Valve's Gabe Newell touts digital distribution

By on February 19, 2009, 9:17 AM
Speaking at the DICE summit last night in Las Vegas, Valve co-founder Gabe Newell announced that the combination of free downloadable content plus a recent half-price sale of Left 4 Dead has resulted in a stunning 3,000 percent increase in sales of the game, shipping one-third more copies over the weekend than it did on release. He also mentioned that new Steam customers jumped 1,600 percent over the same weekend, while retail sales remained constant for the most part.

He attributes the success of Steam and Valve games in general to their goal of providing entertainment as a service. Using their Team Fortress 2 online shooter as an example, Newell said the company treated the launch of the game as a long-term service that included not only bug fixes but also free additional content for gamers. As a result, the game has been constantly updated, which still translates directly to revenue in sales spikes even though it is a relatively old title now.

Furthermore Newell believes the game industry as a whole is benefiting from digital distribution and said it is inevitable that a service like Steam, which started on the PC, eventually migrates to consoles.

User Comments: 3

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eafshar said:
valve is for sure trying to stay up to date with market demand.. they are definitely setting a nice example. 3000% increase.. now that's impressive.
Julio said:
So much for price elasticity... that's a very impressive sales bump though I'm sure it was also helped by the amount of exposure the discount got here and pretty much everywhere else in the online community.
burntham77 said:
Among other things, Steam is great for buying single-player shooters, like Far Cry 2 or Crysis, that I will only play through once. Instead of buying the box and discs, I can just download it and save a little plastic. Thanks Valve.
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