Epic challenges Steam with zero percent fee for first $1 million per game

[Alfonso Maruccia]

In context: Epic Games launched its official digital distribution service for PC in 2018 with the ambitious goal of challenging Steam's dominance within a few years. While it hasn't reached that target yet, the Epic Games Store is offering some compelling deals to game developers.

Epic Games recently announced a new revenue policy for its digital game store. Starting in June, the company will implement a developer-friendly change: any new payment processed through the platform will carry a zero percent fee for the first $1 million in annual revenue. The standard 12 percent cut will only apply to earnings beyond that threshold.

Since its debut, the Epic Games Store has sought to challenge Valve's near-monopoly in digital game distribution by offering more attractive revenue splits. Even before launching the store, Epic introduced a "royalty-free" policy for developers using Unreal Engine and the Unreal Development Kit, waiving royalties on the first $50,000 in game sales. In 2020, that threshold was raised to $1 million in lifetime sales.

According to Epic, the new revenue-sharing policy will apply on a per-app basis, meaning developers with multiple games can benefit from the $1 million exemption for each title. The company continues to position itself as a champion of indie developers, in stark contrast to Steam's tiered revenue model. Valve currently takes a 30 percent cut on the first $10 million in revenue, with reductions to 25 percent after that and 20 percent once a game reaches $50 million in sales.

In a 2018 email to Valve, Sweeney sharply criticized the company's policies toward smaller developers. The Epic Games founder accused Valve of favoring major developers with preferential treatment while imposing a uniform 30 percent revenue cut on independent creators. Sweeney went so far as to call Valve executives "assholes" for what he saw as unfair treatment of the "little people" trying to break into the Steam marketplace.

In addition to the upcoming zero percent revenue share policy for the first $1 million in annual earnings, Epic has also introduced a new "webshop" feature. This allows developers to launch their own storefronts hosted on the Epic Games Store, offering players a direct way to make purchases – bypassing traditional mobile app stores.

Epic criticized Apple, Google, and other platform holders for charging what it called "exorbitant" fees on in-app purchases, but noted that recent legal rulings have curbed those practices. Developers can now offer tax-free payments through third-party platforms on Apple devices, and they will soon be able to link users directly to their own webshops – provided the host platform permits it.

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Epic challenges Steam with zero percent fee for first $1 million per game

 

[yRaz]

Maybe epic should spend their money on making their platform better instead of just giving it to devs. Contrary to what some might thing, what makes a games platform attractive has very little to do with the games on the platform.

 

[m4a4]

The EGS doesn't have a solid gimmick (no DRM) like GoG, and isn't anywhere close to being on par with Steam to be bragging about what their platform can do. This doesn't really attract customers or retain them.

Sure, this is good for devs, but if you don't have the customer base, then who cares? Cater to the customers first before trying to throw your weight around like this. Especially when Steam arguably gives a lot of value for what they're asking for, and doesn't sit on their laurels.

 

[Dreadcthulhu]

Maybe epic should spend their money on making their platform better instead of just giving it to devs. Contrary to what some might thing, what makes a games platform attractive has very little to do with the games on the platform.

This here; Epic in general has focused too much on trying to make their store appealing to the game devs, instead of trying to make the store more appealing to the actual customers who pay the actual money. There are more decent games to play than there is time to play them, which really limits how effective having exclusive games are.

 

[GoldenGoat]

Pc gamers love Steam. Epic needs to win PC gamers hearts if they want to compete with Steam. Winning/stealing developers is not going to get them there. The free games got them on the map, but they still need to win hearts with tech on par with Valve’s.

 

[Theinsanegamer]

Maybe epic should spend their money on making their platform better instead of just giving it to devs. Contrary to what some might thing, what makes a games platform attractive has very little to do with the games on the platform.

Did they figure out how to do a user review yet? Last time I checked EGS still didnt have such a basic feature. Oh, and it was chock full of crypto "games" and poorly made gooner games.

 

[Porkous]

They need more massive free to play multiplayer games.

Steam has Dota, Counter strike, team fortress...

Epic needs more. Maybe if they had LOL for themselves, it would get them a slab of the bigger audiences, for example.

People need those games that they would play forever, a multiplayer game has this tendency, due to its challenges and skill evolution.


Also these free to play games make the platform look popular and it increase the hype and respect.

Epic games store seems neat and clean, while steam always has some pop up showing, or some bandwidth being used for stuff in background related to their recommendations.

 

[GodisanAtheist]

Steam is PC Gaming at this point, certainly for the 30+ crowd who have way too much of their game library/friends/peripherals on Steam to really want to go anywhere else.

Its the Nvidia = GPUs or Intel (still) = CPUs effect.

Epic lost this war when they launched on the premise that if you bring the developers, the gamers would follow. We all know this isn't really true, that games (even big ones) that launch on Epic seemingly disappear off the radar until they "Officially Launch" on Steam.

Valve refuses to sit still too, reinvesting their cut of game sales back into the ecosystem and deepening their ties to "PC Gaming" as a whole.

 

[Porkous]

Would have been interesting to see an alternative history scenario. "What if" epic games was first, how would steam win clients later? That type of scenario. What if half life never launched along steam ?

Anyway both platforms lock you into their business. Do you actually own the titles ? If one went bankrupt, who would afford the servers ?

 

[FaTaL]

If the game isn't on a steam, I'm not buying it. I refuse to have 1,315 game launchers installed.
Any dev would just publish to Epic and steam for maximum exposure/revenue...(unless Epic has clause stating your game must be 'epic games store' exclusive...which probably is).

 

[Burty117]

It’s actually painful reading Epic articles, they clearly do not understand their target audience, it’s just painful watching them do everything other than try to make a good platform.

There was a list of things Steam does that EGS doesn’t that I wrote many years ago now, I don’t think a single thing has been added all these years later…

 

[Puiu]

Cancer is still cancer. I won't use it.

 

[Puiu]

They need more massive free to play multiplayer games.

Steam has Dota, Counter strike, team fortress...

Epic needs more. Maybe if they had LOL for themselves, it would get them a slab of the bigger audiences, for example.

People need those games that they would play forever, a multiplayer game has this tendency, due to its challenges and skill evolution.


Also these free to play games make the platform look popular and it increase the hype and respect.

Epic games store seems neat and clean, while steam always has some pop up showing, or some bandwidth being used for stuff in background related to their recommendations.

What Epic needs is to stop anti-consumer practices like the cancer called "exclusivity deals". No amount of free games will make me install that crap and support what they are doing.

FYI the store is not "neat and clean", it's just barren, lacking any and all important features that gamers want.

 

[VaRmeNsI]

The store interface is awful.

 

[dangh]

That is excellent stuff for all the dev studios around. Not having to give away 30% of gains on a new product greatly helps studio to establish its position and invest. Kudos for this initiative.

Steam is nice, but it is a monopolist and any initiative to bring back competitiveness is welcome.

I do not care about people who surrender their freedom of choice and healthy market just because steam is easy. Or people who are concerned there are some games available on Epic but not on steam. Somehow, I don't see many games - which are available on steam - on GoG or Epic. That is as good 'esclusivity deal' as whatever Epic is doing, even worse, because this exclusivity is achieved by enforcing mopolystic power, not by appealing to customers with better prices. Developers are customers of store fronts as well, and if some games are exclusive to Steam, why some games can't be exclusive to epic or gog?

I buy gog first, always. I want to have easy way to install my games without constant DRM.
I buy Epic second. If I like a game I want to support devs as much as possible, and I'm happy if they get more money from me without crazy 30% tax to the store front, and then another one to government...
And then I buy on any other store which have a game I want.

For anyone confused with the number of clients I recommend checking Heroic launcher which nicely combine GoG, Heroic and Amazon, in addition as well offer some Steam integration (as creating links from steam library to games on hose 3 store fronts and more).

 

[Puiu]

That is excellent stuff for all the dev studios around. Not having to give away 30% of gains on a new product greatly helps studio to establish its position and invest. Kudos for this initiative.

Steam is nice, but it is a monopolist and any initiative to bring back competitiveness is welcome.

I do not care about people who surrender their freedom of choice and healthy market just because steam is easy. Or people who are concerned there are some games available on Epic but not on steam. Somehow, I don't see many games - which are available on steam - on GoG or Epic. That is as good 'esclusivity deal' as whatever Epic is doing, even worse, because this exclusivity is achieved by enforcing mopolystic power, not by appealing to customers with better prices. Developers are customers of store fronts as well, and if some games are exclusive to Steam, why some games can't be exclusive to epic or gog?

I buy gog first, always. I want to have easy way to install my games without constant DRM.
I buy Epic second. If I like a game I want to support devs as much as possible, and I'm happy if they get more money from me without crazy 30% tax to the store front, and then another one to government...
And then I buy on any other store which have a game I want.

For anyone confused with the number of clients I recommend checking Heroic launcher which nicely combine GoG, Heroic and Amazon, in addition as well offer some Steam integration (as creating links from steam library to games on hose 3 store fronts and more).

"people who surrender their freedom of choice" - but to you exclusivity deals are better. is that why Epic is second for you? freedom of choice, right?

the freedom to not be able to choose a store and to destroy smaller stores like GOG by removing important revenue from them. Blades of Fire is the latest example and it's another game I won't ever touch.

 

[dangh]

"people who surrender their freedom of choice" - but to you exclusivity deals are better. is that why Epic is second for you? freedom of choice, right?

the freedom to not be able to choose a store and to destroy smaller stores like GOG by removing important revenue from them. Blades of Fire is the latest example and it's another game I won't ever touch.

Where exclusive deal is better? Most games are exclusive to Steam. I would love to buy them on another platform, but they are steam only. And I wrote why Epic is second: to better support developers and their work.

And absolutely, this lack of availability and Steam exclusivity is killing all smaller stores, gog and Epic included. Epic is trying to fight it, but the balance is crazy off. There are thousands of games I can't get outside of Steam, and maybe a dozen I can't get outside of Epic? Even GoG probably have more gog-only titles.

 

[Burty117]

Where exclusive deal is better? Most games are exclusive to Steam. I would love to buy them on another platform, but they are steam only. And I wrote why Epic is second: to better support developers and their work.

And absolutely, this lack of availability and Steam exclusivity is killing all smaller stores, gog and Epic included. Epic is trying to fight it, but the balance is crazy off. There are thousands of games I can't get outside of Steam, and maybe a dozen I can't get outside of Epic? Even GoG probably have more gog-only titles.

Have you got any evidence these are exclusivity deals with Valve? Or is it simply the developers choose not to put them up on any other platforms?

Edit: I do know the answer, Valve doesn't do anything around paying for exclusives, their platform is so far ahead of the competition, developers actively don't bother with other platforms.

That's again, not Valves fault, they aren't the bad guys here, how about Epic tries to compete with Steam? You know, make EGS better for paying customers? Making your store attractive to developers isn't any use if you haven't figured out how to make your store attractive to the actual paying customer.

 

[dangh]

Have you got any evidence these are exclusivity deals with Valve? Or is it simply the developers choose not to put them up on any other platforms?

Sooooo.... It is fine if developer do not publish on other platforms than Steam, but it is not ok when developer do not publish on any other other platform than epic, even, if other platforms are more expensive?

Very interesting.

Btw that is exactly how monopoly works. You go to more expensive shop because it is a monopoly and other shops does not matter.

 

[Burty117]

Sooooo.... It is fine if developer do not publish on other platforms than Steam, but it is not ok when developer do not publish on any other other platform than epic, even, if other platforms are more expensive?

Very interesting.

Btw that is exactly how monopoly works. You go to more expensive shop because it is a monopoly and other shops does not matter.

You’re angry at the wrong thing, you should be mad that, after many years, and multi-millions of dollars later, EGS still can’t even remotely compete.

If EGS had full screen mode, built-in mod support, local game streaming, I legitimately would use it, but it doesn’t have, even a quarter of the stuff Steam does.

People like steam because it works, why all the other platforms struggle to improve anything over many years is beyond me.