Valve Played Capitalism So Well It Broke It
A former Epic Games engineer dropped a truth bomb this week that every PC gamer and developer already knows but rarely says out loud: Steam does not win because it is the best store. It wins because it is the only store that remembers every game you have ever bought.
>Kiaran Ritchie, a former principal animation engineer at Epic Games, sparked a firestorm when he argued that Valve has effectively broken the competitive dynamics of PC gaming. His thesis is simple: you could vibecode a Steam rival in a week. The infrastructure is not special. The 30% cut is not buying servers — it is buying access to a userbase that has already decided it will not leave.
That userbase is us.
The 30% Tax Is Not Rent for Infrastructure
Ritchie puts it bluntly. Developers are not paying 30% of their gross revenue because Steam provides unmatched distribution infrastructure. Cloud providers handle all of that now. The Steam client — downloads, updates, matchmaking, chat — is, in his words, "somewhere between ’not that hard’ and ’trivial.’"
So what is the 30% actually paying for?
Access.
Access to the massive Steam userbase. Access to the friends lists, the trading cards, the achievement chests, the wishlists, and the library histories that span fifteen years. Ritchie says the fee is "siphoned out of the PC games industry into a black hole" — and that Valve could easily lower it while keeping healthy margins. The company has simply chosen not to because it does not have to. That same concentration of value is exactly what I wrote about when AI delivers zero financial payoff outside the dominant players — the pattern is identical, just the industry changes.
That is the capitalism part. Valve identified the single most valuable asset in PC gaming — player identity tied to a library — and optimized the hell out of it. Sales, seasonal events, badge drops, community hubs, user reviews. Every feature reinforces the same loop: your games live here, your friends live here, your memories live here. Leaving means leaving all of it behind.
Why a Better Store Does Not Matter
Epic CEO Tim Sweeney has spent years calling out Steam’s monopoly. Epic even launched the Epic Games Store with an 88/12 revenue split, exclusivity deals, and a faster, cleaner client. It made headlines. It upset a lot of people. It did not move the needle.
Ritchie, who helped build Epic’s tools, does not blame Epic for the failure. He blames the players.
"No avid Steam user wants other stores to succeed," he wrote. "Even if an alternative were objectively better, by whatever metric you care about, it would still be of no interest to Steam users. They would in fact find it to be a problem and a threat to their investment."
He continues: "Competition in this space is not only uninteresting to most Steam users, it’s actively denigrated!"
That last line is the one that cuts deepest. Anyone who has watched a Steam thread react to a new launcher or storefront knows exactly what he means. The comments are not just skeptical — they are hostile. Why? Because every new store is framed as a threat to the existing library. Players see competition not as choice, but as fragmentation of the one place that holds their entire gaming life. If you are skeptical about platform lock-in, I covered how to audit your own tools for exactly this kind of control.
Ritchie concludes: "I don’t think this is fixable. It’s just sad."
The Network Effect Is the Moat
This is not a new story in tech. Microsoft Office, Apple’s ecosystem, Facebook — all won not because they were technically superior at every point, but because the network effect made leaving painful. Steam is the same playbook applied to games. I saw the same pattern in The CEO AI Gap — platforms optimize for their own benefit while users foot the bill.
The difference is that the moat is entirely psychological. There is no technical lock-in preventing you from buying games elsewhere. GOG, Epic, Humble, itch.io, and others all work. But the moment you have to manage two libraries, two friends lists, two achievement systems, and two separate installs of a game you already own on sale, the friction becomes real.
Valve knows this. Their sales events are masterclasses in psychological reinforcement. The seasonal sale pop-ups, the countdown timers, the "Complete your collection" nudges — they are not just marketing. They are reminders that your identity as a gamer is housed on their platform.
My Take as an ICT Manager and Developer
I manage an ICT division by day and code by night. I also own 527 games on Steam. Let that sink in.
I have three other launchers installed — Epic, GOG, and Battle.net. I use exactly one of them regularly. The rest sit there as reminders that I should diversify, and then a Steam sale happens and I forget all about them.
Ritchie’s argument hits home because it describes my own behavior. I do not stay on Steam because the client is perfect — it is bloated, slow, and occasionally buggy. I stay because my library is there. My friends are there. My cloud saves are there. The mental cost of migrating, even to a theoretically better platform, is just high enough that I never actually do it.
From an ICT perspective, this is a textbook example of vendor lock-in built on network effects rather than technical superiority. We see it in enterprise software all the time. What makes Steam unique is that the lock-in is voluntary — players are not forced into it by IT policy. They walked in, built a life there, and then found the doors quietly locked from the inside.
What This Means for the Future of PC Gaming
The uncomfortable truth is that Valve has created a platform so dominant that it has essentially stopped competing. The Steam client has not meaningfully innovated in years. The storefront is cluttered. Customer support is famously opaque. The 30% cut has remained unchanged since 2003. None of that matters because there is no credible alternative that can offer the one thing players actually value: their entire history in one place.
Ritchie is right that the situation is probably unfixable. Not because a better store cannot be built, but because the barrier is not engineering — it is trust, habit, and accumulated investment. That is a much harder problem to solve than downloading the Steam client API. The AI bubble burst in China showed that even massive capital cannot always overcome entrenched platform dynamics.
The only realistic pressure points are regulatory. The European Union’s Digital Markets Act and similar interoperability mandates could, in theory, force platforms to allow data portability — your friends list, your achievements, your purchase history. If that ever happens, the moat shrinks. But until then, players are stuck with the consequences of their own collective choice.
The Bottom Line
Steam is not a victim of its own success. It is a victim of ours. We — the players — built the moat by treating our libraries as identity rather than inventory. Valve noticed, optimized the feedback loops, and then quietly stopped worrying about competition.
Kiaran Ritchie is correct: you could build a rival in a week. Convincing even one avid Steam user to actually use it? That might take a generation.
Sometimes capitalism does not produce the best product. It produces the one that makes it hardest to leave. Steam is that product. And for better or worse, we bought it — lock, stock, and two thousand DLCs.