case study of steam

1. CASE STUDY OF STEAM
THE BIGGEST ONLINE GAME DISTRIBUTOR
By
Sarang Pushkarna
& Paawan Gaba

2. CONTENT
• Overview
• History
• Features
• How Steam makes money
• STEAM Competitors
• SWOT
• Conclusion

3. Overview
• Steam is an online distributor of games
and game-related media. Users can use
Steam to purchase computer games
and download them without a physical
disk.
• Created and managed by Valve
Corporation, Steam has grown into one
of the largest providers of computer
games for independent studios.

4. History

5. • Steam is Valve’s solution to problem of game that needed constant
updates when it tried to install new patches, which would take the
game offline for days at a time.
• Released on March 22, 2002 for a beta period which attracted
between 80,000 and 300,000 testers playing Counter-Strike 1.6
which was a huge success.
• Around 2004, Valve began negotiations with video game studios
and signing contracts allowing Steam to actually distribute games.
This service became popular once Valve released Half-Life 2.

6. • Originally launched for PC, Steam became available for Mac OS X on
May 12, 2010.
• At the 2010 June Electronic Entertainment Expo, Valve announced
Steam would be available for the PlayStation 3 with Portal 2 being
the vanguard for many other titles to come.
• By 2007- 13 million users and 150 games in its catalogue.
• By 2012 - 40 million users and 1,800 games in its catalogue.
• By 2021 - 132 million users and 11,000 games in its catalogue.

7. Features
• Steam has turned from a gaming platform into a
video and computer game distributor. What sets
Steam apart from other online gaming providers is
the ability to download full video games onto
users’ computer hard drives.
• Steam allows you to log into your account on other
computers and access games an unlimited amount
of times.
• Through the same profiles, gamers can interact
with each other through gameplay and the
provided instant messaging service and VoIP
feature. The profiles also contain player statistics
and achievements which are open for friends of
players to see.

8. How Steam makes money
• Commission- Steam makes its most revenue from commission
charged on every game sold on its platform. Steam charges a
commission of 30% only from the first $10 million in sales. For all
sales between $10 million and $50 million, the commission is 25%.
For every sale after the initial $50 million, Steam charges a 20% cut.
• Hardware Sales - Valve released its own gaming hardware to
strengthen the position of Steam. It rivals other big players in the
industry. The handheld device comes in three different versions
that cost $399 (64 GB), $529 (256 GB), and $649 (512 GB),
respectively.

9. • Developer Fees-In order to help developers build and distribute
their games on the Steam platform, Steam offers them a bundle of
tools and services. These tools and services include: Feature
broadcasts, early access to players, enabling developers to sell
bundles and downloadable contents, announcements of events,
updates, etc. A so-called “greenlight fee” is charged before users
can access them.
• Licensing Fees- A licensing fee is charged for the establishment of a
Steam PC Café. A Steam PC Café offers visitors the same Steam
experience available to them at home. Visitors to the Café can
access their entire game libraries, chat with friends, and do lots
more. Steam charges a one-time installation fee of $29.99 and a
monthly subscription fee of $9.99 per license.

10. STEAM Competitors
• Epic Games
• GOG.com
• EA store
• Xbox game pass

11. SWOT

12. • Steam’s Strengths
• Enormous Number of Users: Steam had approximately 120 million
monthly active players as of 2020;
• Enormous Number of Games: Steam is currently home to over
50,000 games;
• Availability: Games on Steam can be played anywhere with internet
connection.

13. • Steam’s Weaknesses:
• Cheaters: Cheaters are often a nuisance on Steam. They negatively
affect the gaming experience for other players;
• Downtime: Downtime is experienced during maintenance
schedules, while sometimes it could be as a result of hardware
failure, a problem with a point-of-presence provider, or a problem
with the network;
• Legal Tussles: Steam sometimes gets into legal tussles with
partners, which could slow down the release of some games and
content.

14. • Steam’s Opportunities
• Growing Game Industry: The video game industry grew by 23%
during the Covid-19 pandemic from the prior year, and it is
projected that revenue will reach $219 billion by 2024;
• More Multiplayer Games: Steam adds an average of 6,000 to 8,000
new games to its list every year since 2017;
• New Technology: The introduction of new technologies is making
the gaming experience on Steam better and more seamless.

15. • Steam’s Threats
• Strong Competition: Steam faces increasing competition from other
big gaming platforms, such as Epic Games, EA, and GOG.com. They
are encroaching on Steam’s market share;
• Other Game Companies: Other game companies, such as
PlayStation and Xbox, rival its hardware businesses;
• Hackers: Hackers are always on the prowl to exploit Steam’s flaws
and steal users accounts and data.

16. Conclusion
• Steam provided an innovative solution to a pressing problem at its
time of launch. It helped solve the problems of game piracy,
connection between gamers and tracking of sales. Though Steam
continues to face increasing competition from existing and new
gaming platforms, its enormous user base and continuous
innovation still keep it ahead of others in the industry. Some
industry experts believe that the PC game niche is becoming
matured, hence there have been calls for Steam to grow beyond its
core demographic of male gamers who download full PC games.

17. THANK YOU