Epic Games Store profitability

danutz_plusplus

danutz_plusplus

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https://www.dsogaming.com/news/epic...million-on-egs-in-2019-and-2020-respectively/

This was expected, and I wonder how much longer it will last. At least according to Epic until 2023? It would be sad if they couldn't make themselves profitable at the end. Steam does need competition, even if so far they haven't exactly made use of their dominant position (well, except for their publishing rates, which is debateable how good they are). But it seems Epic has a lot of money to lose.
 
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I don't get how they lost that much money, and the article doesn't go into detail.

Also, the court document the article links to appears to be a lawsuit by Epic against Apple. The document is 365 pages long though, and I'm not even going to attempt to decipher it.
 
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I'm guessing this comes from that business where Epic was trying to sell microtransactions in mobile Fortnite, bypassing the Apple in-game purchase mechanism, and avoiding their excessive cut. I just wonder if Epic might have an interest in presenting their books this way in that context, as part of the argument that Apple's demands are anti-competitive, and hurting other companies.
 
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I don't think it's hard to figure out how they lost money. They pay companies millions of dollars to give them exclusivity (or at least an exclusivity window), and a lot of those games don't even sell well. Steam doesn't do that. And then on top of that they take a smaller cut. There are multiple people on this very site who have never spent a cent on that storefront, but claimed plenty of free games. I've bought one or two games from them myself. Does that sound like a strong business model? Certainly not short term. If they didn't plan to lose money at first I'd be very surprised, though it's certainly possible that sales aren't accelerating the way they'd hoped.
 
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Yep they forked over millions probably a billion to secure exclusive's from various developers/publishers. The small take percentage doesn't net a big profit either.

Their lucky to have investors like Tencent and a few big online cash makers.
 
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Steam needs competition for sure - but competition from a store willing to do better, not a store that just pays off developers for exclusives, then hands out free games to gamers. The place seems to be running on bribery, not by inventing a better system.
 
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It doesn't look like Epic game store can stand on its own two feet, and has to give away free games and stuff just to try and stay competitive. Yet they still failed miserably, can't even turn a profit. Good news in my opinion. (I actively boycott Epic games, and know there are other gamers who feel the same way)
 
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Loss leader. Epic's doing what it needs to do to gain a foothold into Steam's strangled territory and I don't think for an instant they didn't know the numbers they'd be bleeding when they went down this path.

The only misstep I see is they're not doing enough marketing to combat anti-Epic sentiment from those exclusivity deals. They probably didn't anticipate such a backlash, or overestimated the goodwill that the free games would bring.
 
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I prefer Steam myself, but I always found it weird that so many people blindly hate Epic.

It's a developer's choice to sign exclusive deals, and it's pretty dumb to want to see a company fail in a market that's currently being monopolized.
 
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Epic was prepared for initial losses in millions so I don't know why is this news.
Unless their predicted number was half a billion and somehow losses ended 1bn or more.
 
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I don't know about Epic profitability, but I know that Epic store app needs a total revamp, it is one of the worst gaming platforms around, if not the worst of all. It lacks a much needed number of features, even the most basic ones. E.g. you can't even put 2 games in the same shopping cart, go figure!!!

I think that if you want to compete against the biggest of all gaming stores, at least try to imitate it (or surpass it, why not?) in what it's good at.
 
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I don't despise the Epic platform, for me they suffer from two serious problems: they don't compete on the same level, and they are quite late to the party. I'll stick with great old games and steam for now, I don't need fifty or even five platforms to purchase games from. Competition is well and good, and I'm all for it, yet you need to actually compete and not just rope people in with gimmicks.

Now UnOrigin and Ubijunk, those I find pitiable and laughable at best. And neither shall ever sully my computer with their presence.
 
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henriquejr said:
I don't know about Epic profitability, but I know that Epic store app needs a total revamp, it is one of the worst gaming platforms around, if not the worst of all. It lacks a much needed number of features, even the most basic ones. E.g. you can't even put 2 games in the same shopping cart, go figure!!!

I think that if you want to compete against the biggest of all gaming stores, at least try to imitate it (or surpass it, why not?) in what it's good at.
Click to expand...

Yeah, it's definitely lacking in features. That said, I find Origin and Ubisoft just as bad in that way.
 
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One of the most often cited reasons why people exclusively use Steam is their desire to keep most of their games in one library. I guess Epic is giving away all those free games in an attempt to get people to build up a new game library which makes them less reluctant to buy games in a new place.

Will it work? Dunno, but it certainly made me feel less hostile towards Epic and I have bought a couple of deeply discounted games there.
 
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abharsair said:
Will it work? Dunno, but it certainly made me feel less hostile towards Epic and I have bought a couple of deeply discounted games there.
Click to expand...

I also hope their effort doesn't go belly up with their store attempt. Epic also has one of the best publishing deals in the industry (I believe Remedy is the first studio with renown to use them) where if they finance you new IP, the devs keep the IP (which is unheard of in this world), and after Epic recoups all their investment they go 50/50 with any money made after that.

But in order not to go belly up, Epic also needs some more work on their app. And I wonder when the stigma of them buying exclusivity deals will wear off. Even now I keep seeing any mention of the Epic store followed by "I refuse to use it, since they bought exclusivity".

Besides the already mentioned wish of gamers to keep their games in one place, I believe there's also the social dynamic that Steam has put in place. Even if you finally end up with a significant library of games on Epic, what if your friends are on Steam? I personally like to visit the Steam achievements and activity feed to see what my contacts are doing. And I get loads of games indirectly recommended by seeing what people wishlist.
 
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It's simple business: if you want to introduce yourself into a market already dominated by someone else, you're going to wind up losing money at the start for promotion. With Fortnite & China money behind the company, it doesn't matter in the short term.
 
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Yeah, I'm sure they went in fully expecting to sink money for a good while before seeing a profit, using massive loss-leaders.

I just wonder if they're presenting the figures in the worst possible light (there's always room for a bit of creativity in accounting), because that might be helpful to their case.
 
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Cough…well the hemorrhaging of profits looks to continue.:cool:

Saints Row 5 and Dead Island 2 may be exclusive to Epic Games Store

Link - https://www.dsogaming.com/pc-perfor...sland-2-may-be-exclusive-to-epic-games-store/
Now while this image is really small, you can find (in red) both Saints Row 5 and Dead Island 2. As the slide suggests, these games will release exclusively on Epic’s store.

As we reported last month, Epic Games lost almost $181 million & $273 million on EGS in 2019 and 2020. Epic expects its store to turn a profit in 2023. Until then, it appears that the company will be doing its best to secure even more exclusives.
Click to expand...
 
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I've bought games on Epic, big titles like Red Dead Redemption and Outer Worlds. To buy anything I wasn't certain of though would be difficult. I have to go to Steam to read reviews, so games on my maybe list will nearly always end up being bought on Steam.
 
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