Valve's Enterprise Value Estimated At $3 Billion

[pugh]

A small piece on Gabe and Valve..

http://www.legitreviews.com/news/12584/

 

[alent1234]

now the question is will Activision follow EA in creating their own store? why pay Steam if you can do it yourself?

 

[darkewaffle]

Oh wow, I had no idea Newell owned more than 50% of Valve. Now that's a good way to do business.

 

[pugh]

Lord knows I have enough programs from other services to keep open for games.. Guess one more won't hurt..

I could see them trying this too this year... mark it!

 

[Barfo]

why pay Steam if you can do it yourself?

Because Steam, as opposed to the rest, overcame it's crappy stage years ago (see Origin).

 

[Maximilian]

Awesome :thumbsup:

Now give us Half life 3 on source 2

 

[Red Storm]

Apparently 3 Billion dollars still isn't enough to finish Half Life.

 

[Gothgar]

Maybe he was waiting for the company to be worth 3 Billion before he could make half life 3?

 

[Barfo]

Maybe he was waiting for the company to be worth 3 Billion before he could make half life 3?

Let's hope he's not thinking 33.

 

[AyashiKaibutsu]

now the question is will Activision follow EA in creating their own store? why pay Steam if you can do it yourself?

Blizzard already does I can't imagine activision is too far behind.

 

[Regs]

I sure hope we don't end up having to have 10 or more game clients just to play the games we like.

 

[wuliheron]

"Valve time" is an industry joke for not making schedules, but that's because they're the only publisher and studio that actually puts the customer first. Forget about Steam, everything they touch turns to gold thanks to Gabe Newell being one of those rare geeks who also understands people. They know how to ask their customers what they want, listen to feedback from their employees, and even be creative.

The real question is why all the other publishers and studios either struggle to figure out what their customers want or just don't care and why they have some of the highest turnover rates for employees of any industry.

 

[Red Storm]

"Valve time" is an industry joke for not making schedules, but that's because they're the only publisher and studio that actually puts the customer first. Forget about Steam, everything they touch turns to gold thanks to Gabe Newell being one of those rare geeks who also understands people. They know how to ask their customers what they want, listen to feedback from their employees, and even be creative.

The real question is why all the other publishers and studios either struggle to figure out what their customers want or just don't care and why they have some of the highest turnover rates for employees of any industry.

It certainly helps having a 3 billion dollar safety net to fall back on.

Because of the money from Steam, Valve doesn't have to undergo any kind of pressure to release a game to the market. Most devs don't have this luxury, they need to make deadlines or they might lose their job.

 

[surfsatwerk]

Where"s episode 3 you fat bastard!@#!@#!

 

[Lonyo]

I sure hope we don't end up having to have 10 or more game clients just to play the games we like.

Do you remember when we needed none?

 

[Mandres]

Even in this era of hyper-inflated tech values (Facebook...) 3b for Valve sounds pretty absurd to me.

Are they estimating that sales from Steam will continue to double every year into perpetuity? That wouldn't be realistic. Other than that where are their revenues? They release a new AAA game every, what, 5 years? There is no MMO cash cow or huge portfolio of licenses like EA has.

Hell EA's market cap is ~5billion, and to even consider Valve's value in the same ballpark is ludicrous.

 

[Lonyo]

Even in this era of hyper-inflated tech values (Facebook...) 3b for Valve sounds pretty absurd to me.

Are they estimating that sales from Steam will continue to double every year into perpetuity? That wouldn't be realistic. Other than that where are their revenues? They release a new AAA game every, what, 5 years? There is no MMO cash cow or huge portfolio of licenses like EA has.

Hell EA's market cap is ~5billion, and to even consider Valve's value in the same ballpark is ludicrous.

Er, Valve makes money from every game they sell on Steam.
They don't release a new AAA game every 5 years, but Activision do, and it requires Steam (Call of Duty series). Valve takes a cut of every Steam sale of that game, and there are lots of other games on Steam, they take a cut of all of those sales.

 

[BTRY B 529th FA BN]

what is it's stock price

 

[wuliheron]

It certainly helps having a 3 billion dollar safety net to fall back on.

Because of the money from Steam, Valve doesn't have to undergo any kind of pressure to release a game to the market. Most devs don't have this luxury, they need to make deadlines or they might lose their job.

You've got it backwards. Valve wasn't always so wealthy and it doesn't explain why so many video games with 50 million dollar budgets are total crap. What does explain it somewhat are games like Duke Nukem which was bounced around from one developer to another for years, universally panned by critics and gamers alike, and still raked in the big bucks. As long as Publishers can continue to exploit developers and continue to exploit gamers for a fast buck there is no incentive to do otherwise. Gabe Newell and Valve represent one of the few companies in the business fighting that trend and that's part of the reason they are such a huge success.

Its the publishers in particular who need to pay attention. THQ recently received an anonymous letter from an employee lambasting their management for driving the company to ruin. EA has had a horrible reputation for years for exploiting developers and gamers alike. Steam and Valve games have forced them to not only start providing better quality games and service, but pay attention to just how badly they exploit their developers and customers. MS Games for Windows Live still sucks as a service. They need to get through their heads that its not all boom and bust and the demand for consistency and quality is enough to make billionaires.

 

[darkxshade]

what is it's stock price

if Valve corp ever goes IPO, I might be all over it.

 

[Lonyo]

You've got it backwards. Valve wasn't always so wealthy and it doesn't explain why so many video games with 50 million dollar budgets are total crap. What does explain it somewhat are games like Duke Nukem which was bounced around from one developer to another for years, universally panned by critics and gamers alike, and still raked in the big bucks. As long as Publishers can continue to exploit developers and continue to exploit gamers for a fast buck there is no incentive to do otherwise. Gabe Newell and Valve represent one of the few companies in the business fighting that trend and that's part of the reason they are such a huge success.

Its the publishers in particular who need to pay attention. THQ recently received an anonymous letter from an employee lambasting their management for driving the company to ruin. EA has had a horrible reputation for years for exploiting developers and gamers alike. Steam and Valve games have forced them to not only start providing better quality games and service, but pay attention to just how badly they exploit their developers and customers. MS Games for Windows Live still sucks as a service. They need to get through their heads that its not all boom and bust and the demand for consistency and quality is enough to make billionaires.

What?
Valve lets people put almost anything on Steam, including things which won't work with newer hardware very well. There's no QC required for games which are put on Steam.
Compare it to something like GoG.com (a very different model, obviously), where older games are updated in order to play nicely with newer systems.

Valve doesn't force people to provide a better service at all, they provide a way to make more money by charging retail prices or more, and getting a higher margin.

When it comes to making games, they just buy in ideas and studios, let the people make the game, then wait to buy their next idea.
A model of creativity.
Sure, they might not push people to make games, which is why they don't make many games, but equally they don't have any outside shareholders to answer to who want money asap, which is the advantage of being a private company. It's an inherent problem with any public company that shareholders have demands which don't necessarily allow people to run things the way which might be nicest.

(Amusingly now that Turtle Rock (L4D) have split from Valve, their next game will be published by... THQ (if THQ lasts that long)).

 

[zinfamous]

if Valve corp ever goes IPO, I might be all over it.

that would be horrible.

stock holder's first, product 2nd or 3rd.

look at EA.

 

[wuliheron]

Valve doesn't force people to provide a better service at all, they provide a way to make more money by charging retail prices or more, and getting a higher margin.

Steam is their service and they were the first to provide anything remotely like a decent online distribution service. Their own updates to their own games are their service and they lead by example rather then forcing other publishers to follow suit.

 

[Craig234]

that would be horrible.

stock holder's first, product 2nd or 3rd.

look at EA.

Interesting point - about games, healthcare, energy, pretty much any corporation.

 

[wuliheron]

Interesting point - about games, healthcare, energy, pretty much any corporation.

Not just any public corporation, but oligopolies/monopolies. They'll gouge customers to death and fight like vicious dogs among each other, but eventually that presents an opportunity for small companies like Apple and Valve to establish themselves as alternatives. Apple even made a small fortune mocking MS in commercials for their crappy products and MS was eventually forced to improve the quality of their products.

Now we've got Sony being taken down by a few amateur hackers, THQ stock taking a nose dive, and EA dead set on gaining a reputation as a vicious snake, while newcomers like Valve and Bethesda thrive practically overnight.