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Entertainment as a Service

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Entertainment as a Service

Game News - posted by DarkUnderlord on Mon 2 March 2009, 06:45:58

Tags: Scars of War

It's a little late but here's something interesting from Valve about one of the Codex' favourite topics:

Gabe beileves the old way of entertainment: Indirect customer relationships, product orientation. The new way of entertainment now: Direct customer relationships, service orientation. Valve aims to touch its customers in some way every three weeks, not every three years when a new game is shipped.

Through this perspective, Gabe and Valve have observed the following:

* 30-year old songs with a little service (Rock Band, Guitar Hero) generate huge profits
* Pirates are ahead not just on price, but on service
* DRM appears to increase, not decrease piracy
* Privacy and transparency
* Shrinking distance to customer empowers content creators
Valve has seen a great turnaround rate on guest passes. Friends invite their friends to play a game they already own. Game invites that also walk a gamer through a purchase process are also effective.

Time to look at the sales of Team Fortress 2 to see the impact of the updates on revenue. Holy s#!%. The sales spike by huge amounts everytime there's a sale or major update. Steam sales went up 106% after a free update. Player minutes went up by 105%. Gifting has thrown a 71% sales increase. Surprisingly, sales from retail stores also went up by 28%. Finally, it saw 75% increase in new users. Knock knock. Who's there? Steam. Steam who? Steam is so successful it hurts.
Valve was afraid that too many price changes would "confuse and anger" customers. It isn't the case.

Last weekend, Valve decided to do an experiment with Left 4 Dead. Last weekend's sale resulted in a 3000% increase over relatively flat numbers. It sold more last weekend than when it launched the game. WOW. That is unheard of in this industry. Valve beat its launch sales. Also, it snagged a 1600% increase in new customers to Steam over the baseline.​
Lower prices and more updates beat piracy? There are a few more stats but I've mentioned it because Naked Ninja talks about it a bit more in his blog. He has intentions of doing the same thing for his indie game. You know, once he actually completes it of course.

Spotted @ RPGWatch

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