This question gets to the core of Epic’s strategy for competing with dominant storefronts. We believe exclusives are the only strategy that will change the 70/30 status quo at a large enough scale to permanently affect the whole game industry.
For example, after years of great work by independent stores (excluding big publishers like EA-Activision-Ubi), none seem to have reached 5% of Steam’s scale. Nearly all have more features than Epic; and the ability to discount games is limited by various external pressures.
This leads to the strategy of exclusives which, though unpopular with dedicated Steam gamers, do work, as established by the major publisher storefronts and by the key Epic Games store releases compared to their former Steam revenue projections and their actual console sales.
In judging whether a disruptive move like this is reasonable in gaming, I suggest considering two questions: Is the solution proportionate to the problem it addresses, and are gamers likely benefit from the end goal if it’s ultimately achieved?
The 30% store tax usually exceeds the entire profits of the developer who built the game that’s sold. This is a disastrous situation for developers and publishers alike, so I believe the strategy of exclusives is proportionate to the problem.
If the Epic strategy either succeeds in building a second major storefront for PC games with an 88/12 revenue split, or even just leads other stores to significantly improve their terms, the result will be a major wave of reinvestment in game development and a lowering of costs.
Will the resulting 18% increase in developer and publisher revenue benefit gamers? Such gains are generally split among (1) reinvestment, (2) profit, and (3) price reduction. The more games are competing with each other, the more likely the proceeds are to go to (1) and (3).
So I believe this approach passes the test of ultimately benefitting gamers after game storefronts have rebalanced and developers have reinvested more of their fruits of their labor into creation rather than taxation.
Of course, there are LOTS of challenges along the way, and Epic is fully committed to solving all problems that arise for gamers are for our partners as the Epic Games store grows.
Creston wrote on Jun 26, 2019, 14:15:Beamer wrote on Jun 26, 2019, 14:12:
But look at the auto industry. We're constantly getting better products for the same prices.
No, we are not. Where the fuck are you getting this idea from??
The average sale price of a new car is now over $37000
That's nearly double from where it was 20 years ago.
You used to be able to buy a truck for under 20 grand. Now, unless you don't mind sitting on a church pew and having literally NOTHING on it, you can't get one for under 30.
Cutter wrote on Jun 26, 2019, 16:40:jdreyer wrote on Jun 26, 2019, 14:53:Cutter wrote on Jun 26, 2019, 13:33:Fion wrote on Jun 26, 2019, 12:43:
Want to break the 30% standard?
Better start competing with Sony, Microsoft and Nintendo on their platforms too, because they all use that standard!
The moment games start selling for $45 on EGS, while they are $60 everywhere else - because EGS takes a smaller piece of the pie - is the moment I'll believe any of this bullshit and install the software.
But we all know that's never going to happen.
Thank you. Was just going to say the same thing myself. Oh so this is all for our benefit is it? Yeah. Sure.
Except that Steam won't let you sell for a different price on a different store. Exclusives are the only way that happens.
What do you mean? There are always sales on other storefronts - Fanatical, GMG, etc. - where games that activate on Steam are cheaper than they are on Steam. I don't know of any game that's exclusive to Steam alone, let alone can't set it's own price.
jdreyer wrote on Jun 26, 2019, 14:53:Cutter wrote on Jun 26, 2019, 13:33:Fion wrote on Jun 26, 2019, 12:43:
Want to break the 30% standard?
Better start competing with Sony, Microsoft and Nintendo on their platforms too, because they all use that standard!
The moment games start selling for $45 on EGS, while they are $60 everywhere else - because EGS takes a smaller piece of the pie - is the moment I'll believe any of this bullshit and install the software.
But we all know that's never going to happen.
Thank you. Was just going to say the same thing myself. Oh so this is all for our benefit is it? Yeah. Sure.
Except that Steam won't let you sell for a different price on a different store. Exclusives are the only way that happens.
Dravnt wrote on Jun 26, 2019, 14:13:
Beamer,
I think you do have a good point but the problem is the powerful greed driving decisions by individual companies.
For example, windfall and increased resources have not changed the buggy mess the SaaS games produced for the last 2+ years from EA. Individual users are now the test monkeys for games, which is why so many of them are either buggy messes on release or games stay in "alpha/greenlight" mode for years.
I think the best example of how to do it right is CD Projekt Red (Witcher series, Cyberpunk 2077) and Rockstar (GTA series, Red Dead Redemption, etc.). I really don't like how Rockstar games are SaaS and how they have a secondary login for cloud saves/purchases but DLC is free and there's no question about quality. And CD Projekt Red is doing amazing work with not only their games but also their supported store front GoG.
Another company doing it right is HumbleBundle, who let's you choose how much percentage goes to the publisher, storefront and developers.
Upshot is we, the gamers, get what we pay for and if we pay a company that encourages pure exclusives while blowing smoke up our asses claiming "it's all for the gamers!", then we only have ourselves to blame for the current state of the industry.
And 30% is very much industry standard among all players (Microsoft Xbox, Android apps, iOS apps, PlayStation, Steam, etc.). It was actually Microsoft that originally set that percentage more than a decade ago and every company followed suit. While it would be nice to dream of a lower percentage charged and with more cash going to developers, it is most likely going to take more than Epic/Sweeney's tiff with Steam/Gabe to change the industry standard.
To be clear, I'm with you, I want change, I want developers to have more cash in their pockets to create games but I also want games to drop back down to $45 for a triple A game, for games to not be exclusive on storefronts, and for DLC to be proper paid expansions. I'd also like for companies to allow modding on their games.
All of this is out the window though as long as big gaming corp is driven by greed and as long as gamers are okay with SaaS software/games.
We are in a worse and worse state of affairs as time goes on because we allow it.
Avus wrote on Jun 26, 2019, 15:06:
I DON'T CARE how much game developer % cut when I buy game. It is fxxking stupid for consumer to care about this. I as a gamer (consumer) only care if I can buy this game with a great price, software quality, post support, digital store features...
If a game developer cannot survive with 30% digital store cut, too bad, it is on the dev management. There are many dev don't make profit with 30% cut but there are also MANY can. Try go back to good old retail route and see how far can you go...
When you buy your Big Mac, Ford Mustang, Samsung TV do you fxxking care how much profit the food suppliers, automaker or Samsung actually made?? I would care about PRICE, store/sales quality and support instead. When fanboys come to game, they just throw their logic out the windows. This is why all these AAA dev made so much $$ off them by DLC, lootbox. Their favorite dev never wrong...
You can hate Valve for many things, but complain them taking 30% from dev is the most stupid.
Creston wrote on Jun 26, 2019, 13:50:EA and ActiBlizz games are mostly sold through their own websites where they keep 100% of revenue (minus the seven non-EA games sold by EA last year, and old Activision games sold on Steam), so the revenue split discussion doesn't affect them very much. Thanks for playing though.
If the Epic strategy either succeeds in building a second major storefront for PC games with an 88/12 revenue split, or even just leads other stores to significantly improve their terms, the result will bea major wave of reinvestment in game development and a lowering of costs.significantly higher bonuses for Bobby Kotick, Andrew Wilson et al.
RedEye9 wrote on Jun 26, 2019, 15:11:
Competition is good for the industry including consumers like us.
grudgebearer wrote on Jun 26, 2019, 15:45:
What demonstrable benefits are consumers receiving from EGS exclusivity?
RedEye9 wrote on Jun 26, 2019, 15:11:
Competition is good for the industry including consumers like us.
Parallax Abstraction wrote on Jun 26, 2019, 14:59:
What about the exclusives then? Because that hasn't been happening with them either. Epic is asking us to use a feature barren, insecure store and literally offering no incentive to do so beyond "The devs get more money" (which shouldn't be the consumer's concern) or "It'll lead to lower prices maybe" (which it hasn't.)
You compete by doing things better than the other guy, not by spending the money you could be using to do that, to bribe other companies in an attempt to strongarm your way into a market you aren't prepared for.
Except that Steam won't let you sell for a different price on a different store. Exclusives are the only way that happens.
jdreyer wrote on Jun 26, 2019, 14:42:
You can't sell for $45 on EGS and $60 elsewhere.
Cutter wrote on Jun 26, 2019, 13:33:Except that Steam won't let you sell for a different price on a different store. Exclusives are the only way that happens.Fion wrote on Jun 26, 2019, 12:43:
Want to break the 30% standard?
Better start competing with Sony, Microsoft and Nintendo on their platforms too, because they all use that standard!
The moment games start selling for $45 on EGS, while they are $60 everywhere else - because EGS takes a smaller piece of the pie - is the moment I'll believe any of this bullshit and install the software.
But we all know that's never going to happen.
Thank you. Was just going to say the same thing myself. Oh so this is all for our benefit is it? Yeah. Sure.
El Pit wrote on Jun 26, 2019, 13:21:Beamer wrote on Jun 26, 2019, 13:18:Bumpy wrote on Jun 26, 2019, 13:01:Fion wrote on Jun 26, 2019, 12:43:
The moment games start selling for $45 on EGS, while they are $60 everywhere else - because EGS takes a smaller piece of the pie - is the moment I'll believe any of this bullshit and install the software.
QFT.
What if, instead of lowering the price, they increase the budget for the game, resulting in a game that has some combination of more content, fewer bugs, better graphics, etc.? Or they make no changes but they reduce the break-even volume, and therefore the game is more likely to be considered a success and be supported longer, get more DLC, and be more likely to get a sequel?
Would that make you happy? I doubt it, because those are invisible benefit that most people would still be very angry about.
It only this would be true... Our economy works like this: any money you don't invest or can even rip out of a product is given to the shareholder and does not go back into the production or the wallets of the employees. It is like Apple does it: cut the productions costs where possible but keep the price up and give all the bonus to the shareholders. And be loved by them.
Verno wrote on Jun 26, 2019, 12:52:
18% isn't going to be sufficient and Sweeney already said as much previously. There is a reason he won't commit to this revenue split going forward, they are just trying to gain marketshare and it was always intended to be temporary. How fucking generous of him to speak for all gamers out there and claim that this is some big benefit. From where I sit this is no benefit at all, objectively it is a worse situation than having a product be sold on multiple storefronts.
Also as a gamer I don't really care about revenue splits, that shit does not matter to me. I don't care if the developer or publisher makes more money, they sell me a product, not shares in the fucking company. This is just silly PR.
Fion wrote on Jun 26, 2019, 12:43:
Want to break the 30% standard?
Better start competing with Sony, Microsoft and Nintendo on their platforms too, because they all use that standard!
The moment games start selling for $45 on EGS, while they are $60 everywhere else - because EGS takes a smaller piece of the pie - is the moment I'll believe any of this bullshit and install the software.
But we all know that's never going to happen.
RedEye9 wrote on Jun 26, 2019, 12:21:Good to know you're not a storist.
I don't mind the color of the store where I buy my games.