Gabe Newell, head of Valve (Steam), explains in a documentary about the shooter Half-Life 2 that they were close to bankruptcy a few years ago. This was mainly due to legal disputes with the large publisher Vivendi Games.
What a move that was! Specifically, it concerns a court case where Valve and the publisher Vivendi disputed the online distribution rights and especially the rights to Counterstrike. For example, Vivendi was allowed to offer Counterstrike in cyber cafés.
For this, Vivendi hired a law firm according to the interview that wanted to change Valve’s perspective: “Valve had some success in this case, and that’s why we need to change their [Valve’s] mindset from ‘we believe we will be successful’ to ‘we will be destroyed’:
They [the plaintiffs] personally included Scott and Julie Lynch as well as Gabe and Lisa Newell, his then-wife, as defendants, so it looked like we were pushing Valve out of business and driving both into bankruptcy. And I believe that was a big part of what they saw as their way to win this fight.
Gabe Newell shares during the “Half-Life 2: 20th Anniversary Documentary” on YouTube that there was a calculation behind it to demonstrate their own power:
The publishers in the industry were used to bullying developers, and this was not just about optimizing financial results, but also a demonstration of power.
The tactic they used was to bleed us of money. They knew how much money we earned because they distributed our games in retail, so they tried to inflate our legal costs to drain resources from the company in this way.
[…]
(from 01:05:00) The company was close to bankruptcy. I was on the verge of going bankrupt personally. We had fully committed.
However, despite the problems, they did not want to disturb the developers who were still diligently working on the game. As stated in the documentary:
So we didn’t need to think about it. They managed pretty well so that the team could focus on what it could do without worrying too much about the future of the company.
Vivendi was dissolved in 2008 and merged with Activision
Does Vivendi still exist today? No, not by name. Because in December 2007, the publisher Activision announced a planned merger with Vivendi Games, from which a new holding company called “Activision Blizzard” was to emerge.
On July 10, 2008, the merger was completed, resulting in the creation of Activision Blizzard, and Vivendi Games was dissolved. By the way, Activision Blizzard now belongs to the Microsoft corporation, which has become known primarily for Windows and its Xbox: Microsoft announces: They want to buy Activision Blizzard
