Valve versus Sierra

Valve vs. Vivendi Universal dogfight heats up in US District Court on GameSpot (thanks Democritus) reveals some details of a behind-the-scenes legal battle between Valve and Sierra (now part of VU Games) over Half-Life and Half-Life 2 that's been brewing for several years now. The article picks through details of a recent court filing by Valve that reveals the current state of the litigation, which has its next court date on October 8, though an actual trial is not scheduled until March 21, 2005. Included are disputes over what role Steam is to take in the game's distribution and who actually holds rights to the Half-Life intellectual property. Here's a segment that summarizes some of this:
In court filings, Sierra/VUG says that the current distribution of Half-Life 2 via Steam exceeds the scope of the current software publishing agreement between the two parties. It is apparently seeking the court's assistance in compelling Valve not to use Steam as an avenue of distribution.

On Friday, when asked if Valve was remained intent on making Half-Life 2 available to gamers via Steam, regardless of what was determined on October 8, Lombardi replied, "Yes."

Interestingly, and in spite of the ongoing legal dispute, Sierra/VUG still wants to work with Valve in the future and is asking the court via filings to force Valve to work with it on whatever is next in the development pipeline. It asks the court, in filings, "for a declaration that Sierra and VUG have the right to a fourth engine license pursuant to the terms of...the 2001 Agreement."

According to Lombardi, "We're going to meet the obligations of our current agreement."
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157 Replies. 8 pages. Viewing page 6.
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57.
 
No subject
Sep 20, 2004, 14:10
57.
No subject Sep 20, 2004, 14:10
Sep 20, 2004, 14:10
 
A game using the source engine doesn't mean it will be released by Steam, that's a Valve thing.

Getting HL2 via Steam may be okay for some, but I want a hard copy that I can re-install at my leisure. Reformat your system and have to wait for it to download all over again, no thanks. Even game installs can get corrupted and need to be uninstalled/reinstalled.

Avatar 6174
56.
 
Re: Question
Sep 20, 2004, 14:09
56.
Re: Question Sep 20, 2004, 14:09
Sep 20, 2004, 14:09
 
What about the rest of those games using the Half Life 2 engine...I was to get my hands on Bloodlines...do you think this will delay those games too????

not if was a straight liscensing agreement for using Source. The engine is simply a tool in that case, the IP doesn't factor into it (if its similar to other engine liscensing deals)

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What Would Fred Do?
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"Both the “left” and the “right” pretend they have the answer, but they are mere flippers on the same thalidomide baby, and the truth is that neither side has a clue."

- Jim Goad
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55.
 
Question
Sep 20, 2004, 14:04
55.
Question Sep 20, 2004, 14:04
Sep 20, 2004, 14:04
 
What about the rest of those games using the Half Life 2 engine...I was to get my hands on Bloodlines...do you think this will delay those games too????

54.
 
Re: Money
Sep 20, 2004, 14:03
54.
Re: Money Sep 20, 2004, 14:03
Sep 20, 2004, 14:03
 
Greed works both ways here. Someone has to pay these people to make these games. Vivendi/Sierra supported this studio making Half-Life and publishing it under agreement that it will share in the success of the game and any future sequels. (Assuming that is what the contract says) If Valve is getting greedy and trying to find a way to get their game out without Vivendi/Sierra getting a share of the profits I'd say shame on Valve.

unless i misunderstand the details I think whats at issue was Sierra/VU distributing the game to cybercafes without the OK from Valve as well as sharing of the royalties.

If I'm wrong someone please explain it so I can better understand it.

----------------------------------------------------------------------
What Would Fred Do?
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"Both the “left” and the “right” pretend they have the answer, but they are mere flippers on the same thalidomide baby, and the truth is that neither side has a clue."

- Jim Goad
Avatar 10137
53.
 
Re: Release the game already
Sep 20, 2004, 14:01
53.
Re: Release the game already Sep 20, 2004, 14:01
Sep 20, 2004, 14:01
 
Vivendi = Member of RIAA

buy it on Steam and support Valve, not the RIAA

52.
 
Re: Money
Sep 20, 2004, 14:00
52.
Re: Money Sep 20, 2004, 14:00
Sep 20, 2004, 14:00
 
Taulin wrote:
Either way, I agree, if Steam is a court issue, and the date is March 2005, then we probably won't see a Steam deployment until then.

Nope. You're wrong there. The STEAM release will be going along as scheduled e.g. when the game goes gold, immediately. This whole issue isn't specifically about the release of Half Life 2 but rather Valve's use of STEAM in general. It covers the entirety of their CS:Condition Zero, CounterStrike and Day of Defeat STEAM releases of which only Valve has made money out of. There is no reason to delay the STEAM release of Half Life 2, of which the preloads have already begun, just for the court date.

Not to mention that this would also open room for a countersuit from ATI to VU for the Radeon 9600/9800 XT HL2 promotion deal that the two companies agreed on. Basically, ATI would stand to lose quite a bit of money from the distribution if it is delayed any longer, and furthermore they would lose their advantage over nVidia in the retail market if STEAM tanks. They'd have to shell out money to send a boxed copy of HL2 to everyone who chose the STEAM deal and they'd have to give everybody else who paid their S&H fees their money back. They can't afford to lose that much.

51.
 
Re: Reminisant of...
Sep 20, 2004, 13:59
51.
Re: Reminisant of... Sep 20, 2004, 13:59
Sep 20, 2004, 13:59
 
After reading the article it seems that some of Sierra's arguements are weak. Isn't there a thing called due dilligence? Was Valve supposed to lay all their cards on the negotiating table?

that struck me as laughable as wel when I read the following

"During the parties' negotiations...Counterclaim Defendants [Valve] repeatedly and falsely assured Sierra and VUG that retail sales would remain "the key to [their] strategy." In September 2000, for example, Newell told Hubert Joly, then VUG's CEO, that "online is a way to nurture the retail business" and that he "could not understand how one can make money online today."

"Sierra and VUG would later learn that these statements were flatly false...Incredibly, Counterclaim Defendant Newell also stated that he "could not understand how one can make money online today," plainly with the intention to falsely imply that Valve had no present or future strategy to engage in widespread online distribution of the games. This misleading half-truth was Newell's deliberate concealment of the extent to which Valve intended through the parties' negotiations to appropriate the substantial value of the distribution rights to Valve, rather than to Sierra and VUG."


so Sierra's argument is hinging on something Newell said several years ago? Even if it was recent comment I doubt any attorney worth the money would have a problem getting it tossed out (that particular aspect of the suit anyway)

----------------------------------------------------------------------
What Would Fred Do?
----------------------------------------------------------------------
"Both the “left” and the “right” pretend they have the answer, but they are mere flippers on the same thalidomide baby, and the truth is that neither side has a clue."

- Jim Goad
Avatar 10137
50.
 
Re: Money
Sep 20, 2004, 13:37
50.
Re: Money Sep 20, 2004, 13:37
Sep 20, 2004, 13:37
 
***Personally, if I was funding a game, I would make damn well sure I got a percentage of ALL sales.***

That's the thing, though. The game wasn't funded by VU/Sierra. It was self-funded by Valve. VU is only the distributor. A lot like Blizzard.

This comment was edited on Sep 20, 13:38.
49.
 
Re: Money
Sep 20, 2004, 13:36
49.
Re: Money Sep 20, 2004, 13:36
Sep 20, 2004, 13:36
 
Greed works both ways here. Someone has to pay these people to make these games. Vivendi/Sierra supported this studio making Half-Life and publishing it under agreement that it will share in the success of the game and any future sequels. (Assuming that is what the contract says) If Valve is getting greedy and trying to find a way to get their game out without Vivendi/Sierra getting a share of the profits I'd say shame on Valve. Whether you like it or not, contracts have to be upheld, if you signed on the dotted line you are responsible for meeting the terms of the agreement. No one forces a development studio to sign contracts, if they don't like them they look elsewhere, if their best offer still doesn't look all that great, oh well. Make a decision, sign or don't, but don't try and weasel out of the deal because you see the oppurtunity to make more money. This looks simply like Valve trying to get more money out of this deal.

Assuming that each of us were to invest in a game if that game was a hit we'd expect to have our investment paid accordingly. If at that point the game company changed the rules and said instead of us paying you $200,000 we are only going to pay you $150,000 because we did all the work, I bet you'd be a little upset too. Gotta stick to your agreements, can't change the rules because you think it's "fair".

[edit]

Hmm Something else I just realized, development of this game could have been delayed in order to make the deployment via steam possible at the same time as distrubution through traditional software stores. This whole thing is just a tremendous mess.
This comment was edited on Sep 20, 13:42.
48.
 
In other words...
Sep 20, 2004, 13:33
Jim
48.
In other words... Sep 20, 2004, 13:33
Sep 20, 2004, 13:33
Jim
 
Half-Life 2 delayed.

Jim
47.
 
Re: Reminisant of...
Sep 20, 2004, 13:31
47.
Re: Reminisant of... Sep 20, 2004, 13:31
Sep 20, 2004, 13:31
 
Joe that's an excellent point about making your own install CD. Are you looking for a means to just install or backup the game? I mean if you could just copy the game directory to another external drive (or burn it to a DVD, since it's GB's in size) would that suffice, assuming it worked when you copied it back? Or do you want an actual install CD program?

Either way, you should post this on the Steam forum. It's a very legitimate concern, considering the size of the game, and it would be interesting to see how Valve responds. I can't see why they can't create a utility program that would package up the original game and the update patches in a single (be it large) install file which you could reuse later. However, backing up to a CD, you'd probably have to use another CD burning utility that would allow you to break it apart between multiple CD's (which some CD burning software already has). I'm assuming it would fit easily on a single DVD though (based upon compression of the files inside the install file).

46.
 
:)
Sep 20, 2004, 13:29
46.
:) Sep 20, 2004, 13:29
Sep 20, 2004, 13:29
 
Half (a)life(time) 2

I don't know if that was original or not, but that's the first time I've seen that and it had me giggling in fits.

m19

Avatar 11406
45.
 
Re: Money
Sep 20, 2004, 13:29
45.
Re: Money Sep 20, 2004, 13:29
Sep 20, 2004, 13:29
 
Wow, it seemed like yesterday when I posted how I was curious about Valve and their deals with distributors and Steam. My guess was that distributors would get a percentage of the Steam sales. I guess not. Personally, if I was funding a game, I would make damn well sure I got a percentage of ALL sales. Same thing goes for any investment. If the distributors are raising sh!t this late, it is their fault. Let's just hope the contracts between them cover the issues. Either way, I agree, if Steam is a court issue, and the date is March 2005, then we probably won't see a Steam deployment until then.

44.
 
Re: Devil In The Details
Sep 20, 2004, 13:28
44.
Re: Devil In The Details Sep 20, 2004, 13:28
Sep 20, 2004, 13:28
 
Where are you guys getting this crap about Steam from? I've been using it for quite a while and have no problem with it at all - would you rather get the game directly from the people who made it, giving them the lion's share of the profit, or buy from some publisher who's in it purely to make money? Same idea as music - I'd much rather that my favorite band got my money directly than their scumbag record label who's going to give them 10 cents or less on the dollar for it.

To answer that huge list of supposed concerns about Steam - you can set it not to auto-patch, you can easily play single player or LAN games without connecting to the internet, it is not spyware, it doesn't upload (they have talked about this for the future, but it would be a configurable option), and as to the people without internet connections - they couldn't even have Steam in the first place - that's what the boxed version is for. The chances of someone without an Internet connection having the type of computer needed to run HL2 I also think is slim to none.

43.
 
Why.
Sep 20, 2004, 13:27
43.
Why. Sep 20, 2004, 13:27
Sep 20, 2004, 13:27
 
The reason VU doesn't want Valve to go ahead with STEAM as a distribution method is because VU has some shady behind the scenes deals with companies like EBGames and Walmart for exclusive shelf space, and likewise VU to those companies for giving them extra copies of VU's bestselling titles to sell. Some dinky little company might have difficulty attaining copies of the game to sell in comparison to the giants. VU will see a lot of money from the sales they make in those stores, and likely a lot less from STEAM distribution.

It seems that Valve is trapped between a rock and a hard place. If they cancel their STEAM distribution method they are going to risk pissing off ATI and customers who have already preordered the game on STEAM. ATI would have to end up shelling out a lot of additional money just to ship the game to people who haven't paid the $10 dollar shipping fee when they chose STEAM streaming in their Radeon 9600/9800 XT card deal. In addition to that, if they shipped it out to free for those customers they'd have to end up giving back everyone who already paid their 10 dollars. The results would be exponentially *bad*.

Edit: to Overron - unlike ID Software and Valve, Blizzard is fully owned by VU. There's no cutting them out. It's the reason why most of the big wigs left Blizzard a while back.
This comment was edited on Sep 20, 13:30.
42.
 
As Mr. T would say...
Sep 20, 2004, 13:23
42.
As Mr. T would say... Sep 20, 2004, 13:23
Sep 20, 2004, 13:23
 
HEY SUCKA!
I PITTY THE FOOL THAT PREFERS THE DOWNLOADED HL2 STEAM OVER THE BOXED VERSION!
YOU`SA GOTSA BE STOOOPID!!!
MR. T LIKES HAVIN THEM LITTLE BOX, BOOK AND CD AROUND!!!
LEARN LITTLE UNS, BOX IS BEST THAN VIRTUAL FILES!!!
HOOOAAAA, ME GOES NOW! I GOT NO TIME FOR JIBBA-JABBA!

41.
 
Re: Money
Sep 20, 2004, 13:22
41.
Re: Money Sep 20, 2004, 13:22
Sep 20, 2004, 13:22
 
Valve should release a demo or something so that people can actually talk about the game itself rather than the delays, conspiracies, steam, etc. I feel like I'm getting sick of HL2 and I haven't even played it yet.

40.
 
Devil In The Details
Sep 20, 2004, 13:19
40.
Devil In The Details Sep 20, 2004, 13:19
Sep 20, 2004, 13:19
 
There is one quote from the GameSpot article that I found quite interesting which relates to a new agreement that was created in 2001 between publisher and developer.

"Among other concessions, Sierra agreed to relinquish intellectual property rights and to allow Valve certain rights to the online distribution of games."

Depending upon what these "certain rights" are then Valve could have an open and shut case. If, and I repeat if, they were given the rights to their own online distribution method then legally (I'm assuming of course cuz I'm no lawyer) they should be able to use Steam as an alternative distribution method (and make money from it). I'm sure Sierra at the time laughed at the thought of an online distribution method, especially for a game that is GB's in size, and didn't consider it much of a threat.

Of course, the devil is in the details, and unless you know those details, then no one really will know the outcome. Hopefully more details will be released in the future about this agreement.

39.
 
Money
Sep 20, 2004, 13:16
39.
Money Sep 20, 2004, 13:16
Sep 20, 2004, 13:16
 
Money is and always will be the motivation. Simply put Vivendi/Sierra do not want to lose money to online distribution of games. With online distribution the middleman ie the publisher is cut out. Right now only a few developers can afford to lose the money they would get from a publisher by allowing them to publish their game. ID and Valve and Blizzard can definately cut the publisher out of the equation completely or partially by doing online distribution. Online distribution is here. The writing is on the wall. All middlemen of the world never want to be cut out of the loop. But in order to make the most money, cutting the middleman is the way to go unless of course you cannot do it yourself as cost effectively as a middleman. Valve has clearly seen that they can earn more money by cutting out their middleman Vivendi/Sierra.

38.
 
Re: Reminisant of...
Sep 20, 2004, 13:14
nin
38.
Re: Reminisant of... Sep 20, 2004, 13:14
Sep 20, 2004, 13:14
nin
 
October is not that far away...

No, but HL2 is!


http://www.johnwaitethehardway.com/index2.htm
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