Well, not quite. From Sweeny’s own conservative estimates, creditcard processing is 3% off the top, CDN is 1.5%, and operating costs are 2%. So their real costs are 6.5%, and their revenue is 5.5% of sales, plus/minus a percent or two.
They aren’t quite running a charity or a non-profit, but those are very, very tight margins.
Does anyone know how much non-Steamworks DRM costs per copy sold, or as a proportion of revenue? That’s really Steam’s only advantage here, beyond their massive market dominance and the strong network effect caused by everybody and their friends already being on Steam. Stuff like achievements, chat, forums, etc, really don’t count, that can all easily be added.
DRM solutions are often flat fee per title. You may get a discount if you commit to multiple published titles with one company. It’s not cheap, either, at least for the stuff that’s supposedly stronger (like Denuvo was).
Steam has a ton of added value. The workshop is great; Big Picture is the best implementation I’ve seen in that category; their input mapping is unmatched; and their networking services are dominant enough that most devs don’t even bother with implementing GOG’s Galaxy networking, even when releasing on GOG. I don’t see Steam being dethroned any time soon.
Workshop and big picture aren’t widely used, are they? Easy gamepad integration and networking are worth something for sure, but are they worth twenty-three percent of your revenue? (Assuming an Unreal title).
It doesn’t matter, because neither the Steam nor Epic stores require exclusivity. I would imagine many games will launch on Epic and then come to Steam later. Some will launch on both at the same time.
Who knew? Well the workshop is basically just a DLC store that allows user submitted content. Epic Store will need to support DLC, so they just need to work on the user-created side of it. That doesn’t seem like an insurmountable problem, and as a dev, probably not worth giving up 23% of your revenue.
The math doesn’t look right here. Let’s say you make $100:
Steam w/ Unreal: Valve takes $30, Epic takes $5, you get $65
Epic w/ Unreal: Epic takes $12, you get $88
The naive subtraction shows the developer keeping 23% more of the topline revenue. But even that’s not the right calculation, since the topline revenue isn’t what’s being optimized for. What actually matters is the revenue received by the developer, and there the increase is (88-65)/65 = 35%.
Streaming TV/movie services seem to be popping up everywhere too these days. It’s no longer just Netflix, Hulu and Amazon Prime. If Net Neutrality gets tossed by the way side, there will be a rush for many of these services to partner with ISPs. Could AOL make a comeback in the next decade?
If the 12 percent is for operational expenses, where is the profit?
I get these emails, and AFAIK I never had anything to do with Epic Games before.
Weird, when I first read about it a long time ago I thought it was just for fraud detection and real basic payment processing. I wasn’t aware it was CDN, Key, and Customer Support hosting as well.
Epic is trying to challenge steam and that’s good, but they can’t maintain this percentage. This seems more like an opening salvo, and will probably go up over time.
They outlined what the real costs of payment processing and bandwidth/ support was. I think it totaled at 7%. So they reckon at 12%, they do very nicely.
They would want their own stores regardless, why give up any money at all? But the network effect is strong; even though many of these companies have their own stores many of them still release on Steam.
Multiplayer games monetized via microtransactions are a notable exception. It’s one thing to give up 30% of your $60 sale price, but if you expect to make a couple bucks per month for years to come, rolling your own makes a lot of sense. Thus fallout76.
If you think about the fact that epic isn’t a publisher, this makes more sense. They have no collection of games to throw up on their store, so they need something to entice devs with. This is more likely to affect twitch and discord’s stores than valve’s.
