Steam accounts now over 65 million

The popular digital distribution platform has seen 30 percent growth in the last 12 months.

Valve has just announced that its Steam platform has grown another 30 percent in the trailing 12-month period, bringing its user-base to more than 65 million accounts. Now in its tenth year, the digital distribution service offers more than 3,000 games, and Valve continues to expand the feature set for the service as it takes Steam to the living room.

Valve plans to introduce the recently announced Steam Machines with a variety of hardware partners later in the year. Combined with SteamOS and the unique Steam Controller, which features touch pads and no analog sticks, Valve is hoping to further disrupt the marketplace.

“The main goal of Steam has always been to increase the quality of the user’s experience by reducing the distance between content creators and their audience,” said Gabe Newell, co-founder and president of Valve. “As the platform grows, our job is to adapt to the changing needs of both the development and user communities. In the coming year, we plan to make perhaps our most significant collaborations with both communities through the Steam Dev Days and the Steam Machines beta.”



Former Steam boss Jason Holtman lands at Microsoft

Valve veteran will be focused on “making Windows a great platform for gaming”

Jason Holtman lands at Microsoft

Jason Holtman, who spearheaded Valve’s Steam business for eight years before leaving the company in February, has a new job.

The former lawyer has taken a job with Microsoft, with a focus on PC gaming and entertainment strategy. Because he has just started at the position, Holtman declined an interview request, but confirmed the move.

“Yes, I have joined Microsoft where I will be focusing on making Windows a great platform for gaming and interactive entertainment,” he said. “I think there is a lot of opportunity for Microsoft to deliver the games and entertainment customers want and to work with developers to make that happen, so I’m excited to be here.”

Holtman’s departure from Valve after an eight-year tenure came cloaked in mystery. He left the company at the same time as several high-profile employees were reportedly laid off. Valve did not address the reasons behind the staff reductions, with founder Gabe Newell telling Engadget “We’re not going to discuss why anyone in particular is or isn’t working here.”

At Valve, Holtman was the primary point of contact for developers that distributed games on Steam – and, to many in the gaming world, was the service’s driving force. While he certainly wasn’t the sole reason for its success, he was its biggest cheerleader and an even bigger proponent of digital distribution.

As a result, his move to Microsoft has raised many questions about the Redmond-based company’s plans in the PC gaming space.

With the Xbox One launch looming, Microsoft has greatly de-emphasized PC gaming of late. Some developer sources tell GamesIndustry International they were under the impression the company had largely given up on the Games for Windows initiative.

Holtman’s hiring could signal a renewed emphasis on the computer, though.

“It seems like a guy who comes from Valve who has no peer, in my mind, in the gaming space relative to really strong B-to-C [business to consumer] relations could indicate a ramp up in the importance of that space,” says John Taylor, managing director at Arcadia Investment Corp.

A skilled dealmaker, Holtman is largely credited with convincing third party publishers such as EA, Activision and more to sell their games directly on Steam – as well as recruiting many smaller companies who might otherwise have vanished by now.

He’s also credited with steering Steam through the DRM controversies it encountered and calming publisher fears that the annual Steam Summer and holiday sales would devalue their intellectual properties.

The respect he has earned in leading digital distribution could be invaluable to Microsoft, which has not had a lot of success in that world. Though available in 41 countries, the Games for Windows Live service is currently not viewed as a strong player in the PC gaming world.

It’s not just his relationship with publishers and developers that’s valuable, though. Holtman also knows how to connect with customers – something Microsoft has been lacking so far in its digital distribution efforts.

Of course, Holtman’s duties could expand beyond just PC gaming as well. Digital distribution is expected to be a major component of the eighth generation of consoles. And while his experience so far has been on the PC side, Microsoft may be looking for Holtman to drive adoption and consumer loyalty of online purchases on the Xbox One in the years to come.

“[Business to consumer] is not just having someone’s credit card number,” says Taylor. “It’s how you use that handshake to maximize satisfaction for the vendor and maximize satisfaction for the customers. This kind of direct relationship is the next stage in the evolution of the games business. Valve is already there on the PC side and I think Microsoft would be very happy to have some sort of Valve template to lay on top of the Xbox.”



EA taking over the gaming industry?

Over the years, I have seen a practice which seems to be becoming more and more frequent, but really worries me. It’s when giant game companies try to buy out smaller successful companies. A great example is when Microsoft bought Rare, who are famous for games like  Donkey Kong Country and Killer Instinct. Nothing stellar has come from them in years.  What worries me is the fact that we see creativity and innovation start to suffer. Game designers who probably have great ideas for new IP’s aren’t too accepted because the big companies are not willing to take risks anymore,so we never get to see these games and the employees either get axed or start a new small company with great ideas and the whole thing starts again. The publishers would rather push a new expensive better console system on us rather then innovate with new games. It’s an excuse. Its either that or just keep pumping out parts 2,3,4 etc…you get the idea. Sure more funds help these companies reach more consumers, more money equals more staff, bigger game budgets (which does not always mean better games) etc.. but in return, many sell their souls also.

Did you know that in the past five years Electronic Arts has spent more than $1 billion to get into social and mobile arena? Since they cannot break through with their own creativity they have bought companies like PlayFish, Firemint and PopCap. I guess if you can’t make a better product against your competitor, just buy them. Hey, this is business and it happens all the time, everywhere we look. I get it, I really do. I just do not want creativity and innovation to suffer because in the end, its us the consumer who get the short end of the stick with crappier overpriced games.

Now EA wants to buy Valve. Thank goodness company president Gabe Newell realized what would really happen, he stated:The company would “disintegrate” if it was purchased by another company”. “Let’s find some giant company that wants to cash us out and wait two or three years to have our employment agreements terminate”.  Yes Gabe, that is what eventually happens to good companies when bought out.

Michael Pachter, an analyst from Wedbush Securities (someone I really disagree with on many issues) “more of that in another blog though” has stated that he estimates Valve has an estimated value of $2.5 billion.

Do you see companies like EA and others buying smaller companies as helpful or hurtful? Let us know