Does Steam allow hard paywalls for games on Steam?

Solution 1:

Does Steam allow hard paywalls for games on Steam?

If by 'hard paywall' you mean actively gating content behind in-game payments, the simple answer is...well, yes. A lot of games on Steam offer extra content in various ways, either through the Steam store itself, microtransactions, in-game purchases or even just community items.

I know it's common for cosmetic items, but why is it not common to add hard paywalls like are common for mobile games?

It isn't just for cosmetics. Character upgrades, weapons, entire game expansions and new story DLC can be purchased for various games right now, including Valve first-party titles like Team Fortress 2, Dota 2 and CS:GO.

There's even a Steam Store category for games with in-app purchases, a quick browse and you can find all sorts of in-app purchases.

Does Steam's publisher TOS prevent it?

Not in the slightest. In fact, Steam has an entire Microtransaction API so that developers can integrate with the Steam wallet for near-seamless payments:

Overview

Steam provides world class support for in game purchases, whether that is items, in-game currency, or anything else that you can think up, you can use the Steam Microtransaction APIs to provide customers with more choices.

In-Game Purchase Requirements

For any in-game purchases, you'll need to use the microtransaction API so Steam customers can only make purchases from the Steam Wallet.

You can use the Steam Wallet to purchase individual items or to purchase your in-game currency.

Emphasis mine, to show that Valve is quite open about in-game purchases.

Solution 2:

The Steam TOS doesn't prevent this, but it's rather uncommon in PC games.

The main reason why PC and Console games do not have that same microtransaction-driven focus as many mobile games is because PC and Console games have a different audience. Mobile games generally are aimed at having quick sessions of a couple minutes while you have time available: toilet breaks, waiting for your bus, sitting on your bus,... . They have no upfront cost and as such need to recoup their investments through microtransactions. That's why a lot of mobile developers end up making their games start out fastpaced and then slow down rapidly, all the while trying to push the player to spend some amount of money on their virtual currency. They generally only need a very small amount of their playerbase to actually starting investing heavily (the so-called "whales") to get a large return on investment.

PC and console games, on the other hand, are designed to play in sessions of multiple hours: you have a lot of spare time and want to sit, relax and put in some time into your game. there is generally an upfront cost for these games because it has always been that way, where the player just pays around 60 USD to buy the game itself. However, because the player has already paid in advance, there isn't as much monetary incentive to put in those microtransactions, because PC and console gamers aren't as inclined to pay a lot above that initial investment.

However, this is changing lately. A lot of publishers are pushing their developers to create additional revenue streams. Up until recently, this was limited to having more expensive versions of the game people can buy, which can cost 150 USD or more and comes with tons of extras, with the most expensive versions usually containing a display piece like a statue or a coin. Then they added season passes and DLC updates, which sometimes are just cosmetic and sometimes add additional content. However, since about a year ago, a number of games have started to implement the mobile microtransaction-oriented Pay2Win economy that you mention, where the pace of unlocking things is deliberately slowed down and players can literally buy the things they want. Because publishers have added this IN ADDITION TO the at least 60 USD price tag the player has to pay to start playing at all, a lot of players are viewing this as price gouging and deliberately making games less fun so they can earn more money.

this is a currently an issue which is in flux. Some publishers are finding that they're losing preorder sales on upcoming games because their poor monetization strategy in recent games have put off players, and others have had to effectively remove some of their monetization strategy, either because of consumer uproar over pay2win mechanics, or because legal authorities have ordered them to stop because they're violating local laws involving unlicensed gambling. Time will tell what happens next.