That lawsuit against Steam’s 30% cut of game sales is now a class action, meaning many other developers could benefit

An on-going lawsuit against Valve about Steam's "anti-competitive" practices and especially, its infamous 30% per-game revenue cut, has taken an interesting twist. According to a report, it's now a class action suit that could benefit any developers or publishers who have sold a game over the Steam store on or after 28th January 2017.

Here's the broad background: in April 2021, Overgrowth developers Wolfire Games filed an antitrust lawsuit against Valve in the USA, arguing that Steam uses its dominance of PC game sales to distort the market and bury the competition, and in particular that the company's base 30% cut of revenue from each video game sold on Steam keeps overall game prices artificially high, with Valve allegedly pressuring developers not to sell their games for lower prices on stores with smaller commissioning fees.

"I believe that Valve is taking away gamers' freedom to choose how much extra they are willing to pay to use their platform," Wolfire founder David Rosen said at the time, as preserved by the GameDiscoverCo newsletter. "I believe they are taking away competing stores' freedom to compete by taking advantage of their lower commission rates. I believe they are taking away developers' freedom to use different pricing models."

As you'd expect, Valve pushed back on all this. In July 2021, the company accused Wolfire of failing to supply evidence for their allegations, while describing the 30% basic revenue cut as an "industry standard" - a claim that, while not unfair, flies in the face of both growing developer discontent and competitors such as Epic Games Store and the Microsoft Store lowering their commission fees in recent years.

Wolfire's lawsuit was eventually dismissed at Valve's request in November 2021, with the judge in the case arguing that Wolfire had not demonstrated that they or anybody else had been harmed by Valve's management of Steam. The judge also observed that the fact that competing stores like EGS have taken a smaller cut and failed, nonetheless, to usurp Steam is evidence that developers and publishers largely consider Steam's offering worth the price.

The judge further rejected Wolfire's somewhat bizarre assertion that Valve has illegally tethered the Steam store (which sells the games) to the Steam platform (which encompasses social networking features, achievement tracking, game library management, and so forth). The judge found that the Steam store and platform are, on the contrary, a single product, with game sales funding the platform's various 'free' features.

Wolfire were given 30 days to amend their case, address the dismissal's criticisms and supply additional evidence. This they did, adding sufficient context to the original claims that, in May 2022, the court found that aspects of the antitrust lawsuit could move forward. In July 2022, a court order also confirmed that Wolfire's suit would be combined with another, similar antitrust lawsuit against Valve brought by multimedia production and VR company Dark Catt Studios.

Fast forward to today, and GamesIndustry.biz reports that the combined suit has been recategorised as a class action suit. A class action suit is, broadly, one brought on behalf of a group of absent people, going beyond those actually in court. In the event that the plaintiffs win, everybody in that group of people stands to benefit. There is an absolute world of finickity legal detail within that hazy definition, mind you, even if you confine your attention to the laws of a particular country.

According to GamesIndustry's James Batchelor, "the class action will apply to any developers, publishers or individuals who paid a commission to Valve in connection with a game sale - referring to the 30% cut the Steam firm takes from each purchase - on or after January 28, 2017." GI also report that the court have denied Valve's request to exclude the testimony of a particular expert called by Dark Catt and Wolfire - the economist Dr Steven Schwartz.

All of these legal wrangles form part of the larger, existential industry wrangle about Valve and Steam's centrality to PC gaming. My extremely Baby's First Monopoly take is that whatever your feelings about specific aspects of Steam's service, or Valve in general, no individual company should exert this much power over the fortunes and overall culture of an artform. As such, I welcome efforts such as Wolfire's to challenge Valve and Steam, even if I may not agree with the detail of the suit in question.

What happens if Wolfire and Dark Catt win? According to my "PhD in Googling" grasp of class action law, it potentially means that Valve might have to compensate a large number of parties, adding up to far more than if they'd had to compensate Wolfire and Dark Catt alone. In turn, this might lead to a larger policy change at Valve, which would have dramatic ramifications for PC game publishing as a whole.

If you'd like to dive into the nitty-gritty of the legal proceedings, the GameDiscoverCo newsletter is worth signing up to. One question it raises is where, exactly, Wolfire and Dark Catt are getting the money for their legal expenses, given the vast expense of discovering and amassing evidence for a case like this.