“The Untold Story Behind a Meteoric Rise: The Early Days of Valve from a Woman Inside”, 2024-08-20 ():
[creation of Steam] Almost 30 years ago, a small company was founded near Seattle WA. Gabe Newell and my now ex Mike Harrington were the official co-founders.
I was on a two-month leave from my job at Microsoft, where I was a group marketing manager in the Consumer Division, overseeing a product portfolio that included Microsoft Games.
…One of the key issues we worried about [for Half-Life 1] was software piracy. One of my nephews had recently bought a CD duplicator [for CD-R] with a monetary gift I’d sent him, and I was horrified to realize that he was copying games and giving them to his friends. To him, it wasn’t stealing; it was sharing.
…At the same time, I was also panicked because I’d read, for the first time, the contractual agreement between Sierra and Valve.
…all I could see was Valve swimming in red ink for years to come. We needed a different path forward. Fortunately, one of the consequences of Valve’s work on an authentication system was that our customers were registering with Valve directly. Early on, we started to understand the benefit of what we’d inadvertently done. Instead of a situation where we had no idea who our customers were, we actually knew exactly who our customers were. It was unprecedented. Every Half-Life registration meant a customer contact directly in Valve’s database.
Added to this, the previous year, Gabe had had the brilliant idea of recruiting a development team that had written one of the leading mods for id’s Doom [actually, QuakeWorld?] and now they were part of Valve’s team. John Cook and Robin Walker were delightful Aussie additions to Valve. The game mod they’d written to run on top of id’s Doom was quickly adapted to run on top of Half-Life. Essentially the game mod enabled a player to play a completely different game on top of the technology of Half-Life. In the case of Team Fortress, it was a multiplayer game where you could team up with your friends over the Internet in a team-based game where each of you played a unique and fun character.
While the Half-Life buzz was continuing to build through word-of-mouth and the new marketing push, the additional buzz and enthusiasm that came as a result of Team Fortress was layered on top of everything else. Soon there were hundreds of thousands of people playing Team Fortress on top of Half-Life and Valve knew who each and every one of them were. We had a direct pipeline, bypassing Sierra, to our own customers.
In late Spring, Team Fortress, the Cook/Walker mod for the Half-Life engine was presented at E3, where it won Best Action Game and Best Online Game on behalf of Valve.
Through all of this, I continued to noodle about the best ways I could position Valve for long-term success. With the bad publishing deal in hand, I knew I had to work on multiple fronts.
If Mike and I were to leave, we needed to demonstrate value for Valve that wasn’t tied directly to the Half-Life IP. We needed to renegotiate our deal with Sierra. And we needed to figure out a way to cap our royalties to id, so that Valve wouldn’t be paying them a fee each time someone bought one of our future games.