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Steam's Business Model Is "Unrealistic," Ubisoft Executive Says

"It doesn't reflect where the world is today in terms of game distribution."


Ubisoft executive Chris Early, who is the VP for partnerships and revenue at the Assassin's Creed company, has spoken up to share his thoughts on Steam. Speaking to The New York Times, Early said the company's business model, as it stands today, is unworkable.

"It's unrealistic, the current business model they have. It doesn't reflect where the world is today in terms of game distribution," he said.

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It's not completely clear what part of Steam's business model Early is speaking about. It may be in reference to the revenue split that Steam offers. Steam typically keeps 30 percent of game sales, with 70 percent going to developers/publishers. By contrast, the Epic Games Store offers much more to the people who make games; on the Epic Games Store, 88 percent of revenue goes back to developers.

Given Early's comments, it's not hard to understand why Ubisoft elected to release The Division 2--one of the company's biggest games of 2019--on the Epic Games Store instead of Steam. The Division 2 was also released on Ubisoft's own Uplay store, and sales of the game there grew 10X after the decision to bypass Steam.

It's not clear if Ubisoft will have a strict "no Steam" policy with its future releases. One of the company's major upcoming games, Ghost Recon: Breakpoint, will also not be sold on Steam.

Epic CEO Tim Sweeney is also quoted in the story, and he spoke about how game stores are known to "extract an enormous portion of game industry profits." As such, they are "ripe for disruption," he said

Super Meat Boy developer Tommy Refenes is quoted as well. He talked about how he believes the video game business needs better systems for buying and selling games. "The only way we'll get it is if companies with tons of money are innovating and trying to outdo each other," he said.

The full story is fascinating and well worth a read.

For what it's worth, Epic has stated it will change its policy of chasing exclusives if Valve reduces the cut it takes from game sales on Steam.

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