A representative from Valve has announced that the company will remove Steam Workshop's controversial paid mods functionality. In a post today, Valve employee Alden Kroll confirmed that the functionality will be removed, and all customers who have paid for mods will be refunded. The move has been made with Bethesda's blessing, Kroll added.

"We've done this because it's clear we didn't understand exactly what we were doing," Kroll wrote. "We've been shipping many features over the years aimed at allowing community creators to receive a share of the rewards, and in the past, they've been received well. It's obvious now that this case is different.

"To help you understand why we thought this was a good idea, our main goals were to allow mod makers the opportunity to work on their mods full time if they wanted to, and to encourage developers to provide better support to their mod communities. We thought this would result in better mods for everyone, both free and paid. We wanted more great mods becoming great products, like Dota, Counter-strike, DayZ, and Killing Floor, and we wanted that to happen organically for any mod maker who wanted to take a shot at it."

Kroll said that while the feature has its merits, it was not wise introducing it into a community which had prospered without the model.

"We underestimated the differences between our previously successful revenue sharing models, and the addition of paid mods to Skyrim's workshop. We understand our own game's communities pretty well, but stepping into an established, years old modding community in Skyrim was probably not the right place to start iterating. We think this made us miss the mark pretty badly, even though we believe there's a useful feature somewhere here.

"Now that you've backed a dump truck of feedback onto our inboxes, we'll be chewing through that, but if you have any further thoughts let us know."

It's unusual timing, as Bethesda released its own statement earlier today explaining its position on the controversy. The new functionality has been subject to a weeklong controversy, with several prominent modders and developers addressing the matter. Gabe Newell, Garry Newman of Garry's Mod fame and renown Counter-Strike modder FMPONE have all spoken publicly in favour of the development, but that didn't stop a petition against the functionality accruing more than 130,000 signatures.