It’s Like David and Goliath But Without David
Epic Games has been making big moves lately. Between Fortnite’s gargantuan success and the launch of the Epic Games store, Tim Sweeney and crew are de-throning a lot of established gaming monarchies. Sweeney recently spoke out about these big moves in an interview with MCVUK Magazine.
I think the game business will change more in the next five years than the past ten. The last remnants of the old retail model of gaming are falling apart, and the biggest successes are fast-moving indies and fast-moving big competitors – exemplified by Fortnite and Apex Legends. All of the old decisions need to be revisited. We built the technology long before we had a business model supporting it. Fortnite accelerated everything by bringing in the large audience of engaged gamers required for a successful storefront launch, and the e-commerce economies of scale for an 88-12 per cent revenue-sharing model. Yes, we’ve worked to ensure it’s genuinely worthwhile for developers to move to the Epic Games store. Fortnite’s success has given Epic significant latitude to help developers. We’re giving game developers and publishers the store business model that we’ve always wanted as developers ourselves. There is no hope of displacing a dominant storefront solely by adding marginally more store features or a marginally better install experience. These battles will be won on the basis of game supply, consumer prices, and developer revenue sharing.
Sweeney can talk all he wants about changing the future and shaking things up. That 88/12 revenue split is more or less the poisoned knife in Steam’s back. If they don’t make massive adjustments to their business model, guys like Sweeney are going to bleed them out fast. No creator on Earth is happy about giving up a third of their income to their distributor. Those numbers only make sense as long as you’ve got zero competition. Anything else is utterly unsustainable.