Steam Refunds : How will it effect an indie?

Xblig had a 7 minute demo. I wonder if 2 hours is just too much

 

No idea but I guess probably not worth the effort and costs. Security would be one big issue (new accounts, offline play etc), massive games would be downloaded and then ingame infrastructure with custom servers and so on. It would require game devs to support it anyways and demo games seem to be dead past few years...

 

It play the role of a demo and if the game is great : playing two hours is a small play session

It prevents scams, unplayable or awfully bugged game

It should be good in mid / long term for our game quality

 

I don't understand why demos need to be updated. I guess they used to be about gameplay, but I think users should be more concerned about performance. They can check a youtube video for content & gameplay, but demos / piracy has been the main avenue for a lot of people I could name for checking hardware capability..

 

Heres a long article about the refund issue.

I cant believe that steam is going to take off $20 off your net pay rather then gross.

http://www.gamasutra.com/blogs/AndrewPellerano/20150604/245208/Steam_Refund__Friend_or_Foe.php

 

What are you talking about? The example given is simply showing that customers who request a refund are given store credit. Steam still keeps their 30% because they aren't giving you money back but rather credit towards future purchases and the developer gets nothing because it is a refund after all.

 

Giving refund in store credit is pretty much standard. I see no issues here. A system involving returning cash is fraught with more legal and administrative details.

Steams main motivation is to keep customers happy, that's ultimately where their income comes from.

 

I've actually been plugging around in steamspy a considerable amount recently. Based on steamspy data, it's not unreasonable to assume that for the vast majority of indie games the median user probably has under 2 hours of play time. The total playtime numbers are pretty wild if you really get into it.

In other words, if 50%+ of users really thought about it two weeks after purchase, they could probably get a refund on the game without concern.

Banner Saga for instance has a median playtime of 4.5 hrs. So probably around 20-30% of banner sagas customers probably could have filed for a refund based on their playtime.

Pretty wild!

 

Steam stand to loose just as much if the system is abused. Trust me, they will be on to it.

 

Am I understanding this correctly? If I, the dev sell 5 games at $20, making $70 after commission, but then one person requests a discount, do I lose $14 or $20? Will the income given become $56 or $50? I ask about the $20, because in effect the sale never took place. Steam get to keep the $6 in their bank account, so interest can accrue (they are making more money from the sale that basically never happened). Also this wallet whereby the next sale has store credit knocked off, will Steam miss out on the knocked off amount, or will a dev like us?

 

You lose your cut of the purchase which in this case is $14.

No. They are not making more money. They are taking $14 back from the developer, but they are giving the customer $20 store credit. The only way this actually affects Steam is that they are getting the 30% of the $20 earlier rather than at the time the credit is used.

 

Your numbers are not correct but your conclusion is right on..

If you sell a game for $20, you are entitled to $14. However, if the customer returned it after two weeks you never got to receive that $14 in the first place. So for you, the developer, it's like the sale never happened. Except you might get a bad review out of that.

However, Steam will give the customer $20 in store credit which means they get to keep the entire $20 in their bank account until the customer decides to spend that credit on something else.

So, yes, they will be making more money out of a return. And yes, interest is the name of the game.

 

No. His conclusion is dead wrong. How can you possibly view taking $14 from the developer and claiming it is $20 for the customer as actually getting money twice? The only way for them to actually receive money twice would be to only give the customer the amount refunded by the developer. Or essentially $14 in store credit.

 

To clarify: yes, Steam will earn interest on $20 instead of their normal $6 cut. So after the player ends up spending the $20 on another game they will have made more money, like $6.0001.

To the developer, their $14 cut is reversed, the sale never happened. They're not penalized or anything.

If Steam stands to make more money, it's really in increased sales revenue not so much interest payments.

 

Thanks for the feedback @Manny Calavera @Ryiah @frosted. I think the numbers stand up

Spoiler: maths

20 [unit price] * 5 [quantity] = 100
100 [above total] * 0.7 [developers share] = 70
70 [above total] - (20 *0.7) [unit price without commission, representing one sale has been refunded] = 56

and yes, I was referring to the ".0001" interest Frosted noted.

I have been informed that a dev is given their cut of monthly sales. What would happen if a customer brought the game, didn't refund it before the dev was given their amount, then after that point requested a refund? Would the dev then be penalised the following month? I've got no qualms with Steam doing this, I just want to understand this fully - I am still very new to this and I do eventually plan on using Steam as a vendor.

 

I'm not 100% sure, but I seriously doubt that Steam would in any way 'penalize' developers.

I imagine that it sort of works like this:

Developer balance at End of Month: $100
Valve Cuts Check for $100
Developer balance at Start of Month: $0
Refund Requested, balance now: $-14
Next Purchase, balance now: $0

If it didn't work like that, we'd be hearing about it loudly, somewhere.

 

Pretty sure its ok and people are making fuss out of nothing due to greed despite the fact refunds may save you in the long term from bad press. people get a whole lot less angry knowing they can get refunds.

 

If I had to guess it is likely they won't include the income of any games sold within the two week time frame.

 

Maybe this means the vast majority of those games sucks.

 

There are a lot of sucky games. But I think a lot of people would be surprised at how much games actually get played on median. It's very low. Banner Saga was critically acclaimed with a 4 hour median play time. Hotline miami has a median playtime of a little over 3 and a half hours. Blackguards has a median playtime of 3 hours.

These aren't like crappy little greenlight games, these are often critically acclaimed indie titles with 5+ million in revenue and good player feedback and half of their audience never played more than like 3-4 hours.

It's a little scary when you see the actual numbers. Personally I have faith that people will only return if they just really don't like the game and that new sales will justify it. But still, the reality of playtime is pretty nutty.

 

How can you possibly be reading 'make more money' as 'getting money twice'?

We're simply analyzing the cash flow and the amount of time in possession of deferred revenue. Nobody is making more money out of the developers cut, no. I clearly stated that, for the developer, it's like the sale never happened, in other words, like the customer never clicked on buy on that game in the first place.

It's simply being stated that Valve will keep the money in their possession longer and that equals making more money due to interest. Interest in a cash flow such as Valve's is a huge deal. Their earnings are not public but you can use similar businesses for comparison.

It's a positive move overall and it's great that Valve is doing this. The customer has more rights and flexibility over their $20. Valve gets to keep the $6 + $14 longer. The developer of the returned game doesn't gain or lose much. The $14 eventually goes to the developer of a different (better?) game.

It's just good business

 

@frosted and @Zeblote :
The reason for this is probably indie bundles. Everyone I know who purchased Humble Bundles or similar packs in the past, have games they haven't played very much (if at all), because they weren't interested in them in the first place.


A bit of news:
Look at what happened to puppygames: With the introduction of Steam refunds, now 72% of their purchases are getting refunded!
How do I feel about this? A picture is worth a thousand words.
Why? Because puppygames have been showing a very special kind of contempt for their customers.
Someone on 8chan's /v/ made a nice summary:

Spoiler

• Bad games? Check.
• Tell your customers that they are worthless to you? Check.
• Defend Phil "I am the biggest dick who ever was part of the indie games industry" Fish? Check.
• Complain about people getting refunds? Check.

This totally made my evening.
I knew that the very first developers to complain about refunds, would be this kind of people.

 

That's kind of unfair to say given that you can include every crappy game being made

I think the number of serious / loved games would yield a better ratio of good:suck.

@TheSniperFan good point. Humble Bundles might also be contributing to that shocking figure of the number of steam games bought but never played. I actually contacted steam to remove a game from my library that I didn't want but got from another deal

 

I think that a lot of us really overestimate a lot of gamers actual playtime. It's been pretty well known that in general only about 1 in 10 players will actually finish a given game.

It's worth noting that there is a huge gap between the median playtime and the average playtime. Often double, and with some games triple. People who really like a game or the really hardcore gamer will play it way, way more than most players.

 

I've owned gta 5 on pc for a while. I've played 8 hours. I've owned ark for 3 days. I've played 16 hours. I intend to play both more. I've owned forgequest since its early access release. I've played less than 2 hours. I probably will in my lifetime play less than 10.

Work is going to change some of that, but I put in hardcore gamer level hours when I'm having fun

 

Good! I hope this new refund system helps reduce the ammount of trash being put on there.

 

Tekken took a minute or two..but could be played for hours..or minutes.

 

Being a pro I want to see a horde of these wannabes go back to flipping burgers or writing Windows Forms corporate software. It's like the 80's where every idiot with a guitar was in a heavy metal band or wanted to be regardless if their haircut sucked.

 

I doubt anyone is really going to care about it though. The alternative is to keep the games you either didn't enjoy or were simply too broken or incomplete to play. What are the typical interest rates on business bank accounts that size in the US?

 

0 for your operating accounts.

There are material cash flow benefits. As steam has no process for giving back store credit, they don't actually need to hold the money in cash. It can be immediately deployed for more useful purposes.

 

"You will receive the refund in Steam Wallet funds or through the same payment method you used to make the purchase."

It says they'll give you a paypal refund if you want one though?

 

Dude, my haircut rocks, I swear to god!

Just please, windows forms, never again!

 

In which case there is no direct financial benefit to steam that doesn't also go to developers.

Honestly I'm still on the side of increased consumer confidence leading to more sales. This will turn out a good thing for legitimate developers. Consumer protection measures always end up benefitting the merchant as well as the consumer.

 

http://www.dsogaming.com/news/indie...m-pc-gamers-show-graphs-to-back-their-claims/

 

You better make those first two hours really exciting lol

 

Exactly. Sell a quality product and you will have little to worry about.

 

I read that article. It brings up a very valid point. One of the game examples (Beyond Gravity) is a casual game with a price and mechanics better suited for mobile than PC, but that game had about 90% positive reviews. It is not what would normally get called a crap game, but it seems to be getting hurt by the refund policy. Clearly 2 hours is too long of a refund period for a simple ultra low cost game.

I still think having a streamline refund system in place will reduce the risk for gamers and ultimately that will lead to a lot more sales of indie games. But that article does show that certain types of games need different refund periods. A simple $2 game should not have a 2 hour refund period. Maybe Value should let developers and publishers set the refund period on the per game basis.

 

Or alternatively two hours is too short for a non-mobile platform.

Allowing developers to set the refund period would assist those with short quality games, but I feel like it would bypass the original intent of the refund system by allowing those with broken, incomplete, or low quality games to restrict it too much.

 

As long as the refund period is boldly shown for the purchaser, then it would work to let the developer set the refund period on a per game basis. If a developer set it to 5 minutes, then that should be a red flag for potential purchasers.

 

This is why I think tying the refund period to the price of the game is a fair compromise. Even 3 simple pricing bands would be better than the one-size-tries-to-fit-all approach.

 

For those who do not know by going to: C:\Program Files (x86)\Steam\SteamApps\common\Game Title and pressing the games .exe, you can bypass using Steam to play some games (not all though, it can depend on devs preventing play without Steam). This means that someone can play a game paid for on Steam without Steam logging the amount of playtime that a player has really had.

Even if the 2 hour period is lessened for some titles, it is very easy to exploit. Is there anything Steam can/should do about this work around?

 

Why not simply pirate the game at that point though? Anyone wanting to perform this exploit will likely need to do so on an occasional basis as I expect Steam to investigate someone requesting refunds too frequently.

 

Steam does not really do anything as they already suggest developers integrating Steamworks and maybe doing bunch of other things when releasing a game there. Maybe there was not enough motivation for everyone to do things properly before to this.

 

The way it works on the asset store is like this I sell something for $20 Gross. Theres a "chargeback", this happens weeks later my Gross goes down $20 (I could still get paid if my payout is before that) - I havent lost anything other then my usual 70% NET and unity loses its 30% having to lose out on the same money.

I'd say the majority of my steam games I play under the 2 hour mark (80% of the ones I buy), and now if there is a system in place to get a refund why wouldnt i do it. I guess we will see if this is a blip on the radar or a widespread systematic practice.

http://www.dsogaming.com/news/indie...m-pc-gamers-show-graphs-to-back-their-claims/

 

Nothing new there and like it was said before thats what happens when you try sell mobile games to desktop users. Only difference is that before the one who paid for it lost the money if he got tricked by false advertising or etc.

Lets see when there are examples of desktop games that are not early access or pixel/mobile stuff.

 

The take away is that refunds are good, 2 hours not so good. Reducing it to an hour may well be all that is required.

 

I've put a lot of thought into this, and I think that this will have the following effects on Steam games.

#1 - Prices will drop. The games at a $10-$15 price point are very often dramatically overpriced. These include a lot of the better mobile ports. Of the games that I have been most dissatisfied with, they're almost always in this price range. There is often a significant quality improvement at $20.

#2 - Smaller steam games will spend a lot more time and effort in the first two hours. Larger titles have done this for a long time. The first few hours almost always contain the most impressive, best polished parts of the game.

As much as crappy mobile games don't justify the $10 or $15 price point, if these end up priced similarly to their pricing on the mobile market, then we will see other price drops. I just really hope this doesn't end up with a race to the bottom like in mobile.

I had a lot of 'introduction' content on my 'nice to have' list - a lot of this stuff just got bumped to critical path. In reality though, I think that will actually just make my game better.

 

There is no good one number solution but one hour is not good either as you can't even start playing some games properly in an hour. Setting up the performance and other settings and then watching intro cutscenes, tutorial etc...

By quickly looking my steam lib starting from top, assassin creeds, bioshock, company of heroes, etc were setting up controls, videos and tweaking perf, etc took like hour or more before you could even get in to "real" game.

 

When I look at something Nuclear throne which is $12.99 I doubt it would have many returns because they said they would never any sales and its not priced at an impulse price point (so you would think only the people that like that type of game will play it). Which is probably why they have a 10/10 rating.
http://store.steampowered.com/app/242680/

 

Nuclear throne steamspy:
- Playtime in the last 2 weeks: 03:12 (average) 01:13 (median)
- Playtime total: 15:14 (average) 05:15 (median)

Who knows man. It's obviously a good game (the top rated review has over 500 hours logged). And a 5 hour median is respectable.