Valve's Gabe Newell

Eurogamer: Is there anything you can say about Episode Three yet other than that it's in development and will close out the trilogy?

Gabe Newell: No - we just need to get Orange Box out the door before we start talking about Episode Three.

Eurogamer: Completing the Half-Life games' story is obviously one of the episodic games' key drivers - what have you learnt about storytelling from the games so far?

Gabe Newell: I think we've learned a lot about subtle cuing, about character development. There is this fundamental challenge with storytelling in this environment, which is the lead character doesn't talk and doesn't have a script, so how do you learn about yourself without breaking immersiveness? How can you be Gordon Freeman while we're actually trying to get you to travel? And we do that through the characters around, by their reactions, by their emotional annotation of the world - 'this makes me feel this way, hint hint, nudge nudge, which is probably how you should be feeling as well'. So there's a lot about the mechanics of the storytelling, and how to move forward without breaking the player's sense of their being a participant in it.

Eurogamer: How did you feel about the way you handled the ending to Half-Life 2? A lot of people felt you could have gone further towards elucidating things.

Gabe Newell: There's always a tension between finishing off some story elements - one of the challenges of serial drama, whether you're a TV show or a videogame series, is how you keep things moving forward and give people a sense of closure while giving them something to look forward to the next time. We read all those threads, and we certainly pay attention to what people say. Hopefully we're getting better. For example, I think the end of the Portal episode in The Orange Box is one of the strongest endings we've ever done, and I think that's a reflection of the feedback we've received to the endings for our games up until now.

Newell says the ending to Portal is one of their best ever.

Eurogamer: Obviously people are expecting Portal to tie into Half-Life 2 in an interesting way, so the ending presumably has a resonance within the Half-Life world.

Gabe Newell: It does, and there are a lot of things in the environment if you decide to go looking for them. There's a story there - there's an even deeper story that's sort of embedded into the environment if you want to go looking for it and you're interested in that part of our games. I think that you'll learn more about the character you're playing and the events of Aperture Science as they relate to what happened at Black Mesa and subsequent games.

Eurogamer: Changing tack to Team Fortress 2, are you happy with how that's going?

Gabe Newell: We're really happy. People are playing it here, the response here's been great. I don't suppose you've seen the Meet the Soldier movie?

Eurogamer: I did! I downloaded it this morning.

Gabe Newell: So, to really feel like we're getting a handle on who these characters are, and how they relate to the classes, we feel really good about the art choice we made - having that derived from a sense of what the gameplay was supposed to be, and be in the service of the gameplay. We're really happy with how the game turned out, even though we first showed it in 1999! Now the ball's in Duke Nukem Forever's camp to be the longest-delayed videogame in actual development.

Eurogamer: Steam seems to be going well. You've got id Software up there, BioShock's just going on there, and the Community stuff's gone live. What's next for Steam?

Gabe Newell: I think that we've spent a lot of time trying to figure out how to do a good job for developers and publishers, as tools for other developers. Now I think we need to turn our focus to providing more value to consumers. Community stuff is a part of that, really driven out of a sense of how to support the social aspect of gaming in a PC environment. I think there are lots of other opportunities for us to provide value directly to gamers to make it more useful to have Steam sitting there, so that it's not just something haranguing you with a series of ads begging you to spend more money, but it's something that actually has a lot of utility for a gamer.

I touched Sasha.

Eurogamer: Speaking of technologies with a lot of utility for gamers, or not, what's your view of DirectX 10 been so far?

Gabe Newell: The thing that we struggle with - so, we use Steam to look at what our customers are actually buying and what they have installed, and right now there's far more DX10 hardware on XP than there is on Vista. About 2 percent of our customers have Windows Vista and DX10 hardware, so for us the investment strategy is to access DX10 hardware functionality - like the tessellater - using the DX9 API, and we can get what we need, we can get access to that hardware functionality, maybe in a non-optimal way, by going through DX9. Until we start to see a much higher percentage of our customers flipping over to Vista, that's the strategy we're going to use.

Eurogamer: Are there any other interesting trends you're seeing from Steam feedback?

Gabe Newell: One of the things I want to do - to follow up from some conversations I've had here at Leipzig - is I want to get a clearer idea of what percentage of customers are actually playing against bots versus playing against real people, and maybe make some changes in our bots to see if that's a choice or a function of the limitation of quality of the bots. My sense is that most people play against other people and it's not a function of the bots, it's a question of wanting to actually play socially. So we'll be able to find that out.

Then there's just nuts and bolts stuff, like where people are getting stuck in our games - that's always really interesting - the automatic weapon-balancing in Counter-Strike - it's interesting to watch how the prices vary - so we learn a lot all the time. Anybody in the company can sit there, and we have a variety of tools for looking at that data in real time, so everybody in the company's sitting there eating their sandwich trying to slice the data in interesting ways.

Eurogamer: Last week Microsoft cut the price of 360 in the UK and Sony didn't make any changes to the pricing structure for PS3 in Europe - what do you make of the current generation of consoles so far?

Gabe Newell: The one that personally I find the most fun - this is an odd thing to say, because we don't have any development for it - is the Wii. That's the one I have at home. I think that their decision to invest in new input is right and sort of a jab with a stick to the rest of the industry about what makes games fun and what we should be thinking about. So I think it's been super-impressive what they've done. In eight months they've just passed up 360 [with sales], so it seems like they're selling them as fast as they can make them, and I think it's going to continue to be very successful for the foreseeable future.

Eurogamer: Obviously it's a very different sort of control system, but does it give you ideas for things you could be doing with PC products?

Gabe Newell: Yeah, it's actually - there are sort of like false things to be worried about as a PC developer, and I sort of want to point out: where did all the graphics come from for the current generation? They're all PC-derived graphics, and I think that's a testament to the volumes of scale and the amount of capital investment going on in the PC space. That's why I'm not very worried. The thing that does worry me is input, because there is no Nintendo equivalent in the way there's an NVIDIA or ATI on graphics technology, living in the dog eat dog world of the PC space to drive all this technological innovation. There's no equivalent on the input side. So maybe Microsoft can step up there, or Logitech - that's where I feel, as a PC game developer, more exposed, in the fact that nobody can do anything other than mouse and keyboard and expect to be successful. I was just over there seeing the [Wii Fitness] board on Nintendo's booth, and I've got input envy! There are all these cool things, but it's been years since someone's come to us and said 'let's talk about building a controller that would be better than just a mouse and keyboard for what you're doing'. Nobody's even trying any more. I think that's a big exposure for us PC-focused game developers.

Not long now 'til we find out what this is about.

Eurogamer: And you'd like to see it, obviously.

Gabe Newell: Oh absolutely. I'd love to see somebody do some leadership there.

Eurogamer: To change tack completely, how do you think Orange Box will do given it's coming out just a few weeks after Halo 3?

Gabe Newell: I think that it's going to do very well. I've got a lot of confidence to say it's the best FPS on the platform that it's on. If they had to pick an FPS of the year for 360, I think Orange Box will do very well.

Eurogamer: On that sort of note, Midway recently said that Stranglehold cost USD 30 million to make. How much investment's gone into The Orange Box?

Gabe Newell: I don't know. We don't track that. One of the nice things about being an independent developer is we just keep everybody busy. We're making lots of money, and we just focus on what we're trying to build and then build it.

Eurogamer: So there's no mentality of having so many copies to sell? Even at a higher level?

Gabe Newell: No. We're trying to make the decisions that a gamer would if they were given the opportunity to run a games company. I think that the harder questions for us are making the bigger games versus the time it takes - that's a much harder choice for us than 'oh, we have to stop spending money on this title'. We've never really even had a conversation internally where we say 'we've put enough money into this - let's just cut it off'. That's not even a conversation that happens at Valve.

It's like that horror film 'The Hills have Striders on them'.

Eurogamer: Last time we spoke you said you were scratching your head about - your phrase was - "a more comprehensive entertainment experience" that would bring together disparate elements like trading cards, DVDs, games, etc. rather than separating them, sort of the opposite of the way Pokemon currently works. I was curious as to whether you'd had more thoughts on that.

Gabe Newell: Well right now we're doing these free movies for TF. They're short movies, and it's really interesting to see how people are reacting. Right now people seem to love them. Is that the novelty of them, or is there really something there where millions of people are going to want to watch these things? So we're using these TF character shorts as an opportunity to explore that in more detail. Right now, people seem to like them a lot. We haven't made them pay for them yet, so maybe that'll change, but that's the test that we're using right now.

Eurogamer: Are all nine TF2 shorts coming out before release?

Gabe Newell: I'm not sure we'll get them all out before release, though we're hoping to - I mean, it's a lot of work, so. We think people will enjoy them whether it's before or after the release. It's more a question of - you know, just as we're editing them, are we happy enough with them to get them released.

Eurogamer: You did mention the possibility of charging for them or putting ads in them - do you see that happening? Is that going to happen in the current run?

Gabe Newell: No - the first nine will all be free. How you find out whether people really like something or not? People will tell you they like something when it's free and then as soon as you say 'okay give us a dollar' they're like 'I didn't really like it that much! Go make more games! Stop f***ing around with these movie things!'