Going gold?

[Voyager]

Originally Posted by Wolf_Rider

I fall into that camp... and not because I think Steam/ Game Spy, etc, to be dodgy but because I like to run a clean system. Equally, I don't like DRM's which install drivers, even though I never had any noticeable problems with the first LOCKON Starforce DRM, I did find my system ran better after SF was uninstalled. Reporting home factor plays a part as well.
I very rarely have any software conflicts and like to keep things that way

I have had some odd hardware behavior since installing a Starforce CD, but what finally pushed me hard away from CD's was the copy protection on Bioshock, where you couldn't install off the disk more than three times. To the best of my understanding the Steam versions don't have that restriction.

That said, Ubi did manage to get the call home DRM for Assassin's Creed 2 into the Steam version, probably because of how tightly they integrated it into their game. That managed to eat a couple of my saves too. Very annoying.

Overall I've found the Steam DRM to be less invasive and install fewer hidden drivers than the current cycels of the CD based DRMs, simply because most companies are fine with Steam's Log-In system as the primary DRM.

Now D2D, they apparently encrypted the data files for their edition of "Sword of the Stars", and managed to up the turn cycle time from around twenty seconds normally to about twenty minutes. Kerberos e3ventually figured out what was wrong, but htey had all manner of grief getting D2D to finally unencrypt the files they weren't supposed to have been encrypting in the first place.

[Kikuchiyo]

Originally Posted by Vevster

I don't quite understand your first sentence "Steam sales cost *Meant "give"* the company(s) offering games through them a higher margin of profit "

Do you mean Steam takes a higher cut? That would be exact but contradictory to what you write further


Steam, as a publisher often take a higher % than a retailer. That's because they act both as publisher & retailer for some games. They can take as much as 80% of price for some indie games....They take the risk with infrastructure as a retailer takes the risk with shelf space.

So when you say "it is technically more profitable to offer your games solely through steam than through Steam and B&M stores. " I'll answer "it depends, and sometimes it's quite the opposite". Each case is different; too many parameters to sum up.

Some people do not like DLing games, via Steam or else.


Best thing today is to offer both DL & boxes, gives a broader audience. That's why publishers like Ubi also offer games on steam.

Not sure what you are having trouble understanding with that first sentence. Companys that sell their games through Steam tend to see a 70% profit vs 30% profit for box copies. Sorry for the miswording it has been corrected

No it technically is more profitable to offer a game solely through a DD than it is to offer a boxed copy. Less overhead = less cost to publisher.

I'd like to see some citation on that Steam charging 80% to a developer to use Steam. I find that highly unlikely, and even less likely that a indie publisher would accept such a steep cost to get their game on the market. I am actually using estimates made by market analysts, and have never seen anything that suggests that Valve takes such a huge chunk of anyone's profits.

oh and so we are clear I am getting my info from a small financial company you may have heard of Forbes.

[Vevster]

Originally Posted by Kikuchiyo

Not sure what you are having trouble understanding with that first sentence. Companys that sell their games through Steam tend to see a 70% profit vs 30% profit for box copies. Sorry for the miswording it has been corrected]

Please define profit, but in any case, the % are wrong.
I think I have seen more profit and loss statements of video games (products) than you do. Unless you have worked for a major editor or studio, that is.
My source is my job experience in the video game industry

Originally Posted by Kikuchiyo

No it technically is more profitable to offer a game solely through a DD than it is to offer a boxed copy. Less overhead = less cost to publisher.

There are many cases here, and not always less overheads:
- the company distributes online by its own means (no steam): has to buy servers, pay for bandwith etc... compared to manufacturing costs. Manufacturing costs are very low and essentially variable. Servers are fixed costs (could be variable if externalized). If you distribute a lot online, then fixed costs can be offset well.
Main drawback of boxes, again, are the unsold inventory: in some countries, they can be send back by retailers; in most, unsold copies will see price decline rapidly, and those unsold to retailers will have to be destroyed (while manufacturing costs have been incurred)
- the company distributes onlina via steam: they pay a service, steam charges for it, depending on the level of service & risk ; see below

Originally Posted by Kikuchiyo

I'd like to see some citation on that Steam charging 80% to a developer to use Steam. I find that highly unlikely, and even less likely that a indie publisher would accept such a steep cost to get their game on the market. I am actually using estimates made by market analysts, and have never seen anything that suggests that Valve takes such a huge chunk of anyone's profits.]

If you read french, buy the PC Magazine Canard PC and read their article about steam. Will look it for you and find the game they mentionned (said the studio got 10% on reatail price - have to take out VAT to calculate each chnk, but that would be around 85% for stema, 15% for the studio

Also, do not forget that Steam acts 2 ways:
- online distributor, for instance for some THQ, Ubi etc... games: in that case, they take the equivalent of a retailer's chunk (20 to 30%)
- publisher AND retailer: when an indie game for instance is distributed via steam: in that case, they take the equivalent of a retailer (20-30%) plus a chunk as publisher. And that can go high depending on the contract (40-60%).
Main difference is , afaik, Steam doesn't prefinance a lot of games the way editors do; so their contracts with studios are quite different, and studios get money on each unit sold. On the other hand they get no guaranteed minimum (as is the case in most editor-studio deals; that's an advance on royalties system)

The % given by Forbes are for publishers, not studios. And frankly, these are not at all the figures I've looked at (retailers take 20 to 30% max, including returns etc...). Gross margin includes manufacturing costs (Net revenues - Manufacturing costs, that's all)
If they got 30%, they would all be bankrupt.
As I said, average is above 50% (60%) on a full year and there are not enough online copies (at 70%) to offest the larger number of boxes sold (at 30% according to Forbes). I call BS on that one. Probably a question of wording:

EA gross Margin (p107): from 60% in 2006 to 49% in 2010 with an increase of online distribution ...)
http://files.shareholder.com/downloa..._Arts-2010.pdf

Ubi gross margin:
http://www.ubisoftgroup.com/gallery_.../1042/2360.xls
around 60% on a full year (59% to 66%)

To reach a 60% gross margin with the % (30% - 70%) given by forbes would mean that Ubi sells 3 times more games through steam than through retailers. and that is just plain wrong


Steam is certainly a great platform and a good publisher for small studios, but asserting that these studios always get more than if they'd taken another (mainstream) editor is wrong. Some get more, some get less.

If you don't need to prefinance your game, best deal can be steam (but hey, you can negociate with other editor)
If you need to prefinance your game, today, I'm not certai at all that Steam is helpful.
And you have to take into account that advance on royalties paid by an editor in the % of profit you mentionned in the first place....

[Kikuchiyo]

Originally Posted by Vevster

Please define profit, but in any case, the % are wrong.
I think I have seen more profit and loss statements of video games (products) than you do. Unless you have worked for a major editor or studio, that is.
My source is my job experience in the video game industry




There are many cases here, and not always less overheads:
- the company distributes online by its own means (no steam): has to buy servers, pay for bandwith etc... compared to manufacturing costs. Manufacturing costs are very low and essentially variable. Servers are fixed costs (could be variable if externalized). If you distribute a lot online, then fixed costs can be offset well.
Main drawback of boxes, again, are the unsold inventory: in some countries, they can be send back by retailers; in most, unsold copies will see price decline rapidly, and those unsold to retailers will have to be destroyed (while manufacturing costs have been incurred)
- the company distributes onlina via steam: they pay a service, steam charges for it, depending on the level of service & risk ; see below




If you read french, buy the PC Magazine Canard PC and read their article about steam. Will look it for you and find the game they mentionned (said the studio got 10% on reatail price - have to take out VAT to calculate each chnk, but that would be around 85% for stema, 15% for the studio

Also, do not forget that Steam acts 2 ways:
- online distributor, for instance for some THQ, Ubi etc... games: in that case, they take the equivalent of a retailer's chunk (20 to 30%)
- publisher AND retailer: when an indie game for instance is distributed via steam: in that case, they take the equivalent of a retailer (20-30%) plus a chunk as publisher. And that can go high depending on the contract (40-60%).
Main difference is , afaik, Steam doesn't prefinance a lot of games the way editors do; so their contracts with studios are quite different, and studios get money on each unit sold. On the other hand they get no guaranteed minimum (as is the case in most editor-studio deals; that's an advance on royalties system)

The % given by Forbes are for publishers, not studios. And frankly, these are not at all the figures I've looked at (retailers take 20 to 30% max, including returns etc...). Gross margin includes manufacturing costs (Net revenues - Manufacturing costs, that's all)
If they got 30%, they would all be bankrupt.
As I said, average is above 50% (60%) on a full year and there are not enough online copies (at 70%) to offest the larger number of boxes sold (at 30% according to Forbes). I call BS on that one. Probably a question of wording:

EA gross Margin (p107): from 60% in 2006 to 49% in 2010 with an increase of online distribution ...)
http://files.shareholder.com/downloa..._Arts-2010.pdf

Ubi gross margin:
http://www.ubisoftgroup.com/gallery_.../1042/2360.xls
around 60% on a full year (59% to 66%)

To reach a 60% gross margin with the % (30% - 70%) given by forbes would mean that Ubi sells 3 times more games through steam than through retailers. and that is just plain wrong


Steam is certainly a great platform and a good publisher for small studios, but asserting that these studios always get more than if they'd taken another (mainstream) editor is wrong. Some get more, some get less.

If you don't need to prefinance your game, best deal can be steam (but hey, you can negociate with other editor)
If you need to prefinance your game, today, I'm not certai at all that Steam is helpful.
And you have to take into account that advance on royalties paid by an editor in the % of profit you mentionned in the first place....

Personally I am want to trust the figure estimates of a large established financial market expert like Forbes over a gaming magazine whose name (if I am not mistaken) is commonly used to indicate satire in the French language. What's more is indie developers are a different animal from established developers like 1C who I am sure gets a more fair deal due to a decreased risk of loss on the part of Valve.

What's more is I said profits on retail copies are 30% I think you are misinterpreting what I am saying here. 30% would be after costs from publisher and costs of manufacturing, and costs from retailers. You can't fairly include the profit margins of co-dev/publisher houses in that figure. We are talking about Developers (not indie) that have to use a 2nd party for publishing. I am sure Forbes has done their research on these things. I highly doubt they just guessed. Likely extrapolated those figures using financial algorithms. That said I am sure there is give and take as even Forbes would have some fuzzy area considering Valve's contracts with developers and publishers alike prohibit them from disclosing exact percentages.

I can't seriously take into account anecdotal evidence as validation of proof either. Not intended to be insulting. It is a very interesting conversation, and I am rather enjoying it

[Vevster]

Kikuchiyo,

no problem. You do not have to believe me or something you haven't read

Just explain me how Forbes figures (30% -70%) can be accurate when I showed you financials from two publishers showing a profit margin (gross margin) of 50% or 60% .

To reach an average of 50% with Forbes figures, that would mean EA sells as much through Steam than on boxes (70+30)/2 = 50 ; at the same average price
I do not think that is the case. Therefore, the 30% figure seems highly doubtful

To reach 60% average (Ubi) , that would mean 3 sales on steam to 1 box (70+70+70 +30)/4; at the same average price.
Not possible either.


Therefore, 30% gross margin on retail business is just wrong. As I said, Forbes probably means something else, though they say: "Publishers earn a gross margin of around 70% on Steam, compared with 30% via retail stores"

Again, look at the figures I presented from two publishers, and tell me how that works with what Forbes say. Figures from the publishers are official ones (listed companies)


Heliocon:
1- there has been many articles saying that Steam does not take the same % for each game too. So a broad statement (stam gives more to all compared to others) is not necessarily true. That was one pf my point.
2 - I never said I am a developper, just that I have experience in the industry, and given the way your request for name & company, you won't get anything. It's the internet, correct, and there are some bullies out there.
I frankly do not care if you believe me or not regarding my experience.
Those who count for me know, and some are on this forum.

I don't even ask them to vouch for me, as it is utterly useless.


You're mixing some suff here: you talk about the % given to publishers then conclude that Steam gives more to studios (devs).

Problem is, Steam gives only something per copy sold (your own words).

A publisher (EA, Ubi etc...) sometimes (often) prefinance the game.
So you do not have to compare only the % given after release, but also incluse the advance on royalty paid to make an hones comparison of what the devs receive. I hope you agree with that...


Anyway, I personnally like steam, use it, am grateful because I think they helped the PC market and like that retailers are whining about it while at the same time often refusing to put PC games on their shelves.
Think what you want about the figures, they do not compute in the case of those given by Forbes.

[Kikuchiyo]

Originally Posted by Vevster

Kikuchiyo,
Just explain me how Forbes figures (30% -70%) can be accurate when I showed you financials from two publishers showing a profit margin (gross margin) of 50% or 60% .

To reach an average of 50% with Forbes figures, that would mean EA sells as much through Steam than on boxes (70+30)/2 = 50 ; at the same average price
I do not think that is the case. Therefore, the 30% figure seems highly doubtful

To reach 60% average (Ubi) , that would mean 3 sales on steam to 1 box (70+70+70 +30)/4; at the same average price.
Not possible either.

Again, look at the figures I presented from two publishers, and tell me how that works with what Forbes say. Figures from the publishers are official ones (listed companies)

You're mixing some suff here: you talk about the % given to publishers then conclude that Steam gives more to studios (devs).

Problem is, Steam gives only something per copy sold (your own words).

A publisher (EA, Ubi etc...) sometimes (often) prefinance the game.
So you do not have to compare only the % given after release, but also incluse the advance on royalty paid to make an hones comparison of what the devs receive. I hope you agree with that...


Anyway, I personnally like steam, use it, am grateful because I think they helped the PC market and like that retailers are whining about it while at the same time often refusing to put PC games on their shelves.
Think what you want about the figures, they do not compute in the case of those given by Forbes.

I did address your figures from the large dev/publisher houses of EA and Ubisoft, but perhaps it wasn't clear. Their figures would be a skew to the statistics that Forbes is showing for the simple fact that they both publish and develop games so their profit margins would be a conglomerate of both aspects. Basically they can take in a much larger profit from in house development on both retail and DD sales which would seriously affect their margin of profit by the end of the year, and what's more is they don't pay out to developers, that they act as a middleman publisher for, until the end of a fiscal quarter. That means they collect interest on that money in the intervening time and can count that as additional profit.

I didn't say that Steam gave more to developer's than publishers at any point. I said the profit margin for a developer that went solely with DD rather than DD and a Publisher would see a higher profit margin per unit sold.

As do publishers. If you believe that publisher pay a developer per boxed unit produced you are sorely mistaken. They pay out to developers a percentage of sales.

As to the prefinance aspect the publisher then takes that money back off of the initial sales until the loan is paid off, because financing is a loan after all.

Edit: Sorry for the multiple edits I just dropped some talking points unintentionally and wanted to address them.

[Heliocon]

Originally Posted by Vevster

Please define profit, but in any case, the % are wrong.
I think I have seen more profit and loss statements of video games (products) than you do. Unless you have worked for a major editor or studio, that is.
My source is my job experience in the video game industry




There are many cases here, and not always less overheads:
- the company distributes online by its own means (no steam): has to buy servers, pay for bandwith etc... compared to manufacturing costs. Manufacturing costs are very low and essentially variable. Servers are fixed costs (could be variable if externalized). If you distribute a lot online, then fixed costs can be offset well.
Main drawback of boxes, again, are the unsold inventory: in some countries, they can be send back by retailers; in most, unsold copies will see price decline rapidly, and those unsold to retailers will have to be destroyed (while manufacturing costs have been incurred)
- the company distributes onlina via steam: they pay a service, steam charges for it, depending on the level of service & risk ; see below




If you read french, buy the PC Magazine Canard PC and read their article about steam. Will look it for you and find the game they mentionned (said the studio got 10% on reatail price - have to take out VAT to calculate each chnk, but that would be around 85% for stema, 15% for the studio

Also, do not forget that Steam acts 2 ways:
- online distributor, for instance for some THQ, Ubi etc... games: in that case, they take the equivalent of a retailer's chunk (20 to 30%)
- publisher AND retailer: when an indie game for instance is distributed via steam: in that case, they take the equivalent of a retailer (20-30%) plus a chunk as publisher. And that can go high depending on the contract (40-60%).
Main difference is , afaik, Steam doesn't prefinance a lot of games the way editors do; so their contracts with studios are quite different, and studios get money on each unit sold. On the other hand they get no guaranteed minimum (as is the case in most editor-studio deals; that's an advance on royalties system)

The % given by Forbes are for publishers, not studios. And frankly, these are not at all the figures I've looked at (retailers take 20 to 30% max, including returns etc...). Gross margin includes manufacturing costs (Net revenues - Manufacturing costs, that's all)
If they got 30%, they would all be bankrupt.
As I said, average is above 50% (60%) on a full year and there are not enough online copies (at 70%) to offest the larger number of boxes sold (at 30% according to Forbes). I call BS on that one. Probably a question of wording:

EA gross Margin (p107): from 60% in 2006 to 49% in 2010 with an increase of online distribution ...)
http://files.shareholder.com/downloa..._Arts-2010.pdf

Ubi gross margin:
http://www.ubisoftgroup.com/gallery_.../1042/2360.xls
around 60% on a full year (59% to 66%)

To reach a 60% gross margin with the % (30% - 70%) given by forbes would mean that Ubi sells 3 times more games through steam than through retailers. and that is just plain wrong


Steam is certainly a great platform and a good publisher for small studios, but asserting that these studios always get more than if they'd taken another (mainstream) editor is wrong. Some get more, some get less.

If you don't need to prefinance your game, best deal can be steam (but hey, you can negociate with other editor)
If you need to prefinance your game, today, I'm not certai at all that Steam is helpful.
And you have to take into account that advance on royalties paid by an editor in the % of profit you mentionned in the first place....

1. you are completely wrong. There has been many articles about profit margins in Steam vs normal retailers and steam takes a FLAT RATE for each game sold (in %) and steam itself released the statistics on profit margins. His numbers are correct I have seen them myself (and will track the link).

2. Stop the: "I am a game developer" because its the internet and anyone with half a brain knows you can claim whatever you want and there is no way to verify it. So please tell me your name and the company you work for so I can verify your statements. If not dont make stuff up.

Steam gives a FAR LARGER profit margin to devs because 1. They dont require a publisher (and steam IS NOT a publisher, purely distribution and in console advertisement). 2. They dont have to pay for the physical distribution and creation of the hard copies.
This gives steam sales a far far larger profit margin then normal retail sales especially with a publisher.

- calling you on your bs, this article is from Darryl Still the 1C Publishing director and his opinion on Steam vs retail: http://www.mcvuk.com/features/808/OP...etail-vs-Steam

Forbes confirming similar numbers: http://www.forbes.com/forbes/2011/02...ne-mayhem.html

*cleaned up the language

[Heliocon]

Originally Posted by Vevster

Please define profit, but in any case, the % are wrong.
I think I have seen more profit and loss statements of video games (products) than you do. Unless you have worked for a major editor or studio, that is.
My source is my job experience in the video game industry




There are many cases here, and not always less overheads:
- the company distributes online by its own means (no steam): has to buy servers, pay for bandwith etc... compared to manufacturing costs. Manufacturing costs are very low and essentially variable. Servers are fixed costs (could be variable if externalized). If you distribute a lot online, then fixed costs can be offset well.
Main drawback of boxes, again, are the unsold inventory: in some countries, they can be send back by retailers; in most, unsold copies will see price decline rapidly, and those unsold to retailers will have to be destroyed (while manufacturing costs have been incurred)
- the company distributes onlina via steam: they pay a service, steam charges for it, depending on the level of service & risk ; see below




If you read french, buy the PC Magazine Canard PC and read their article about steam. Will look it for you and find the game they mentionned (said the studio got 10% on reatail price - have to take out VAT to calculate each chnk, but that would be around 85% for stema, 15% for the studio

Also, do not forget that Steam acts 2 ways:
- online distributor, for instance for some THQ, Ubi etc... games: in that case, they take the equivalent of a retailer's chunk (20 to 30%)
- publisher AND retailer: when an indie game for instance is distributed via steam: in that case, they take the equivalent of a retailer (20-30%) plus a chunk as publisher. And that can go high depending on the contract (40-60%).
Main difference is , afaik, Steam doesn't prefinance a lot of games the way editors do; so their contracts with studios are quite different, and studios get money on each unit sold. On the other hand they get no guaranteed minimum (as is the case in most editor-studio deals; that's an advance on royalties system)

The % given by Forbes are for publishers, not studios. And frankly, these are not at all the figures I've looked at (retailers take 20 to 30% max, including returns etc...). Gross margin includes manufacturing costs (Net revenues - Manufacturing costs, that's all)
If they got 30%, they would all be bankrupt.
As I said, average is above 50% (60%) on a full year and there are not enough online copies (at 70%) to offest the larger number of boxes sold (at 30% according to Forbes). I call BS on that one. Probably a question of wording:

EA gross Margin (p107): from 60% in 2006 to 49% in 2010 with an increase of online distribution ...)
http://files.shareholder.com/downloa..._Arts-2010.pdf

Ubi gross margin:
http://www.ubisoftgroup.com/gallery_.../1042/2360.xls
around 60% on a full year (59% to 66%)

To reach a 60% gross margin with the % (30% - 70%) given by forbes would mean that Ubi sells 3 times more games through steam than through retailers. and that is just plain wrong


Steam is certainly a great platform and a good publisher for small studios, but asserting that these studios always get more than if they'd taken another (mainstream) editor is wrong. Some get more, some get less.

If you don't need to prefinance your game, best deal can be steam (but hey, you can negociate with other editor)
If you need to prefinance your game, today, I'm not certai at all that Steam is helpful.
And you have to take into account that advance on royalties paid by an editor in the % of profit you mentionned in the first place....

Going back and quoting your statements earlier that you made. Because you contradict yourself/dont know what you are talking about. Quoting you "As I said, average is above 50% (60%) on a full year and there are not enough online copies (at 70%) to offest the larger number of boxes sold (at 30% according to Forbes). I call BS on that one. Probably a question of wording:"
- This is what I addressed earlier - you are comparing profit from retail store sales to steams sales on the basis of number of units shipped, NOT % profit margin which is what the 30% vs 70% is. Thats a gross profit margin, not % of end gross profit.

"Also, do not forget that Steam acts 2 ways:
- online distributor, for instance for some THQ, Ubi etc... games: in that case, they take the equivalent of a retailer's chunk (20 to 30%)
- publisher AND retailer: when an indie game for instance is distributed via steam: in that case, they take the equivalent of a retailer (20-30%) plus a chunk as publisher. And that can go high depending on the contract (40-60%)."

- Thats a lie, Steam DOES NOT publish anyone elses games but Valve's (the company that owns/created Steam. Your numbers are not true, Steam never acts as a publisher, just a distributer. The only time it may act as a publisher is posting advertisements in the console which is advertisement and not "publishing". Steam does however charge royalties for using the Source engine but that is a different matter.

"The % given by Forbes are for publishers, not studios. And frankly, these are not at all the figures I've looked at (retailers take 20 to 30% max, including returns etc...). Gross margin includes manufacturing costs (Net revenues - Manufacturing costs, that's all)
If they got 30%, they would all be bankrupt."

-Gross margin does not include manufacturing costs. You are now contradicting yourself in later posts. Also you are interchanging and confusing terms and numbers. Again like I hae tried to point out earlier, you are confusing yourself. Also again the point is wrong anyway because if I make 30% gross profit per sale and my other costs are only 5% of the products cost then I can easily cover my expenses.

-The EA and Ubi financial reports you gave do not include any accurate data that is relevant to your argument. Their gross sales profit is a conglomerate from many products, many distribution methods and many regions. It does not support the argument you are making. Also EA is a developer AND publisher, while Ubisoft is a publisher. The argument is over publisher vs no publisher and its effects on the development studios end profits if publishing on steam. Again you did not show developer figures. Also your assesment of a decline in profit due to digital sales as you said in your post is idiotic. First these profits include CONSOLE game sales aswell, second there is currently a recession and that reduces sale quantities among other things. Basically your full of it.

[Heliocon]

Originally Posted by Vevster

I don't quite understand your first sentence "Steam sales cost the company(s) offering games through them a higher margin of profit "

Do you mean Steam takes a higher cut? That would be exact but contradictory to what you write further


Steam, as a publisher often take a higher % than a retailer. That's because they act both as publisher & retailer for some games. They can take as much as 80% of price for some indie games....They take the risk with infrastructure as a retailer takes the risk with shelf space.

So when you say "it is technically more profitable to offer your games solely through steam than through Steam and B&M stores. " I'll answer "it depends, and sometimes it's quite the opposite". Each case is different; too many parameters to sum up.

Some people do not like DLing games, via Steam or else.

Best thing today is to offer both DL & boxes, gives a broader audience. That's why publishers like Ubi also offer games on steam.

Where does this 80% come from? Where did you find this number? What games? Source games? Or are you making this up (more likely)?
Steam does not need to invest in infastructure, they rent out servers in regions, the servers are owned by a third party but are updated by valve and operate 24/7 serving content. Valve rents them, so there is no investment (more bs you are making up). This is easy to find info if you look on Steam's website and go to their collaboration/buisness section where they talk about hosting requirments.