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Valve's Gabe Newell Proposes Merit-Based Pricing

In a video conference call presentation to marketing students last week, Gabe Newell proposed some very unique ideas about the future of pricing for content like DLC or even entire games. Valve has had huge success with variable pricing on Steam - offering up some crazy sales in the past - so it's no surprise that their head honcho has been brainstorming new ways to experiment with pricing.

His idea? To provide price perks to customers who are good sports in the community, and punish those who he succinctly describes as “jerks”.

“Those two people are creating different sets of value for everybody else, and they should be charged accordingly,” says Newell. “The person who, when he or she starts playing a bunch of other people join their team... you might even think about giving the product to them for free. The person who is hated and everybody else leaves [when they're online], you might want to make that person watch a bunch of ads to help compensate for the negative externalities they create.”

The idea is to provide a custom pricing model for everyone. The player that everyone loves to team up with gets perks for providing a pleasant experience for others, while a more annoying player could find other ways to take advantage of the incentives. “For example, the jerk guy or girl might put up a server for people to play on, and that's a way for them to create value for the overall community,” Newell explains.

Of course, these are all just ideas now, not anything Valve is putting in to practice yet, but it sounds kind of brilliant. Money talks, and if Valve can figure out a way to channel its power into a better community for gamers, then we'd probably be all the better for it. Then again, not everyone likes so much fluctuation in their pricing, and many may find this idea a little bit too controlling. What do you think? Sound off in the comments below.

[Source]

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Joe Donato Video games became an amazing, artful, interactive story-driven medium for me right around when I played Panzer Dragoon Saga on Sega Saturn. Ever since then, I've wanted to be a part of this industry. Somewhere along the line I, possibly foolishly, decided I'd rather write about them than actually make them. So here I am.
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