Valve's Gabe Newell touts digital distribution

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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.

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