Epic Games takes on Steam with its own fairer game store

Epic Games, the developer of Fortnite and the widely used game creation software Unreal Engine, is also about to start selling games from other companies. Epic is launching a new online store like Valve’s Steam that will also feature third-party games, marking another significant threat to Steam’s dominance as the primary distributor of PC titles. Epic’s store, which is slated to launch soon, will start with a number of PC and Mac games, and it will open to more developers next year.

While we don’t know which games will make the initial cut – “Stay tuned for game announcements Thursday at the Game Awards,” company hints – Epic CEO Tim Sweeney said The edge that it aims to eventually include “quality games of all sizes and genres” and is open to extending the store to Android and even iOS, if Apple allows users to install a competing storefront on its iPads and iPhone. (Low chance of that.)

It won’t just be games created using Epic’s Unreal Engine. Epic says its store will be open to games created using the competing Unity engine and other software tools. But Epic continues to plug in its own tools: For games made with Unreal, Epic says it will waive all Unreal royalty fees for sales generated through the store. (Unreal developers have traditionally given Epic a 5% royalty reduction on all sales.) More promising, however, is that Epic says it will only take 12% of all game sales revenue in its store, with the remaining 88% going directly to developers and publishers.

With Steam, Valve has traditionally taken around 30% of all revenue generated from game sales, in-game transactions, and DLC like expansions, leaving only 70% to creators. It’s also the norm in app stores run by Apple and Google, but Epic wants to take a different, more developer-friendly approach. “As a developer ourselves, we’ve always wanted a platform with a great economy that connects us directly with our players,” Sweeney explained in a separate prepared statement. “Thanks to the success of Fortnite, we have it now and are ready to share it with other developers. “

Image: Epic Games

The timing is certainly noticeable. Last Friday, Valve announced a new revenue split for Steam that gives developers more money for each sale after certain thresholds are reached. But Epic’s 88/12 deal could be more lucrative for developers than the 70/30, later 75/25, and finally 80/20 (based on gross revenue) revenue splits that Valve now offers. Valve, seeing increased competition from other game stores, seems to understand the developers won’t stick around unless conditions turn more favorable.

“Steam’s new 25% and 20% tiers are a big improvement for the top percent of games and make Steam a much better offering for top games than Google Play and the iOS App Store,” comments Sweeney. That’s a compliment, but also a burn: Valve’s revised revenue rules won’t help indie developers as much as Epic could.)

In addition to its revenue split, Epic has another unique advantage that it hopes will convince game makers to bring titles to its store. Borrowed from a feature in Fortnite, Epic brings its Support-A-Creator program to its new game store.

In Fortnite, Support-A-Creator allows a popular streamer, like Tyler “Ninja” Blevins for example, to earn $ 5 for every 10,000 in-game currency spent by players who choose to pledge their support. In return, Ninja brings publicity to Fortnite by continuing to stream it daily, while the developer earns income from in-game transactions. But it’s for free games like Fortnite. Sweeney says the Epic Store will now also allow creators to get a portion of the total selling price of each paid game, though the amount is up to the developers. To prevent developers from simply setting it to $ 0, Epic is committing to cover the top 5 percent of creator revenue sharing over the next 24 months – which could be a big incentive for big internet celebrities. to plug in the Epic store.

Here are Sweeney’s answers to some of your hottest questions:

  • No, there is no store-wide DRM, although game developers can add their own.
  • No, Epic doesn’t plan to add any social components like game streaming or forums.
  • Yes, Epic will help developers take advantage of their games’ online features (likely things like chatting, pairing, and cloud saves, although they weren’t mentioned by name).
  • Yes, the Epic Store will offer refunds, initially via customer support, although a 14-day, automated, no-questions-asked return policy is expected to follow soon.
  • Yes, it will be available outside of the United States, in “most countries of the world except China and where prohibited by US law, such as North Korea and Iran.”

Whatever the market structure of Epic, a new competitor of Steam, that of the creator of Unreal and Fortnite anything less, is a direct threat to Valve’s main money maker. Valve has developed some of the most popular PC games of all time, including the Counter strike, Half life, and Team fortress franchises, as well as the very popular esports title Dota 2.

Still, Steam is estimated to have generated over $ 4.3 billion in 2017 from game sales, earning Valve recurring and substantial annual revenue as its game development ambitions have dwindled over the years. . (The company is still developing games and just released a new digital card game based on Dota 2 called Artifact, but its biggest and most famous franchises have largely been dormant for years.)

With Epic entering the scene, Valve will have yet another contender to contend with. The PC gaming-centric chat app Discord recently launched its own online game store to compete with Steam. With its network of over 150 million users, Discord already has a significant portion of the social infrastructure for PC gaming, including friend lists, text chat, and voice chat. Soon, Discord could start owning game purchases by providing its users with a one-stop destination to buy games, launch them, hang out, and chat with friends.

Additionally, a number of other smaller stores like indie-focused Itch.io have also become popular alternatives in recent years as developers have deteriorated on Valve’s revenue split. What also makes these alternatives more appealing to developers is Valve’s lax approach to content moderation. Steam has endured a number of high-profile controversies around its increasingly passive approach to the games that can be sold on the platform, which has sent some players and developers elsewhere.

This new move from Epic is certainly in line with the stance it has taken on platform owners since the launch of Fortnite, and it all matches Sweeney’s outspoken disgust for middlemen. The founder of Epic has long voiced his criticism of app store owners, especially Apple, who take a large chunk of the revenue while doing, in Sweeney’s opinion, very little work for it. . “These app stores take 30 percent of your revenue for distribution,” Sweeney told a crowd at the Devcom conference in Germany last year. “It’s strange because Mastercard, Visa and other companies that handle the transactions take two or three percent of the revenue.”

Long before Fortnite Launched, Epic decided to develop its own launcher so it could sell and distribute its own PC games, much like Blizzard, EA, and Ubisoft handle PC games. And when deciding how to launch Fortnite on mobile, Epic was unable to bypass the iOS App Store due to the iPhone manufacturer’s strict restrictions on third-party software. Yet, thanks to the absence of such restrictions on Android, Epic took Google out of the equation by allowing gamers to download and install the mobile version of Fortnite directly on the Internet.

Now, with a handful of changes, Epic is turning that same launcher into a store. (You can go for the Epic Games Launcher beta and see the showcase right now.) It’ll be interesting to see if the biggest game publishers hook up with Epic – or if they decide to turn their game launchers into showcases also.