Is it still financially viable to create games on Steam for a living?

Game dev stats

Have you ever wondered how well most games on Steam do? Most of the time you only hear about the really big successes who manage to earn millions, but what about the average game on Steam? Does it bring in enough money to live off, or is it not worth the time and effort unless you are already a big established studio?

Well, I went ahead and gathered some data over the course of two months (July — August 2021) to help me answer this question.

I hope this will give everyone a better insight in what to expect when they release their own games to Steam.

Reviews

My first step was to divide all games that were released each week by number of reviews. The number of reviews is often used as an indication of how well a game does, and since this data is publicly available we can already learn a lot through this.

In the image below you can see all the games that were released each week from the 29th of June, all the way up until the 23th of August. Categorised by number of reviews all the way from no reviews to over a thousand reviews. Please note that the number of reviews is the amount of reviews they had after being launched a week. Most games still had an increase in the number of reviews later on, but the amount of reviews after a week already gives a good indication of how popular each game is on average.

On it’s own this data might not say much though, so I combined all the numbers into an average and a percentage.

In the combined data below you can see a whopping number of 201 Steam games were released each week on average. That’s one game every 50 minutes! Though 31,6% of these games never got a single review.

There’s a common saying between game developers on Steam that the first 10 reviews are the most difficult to get, and this is clearly reflected in the data. Over 76.5% of all games released didn’t manage to get 10 reviews in the first week of releasing.

But why is this so important? Well first off, Steam doesn’t officially give you a rating until you have reached at least 10 reviews. That’s 10 reviews of people who bought the game on Steam, keys that were received for free not included.

Secondly, it’s heavily rumoured that Steam only really starts promoting your game unless it has overcome this invisible barrier. Though I personally take this with a grain of salt, as explained later on in this article.

Interestingly enough about 3 games or 1.6% of all games released each week reaches massive success. Not a big chance per se, but at this level we are talking multiple millions of dollars in revenue. As a side note though, the top spots are often claimed by triple-A games released by well established studios. But it was actually nice to see that a fair number of indie games also managed to reach these heights.

I didn’t do a comparison of the number of indie games vs triple-A games, mainly because I personally find it very hard to draw a concrete line between the two nowadays.

Revenue

So now we have all this data about reviews, but what does that really tell us?

Using the number of reviews I can now create categories that roughly indicate the average revenue each game would make. Or at least that was the idea behind it.

While actually writing down the numbers, I did notice that revenue could wildly vary even within a similar category. Mainly because I decided to leave out the price range that each game was sold at. So naturally games with a higher price tag made more money, if they had roughly the same amount of units sold.

In the image below you can see how I picked out 10 games at random from each category, and compared the estimated revenue in dollars after being released for one month. In some of the categories I didn’t manage to get 10 games, simply because there weren’t enough games I could compare from exactly a month ago, that weren’t also free or didn’t have some other kind of monetization.

Please note that the amount of revenue isn’t publicly available. The numbers you see are an estimation and can widely vary from the actual amount. Though from the games that I actually know the revenue off, these values did reflect relatively close the estimated amounts.

Just like before I also combined the data to see what the average revenue was per category, as you can see in the image below.

You can clearly see that when the number of reviews increases the average revenue naturally also steadily increases with it. Though what I didn’t expect here is how much the revenue is actually skewed towards the top sellers.

The revenue made almost exponentially scales as the number of reviews increases. Even to the point that 98.4% of all games combined earned 16.3 times less than the top 1.6%!

What I was also expecting was a bigger divide between games with less than 10 reviews and those who did manage to get more than 10 reviews. This makes me believe that the 10 review barrier isn’t as important as most developers think, though more reviews never hurt.

Conclusion

Let me first start by saying that none of the games released on Steam could be considered a failure, even if they didn’t manage to be a financial success. It takes a lot of time and hard work to even finish a game, so anyone who managed to publish a game to Steam should feel proud of their accomplishment.

So that brings us to the final question. Is it still financially viable to create games on Steam for a living?

And the answer to that is, it depends. Most of the games on Steam are released by relatively small and inexperienced teams, who most of the time create games with a tiny budget. So for those any revenue gained is a financial success. The chances however that you will hit the jackpot and go home a millionaire are relatively small.

Even for actual companies it’s still a gamble whether or not they can bring in enough money to make it worth their time.

Though Steam is far from the only place people can earn money from games. And the revenue didn’t take in consideration other sources of income, such as DLC, in-game purchases, merchandise, other marketplaces etc.

On the negative side it also doesn’t take in consideration the 20% VAT, 30% Steam cut, any additional income taxes or even the costs of developing a game.

I still think Steam can be a great source of income, but it’s all about standing out and creating the best possible games. If your only goal of developing a game on Steam is making a profit, you will probably be disappointed in the end and be better off learning a different trade.

When developing a game it’s best to stay realistic, and set achievable goals. Even if your first game might not be the success you had hoped for, as long as you keep trying you have a decent chance of becoming the next top hit.

Special thanks to ICO (https://icopartners.com/) and Game stats (https://games-stats.com/) for allowing me to gather all this data. They are both great sources of information on game data, and without them I wouldn’t have been able to write this article.

If you like this article and would like to see more, consider following me on my twitter account @Vincent_Vangeel where I post updates whenever I’m doing something.

Also be sure to let me know your personal opinions, I would love to hear what you think about all of this!