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German group files legal complaint against Valve's Steam service

German group files legal complaint against Valve's Steam service

Fri 01 Feb 2013 12:19am GMT / 7:19pm EST / 4:19pm PST
Legal

German consumer group complains about Valve's lack of digital resale

The Federation of German Consumer Association (Verbraucherzentrale Bundesverband, VZBV) has submitted a legal complaint over Valve's lack of haste in making changes to its End-User License Agreement (EULA).

In September of last year, the VZBV threatened to pursue Valve in court if it did not change its EULA to allow Steam users to resell their digital content. The organization also took issue with Valve not allowing an opt-out for users that did not want to sign the new EULA. Ultimately, the VZBV says that digital games should be handled like physical games and the current status quo isn't beneficial to consumers in the long run.

"We have submitted complaint against the company to the district court Berlin," VZBV spokesperson Eva Hoffschulte told Cinema Blend.

The VZBV has stated that it will take its case all the way up to the Supreme Court if Valve doesn't come into compliance with EU law. Valve will be modifying its EULA on January 31, but the VZBV believes that it may be a case of 'too little, too late'.

33 Comments

Tom Pickard
Lead Environment Artist - Campaign Map

308 382 1.2
Popular Comment
Digital Resale will be a bad thing for all developers. Steam sales already reduce games to low low prices for those prepared to wait a tiny ammount of time. If you then add In a 2nd hand market able to undercut developers sale prices for the same product you effictively wipe out long term sales of games. It will be manipulated too, Sale prices will have to go up because otherwise people will buy copies of games In sales just to sell second hand once the sale ends for a profit.

It will mean the introduction of more always online 1 activation per code and free to play micropayment models for making money. As the developers will need to work around the loss of long term sales.

Im not actually sure who this benefits either, people claim It's the consumers, but the studios who can no longer offer good games without crippling DRM and money making micro transaction methods embedded into their games will dissapear and you'll end up with less choice stiffled because sales figures can't be predicted..

I find It quite strange that digital media such as games, where people play them for 100's of hours for effectively pennys an hour can't be considered either a consumable product without resales allowed or at least restricted.. Surely we could come up with a fair solution like once 30 hours are played the game becomes unsellable as Its determined a fair value of the product has been recieved, or the developer gets 50% of any resale of a digital product...

Also just as a disclaimer, these views are totally my own and don't reflect my employers views or policys on the subject..

Posted:A year ago

#1

Rafe Gaskell
Lead Programmer at the Design Institute

11 12 1.1
About time someone did something about this. Hopefully it'll create a bit more of a competitive environment in the digital distribution space. Having a game on one service at a high price with no competition is a scary thought and it's already happening.

Posted:A year ago

#2

Mariusz Szlanta
Producer

28 22 0.8
@Tom

Digital re-sales may be tied to Steam accounts only and both Valve and developers/publishers can have a cut for every re-sale done.

It would, obviously, limit the impact Steam sales have and that's not something easy to forgo. Gamers track sales promos and are constantly exposed to many products while searching for gems they think they want the most. Impulse buying is quite popular on Steam.

There's also a question about games that can't beat magical point of entry of 80% on Metacritic. Would their price point have plummeted instantly driven by word of mouth and re-selling opportunities just like in traditional brick and mortar shops? If yes, could these games really gross more with prices moderated or should publisher worry when receving cut for every re-sale?

Even with re-sales happening between Steam accounts only, backend to support it would take many months to develop.

Just to be clear, there are my personal views too :).

Posted:A year ago

#3

Mats Holm
Technical Process Analyst

49 29 0.6
Don't see this happening, mainly because there is a bigger elephant out there called Apple who would really not like this, and throw in Microsoft, Sony and Nintendo in the mix and you are very much fighting a uphill battle.

There is also the problem of how this would be done. How does Valve know when a legal transaction has been done between two people? Do they expect Valve to set up the system that trades second hand games? How do they avoid having this be a excellent way to launder money? Are they supposed to force Valve to buy back games? If so, is that not like forcing Waterstones to buy back books from customers after they have read them?

Posted:A year ago

#4

Dave Herod
Senior Programmer

517 731 1.4
Popular Comment
Anyone want to buy a second hand cinema ticket? I've seen the film, I don't need it now.

Posted:A year ago

#5

Joshua Rose
Executive Producer / Lead Designer

191 74 0.4
I honestly don't see this happening.

This is no different than an Adobe software license, or Autodesk. I'm pretty sure (not positive, fact check please?) you aren't allowed to resell your Adobe or Autodesk software licenses. Have they tried suing Adobe or Autodesk in the past for this practice?

One thing that some people don't really think about is the fact that you CAN NOT treat digital sales the same was as physical, therefore the laws can not be applied in the same way.

Since the development process has already been brought up as an issue, I'll leave that one be. But there are plenty of other problems that can come up. They have to maintain a completely separate price schedule for used licenses, how much they give to the publisher from transactions (I can assure you no publisher would agree to this without some sort of compensation), Would the user be reselling to other customers or selling their license rights back to Steam at a prorated value to be put towards the purchase of another product? If so, how does Steam compensate publishers for the reduced value at which their games are being sold due to the 'trade in' value. If it was to be sold to another customer, would Steam get a cut for facilitating the transaction? What would their responsibility be to publishers?

The list can go on, but I think you get the point.

To be honest, this organization could have submitted this case years ago, It still wouldn't have made a difference. The licensing nature of the software industry as a whole (not just games) will not lend to the idea of digital resale. EULA's have always been written in such a way that the user agrees they have no ownership of the game itself, merely a license to download, install, and use the product. The publisher agrees to provide said product, support if necessary, etc... That's it.

I can't just take my entire Steam library, put it on flash drive, and go to the local Flea Market and sell it saying "there are tons of games on here, all yours 100 bucks". I'm sure you could, but most people will look at you and wonder which local mental institution you recently escaped from.

Posted:A year ago

#6

Steven Wemyss
Senior QA Engineer

32 31 1.0
Pretty sure this actually came about as a result of the licence reselling case that was lost by someone sometime last year.

In fact yep it was Oracle Vs Usedsoft:
http://www.gamesindustry.biz/articles/2012-07-03-consumers-can-resell-downloaded-games-rules-eu

Posted:A year ago

#7

Rafe Gaskell
Lead Programmer at the Design Institute

11 12 1.1
I'm having trouble understanding why people are saying they don't see this happening, as Steven's link shows it technically already has, all that's needed is a test case. EULAs mean nothing if they go against the law.

Also why, as someone said, would publishes get a cut? If the item is considered as being the same as a physical product they are entitled to nothing.

Posted:A year ago

#8

Tom Keresztes
Programmer

632 223 0.4
Pretty sure this actually came about as a result of the licence reselling case that was lost by someone sometime last year.
That law means that they cannot block resale, not that they have make it possible. If you can find a way to transfer, you can transfer. But Steam is primarily a service.

Posted:A year ago

#9

Dave Herod
Senior Programmer

517 731 1.4
If the item is considered as being the same as a physical product they are entitled to nothing.
And why should it be considered the same as a physical product when it isn't one? Why can't I sell my car insurance policy to someone else?

Posted:A year ago

#10

Joshua Rose
Executive Producer / Lead Designer

191 74 0.4
Exactly.

It's not a physical product, so it should not be subjected to the same physical retail based laws regarding resale.

While it's against the EULA (I think) to share your account information in just about every online based service available, nothing is 'actually' stopping you from selling your entire account.

So if people really want to sell their games linked to Steam... then they have to sell their whole account. So they can either lose their entire library for the sake of selling one game, or they can keep separate email addresses and logins for each game they buy, and figure out a way to keep track of each one. At least then, if they try to sell the games, they can do so without losing the others.

Laws making it illegal to block resale are one thing. as Tom mentioned, they don't say the service has to MAKE IT POSSIBLE to resell the product. I'm not sure about the EU, but forcing a company to facilitate uncompensated resale of their products is quite illegal and borderline unconstitutional.

Posted:A year ago

#11
As Tom says. "Not preventing" is very different to "Facilitating". Reading Valves Subscriber Agreement s3 D. talks about a Subscription Marketplace where users can sell and buy licenses. The facility is not in place yet obviously, I do like the second paragraph about Valve taking a cut of the sales. :)

Posted:A year ago

#12

Tom Pickard
Lead Environment Artist - Campaign Map

308 382 1.2
Popular Comment
I don't thin anyone Is denying that EULA's "currently mean nothing" Although this will be appealed and there will be a test case arguing from the business point..

The biggest Difference between this and a physical product comes in several subtltys. For a start Condition of the product.. With a new physical product you own It, use It, It eventually Isn't new and If you choose to sell It, It is different to a brand new version of the same thing, your not selling a perfect pristine item to a new user and therefore a descion needs to be made by a buyer "do I want new, or do I want 2nd hand/used" It's a clear distinction, using it depreciates It's value and you have to make a valid decsion on what you want to purchase..

With Digital - Its the exact same product, Your selling not only the rights to It, but the new user downloads It from a service they have never paid money too, The seller can undercut a brand new copy by £1 and most people will pick that option because It is exactly the same..

So you immediatly have no reason to ever buy a new copy of somthing cause It's not like your used copy will be different In any way shape or form. Which effectively makes Digital products Worthless.. One user buys a copy and sells It for £1 less, that copy could be sold for £1 less than the retail version hundreds of times with no wear and tear and no eventual dissapearance from the market and no more sales to the developer. Who keeps their product at an affordable price because they want sales (Games are incredibly cheap considering the cost of other things, Beer £4 30mins enjoyment, Game with 100+ hours enjoyment £7.50 in a steam sale... Value) If you then take away the long term sale value of games by allowing users who have got amazing value for money out of a product to then sell an identical product at an undercut of £1. Well you don't see anything wrong with this??

It will kill PC gaming as we know It, It just won't be worth the investment to make high end games cause there will be no return.

Instead what you will get Is Free To play, and you will buy Items and levels and cosmetic things, and the games will be designed around making money principly so It will be in your face.

Or look at the big picture and realise digital needs to be treated differently, If a developers can't make money back after a few months because of 2nd hand undercutting them with exactly the same product, they will stop making games. It's a big issue and It requires action by the EU anyways, Digital rights need to be enforced or allowed in principle or you'll lose a large proportion of our games industry. Games aren't like movies, they don't make money from theatre release, then dvd, then rental, then tv syndication, then merchandise.. They aren't like music where an artist releases several singles, then an album, then tours for 2 years, then a best of album all whilst earning radio and music tv royalties and advertisers using their music and merchandise etc.. It's a single digital product which is sold at face value and doesn't deteriorate at all, Effectively you just take money of developers hands completely and make a closed cirle for each individual sale, for every game sold you might lose 10-20 more sales, except all those people got to enjoy this game yet the developer only ever made 1 sale. Am I crazy thinking that It effectively makes the product worth nothing? Cause In theory only £30 has ever reached the devloper for the first sale, every other sale Is just repaying the previous owner rather than funding the products and making future games possible.

Posted:A year ago

#13

David Spender
Lead Programmer

127 51 0.4
Ok let me be the lone dissenter. The problem with digital licenses is that making them non-transferable makes them in almost all cases revocable. No longer can I count on having forever (up to me to keep in good condition) my copy of NES Legend of Zelda Gold cartridge game - which I still play and my kids now play.
Instead I'm given a revocable license which could vanish at any time with no possibility of recourse. I am perfectly fine with a digital copy of something that cannot be resold, but if you are going to take away first sale doctrine rights, then please relinquish your ability to delete my license as you see fit. I should own the game permanently.

Edited 2 times. Last edit by David Spender on 1st February 2013 4:51pm

Posted:A year ago

#14

Rafe Gaskell
Lead Programmer at the Design Institute

11 12 1.1
"And why should it be considered the same as a physical product when it isn't one?"
That would be because that's what the EU ruling said ie it is to be treated as one when it comes to resale.

"Why can't I sell my car insurance policy to someone else?"
Last time I checked you didn't get games sold to based on your age, years gaming and how many accidents you've had while gaming ;)

Posted:A year ago

#15

Joshua Rose
Executive Producer / Lead Designer

191 74 0.4
@Tom: Couldn't have said it better myself.

Posted:A year ago

#16
I don't think anyone should be prevented from participating in a secondhand market. But there is obviously a disadvantage in continuing with perpetual licenses - the publisher's product is competing with itself, there is no wear and tear depreciation. It is difficult enough competing with the rest of the market. IIUC, the EU ruling means there is an incentive for the following:

1. More DRM (to revoke the copy on the seller's equipment);
2. Limited term licenses / subscription-based models;
3. Software becoming more 'service' than 'good' (e.g. there is something running on a server, you only have a client);
4. More online passes, DLC and suchlike, to extract value from the secondhand market.

On the facilitation point, I believe Oracle was obliged to make the software available for download to the secondhand buyer as that is how the software was originally obtained by the seller. So I can sell my licence to you and you can then download it from Oracle without any money going to Oracle. But Oracle is not obliged to give you updates, patches or support.

Perhaps a case of 'be careful what you wish for'.

Posted:A year ago

#17

Morville O'Driscoll
Games Blogger & Journalist

1,374 1,020 0.7
Mats Holm said:
There is also the problem of how this would be done. How does Valve know when a legal transaction has been done between two people? Do they expect Valve to set up the system that trades second hand games?
This already exists, in a lot of ways. The trading system is already there. The legal transaction system is a subset of that (passing items from one persons's Steam account inventory to another, with the end user legally owning the item). Moreover, Valve have recently set-up a monetary marketplace which allows users to sell items they've created, for actual money, with Valve taking a percentage cut.

I honestly don't want to see this happen, since I think it would massively harm the industry, but technically, there's very few things actually standing in the way of second-hand sales on Steam, I think.

Edited 1 times. Last edit by Morville O'Driscoll on 1st February 2013 7:42pm

Posted:A year ago

#18

Stephan Schwabe
Multichannelmanagement

69 31 0.4
Ther is no harming for the industry, somone has to buy the game in the first place to resell it. This guys buys a new game after he sold his game. The digital market is one of the bigest reasons why ther is so much piracy.

Posted:A year ago

#19

Morville O'Driscoll
Games Blogger & Journalist

1,374 1,020 0.7
@ Stephan
This guys buys a new game after he sold his game.
Or he just buys another second-hand game. Plays it. Sells it. Buys another second-hand game. Plays it. Sells it. Buys another second-hand game... And so it goes.

Posted:A year ago

#20

Stephan Schwabe
Multichannelmanagement

69 31 0.4
No the comanys just need to convice the people to buy a game.
Right now most companys lost control of ther customers. Look to EA/ Capcom/ Activision ther standing is very bad.
Customers dont need to be told what thy have do do with software thy payd 60$ for. Give them the freedom thy want and you get a return.

Posted:A year ago

#21

Morville O'Driscoll
Games Blogger & Journalist

1,374 1,020 0.7
Mmmm... In a way, yes, you're right. The customer does need to be given more respect, and freedom.

But in another way? Times are hard. Unemployment in most countries is high (relative to about 6/7 years ago). Inflation is increasing, whilst, certainly in the UK, wages are increasing below inflation. Which means consumers look for a bargain, and buy second-hand (not just games, but books, DVDs, and occasionally shoes and clothes).

Posted:A year ago

#22

Stephan Schwabe
Multichannelmanagement

69 31 0.4
Ther are so many oppertunitys for companys to make that work. Support the game for a longer time, give it a good multiplayer so ppl stay. Sell a singel player version for 50%? If you own 3 games get 15% discount for the next game. Make the games worth to keep. Or just rent games for one playthrou for 15$/ 30 Day licence. Just make somthing heppen.

Posted:A year ago

#23

Morville O'Driscoll
Games Blogger & Journalist

1,374 1,020 0.7
True... Other than pre-order bonuses (which obviously end when a game is released), there's very few positive-spins to buying new. Mostly it's negative-points on buying second-hand (like single-use DLC codes, and Project 10 Doller).

Posted:A year ago

#24

Nicholas Pantazis
Senior Editor

968 1,161 1.2
This whole suit is created on the basis of a misunderstanding of the court ruling, which allows resale IF the consumer finds a way to do so. So, for example, you may legally sell your entire Steam account. The court did not, in ANY way, rule that software providers were REQUIRED to provide a way for people to sell digital software, merely that they couldn't fight them in court if they find their own method. They will lose, Valve will not change.

Posted:A year ago

#25

Dave Herod
Senior Programmer

517 731 1.4
@Rafe - Ok then, how about if I go to a museum, pay to get in, have a look round, then leave - why can't I sell on my permission to be in the museum to someone else? I've already seen all there is to see, I should be able to just sell that ticket on now that I'm not in the building any more. Because permission is not mine to give. You don't buy a game, that would cost you millions. You simply buy permission from the owner to play it. Just like buying a museum ticket means I don't own the museum.

Posted:A year ago

#26

Mariusz Szlanta
Producer

28 22 0.8
@Dave

Exactly. Provider limits your right to re-sell and it makes sense for classic service that requires customer's presence at fixed time.

I think that if you would agree on giving museum a cut of your re-sale and register it in their system, then many museums would not have a problem with that.

However, I donít think this argument is valid for service that is not time or space limited. Transaction would be registered, license transferred and publisher given a cut. There is no need to verify new customer or danger to service quality whatsoever.

Having said that, re-sale transfers power from a company to individual, limiting control the former has over product and as Mats remarked, essentially anyone in publishing business would react negatively.

Posted:A year ago

#27

Rafe Gaskell
Lead Programmer at the Design Institute

11 12 1.1
@ Dave I see what you're getting at but can you stop with the straw men?

My original point was that I'm behind the idea of selling your old digital games. I'm genuinely scared about how the market is going with everything being £30 and staying that way outside of sales or being out for a long time. Even more so in the case of Sony and Microsoft in that they have zero competition for what they sell. I'm all up for devs getting money from this service.

Posted:A year ago

#28

Dave Herod
Senior Programmer

517 731 1.4
I'm genuinely scared about how the market is going with everything being £30 and staying that way outside of sales or being out for a long time.
Considering how often Steam has sales, a bit of strategic shopping and a little bit of patience lets you play all the top games for very little money. I have absolutely no concerns about Steam's pricing whatsoever. Even Xbox and PS3 games drop pretty rapidly in price on Amazon and the like.

Posted:A year ago

#29

John Tearle
Founder, CEO

17 10 0.6
"Why can't I sell my car insurance policy to someone else?"
Last time I checked you didn't get games sold to based on your age, years gaming and how many accidents you've had while gaming ;)
What about reselling a TV License? or recording a TV show on the internet and then redistributing it for free? I'd genuinely be interested if this were legal - plus, to my knowledge that wasn't based on your age, years watching and how many accidents you've had whilst doing so :P

Posted:11 months ago

#30

Alex Bunch
Proof Reader

87 86 1.0
At last with this case we might have some real movement on this issue. I hope someone also takes this up with Microsoft, Sony & Nintendo. It's a game: I OWN it, therefore I should be able to SELL it. And the EU agrees. Where does the games industry get off believing it's products are somehow exempt from every other product produced?

Posted:11 months ago

#31

Trevor Sayre
Interaction Designer

4 2 0.5
People need to learn the difference between physical and digital. It's a big part of the debate around illegal downloads being equated to theft. And here it's a big debate about reselling digital product. The crux of the problem is that digital media can be infinitely and freely copied, whereas physical media cannot. Copying is not theft, the media is not gone or removed from possible use after a copy. In this same vein, reselling digital media you purchased is nonsense. You did not obtain a limited resource with which to trade.

Posted:10 months ago

#32

Petter Solberg
Freelance Writer & Artist

56 30 0.5
It's good to see someone challenge the norms for digital content. People here are comparing digital games to Adobe and Autodesk licences. Well, I®m personally sick and tired of paying a premium for an Adobe licence that a few years down the road doesn't work properly due to lack of support, and being forced to pay for an upgrade. It's simply too easy for publishers and distributors to make their own rules in order to limit their digital products. Digital content should be subject to the same laws as physical products. If a product doesn't work, well, then either you can get a free upgrade or a full refund. At this point the consumer has no control over digital purchases, and something has to be done about that.

Edited 2 times. Last edit by Petter Solberg on 1st July 2013 6:01pm

Posted:9 months ago

#33

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