Epic Games CEO says store exclusives will ultimately benefit gamers

[midian182]

A hot potato: It’s no secret that many PC gaming fans are less than thrilled about the Epic Games Store’s tendency to secure exclusive games for the platform, but according to company CEO Tim Sweeney, these will ultimately benefit consumers.

In a Twitter thread, Sweeney said its exclusives were the “only strategy” of ending the current 70/30 industry standard model, in which 70 percent of a game’s sales goes to the developer/publisher, and 30 percent goes to a storefront. The Epic Games Store uses an 88/12 split that’s more generous to those responsible for creating the titles.

Sweeney added that while independent stores have done great work over the years, none of them, apart from big publishers such as EA, Activision, and Ubisoft, have managed to reach 5 percent of Steam’s scale.

"Nearly all have more features than Epic; and the ability to discount games is limited by various external pressures,” he wrote.

Sweeney notes that the 30 percent store tax often exceeds the entire profits of the developer who built the game, creating a “disastrous situation,” but should Epic Games become the second largest storefront behind Steam, or encourage rivals to 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).

— Tim Sweeney (@TimSweeneyEpic) June 26, 2019

Metro Exodus, Phoenix Point, and Borderlands 3 are just some titles that faced a backlash for their Epic Store exclusivity deals, but this hasn’t affected their sales. World War Z, which isn’t available on Steam, has sold over 700,000 copies on the Epic Games Store, while Metro Exodus sold double that of its predecessor. Whatever people think of Epic exclusives, you can expect them to continue.

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.

— Tim Sweeney (@TimSweeneyEpic) June 26, 2019

Permalink to story.

https://www.techspot.com/news/80680-epic-games-ceo-store-exclusives-ultimately-benefit-gamers.html

 

[m4a4]

Yeah, not buying it. Epic should put that money that they're paying for exclusives with to take a hit and undercut the prices from other stores ($5, $10, $15 cheaper than anywhere else artificially) so there's an incentive to go to their store. You know, in a friendly competition way that doesn't screw over customers and our choice?

Until Epic stops with the BS and stops screwing us over, I will not be buying any timed exclusives on the Epic store (and will more than likely not spend money on the store in general).

 

[TomSEA]

For anyone who thinks Epic is doing this solely for the benefit of the gamer and game developer as they claim, I have a bridge to sell you.

It couldn't POSSIBLY have anything to do with making more money and attempting to corner a segment of the market for Epic, right??

 

[thelatestmodel]

They're wrong. M4A4 took the words right out of my mouth, the only way to do this in good faith is just to make the games cheaper on your store. Or offer a significantly better service with more features and a better client program.

Buying out exclusives is an absolutely scummy business practice and I don't think it has the effect that Epic thinks it does. I don't know how else to describe it, but basically if I hear that a game is going Epic exclusive, it effectively ceases to exist for me. I have no interest in creating an Epic account or installing another launcher. I just resign myself to the fact that now I'm not going to get to play that game.

Great example would be Shenmue 3. I backed the Kickstarter and chose Steam as my reward. Now it's Epic exclusive, I no longer care about playing it. Ever. With the number of games available to play in 2019, it's easy to find something else to play. I just don't care, life's too short to fuss about with that many accounts and launchers.

I already don't use UPlay or Origin, so there's no way I'm going to consider another one. Compete fairly and properly with Steam, or die.

 

[144hzGamer]

Yes it will benefit gamers, because they are going to console to have a single store and not feed epic bs.

 

[fadingfool]

The "only" strategy huh? Well posters above have already come up with another strategy and I doubt they needed an MBa and huge salary to come up with it. Remind me again how much distribution used to cost when physical copies were the only option (before Steam came along)? Offering the same game but cheaper would definitely benefit gamers - right now - not at some nebulous point in the future. I do have Epic installed (had it for unreal Tournament before Fortnite even existed) - but I haven't spent a copper penny on that store (I do have WWZ but that came free with an AMD RX570).

 

[Vrmithrax]

Wow, so the guy who runs the store that is using shady exclusivity tactics to undercut other companies that have spent years or decades developing their platforms, effectively eliminating choice for consumers who want specific products, is defending the action as good for the consumer. Shocking!

On a real note, though... There is a problem with selling the games cheaper on Epic's store, as @m4a4 and others suggest. Yes, that would be great for the consumer, but if you sell it at a lower price then you effectively nullify part or all of the benefit of the reduced cut that the store takes from developers. At that point, what reason would developers have to go exclusive on a weaker platform with questionable security and severely lacking in features? It's in Epic's best interest to keep the prices at their max competitive levels, to prevent their catalog from dwindling and dying off. Consumers be damned.

 

[dangh]

I'm fine with that, and I'm happy they do not have crazy 30% ripoff. Market will verify that and I'm happy to buy games there knowing developers will be more directly rewarded.

 

[Evernessince]

The only problem is 30% is only for games sold through steam and only at low volume. Steam keys sold outside steam give Valve a 0% cut and games that sell more copies get a larger revenue share.

The fact that EPIC seems to hide this shows to me they have disingenuous intentions to begin with.

 

[Ludak021]

If they (Epic) think that is going to work out for them, they should think again. Gabe is just waiting them out to run out of money. Steam is not going to run out of money anytime soon. Tim should think hard about this: "Why isn't Steam countering us?"

 

[DukeJukem]

So these guys are offering developers of said video games more money to publish them on their store and they're way of thinking is if the developers are earning more money that they'll be more enticed to sell their games to us cheaper right? What's the problem? You're all simply mad you have to install another launcher on your computer. Microsoft has been doing this for years, buying playstation exclusives rights so they can have them on xbox so they can make more money. If the developers aren't selling their games cheaper when they're raking in more money thanks to Epic, then that's on the developer of the game, not Epic themselves.

Here's the easy, big picture. These are all this PC games folks. What's the huge deal if you have to install another launcher to run them? They can be closed you know? Are you paying more money for the game on the Epic Store? No. What's the problem? People always find something to cry about these days honestly.

The fact is someone with deep pockets is buying games and taking them away from steam and it annoys you and theres literally no reason to be annoyed besides the fact you're a steam fanboy or you work for valve. Alot of aspects about steam simply suck. The refund policy mainly. The fact they choose to push updates during tuesday afternoons which make any online game that requires steam literally unplayable. Why wouldn't they do this **** on sunday at like 3 am or something?

If you start seeing new games on epic store for 50 bones instead of 60 maybe you'll quit complaining.

 

[Adhmuz]

Sweeney can say what he wants to say, I'm not buying from his platform, it doesn't offer 1/10th of what Steam offers. What's extremely disappointing is how game developers are willing to sacrifice all of that in exchange for better profit margins.

 

[Capaill]

Yes, it will benefit me as a consumer as I save money by not buying the game. Thanks Epic! There are lots more games in the Steam Sales for me to throw my money at.

 

[m4a4]

On a real note, though... There is a problem with selling the games cheaper on Epic's store, as @m4a4 and others suggest. Yes, that would be great for the consumer, but if you sell it at a lower price then you effectively nullify part or all of the benefit of the reduced cut that the store takes from developers. At that point, what reason would developers have to go exclusive on a weaker platform with questionable security and severely lacking in features? It's in Epic's best interest to keep the prices at their max competitive levels, to prevent their catalog from dwindling and dying off. Consumers be damned.

I'm suggesting Epic take the hit, not the devs (as in, if the game is $60 on another store, Epic shows it for $50, but the dev gets the 88% as if it was a $60 sale).
Epic is throwing money around to get these timed exclusives. They can surely afford something like this to grow their player base more honestly...

 

[Vrmithrax]

On a real note, though... There is a problem with selling the games cheaper on Epic's store, as @m4a4 and others suggest. Yes, that would be great for the consumer, but if you sell it at a lower price then you effectively nullify part or all of the benefit of the reduced cut that the store takes from developers. At that point, what reason would developers have to go exclusive on a weaker platform with questionable security and severely lacking in features? It's in Epic's best interest to keep the prices at their max competitive levels, to prevent their catalog from dwindling and dying off. Consumers be damned.

I'm suggesting Epic take the hit, not the devs (as in, if the game is $60 on another store, Epic shows it for $50, but the dev gets the 88% as if it was a $60 sale).
Epic is throwing money around to get these timed exclusives. They can surely afford something like this to grow their player base more honestly...

I don't think Epic can afford the hit. They are already undercharging and dropping money into exclusivity contracts, but there is no way they can build and fortify their platform infrastructure without consistent revenue. And it leaves zero budget for actually expanding and improving the platform itself, adding features and making the platform something more than a bare bones storefront. That's something that the people who defend Epic just don't seem to understand - that 30% that Steam charges is what keeps the lights on, keeps the servers running, and keeps the extra content and tools flowing on the Steam platform. Epic doesn't have server issues yet, but if they ever got even half of the kind of catalog and user base that Steam had, they would see that even just server maintenance and support gets progressively (sometimes exponentially) more difficult with increased user traffic. Epic needs to be preparing for the coming storm, if they truly want to grow enough to go toe-to-toe with Steam.

 

[Uncle Al]

I'm recommending they rebrand the entire company under a new name ....... Epic Fraud sounds about right ....

 

[m4a4]

I don't think Epic can afford the hit. They are already undercharging and dropping money into exclusivity contracts, but there is no way they can build and fortify their platform infrastructure without consistent revenue. And it leaves zero budget for actually expanding and improving the platform itself, adding features and making the platform something more than a bare bones storefront. That's something that the people who defend Epic just don't seem to understand - that 30% that Steam charges is what keeps the lights on, keeps the servers running, and keeps the extra content and tools flowing on the Steam platform. Epic doesn't have server issues yet, but if they ever got even half of the kind of catalog and user base that Steam had, they would see that even just server maintenance and support gets progressively (sometimes exponentially) more difficult with increased user traffic. Epic needs to be preparing for the coming storm, if they truly want to grow enough to go toe-to-toe with Steam.

They're throwing hundreds of thousands of dollars into timed exclusivity deals (Fortnite money? Lol). I think they can instead come up with something more along the lines of what I'm suggesting (even if it's also a timed "discount").

Otherwise, I agree with the rest of what you said. People don't understand how much Steam actually does with the 30% take. Especially with also providing free bandwidth for keys sold outside of Steam (with $0 going back to Valve).

 

[m4a4]

Also, here's some irony: https://www.pcgamer.com/tim-sweeney-microsoft-uwp-is-still-woefully-inadequate/

"Well, I should be very clear," Sweeney said. "The thing that I feel is incredibly important for the future of the industry is that the PC platform remains open, so that any user without any friction can install applications from any developer, and ensure that no company, Microsoft or anybody else, can insert themselves by force as the universal middleman, and force developers to sell through them instead of selling directly to customers.

 

[brucek]

It's clear from both his own "storefront" (a mis-leadingly trivial name for all the services actually encompassed) and his way of thinking about the funding for it that he just doesn't see it as important to gamers. l'm one of them who disagrees.

Also, The majority of titles I've bought on Steam have been for $20, or less, or much less. The alleged "30%" is not so much when it is for a $5 game, but the "70%" is mostly all found money for the developers who would have had trouble connecting with me outside of there being such a consolidated place I feel comfortable to do it.

 

[ckm88]

Who are they kidding? They expect us to believe this?

 

[IAMTHESTIG]

I'm fine with that, and I'm happy they do not have crazy 30% ripoff. Market will verify that and I'm happy to buy games there knowing developers will be more directly rewarded.

You don't really believe that do you? Do you think they are going to pay their dev's more? Or do you think they will use the money to line the pockets of the CEO and marketing department?

 

[kevbev89]

I feel like Epic's tactic is to constantly pump out PR articles to condition/reinforce the idea that they are benefiting the end consumers. I'm pretty sure some consumers bought into it to some degree.

I really hope this exclusivity crap stops sooner...

 

[parowOOz]

So these guys are offering developers of said video games more money to publish them on their store and they're way of thinking is if the developers are earning more money that they'll be more enticed to sell their games to us cheaper right? What's the problem? You're all simply mad you have to install another launcher on your computer. Microsoft has been doing this for years, buying playstation exclusives rights so they can have them on xbox so they can make more money. If the developers aren't selling their games cheaper when they're raking in more money thanks to Epic, then that's on the developer of the game, not Epic themselves.

Here's the easy, big picture. These are all this PC games folks. What's the huge deal if you have to install another launcher to run them? They can be closed you know? Are you paying more money for the game on the Epic Store? No. What's the problem? People always find something to cry about these days honestly.

The fact is someone with deep pockets is buying games and taking them away from steam and it annoys you and theres literally no reason to be annoyed besides the fact you're a steam fanboy or you work for valve. Alot of aspects about steam simply suck. The refund policy mainly. The fact they choose to push updates during tuesday afternoons which make any online game that requires steam literally unplayable. Why wouldn't they do this **** on sunday at like 3 am or something?

If you start seeing new games on epic store for 50 bones instead of 60 maybe you'll quit complaining.

The money is going not to development teams (aside from indie devs) but the big publishing houses like EA, 2K, Ubisoft, Bethesda etc. Aside from 2K all other publishers have their own platforms where they get 100% of the money. Have you seen a drop in prices of their games ? Have you seen a decline in BS monetization schemes inside their games ? And yet with Epic, magically we're supposed to expect games to drop in prices ? How deluded are you ?

Good job, you beat the hell out of the strawman you created. I'm starting to see why you're defending Sweeney. Installing another launcher is not the point. The lying, flip-flopping on key issues, bribing devs to **** on their fanbase (Phoenix Point, Shenmue III), providing inferior store front and many others are they reasons people don't like Epic. Care to share your opinions on those ?

The refund policy on Steam sucks ? You do realize Epic didn't even have a return policy until people made a big stink about it right ? Not to mention their policy is exactly the same as Steam's so swing and a miss.
Game devs/publishers decide when to update their games, stop making things up. And pushging updates during the weekend is dumb as that is when most people have the time to actually play their games.

 

[parowOOz]

You don't really believe that do you? Do you think they are going to pay their dev's more? Or do you think they will use the money to line the pockets of the CEO and marketing department?

Exactly. I really don't understand how people can get conned by Sweeney's razle dazzle with 88/12 split. We've had things like Origin, Battle.net, Uplay, Bethesda.net for months or years now. Publishers get a sweet 100% of the revenue on those. Games still cost 60$, still have microtransactions and "surprise mechanics" in them, their quality hasn't improved - Fallout 76, Anthem etc. But because Sweeney says he's the saviour of the game industry, everything is going to be different...

Let's also not forget that Epic is treating their own developers like shite but we're supposed to believe they give a rats bum about other development teams - yeah right.

 

[toooooot]

What game is the screenshot from?