Valve outlined their new policy in a post on the Steam Blog:
We’re also introducing a new dispute resolution process that will benefit you and Valve. Recently, a number of companies have created similar provisions which have generated lots of discussion from customers and communities, and we’ve been following these discussions closely. On Steam, whenever a customer is unhappy with any transaction, our first goal is to resolve things as quickly as possible through the normal customer support process. However in those instances in which we can’t resolve a dispute, we’ve outlined a new required process whereby we agree to use arbitration or small claims court to resolve the dispute. In the arbitration process, Valve will reimburse your costs of the arbitration for claims under a certain amount. Reimbursement by Valve is provided regardless of the arbitrator’s decision, provided that the arbitrator does not determine the claim to be frivolous or the costs unreasonable.
Most significant to the new dispute resolution terms is that customers may now only bring individual claims, not class action claims. We considered this change very carefully. It’s clear to us that in some situations, class actions have real benefits to customers. In far too many cases however, class actions don’t provide any real benefit to users and instead impose unnecessary expense and delay, and are often designed to benefit the class action lawyers who craft and litigate these claims. Class actions like these do not benefit us or our communities. We think this new dispute resolution process is faster and better for you and Valve while avoiding unnecessary costs, and that it will therefore benefit the community as a whole.
This new policy does not, however, limit one’s ability to interact with government agencies, as the Steam Subscriber Agreement states.
This Section does not prevent you from bringing your dispute to the attention of any federal, state, or local government agencies that can, if the law allows, seek relief from us for you.
Additionally, full reimbursement of arbitration costs is not available for those who seek rewards of $10,000 or more.
If you seek $10,000 or less, Valve agrees to reimburse your filing fee and your share of the arbitration costs, including your share of arbitrator compensation, at the conclusion of the proceeding, unless the arbitrator determines your claims are frivolous or costs are unreasonable as determined by the arbitrator. Valve agrees not to seek its attorneys’ fees or costs in arbitration unless the arbitrator determines your claims are frivolous or costs are unreasonable as determined by the arbitrator. If you seek more than $10,000, the arbitration costs, including arbitrator compensation, will be split between you and Valve according to the AAA Commercial Arbitration Rules and the AAA’s Supplementary Procedures for Consumer Related Disputes, if applicable.
Individuals will be prompted to accept the agreement when they log into Steam for the first time after the update.
Analysis: Under the Federal Arbitration Act, Valve does have the ability to preclude class action lawsuits. Here’s Section 2 of this very interesting law:
A written provision in any maritime transaction or a contract evidencing a transaction involving commerce to settle by arbitration a controversy thereafter arising out of such contract or transaction, or the refusal to perform the whole or any part thereof, or an agreement in writing to submit to arbitration an existing controversy arising out of such a contract, transaction, or refusal, shall be valid, irrevocable, and enforceable, save upon such grounds as exist at law or in equity for the revocation of any contract.
The down and dirty of the matter is that, if you want to keep using Steam, you’re going to have to give away the right to put them to a class action lawsuit. While that will naturally make someone hesitant, the upside is that the new policy isn’t as prohibitive and draconian as a lot of people are making it out to be because you can still get fees-paid independent arbitration on the matter. Such legal pursuits can probably net you more money than a class-action lawsuit ever would. So you can still sue Valve, and it’s cheaper than before to do so.
The downside is that class-action lawsuits are easy to participate in and doesn’t consume much of your time, so very busy people who simply don’t have the time to take someone to court should naturally feel a bit worried about this new subscriber agreement.
Ultimately, there isn’t going to be any revolution here since gamers will almost certainly take this move lying down. I mean, be honest, when was the last time you even read a subscriber agreement? So, this is the new face of Steam, and you now have a choice: keep using Steam and be okay with a digital distribution service outlining the parameters under which you can sue them, or stop using the service and make a ceremonial drop in the bucket that will ultimately do nothing to change things.
I suppose the good news, then, is that this isn’t the horrible, terrible, rights-eating move that many people are claiming it is. Still, it’s always a bit worrying every time a company shrinks the tightrope that lies between you and them, especially when the option of disusing the company’s service implies a loss of potentially hundreds of dollars of lost content, and users have every right to feel uneasy about this move.