also I didn't excuse you of purposely doing it.


"Fear, uncertainty and doubt"
F U D
Gabe is the one who started the whole thing with his comments about Apple. People are calling him on the carpet all over the internet as Valve also has restriction. Maybe not as draconian as Apple's, but restrictions non-the-less.

When someone like Newell points an accusitive finger at another company, for whatever reason, it's going to make the news and people are going to have opinions on what he said.

Personaly, I don't think he really cares and just got a ton of free publicity for Steam. :D
Posted on Reply
#3
[H]@RD5TUFF
pantherx12 said:
Dude I'm not trying to be nasty, by definition this is fud, you are essentially making valve look bad by posting this even though as I stated, they not letting you sell the games has nothing to do with them at all. ( It's law)

Also I didn't excuse you of purposely doing it.


"Fear, uncertainty and doubt"
F U D
clearly the point of the editorial was lost on you.

Kreij said:
We mods like a good drawn out, bloody, fist-fight as much as the rest of you. ;)



Gabe is the one who started the whole thing with his comments about Apple. People are calling him on the carpet all over the internet as Valve also has restriction. Maybe not as draconian as Apple's, but restrictions non-the-less.

When someone like Newell points an accusitive finger at another company, for whatever reason, it's going to make the news and people are going to have opinions on what he said.

Personaly, I don't think he really cares and just got a ton of free publicity for Steam. :D
Agreed this does look like a publicity stunt to a degree.
Posted on Reply
#4
Kreij
Senior Monkey Moderator
Remember when as an April fools joke W1zz said he had enough and was leaving?
The tech boards lit up like Christmas trees. :D
Posted on Reply
#5
[H]@RD5TUFF
Kreij said:
Remember when as an April fools joke W1zz said he had enough and was leaving?
The tech boards lit up like Christmas trees. :D
I do remember that, good times unlike this.
Posted on Reply
#6
qubit
Overclocked quantum bit
pantherx12 said:
Dude I'm not trying to be nasty, by definition this is fud, you are essentially making valve look bad by posting this even though as I stated, they not letting you sell the games has nothing to do with them at all. ( It's law)

Also I didn't excuse you of purposely doing it.


"Fear, uncertainty and doubt"
F U D
Ok, I now know you're not being nasty and we're good. :toast:

I'm not sure how the law forbids selling your games though? :confused: After all, you could do it with disc-based software, so why would an online version be any different in the eyes of the law?
Posted on Reply
#7
pantherx12
qubit said:
Ok, I now know you're not being nasty and we're good. :toast:

I'm not sure how the law forbids selling your games though? :confused: After all, you could do it with disc-based software, so why would an online version be any different in the eyes of the law?
Because when you buy a game, you are in fact buying the device the game is on, not the game it's self.

The game is licensed to you and thus the game it's self cannot be sold, so if it's in a digital format you can't sell the game as it isn't yours to sell.

It's because of archaic copy right laws but until they are rectified that is the case and thusly the lock down has nothing to do with valve/the steam service it's self.


Get me now? ( Imagine that being said in a rude boy voice if you would lol)


Note I completely agree you should be able to sell a digital copy.

It's just not how it works unfortunately.
Posted on Reply
#8
TheLaughingMan
qubit said:
I'm thinking about the crucial area of being able to sell on your unwanted games - that's a straightjacket alright. It's true that they allow you more freedoms in other areas, so I explained that in my article and even acknowledged it as the "best" DRM out there.
Well I can agree with that.

Kreij said:
Wait ! That's your opinion! Did you just write an editorial on Qubits editoral? :roll:
Sunday Editorials FTW !!

On topic : Every software distribution system, by nature, has some closed aspects to it.
Otherwise it's just a torrent site.
Wow, that was not an opinion. And what you said is a statement and I respect that.
Posted on Reply
#9
morphy
Sure it would be nice to be able to sell your used games but I can see their point for not allowing..it's a digital medium. Unlike a used car that has limited mileage on, a 'used' digital product is basically as new and most times in better shape as it would benefit from post release patches.

Plus with the constant sales on Steam at rock bottom, bargain bin prices on older games, I find it hard to complain. In fact this past year I have bough more games on sale from Steam than I have bought new releases. It's a win-win situation for both the developer and consumer.
Posted on Reply
#10
Mistral
OK, what is that rant doing on the front page masquerading as a "news" article?

And what is the whole point of it? QQ, STEAM does not let me re-sell my games? If that's what it takes to have insane sales that get me awesome titles at 70% discount compared to retail, big deal! It's still overall better savings and experience for the customer than filling up GameStop's pockets, for example. And how many non-steam games require online activation that would prevent resale anyway?

qubit
Steam is wonderfully open in the sense that developers can use it flexibly and they don't charge high commissions, but the customer (gamer) is locked in tight, like a straitjacket.
How is STEAM a "walled garden"? Does it prevent you from installing retail software that you've bought from another store on your machine? Does if yell at you if you decide to install Origin (God forbid), get stuff from GoG, or any of the other sources STEAM does not interfere with? How is Valve's software "walled" in any way comparable to what Apple does, eh?
Posted on Reply
#11
jamesy
Kreij said:
There is nothing wrong with editorials and/or opinion pieces. The problem is that there is no editorial/opinion section to put them into at the moment. There should be.
I asked W1zz about doing editorials and he said fine, put them in their respective section. The problem is that editorials can many time cross multiple sections in their content (hardware/software).

Anyway ... Steam is a more open system in that as a developer you are not required to only sell your product on Steam. You can sell your game on Steam, on your own website and anywhere else you would like all at the same time.
Agreed. I was pretty confused by this article. The writer seemed to be hinting at all the ways that box you in...the fact that ANY software company...even a distribution company, enabled game transfers as all is a rarity.

Your not forced to buy games through steam....hence, the not "closed". Wanting to use a tool and being forced to only use that tool are 2 COMPLETELY different things...yea, steam further encourages users to continue using their product....but i don't see a single reason why steam's platform is worse than a CD. No worry about discs, great sales and pricing, save game backups (steam cloud), etc. etc. etc. etc. etc....need i go on? Steam is a good thing for PC Gaming
Posted on Reply
#12
Katanai
Wanna get more comments on your "articles" ?
Put the name Apple in the title.
Wanna get even more comments?
Put Apple vs* in the title


* Actually putting the letters vs is not mandatory, it can also be implied
Posted on Reply
#13
phanbuey
That's a lot of words for "Waa... I can't resell my games on Steam"

This is essentially a greedy article. Steam is one of the main reasons PC gaming hasn't been exclusively relegated to MMORPGs and console emulators. A great way to piss off TPU gamers is to proclaim that "Steam is as tyrannical as Apple, because it doesn't let me resell my games."

By reselling your game all you are doing is giving less money to the people that originally worked to make it. Great thanks quibit. Lets make PC game development EVEN LESS profitable for developers so then we could all buy Xboxes and complain about how closed off Xbox live is.

Maybe the article should be titled "I need more money so I can afford all the awesome games on Steam. Subtitle: Damn you Valve - you are just like Apple, your stuff is so shiny and awesome but too expensive."
Posted on Reply
#14
DrPepper
The Doctor is in the house
I have to say I'm a lot more inclined to read the front page of TPU with the editorials. I might not agree with the article but that's why we can post on them and discuss it and the fact that news threads have a lot more participation is proof that everyone enjoys talking about it.
Posted on Reply
#15
Katanai
DrPepper said:
I have to say I'm a lot more inclined to read the front page of TPU with the editorials. I might not agree with the article but that's why we can post on them and discuss it and the fact that news threads have a lot more participation is proof that everyone enjoys talking about it.
I totally disagree with this. I for one enjoyed reading TPU because stuff like this wasn't posted here. Although most stuff was just a copy and paste from somewhere else it never contained any personal views by people posting it so it didn't contain the stuff I'm tired with most on the internet: bias. For me TPU was a refuge from engadget and gizmodo and other heavily Apple biased sites. Now: let's take the first 3 "articles" on this site and translate their title like I have to do with everything on the sites I mentioned, something I was not looking forward to on TPU:

1. Nvidia standard press release.

2. Valve in a catfight with Apple

3. Microsoft hates you!


See a pattern emerging here? Especially in the last 2. I think it's called: tabloid fever. It's infecting everything and everyone on the internet these days and is more deadly and destructive than any virus Microsoft could blame you for.
Posted on Reply
#16
newtekie1
Semi-Retired Folder
phanbuey said:
That's a lot of words for "Waa... I can't resell my games on Steam"

This is essentially a greedy article. Steam is one of the main reasons PC gaming hasn't been exclusively relegated to MMORPGs and console emulators. A great way to piss off TPU gamers is to proclaim that "Steam is as tyrannical as Apple, because it doesn't let me resell my games."

By reselling your game all you are doing is giving less money to the people that originally worked to make it. Great thanks quibit. Lets make PC game development EVEN LESS profitable for developers so then we could all buy Xboxes and complain about how closed off Xbox live is.

Maybe the article should be titled "I need more money so I can afford all the awesome games on Steam. Subtitle: Damn you Valve - you are just like Apple, your stuff is so shiny and awesome but too expensive."
I agree, and is reselling PC games really a big thing these days? I mean, even with the ones that come on physical media, are people really reselling them that much? I know with console games it happens a lot because all of the content is kept on the disc, and the game really isn't playable at all without the disc in the console, so reselling the disc is no big deal.

However, with PC games, they have to be activated, and are usually tied to the PC they are originally installed on, or have limitted number of activations, etc. I wouldn't even buy a used PC game for fear that it would be useless due to DRM. Not to mention a lot of the games user agreements forbids reselling them anyway, just like steam, it just isn't as easy to enforce that as it is with a steam game. So I hardly think "OMG...you can't resell steam games" is a valid argument to say Valve is just as restrictive as Apple.
Posted on Reply
#17
[H]@RD5TUFF
newtekie1 said:
I agree, and is reselling PC games really a big thing these days? I mean, even with the ones that come on physical media, are people really reselling them that much? I know with console games it happens a lot because all of the content is kept on the disc, and the game really isn't playable at all without the disc in the console, so reselling the disc is no big deal.

However, with PC games, they have to be activated, and are usually tied to the PC they are originally installed on, or have limitted number of activations, etc. I wouldn't even buy a used PC game for fear that it would be useless due to DRM. Not to mention a lot of the games user agreements forbids reselling them anyway, just like steam, it just isn't as easy to enforce that as it is with a steam game. So I hardly think "OMG...you can't resell steam games" is a valid argument to say Valve is just as restrictive as Apple.
What bothers me most about steam is not the lack of the ability to resell a game is the fact they will sell older games that may not work properlly.
Posted on Reply
#18
GunsAblazin
Valve a Walled Garden?! What moron wrote this? If you could transfer games to another account wouldn't you figure that people are buying, selling, and trading games... Duh. The money doesn't have to exchange hands/accounts via the steam client. So steam is more open and much more evolved than any other digital distribution services. Of course Valve would never speak of this, because they want to keep the greedy developers and their backers/bankers happy.

For digital media to take the place of physical media it will have to offer the same value; that means the same rights of ownership, but that's not the case and yet they cost the same. This issue lies at the core of our economic problems - while I try not to get all political, but It's the rich vs. the poor all over again.

What I don't get is while piracy is at it's lowest and the entertainment industry continues to crack down on individuals, things just keep getting worse as we give up our freedom to rich corporations that want to dictate what's fair. Now is the time for "Limewire" if there ever been one.
Posted on Reply
#19
AndreiD
I had no idea techpowerup was turning into Fudzilla.

PS: It would be nice if there weren't several Battlefield 3 and other EA games articles leading up to a Steam rant one.


[H]@RD5TUFF said:
What bothers me most about steam is not the lack of the ability to resell a game is the fact they will sell older games that may not work properlly.
On the page of every game, you have the PC and/or MAC System requirements.
Posted on Reply
#20
DannibusX
This editorial is full of fail.

Comparing Apple to Steam is useless, as Apple is primarily a hardware manufacturer. It’s their business model to lock out other vendors so you have to use Apple’s services and devices for your content.

I’ve never heard that Steam is an “open” platform as you erroneously suggest in this editorial. Steam is DRM and digital distribution it’s a retail outlet for any and all publishers to put their games on. I’m pretty sure that the commissions that Valve earns through sales on Steam will be head to head with the commissions that other retailers receive for selling games.

Steam is available on PC and Mac, with Steamworks features now made partially available on PSN through Portal 2. There is a rumored and often denied Linux port in the works as well. Steam is available on many different platforms. I’m pretty sure that Valve wants to sell games and bring Steam to iOS and Android, but Apple would obviously try to keep them out of that business.

I like the subtle hint that Newell gave about “if we get into the hardware business”. Yeah, Steam console bitches. That is basically Gabe Newell telling Sony, Microsoft and Apple that they can take a huge bite out of their bottom line. Especially when you factor in that most games on Steam, if they are available on another platform (Steamplay), you usually can play it on another without rebuying it. That’s not true for XBLA titles, but across the PC platforms it is.

If you want to be able to resell your games, don't buy them through Steam and don't buy any Steamworks title. It's an easy solution.
Posted on Reply
#21
brandonwh64
Addicted to Bacon and StarCrunches!!!
Easy Rhino said:
huh?
He's a great news poster :)
Posted on Reply
#22
qubit
Overclocked quantum bit
DannibusX said:
This editorial is full of fail.

Comparing Apple to Steam is useless, as Apple is primarily a hardware manufacturer. It’s their business model to lock out other vendors so you have to use Apple’s services and devices for your content.

I’ve never heard that Steam is an “open” platform as you erroneously suggest in this editorial. Steam is DRM and digital distribution it’s a retail outlet for any and all publishers to put their games on. I’m pretty sure that the commissions that Valve earns through sales on Steam will be head to head with the commissions that other retailers receive for selling games.

Steam is available on PC and Mac, with Steamworks features now made partially available on PSN through Portal 2. There is a rumored and often denied Linux port in the works as well. Steam is available on many different platforms. I’m pretty sure that Valve wants to sell games and bring Steam to iOS and Android, but Apple would obviously try to keep them out of that business.

I like the subtle hint that Newell gave about “if we get into the hardware business”. Yeah, Steam console bitches. That is basically Gabe Newell telling Sony, Microsoft and Apple that they can take a huge bite out of their bottom line. Especially when you factor in that most games on Steam, if they are available on another platform (Steamplay), you usually can play it on another without rebuying it. That’s not true for XBLA titles, but across the PC platforms it is.

If you want to be able to resell your games, don't buy them through Steam and don't buy any Steamworks title. It's an easy solution.
No way is it so "full of fail" lol.

Try reading and comprehending. I know Steam is a closed, locked-in DRM system and I said so - that's the whole point of the article and that one DRM vendor is accusing another of the same thing, hence the pot calling the kettle black. I actually make that point right in the title and in various places in the article.
Posted on Reply
#23
DannibusX
Uh, Steam is a retail outlet. Yes, it inludes DRM. Apple is a hardware designer, manufacturing outsourcer. My reading comprehension is fine.
Posted on Reply
#24
qubit
Overclocked quantum bit
DannibusX said:
Uh, Steam is a retail outlet. Yes, it inludes DRM. Apple is a hardware designer, manufacturing outsourcer. My reading comprehension is fine.
No it isn't.
Posted on Reply
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