Gabe Newell on Steam Monopoly Accusations: Gamers Have 'Enormous Choice'
Back in 2023, a court ordered Valve chief Gabe Newell to testify in person during the long-running antitrust suit filed by Wolfire Games in 2021. A new report by Bloomberg highlights some of what Newell had to say during that testimony, including his denial that Steam holds a monopoly on PC gaming or even an overly dominant position.
Newell argued that gamers have enormous choice about where they purchase their games. He listed several options, including "whether they buy the game on an Xbox, whether they buy it on Steam, whether they buy it on Epic Games Store or whether they buy it directly from software developers." This emphasis on consumer choice is central to his defense against the allegations of market dominance.
The Alleged Unwritten Rule
Newell also denied the existence of an alleged "unwritten rule" that prevents developers from offering their games at lower prices on non-Steam storefronts. This is one of the central complaints behind Wolfire's lawsuit. Founder David Rosen claimed that when he asked Valve about offering his studio's game Overgrowth at a reduced price on other stores, "they replied that they would remove Overgrowth from Steam if I allowed it to be sold at a lower price anywhere, even from my own website without Steam keys and without Steam's DRM."
When asked about this rule, Newell repeatedly denied its existence, even when presented with internal communications that seemed to show Valve employees enforcing it. He stated, "Valve does not have a policy or practice of dictating prices to third-party software developers on other platforms." When asked how Valve would react if such a situation occurred, Newell initially expressed confusion and then added, "Many of our partners and many of our customers are quite happy with the service that we're providing."
The Dominance of Steam
It's true that Steam has a massive user base and remains a popular platform for gamers. Sales on the platform are still highly sought after, offering a wide range of games at significantly discounted prices. Steam has also helped reduce the influence of major publishers over conventional retail sales, giving indie developers a chance to gain fame and fortune.
However, despite Newell's claims, Steam is, if not a monopoly, very close to one. Its deep integration into the PC gaming ecosystem has made it a dominant force. Even Epic Games, which has spent years giving away its games for free, has found that these promotions have actually boosted sales on Steam. While the Epic launcher may not offer the same experience as Steam, the challenge for Epic is that many gamers seem content with Steam as their primary platform.
The Legal Landscape
Newell's deposition is particularly significant given the potential ramifications of the Wolfire case. Valve is currently facing serious legal challenges on multiple fronts, most notably a $900 million lawsuit filed in the UK that accuses the company of using Steam to overcharge for games and push out competing storefronts. This lawsuit also alleges the existence of that unwritten rule, which Newell denies even exists. The outcome of these legal battles could have far-reaching effects on the future of Steam and the broader PC gaming market.
