Topic: Valve & Paid Content/Mods

[kat]

IMPORTANT: Paid Mods to be removed

There's a lot of discussion in the community questioning why Mod creators don't add Donate buttons to their projects. The simple truth of the matter is that, aside from real-world implications concerning donations, they just don't work. For mod authors this makes finding equitable solutions complicated as they also have to avoid doing things that inadvertently break network or provider Terms of Service rules that risk their accounts, work or even legal action.

[updated 28th April 2015]


Value has unveiled a new initiative, Paid Mods. Initially offerings will be for Skyrim but others appear to be planned (although not yet announced).

For Mod CREATORS this is obviously good news; all the time and energy spent creating mods can now be rewarded in a meaningful way.

For GAMERS (consumers/customers) it might not be such good news as they may now have to purchase their favorite (or new) Mods.

Which has inevitably (one might say "obviously") lead to a lot of... comment, 99.99% of which are in agreement that this new move by Valve is a bad idea, the only salient reason why being because "mods have always been free". Freely available to be consumed perhaps. But not free to make, and nearly always at the commercial expense of the creator, who doesn't even get a cut of the advertising revenue accrued by the mod hosting party.

The truth of the matter is that Mod creators have only offer their content for free in the past because there has never been an effective mechanism in place to 'charge' for their efforts - Mod's traditionally have never been recognised as DLC in the modern sense so have never occupied any status beyond being fan-made material, which has always put it in an odd position where monetisation is concerned, especially for games where EULA (End User License Agreements) don't make specific allowance for the modification and exploitation of original content ("exploitation" might not necessarily explicitly mean "revenue generation").

The key point about this new initiative on Paid Content however, is that's it's OPTIONAL; modders wanting to continue offering their wares without cost are freely able to do so, they just provide them as normal; those that don't want to do that can offer their content using different payment options, as either a fixed or pay what you want price - a mod being offered for 'free', at a 'fixed' or 'pay what you want' price, is entirely up to the mod creator.

The amount of revenue Creator can earn from selling their item or Mod via Workshops and Paid Mods varies depending on the Mod - this also applies to whether or not items or Mods can be sold; permission to do so it granted by the Developer through Valve.

For Skyrim Modifications revenue share currently stands at 25% (see resources links below).

An unofficial FAQ on this initiative is available here

Creators should visit the Steam Workshop/Community Paid Content page for more details.

IMPORTANT NOTE: Modder & UGC (User Generated Content) Creators wanting to take advantage of this initiative are urged to thoroughly read through the Getting Paid on Steam page, especially sections relating to TAX and TIN (Tax Identification Number) requirements.

Additional Resources
About Paid Content: FAQ's
Getting paid on Steam: Payment info FAQ's
Getting Paid on Stead: Tax Information
Getting Paid on Steam: Tax US/Non-US TIN's
Supplemental Workshop Terms - Revenue Sharing

[ratty redemption]

interesting, i wonder how quality assurance is going to be covered? maybe a mod could be free while in beta development then commercial when it's stable and finished?

[kat]

There's a section on Copyright and DMCA in the T&C.

Basically, as with all services that accept UGC (User Generated Content), it's up to the individual to police their work and make sure their Copyright is not being infringed. Users are also held to an upload Agreement that declares they own the appropriate 'rights' to the material (just like YouTube), if not they can be issued a DMCA and Valve can suspend their accounts (and cancel payment/issue reversals).

It's important to note that, as part of the procedure to receive payment from Valve, Individuals are REQUIRED to provide BANK and TAX ID information (Bank account Sort Codes/Account Numbers and/or IRS W-9/W-8BEN et al forms) that specifically identifies a person, meaning there ARE consequences for engaging in theft or misrepresenting ownership of anything sold.

[ratty redemption]

re-reading your post again, i just realized the modders are going to only receive 25% of what their mods sell for, and 75% go to value? wow that sounds unfair to me.

[kat]

Updated the first post with info to address that. Suffice to say it's a bit more complicated than that for games that Valve doesn't own.

[EDIT] the FAQ's are getting a bit long so they've been moved to their own topic in the FAQ section of the forum here.

[ratty redemption]

i just read the update, and i think i understand. it will be interesting to hear if any modders can confirm how much they earn.

[kat]

Technically, as per Valves documentation, the creator split is 25%. What's up for debate is how that percentage breaks down relative to Tax obligations (30% withholding, exemptions or not as the case may be).

[kat]

Important update. Paid Mods are being removed. See OP for link.

[ratty redemption]

kat, what do you think the future is going to be for companies like valve if paid user generated mods aren't accepted by the community? will the mods just continue to be free?

[kat]

When the user base so used to getting content free, it's difficult to find ways to then charge for the same thing. When that happens they naturally conclude they're being ripped off. A solution in that situation might have been modders opting to lock content at a given version and then offer an updated version at cost. That way Users would have the option to continue using what they had access to (same game-play, same feature), or paying to update. It appears this didn't happen though and modders chose to just offer what they already had at cost (don't know if Steam allows for pseudo-duplicates like that).

The broader issue with the system revolves around Copyright and using other peoples content, it brings a whole massive set of complications to the table; when things are free it doesn't matter; when money is involved, it does. For example, if a popular mod earns significant revenue and has a DMCA Take Down Notice issued against it, Valve is obligated to temporarily remove from, or deny access to, the infringing content in Store AND the purchasers computer(s). If the Notice isn't challenged within 10 days, it implies the content is 'bad' and Valve is then further obligated to issue refunds to all those whom purchasing the item AND find a way to deny access to, or remove the content, permanently from computers.

Furthermore, if the mod that's taken down is used by other mods, it results in a whole mess where people that might have paid for "X" mod now can't use it because "Y" is no longer available. Users would blame Valve for that, demand refunds, and vocally blame the company when that does not happened - Valve is not actually obligated in those instances to issue refunds because the onus of mod "X's" operability would be on Users doing their due-diligence before purchase, or accepting their own liability for acknowledging the mod may not work (this is of course notwithstanding the author of the mod that was taken down.. are they then obligated and liable to refund those users now with broken products).

Paid Mods would work, after all it's no different than other forms of purchasable User Generated Content, but not in an environment where the marketplace is literally a free-for-all full of disproportionate cross-contamination.

The only other alternative is for content authors to sell their wares directly from their own websites, but that brings with it its own set of problem, mainly administrative and management.

[ratty redemption]

understood, very interesting.

what about mod makers having patreon accounts? could it be argued that their supporters would not be specifically paying for the mod content?

[kat]

Money raised through Crowdfunding is a source of investment revenue. That puts it square into the court of being a 'capitol gain', not income, i.e. revenue not generated through the sale of goods or provision of service etc. It brings its own liabilities and obligations to the table that "amateurs" (the individuals 99% of those critical of Paid Mods were saying should be working and providing their content for free) generally don't understand or know about; and frankly wouldn't unless they were already working for themselves (Self-Employed/Small Business Owner etc.) or had to file their own tax returns.

Crowdfunding is certainly an avenue to raise funds, but anyone doing that really aught to investigate the implications such capitol has on their income and tax burdens, especially when not associated with a Corporate Entity (personal liability is much greater than it is for Corporations). In other words, because it's investment revenue and not sales based income, being in receipt of such money may needlessly complicate the individuals tax obligations, and even increase their liabilities due to the very nature of such funds.

Modders shouldn't jump at the chance to receive what might appear to be easy money without first consulting an appropriately qualified professional or adviser. This can't be stressed enough.

[kat]

A long read on why donations are not a viable alternative, aka they don't work when it comes to paid content.

[ratty redemption]

kat, have you updated your article? it looks the same to me.

[kat]

Linking to the new one (posted last night) from here because the topic is relevant.