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Valve does not release any sales figures for its Steam service; it only provides the data to companies with games on Steam, which they cannot release without permission because of a non-disclosure agreement with Valve. However, Stardock, the previous owner of competing platform Impulse, estimated that as of 2009, Steam had a 70% share of the digital distribution market for video games. In early 2011, Forbes reported that Steam sales constituted 50–70% of the US$4 billion market for downloaded PC games and that Steam offered game producers gross margins of 70% of purchase price, compared with 30% at retail. Steam’s success has led to some criticism because of its support of DRM and for being an effective monopoly. Free Software Foundation founder Richard Stallman commented on the issue following the announcement that Steam would come to Linux; he said that while he supposes that its release can boost GNU/Linux adoption leaving users better off than with Microsoft Windows, he stressed that he sees nothing wrong with commercial software but that the problem is that Steam is unethical for not being free software and that its inclusion in GNU/Linux distributions teaches the users that the point is not freedom and thus works against the software freedom that is his goal.

In November 2011, CD Projekt, the developer of The Witcher 2: Assassins of Kings revealed that Steam was responsible for 200,000 (80%) of the 250,000 online sales of the game. Steam was responsible for 58.6% of gross revenue for Defender’s Quest during its first three months of release across six digital distribution platforms—comprising four major digital game distributors and two methods of purchasing and downloading the game directly from the developer.

Because Steam is nearly required to play most games for personal computers, its customer service has been highly criticized by its users, with users citing poor response times or lack of response in regards to issues such as being locked out of one’s library or having a non-working game redemption key. In March 2015, Valve had been given a failing “F” grade from the Better Business Bureau due to a large number of complaints in Valve’s handling of Steam, leading Valve’s Erik Johnson to state that “we don’t feel like our customer service support is where it needs to be right now”. Johnson stated the company plans to better integrate customer support features into the Steam client and be more responsive to such issues.

Sector competition

From its inception in 2003 through to nearly 2009, Steam had a mostly uncontested hold over the PC digital distribution market before major competitors emerged with the largest competitors in the past being services like Games for Windows – Live and Impulse, both of which were shut down in 2013 and 2014, respectively.Sales via the Steam catalog are estimated to be between 50 and 75 percent of the total PC gaming market. Steam’s critics often refer to the service as a monopoly, and claim that placing such a percentage of the overall market can be detrimental to the industry as a whole and that sector competition can only yield positive results for the consumer.Several developers also noted that Steam’s influence on the PC gaming market is powerful and one that smaller developers cannot afford to ignore or work with, but believe that Valve’s corporate practices for the service make it a type of “benevolent dictator”, as Valve attempts to make the service as amenable to developers.

As Steam has grown in popularity many other competing services have been surfacing trying to emulate their success. The most notable major competitors are Electronic Arts’ (EA) Origin service, Ubisoft’s Uplay, Blizzard Entertainment’s Battle.net and GOG.com. Battle.net competes as a publisher exclusive platform, while GOG.com’s catalog includes many of the same titles as Steam but offers them in a DRM-free platform. Upon launch of EA’s Origin in 2011, several EA-published titles were no longer available for sale, and users feared that future EA titles would be limited to Origin’s service. Newell expressed an interest in EA games returning to the Steam catalog though noted the situation was complicated. Newell stated, “We have to show EA it’s a smart decision to have EA games on Steam, and we’re going to try to show them that.” Ubisoft still publishes their games on the Steam platform, however most games published since the launch of Uplay require this service to run after launching the game from Steam.

Legal issues

Steam’s predominance in the gaming market has led to Valve becoming involved in various legal cases involving Steam.

The lack of a formal refund policy led the Australian Competition and Consumer Commission to sue Valve in September 2014 for a violations of Australian consumer laws that required stores to offer refunds for faulty or broken products. The Commission won the lawsuit in March 2016, though recognizing Valve changed its policy in the interim, with fines to be determined at a later date.

In December 2015, the French consumer group UFC Que Choisir initiated a lawsuit against Valve for several of their Steam policies that conflict or run afoul of French law, including the restriction against reselling of purchased games which is legal in the European Union.

In August 2016, BT Group filed a lawsuit against Valve stating that Steam’s client infringes on four of their patents, which they state are used within the Steam Library, Chat, Messaging, and Broadcasting.

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