Mark Kern, CEO of Red 5, explains that – while he’d “love to find a way” for the project to work, he had to decline the offer.
Steam takes a chunk of the profit from each virtual item sale (since the game is free). This fee is quite large. It works for box games because box games don’t have much development expense after the game is made. An online game, with servers, data centers, bandwidth and customer services, can incur costs of up to 60% on an ongoing basis. After Steam takes their share, there is little left over for ongoing content development or profit.
Steam, as Gabe likes to put it, has to offer a strong value proposition to developers. While it does for box games, it is less clear that it offers an online game much at this point, since it does nothing to share in the costs of operating such a game.
Despite all that, Kern remains optimistic and is still a big fan of the service Valve has created (even if he’s not so fond of its business model), and assures gamers that – if the two companies can work something out, then he “would be happy” to have Firefall available via Steam.