Full Steam Ahead

Apparently, the PC is dead as a gaming platform. Piracy, increasing console userbases, the nightmare of drivers and infinite hardware combinations – all too much for our increasingly profit-hungry industry.

Which makes it all the stranger to be sitting in Valve’s industrially-themed meeting room – more prominent pipes and metalwork guns than executive plush – alongside a handful of other journalists from across the world. After all, if PC gaming is dead, why is Valve still here?

The answer, you might be thinking, is that Valve exists in a bizarre in-between space. It’s primarily a developer, but it only partners with publishers for distribution. It’s a developer, but it also publishes other people’s products online through the hugely-popular Steam network. It’s a developer, but – well, it’s more.

Is that why Valve is still here? Is this why we’re all assembled here? The answer, perhaps unsurprisingly, is no. The reason, it soon manifests, is that Valve is concerned – or perhaps more accurately perplexed – about the bizarre sequence of stories and reports that has sparked this poor platform’s funeral procession. Rather than being a development graveyard best left fallow during the console crop’s harvest, Valve is keen to get the message out that, actually, the PC is the best place for a game developer to be.

SEEING THINGS

“There’s a perception problem: the stories that are being written are not a true reflection of what’s really actually happening,” explains Valve co-founder and honcho Gabe Newell.

“I mean, go ask [Blizzard president] Rob Pardo if PC gaming is dead – if he can take the time out from making money hats, I’m sure he’ll give you a really eloquent explanation of why probably the most valuable entertainment franchise of the moment is PC-specific.”

The misconception stems from the fact that online commerce – be it sales of digitally distributed games, subscriptions, micro-transactions or whatever – remains untracked and under-represented by organisations such as NPD and ChartTrack, and it’s leading analysts to make assumptions based on massively incorrect data. Is it fair to judge a market on figures that don’t include the fact that, for example, Blizzard makes $120 million in gross revenue a month? Or on figures that usually only reflect English-language territories, ignoring massive opportunities such as China and Korea and emerging markets like Russia?

Even if you just consider vanilla MMOs alone, the figures significantly out, says Newell. “Essentially, Blizzard is creating a new Iron Man each month in the studio in terms of the revenue they’re generating.

“Any movie studio that was doing that would be heaped with praise, but all of this is essentially invisible to the way that data is being aggregated and recorded. You’ve got MMOs, online, ourselves, GameTap, Metaboli, PopCap, RealArcade, Nexon – and all are completely invisible to business press and stock analysts.”

Not everyone has the infrastructure or time to develop a World of Warcraft competitor, of course – and even those that do still can’t seem to find that special something – but that’s actually the point Valve is really trying to make: that by embracing online and treating games as an ongoing entertainment ‘service’, small teams can make tight games and foster a community that can continue to support a company for a long time, much in the way that Warcraft’s player base sustains Blizzard.

Experimenting with player relationships in this way can only really be done on the PC, Newell explains, because the PC’s open nature means that it’s the best place to innovate, and the only place you can try out new models without the restrictions of a format holder.

“It’s the place where innovative new business models are coming from. Given the vast amount of R&D done on the PC, consoles are really just becoming stepchildren of the capital investments being made there. In the future, in the 2010 timeframe, the next generation of gaming standards are going to be established not by the Nintendos and Sonys of this world, but by Intel and Nvidia.”

TANGLED WEB

If you’re wondering why Valve is championing the online model, well, it thinks it has a solution – Steam and Steamworks. The combination of the Steam delivery platform and the free Steamworks community functionality can provide developers with detailed play metrics, helping designers to recognise choke points or imbalances and then iterate accordingly.

“Not only does doing that help your business people make better decisions, it’s also having a huge impact on game designs themselves,” says Newell. “Iteration and managing risk are the keys to being able to innovate – we really believe that taking smaller, riskier steps will end up taking your game designs further faster.”

And if you want an example, look no further than Valve’s own Team Fortress 2, which has been updated 53 times since its October 2007 release in response to player feedback.

“It’s really about having an entertainment service with the community – all of our decisions are geared towards how can we do something that’s interesting and exciting. If we see that users want movies in Team Fortress 2 – like we are – and we can see its impact on sales and on gifting, well yeah, we’re going to do that. It’s moving towards that mindset – people thinking ‘how can I generate web hits on to my servers?’ are much closer to the mentality for what’s going to be successful going forward.”

Newell is quick to mention that, in all fairness, it shouldn’t be Valve championing this particular cause – the aim is not to promote Steam, rather the PC as a whole – but that the decentralised management structure of the PC platform means that there’s no PR army on hand to put a positive spin on any story. “The people who traditionally drive these messages, like Intel or Microsoft or Apple, are not very effective for various reasons,” he explains.

“Intel and Apple both have anti-gaming positions that they’ve traditionally followed – although that’s changing now. Microsoft has clearly decided to create a closed proprietary platform so that they don’t have to compete with the YouTubes and Googles of the world. The success of everyone else in the space effects all the others – if Nvidia does better, we do better. If Crytek makes an awesome engine, it’ll drive Intel’s sales. We recognise that we’re part of this and we’re trying to do our part.”

Newell is also at pains to point out that they’re not trying to usurp the PC Gaming Alliance established earlier this year by Microsoft, Intel and Nvidia – it is interfacing with them in some capacity, he confirms – it’s just that Valve tends to believe that “actually shipping products is one of the best ways to make things move forward,” admits Newell.

“I think that Wrath of the Lich King [the new World of Warcraft expansion] will have a larger impact on moving the PC forward as a gaming platform than companies sending representatives to meet and decide that PC gaming should be doing better.”

CHAMPIONS LEAGUE

Newell is very quick to point out that Valve is not trying to position itself as the champion of PC gaming, mentioning not only competing services like GameTap and Metaboli, but also singing the praises of other developers doing more impressive things in the PC space. Newell specifically points to Blizzard – “They engage with their community in great ways, like getting fans to participate in art. That’s something I’m really jealous of,” – and Korean studio Nexon: “Using the rabid fans to subsidise your casual fans and generating more money than charging for the game upfront is fascinating. We wouldn’t have thought of that at all.

“I think that, actually, other companies are ahead of us. But this is a transition that the whole industry is going to do, and it’s a lot more feasible to make this transition on the PC than it is on other platforms,” he says.

“I think providing an ongoing entertainment service to my customers will be the best decision financially, from a game design position and from a productivity and quality standpoint. Having real time data on game player behaviour is hugely more important to making good decisions going forward as a game designer than your fill rate or how many polygons you’re throwing around.”