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Microsoft purchasing Valve would pay for itself in profits (and power)

Microsoft needs help when it comes to exclusive games for the Xbox One, and acquiring developers or publishers with a great game selection is the easiest way to get that help.

But Valve is an unlikely source of relief for Microsoft. Valve doesn’t need the money, and few people involved with the company, studio head Gabe Newell included, have any reason to sell. But it’s still reported that Newell owns the majority of Valve, and it often appears from the outside as if Valve is more or less on cruise control. If Newell wanted to focus on something else in his later years, this would be a good chance to make a clean break while pocketing a fortune.

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Brian7655492231d ago

What would the cost be, 20 billion?

UCForce231d ago (Edited 231d ago )

MS did tried to convince Gabe Newell last time and he said no. Now, it isn’t going to happen.

hardmankensington229d ago

Think you find it probably will

229d ago
badz149229d ago

the title says "...pay for itself in profit". THAT'S exactly the reason why Valve won't sell. the profit is enough to by themselves, so why would they let MS grab all them money for a 1 day pay?

fiveby9229d ago

Well if MS bought Steam, then I am many others would stop buying from Steam. GOG, Robot Cache, and others would grow.

rainslacker229d ago

I don't think a lot of people here actually understand that most PC gamers aren't that into MS. Steam spent a long time building it's relationship with the PC community, and while they aren't perfect by any means, they certainly have a lot of good will to have a generally happy user base.

Assuming MS were to buy Valve, I can't see the PC gamer being that happy about it. There are alternatives to Steam now, and some of them have just as much good will in them, and about the only thing that keeps gamers on Steam is because that's where most of their library is.

To me, it seems that MS already has everything they need to compete against Steam, so they just have to convince the gamer to use their service. They'll do this a lot cheaper by just providing a good service, and fostering good will like Valve has done for a long time now.

MS isn't going to just suddenly eradicate decades worth of consumer discontent towards them because they buy Valve, because most modestly active PC gamers are well aware that MS has held back PC gaming for decades now by restricting DX to new versions of windows, despite there usually being absolutely no reason for them to. MS abandoned the PC gaming market to promote their console, and now they are crawling back to try and get their MAU's. The PC gamers aren't dumb....at least collectively....and they already see what MS is trying to do. There is nothing wrong with MS trying, but it'd be much cheaper for MS to simply build their relationship with the community, instead of just trying to squash the competition.

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UCForce231d ago (Edited 231d ago )

You do know that Gabe Newell is anti MS. Not because a fanboy. It’s because how MS treated him in the past. You can tell how much Gabe hate MS for his personal reason.

Brian7655492231d ago (Edited 231d ago )

He is not anti MS, he worked there for 13 years and said he learned more in 3 months there than all his time at Harvard. That is a positive experience, not a bad one. He left Microsoft to start up Valve. He has made derogatory comments about the Playstation 3 and has also shown concerns over Windows, Xbox Live and DX12. Which goes to show he is vocal but does not hold any grudges towards Microsoft and how they treated him. He also doesn't hold any grudges towards Sony. He just speaks his mind. He's gone on to make deals with Sony and also works with Microsoft and collaborating with Steam and Windows/Xbox games.

You've mentioned before to being a Sony loyalist but try not to do that at the expense of embellishing the truth at the cost of undermining Microsoft because of it.

Dlaw76229d ago

Brian I swear they need more people like you around that was one of the best comments ever Im unfortunately at the point of saying crazy things because these guys on here has pushed me to the limit

UltraNova229d ago

Lets get real shall we...Who cares about Gabe's feelings? What about PC community's feelings? You know, the people who matter in case MS buys Valve. How would their gaming experience change? Will so much power and control in MS's hands be a good or bad thing for PC gamers?

What's your opinion on that?

Prince_TFK229d ago (Edited 229d ago )

@Brian

I do agree. People here would just always make assumptions without having any facts to back up, especially regarding Nintendo and MS.

Cobra951229d ago

"Will so much power and control in MS's hands be a good or bad thing for PC gamers?"

It would be horrible. What these articles keep missing (or avoiding) is that not only would Steam be owned by Microsoft, but it would also change to fit Microsoft's plan for complete PC domination through a closed OS like Apple's. They've been pushing their app store and UWP very hard. How long do you think it would take for a Microsoft-owned Steam to migrate to this console-like walled garden? My guess is not very long. It wouldn't happen overnight, because it's too massive. But I'd bet new games would be shackled inside their store right quick.

Once major gaming is successfully bottled up, MS will have more leverage to do the same to the rest of Windows software. They'll eventually cut the cord on the "legacy" open functionality. Most business and productivity people don't much care about such things. They'll go along with whatever MS feeds them. It's the fiercely independent PC gamers who lead the fight for an open Windows. The rest of the resistance are too few to matter to this huge company.

rainslacker229d ago

I don't think he hates MS, he just doesn't like the way they operate their business and tend to put the corporate ideals ahead of treating the customer right. He's not a fan of the walled garden approach that MS has been taking with the Windows Store/UWP, and I doubt that he'd be keen on selling to MS knowing that they would pretty much destroy all that he meant for Steam to be....which was pretty much everything opposite of what MS was prone to doing.

I don't get why people say that MS should buy Valve/Steam. That'd be a huge expenditure just to take control of the competition. MS has all it needs to compete against Valve without spending billions of dollars on an acquisition. MS just needs to build their place in the community they neglected for so long, build trust in the community they abandoned in their last attempt, and ultimately, provide a service which is equal to or better than what Steam offers, and they'll get their users. Valve won't go down without a fight, but that's going to be a good thing for the consumers.

MS doesn't need to buy Valve, or any other major publisher. The rumor, and subsequent opinion pieces on it are being way too myopic on what exactly MS is capable of. MS will not gain good will by buying a major publisher or steam. They likely will receive a lot of hate for buying something like Valve/Steam, and likely a lot of their problems with the PC community will be made more vocal in the community.

It makes little sense for MS to expend so much money on such large acquisitions, when MS as a whole seems to be taking a rather long term view on how to achieve their goals. Spending billions to get a jump just doesn't make sense, and it'd take a really long time to make a return on their acquisition by the profits alone. Minecraft can generate half a billion dollars in revenue a year, so paying 2 billion for it pays for itself rather quickly, and helps them achieve some other things they want. But paying 5-20 times that to acquire a big company whose profits aren't as clear means a lot more work, with only the potential to return a profit...and in the case of a publishing branch, their asset acquisition will likely be greatly devalued as soon as they leverage that asset to sell the Xbox brand.

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UCForce231d ago (Edited 231d ago )

He did worked with MS for 13 years. But he want to be himself. By creating Valve, he and his company are now profitable. He only respect his former MS employees, not the current one. Look, Gabe Newell isn’t going to be convinced by MS for buying his studio.

UCForce231d ago (Edited 231d ago )

@Brian7655492 I do remember Gabe Newell bashing a lot about PS3 which I have to agree with him. But like I said, his company won’t accept MS offers. The True is that Valve want to be independent. The only semi realistic that MS going to give PUGB an offer.

Dlaw76229d ago

Gabe not turning down 10 billion dollars bruh no matter what you can pray all day but Microsoft is coming for ya 150 billion probably more at its disposal

morganfell229d ago (Edited 229d ago )

And you assume MS just has 10 billion dollars to throw at this. Another laughable MS burns money in their cars remark. MS is incredibly profitable but they do not have cash to toss away. You also act as if Valve wants to sell - laughable - as well as acting as if this would just waltz past anti-trust reviews.

And if you think Valve would sell for as little as 10 Billion...well...good luck with that.

This is nothing more than people with a dreaming because they support a company that abandoned gamers.

Seafort229d ago

If Microsoft bought Valve there would be such a backlash from PC gamers and most would abandon Steam and demand a refund for all the games they've bought on the store.

Steam is not just a game launcher. It is a store, a community and a place where AAA and indie devs can interact with their customers and sell their games.

Anyone who thinks this will happen is living in cloud cuckoo land. Valve will never sell up as they would rather dissolve Steam and the company than sell out to Microsoft or any other corporation.

It would cost Microsoft tens, maybe hundreds, of billions of dollars to buy out Valve.

Most PC gamers hate Microsoft as it is so if they did try to buy Valve it would be a zombie investment in a few weeks as many gamers would abandon it for other platforms like GoG, Origin or Uplay.

rainslacker229d ago

Gabe seems to be more about principle than money. The man is already a billionaire, and while I'm sure he wouldn't mind having more, he always struck me as the kind of person who never felt the need to simply acquire more money.

Also, 10 billion for Valve/Steam is a steal. As a private corporation, it'd be more likely that 10 years worth of profits would be the selling price of the company, and for Valve, that's estimated to be closer to around 15-20 billion dollars. Although exact numbers aren't available publicly.

I'm sure Gabe's been approached before to sell. But to date, he hasn't, and I can't see MS investors being willing to have MS invest so much when the gain would take too long to return. Particularly since MS already has the infrastructure to do what Steam already does. It just doesn't have the same number of users. What MS does have though is that the Windows Store is included in every new copy of Windows, which is about all they need to eventually get new people, or people through attrition, and within PC gaming, it's not unheard of for users to use more than one service, so MS just needs to play the long game, and keep a good service running. Eventually they'll get their users, and hopefully restore any faith they lost from the PC gamer through years of neglect and outright screwed up policies which held back PC gaming to try and sell new versions of Windows.

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agent4532229d ago

Gabe Newell will not sell his private corporation anytime soon

sampsonon229d ago

imagine if they took half of that and made AAA games for their fan base? i know, that would be too easy right?

rainslacker229d ago

Exactly. Even assuming that MS only had to spend 10 billion for Valve, which is way too low considering the revenue the estimated revenue they buy every year, that'd be 10 high profile AAA games they could make including a nice marketing budget for each. That would make a lot more sense than just getting a few IP's, and a storefront which they already have their own of. with 10 high profile IP's they stand the chance to strike it big on at least one of them. Probably more than that really. Those 2-3 that ultimately are successful, will return their investment within a few years, as opposed to taking 5-10 years to return it with a Valve purchase.

The only real benefit to buying Valve would be to absorb Steam into what they're doing, but it seems like a huge expenditure that they can do much cheaper by simply doing it on their own.

The people talking about MS buying EA are even more delusional IMO. EA would cost at least 20 billion to get a controlling interest, and that investment would immediately be devalued if MS didn't keep them multi-plat. What would MS even do with EA's IP's to make a return of 20 billion dollars? What more could they do, even assuming they kept them multi-plat, that EA isn't already doing? Leverage the games on Game Pass? Spend tons of money to promote subs which wouldn't return anywhere near what they could get by simply releasing the game through traditional channels?

This whole speculation about what MS should buy, what would be good for them, can't look at the entire picture. MS saying they wanted to acquire assets was likely more about developers than huge publishing houses, or the biggest digital distribution community on PC.

229d ago
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ziggurcat229d ago

People need to let this go because it's not going to happen.

Dlaw76229d ago

How u know Microsoft can buy you and put you on that corner if they want to never say never

UCForce229d ago

Valve is private owned company.

munchmiller229d ago

That's some stellar logic right there. Microsoft can buy ziggurcat, so conclusion is, they can buy Valve.

Valve is privately owned, there is no "corporate takeover" option here.

Lastly, Gabe has been quoted as saying in the past, that he would sooner dissolve Valve, than sell it.

- Valve boss Gabe Newell explains that it's more likely Valve would "disintegrate," employees departing, before he would sell it to another company.

So ya, whether Microsoft can buy ziggurcat, or you for far cheaper I'm sure, they can't just buy Valve on a whim. Should keep your wet dreams to yourself really.

Vegamyster229d ago

munchmiller

Bingo, Gabe Newell's net worth is over 5 billion dollars & Steam is still growing at a fast pace, it's not like they're hurting for money.

229d ago
darthv72229d ago

Never say never. People thought Lucas would never sell his company but he did... to Disney and now Disney is making more $$ hand over fist with the SW license.

Lucas got his $$ and Gabe would do the same if the offer was just too tempting to pass up.

UCForce229d ago

@darthv72 You do understand that Lucas was in rough spot back then when Disney was only his solution. This isn’t case with Gabe Newell and Valve. Steam made a lot of money for his company.

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Silly gameAr229d ago

There's already been countless articles about this on N4G. Either only wishful thinking, or these gaming sites have nothing else to talk about.

229d ago
FreakyFox229d ago (Edited 229d ago )

Looks like somone had a dream about a Microsoft and Valve love afair, but to me ... its a Nightmare.

Starnge people stil think the answer to everything , is if Microsoft buys everything.

Dlaw76229d ago ShowReplies(2)
Ristul229d ago (Edited 229d ago )

I'm not even sure it would be legal, as Microsoft would basically create a monopoly again on PC, but then again, they don't like to compete so buying a company wholesale would be easier for them.

agent4532229d ago

Agreed, it didn't help Microsoft in the past. PC gamers have fought back against Microsoft and Valve. Microsoft buys Valve, PC gamers would buy their PC games elsewhere. Specially now that most game developers have their own website to sell their games.

Dlaw76229d ago Show
UCForce229d ago Show
rainslacker229d ago

I remember the days when it was a meme that MS would just buy up the competition so they didn't have to compete. Simpsons even had a thing about it in the first or 2nd season when Homer was trying to provide a computer product.

MS has actually backed off of that in the last decade, although they still buy up technologies that help them, but back in the day, MS got a lot of criticism for their policies of trying to shutter competition to sell it's own products.

While I think a hypothetical Valve takeover would be more an absorbtion to get their users and revenue, than an outright shut down. I just don't see such a take over going over well with a community that doesn't have a love of MS, and has seen them hold back PC gaming for decades now by restricting DX to new versions of windows, outright remove their games from PC to promote Xbox instead, and pretty much put up walled gardens to try and promote their own goals over the interest of the consumer themselves.

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agent4532229d ago

Microsoft messed up badly after xbox. This is the corporation that bought the very best 90s game developers of all time:

Lionhead Studios
Rare
Assemble
Bungie

Formed one of the best Japanese gaming studio (Mistwalker) comprised of the best Japanese Developers (Hironobou Sakaguchi, Nobou Umetasu) of that time.

Had it's own Sports Studio XSN: sports

Despite all of this Microsoft turn it into shit just like EA and became the most hated corporation just like EA.

If this corporation can't do anything with the very best other than running them to the ground then is a shit corporation.

The_Sage229d ago (Edited 229d ago )

Wow... Talk about wishful thinking. I was thinking that they were in negotiations coming into the article.

Here... I'll change it up a bit. Nintendo acquiring Valve will greatly expand their variety of content.

Sony buying Valve will bring even more exclusive content to the PlayStation lineup.

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