ADarkWeb

Epic 2021 reportedly set to lose at least $330m in efforts to compete with .

Epic 2021 reportedly set to lose at least $330m in efforts to compete with .

Epic Epic efforts in to $330m least reportedly lose with compete set … to at

Mon, 12 Apr 2021 09:00:00 -0700

CEO Tim Sweeney considers it a “fantastic investment” into growing the business

.

You are not signed in.

14 – 16 April 2021

Danielle Partis

News Editor

Monday 12th April 2021

Share this article

Companies in this article

Epic Games

Epic Games may lose millions after struggling to recuperate costs from the Epic Games Store, following its fight to gain market share from Steam.

The Fortnite giant spent around $444 million in 2020 on making the storefront more lucrative to PC gamers, mainly through giving away titles for free and exclusivity deals.

The company dug deep to offer “minimum guarantees” to developers releasing games exclusive to the Epic Games Store.

Under this arrangement, titles must remain exclusive to the PC storefront for one year, even if they’re released on console platforms.

This means that the developer will receive a guaranteed advance from Epic whether or not their game sells enough to recoup the number.

As an example, the company spent over $10 million securing PC exclusivity for Remedy’s Control in 2019.

A report by IGN that shows players spent $700 million on the Epic Store in 2020, but only $265 million of that was spent on third-party games exclusive to it.

According to predictions made by Apple, the Epic Store will not see any profitability until 2027 if it continues to operate this way.

Apple also projects that the store could lose around $600 million by the end of the year.

While Apple claims that the figure is a loss, Epic CEO Tim Sweeney confirmed on Twitter that he considers it a “fantastic investment into growing the business.”

Although this doesn’t initially feel beneficial to the Epic Game Store alone, Epic itself generates enough revenue to absorb the loss, while enabling developers to release their games and see a sizable return immediately.

In December 2020, the store saw over 56 million MAUs, up from 32 million in 2019.

Epic is still in an ongoing antitrust duel with Apple – the trial is scheduled to take place on May 3, 2021.

14 – 16 April 2021

Sign up for The Publishing & Retail newsletter and get the best of GamesIndustry.biz in your inbox.

More stories

Latest complaint in ongoing campaign against mobile giants claims Google restrictions violate Australian consumer law

By James Batchelor

Unreal Engine maker adds photogrammetry company that creates 3D models from pictures or laser scans

By Brendan Sinclair

Related Jobs

Gameplay Programmer – London – £50,000

London

Datascope

Animation Programmer – North West UK OR Remote within UK – £50,000

North

Datascope

Lead Narrative Designer – Remote UK – Narrative Adventure

North

Datascope

Latest comments

There are no comments on this article yet.

Why not be the first to post one?

Sign in to contribute

Need an account? Register now.

Latest articles from our team

James Batchelor
Editor-in-Chief

How to get a job as a narrative director

Brendan Sinclair
Managing Editor

Never too late to learn something new | This Week in Business

Rob Fahey
Contributing Editor

Could Apple and Google pull the plug on mobile game monetisation? | Opinion

Christopher Dring
Head of Games B2B

Animal Crossing: New Horizons reclaims No.1 spot | UK Boxed Charts

Marie Dealessandri
Academy Writer

An introduction to UX writing for mobile

Danielle Partis
News Editor

Jeffrey Rousseau
Staff Writer

Upcoming Events

GI Live: Online

14th April 2021

Online

The Indie Publishing Awards

15th April 2021

Online

First Playable

1st July 2021

Tuscany, Italy

Games for Change Festival 2021

12th July 2021

Online

Latest Comments

Pete Thompson posted a comment in

Why next-gen consoles need next-gen faces

Andrew Whitehead posted a comment in

"Don’t edit your games for Australia" | Opinion

Ian Griffiths posted a comment in

Loot boxes reported "structurally and psychologically akin to gambling"

.

Epic Epic

Mon, 12 Apr 2021 09:00:00 -0700

With Epic Games Store (EGS), the Fortnite-creator is undoubtedly targeting Steam's market dominance on PC

.

But the store has now been drawn into the legal 

With Epic Games Store (EGS), the Fortnite-creator is undoubtedly targeting Steam’s market dominance on PC.

But the store has now been drawn into the legal fight between Epic and Apple as well.

In court papers for an upcoming hearing, spotted by PC Gamer, Apple uses EGS as an example of how much time, money and effort go into to creating a successful online store, a fact that it’s using as part of its defence against Epic’s claim that Apple’s 30 per cent fees amount to a monopoly.

EGS charges just 12 per cent, undercutting both Steam and Apple significantly, and so becoming a weapon in Epic’s arguments that the industry-standard 30 per cent rate is outdated for such stores.

However, Apple argues that EGS’s recent huge losses undermine that argument.

To which end it has released at idy summary of figures.

Apple stated that:

EGS lost $181m in 2019
EGS is projected to lose $273m in 2020
EGS is projected to lose $139m in 2021

The large majority of those losses come from ‘minimum guarantees’ as part of exclusivity deals.

Effectively Epic promising that developers/publishers will earn out a guaranteed minimum from selling their game on EGS rather than Steam.

Epic committed $444m in minimum guarantees in 2020 according to Apple’s submission.

While some of those will have been met from actual sales, Apple says Epic has paid out $330m in ‘unrecouped costs’ to date.

It’s not surprising that Epic has pumped hundreds of millions of dollars into setting up EGS as a competitor to Steam over the past few years.

And it’s notable that a large amount of the money spent on doing so has come from Fortnite profits and gone to a wide variety of developers and publishers in the industry.

And such shifts in finances look set to continue.

With Apple claiming the store will not be profitable until 2027, although Epic has claimed that date to be 2023 in its own submission.

Epic CEO Tin Sweeney noted in a tweet in reply to news of the ‘losses’:

“That’s right! And it has proven to be a fantastic success in reaching gamers with great games and a fantastic investment into growing the business! … Apple spins this as “losing money”, but spending now in order to build a great, profitable business in the future is exactly what investment is! It’s equally true whether you’re building a factory, a store, or a game.”

Is any of this really relevant to the bigger picture of whether Epic will succeed in breaching Apple’s walled garden of in-app purchases? Most probably not, that battle is set to run and run, with some kind of compromise being the most likely outcome.

It’s fair to say that there’s nothing new in CCP trying to make a successful …

.


Epic | The Leading Digital Library for Kids …

www.getepic.com
Epic is the leading digital reading platform—built on a collection of 40,000+ popular, high-quality books from 250+ of the worlds best publishers—that safely fuels curiosity and reading confidence for kids 12 and under.
Log In


Log In
Student Log In


Student Log In
Epic Books


Epic Books
Books


Books
Educators


Educators


Epic Games Store | Download & Play PC Games, Mods, DLC …

www.epicgames.com › store › en-US
Welcome to Epic Games Store! Download and play PC Games of every genre. We have mods, DLC and Free Games too! Games for everyone.


Epic | …with the patient at the heart

www.epic.com
Founded in a basement in 1979, Epic develops software to help people get well, help people stay well, and help future generations be healthier.


Epic is losing hundreds of millions of dollars in its war against Steam

Eurogamer 2 days ago


Epic Games vs Apple — things just got ugly right before trial

Toms Guide 3 days ago


Epic reportedly set to lose at least $330m in efforts to compete with Steam

GamesIndustry.biz 4 hours ago


The Epic Games Store is haemorrhaging cash to deliver exclusives and free games

Gamasutra 4 hours ago


Epic CEO Tim Sweeney Is Very Excited About The Epic Games Store Losing A Ton Of Money

Kotaku 1 day ago


Fortnite v16.20: what to expect

Fortnite INTEL 45 mins ago


Epic will lose over $300M on Epic Games Store exclusives, is fine with that

PC Gamer 2 days ago


Epic Vs. Apple: Every App Store At Risk

Seeking Alpha 6 hours ago


Epic antitrust case versus Apple in Australia gets three-month stay

The Verge 2 days ago


Epic is losing millions on Epic Games Store exclusives – and Tim Sweeney is cool with that

VG247 5 hours ago


Electronic Privacy Information Center: EPIC

epic.org
4 days ago ? The Electronic Privacy Information Center (EPIC) focuses public attention on emerging civil liberties, privacy, First Amendment issues and?…


Epic Games Store ✓

Twitter › EpicGames


Experience #HorizonZeroDawn on PC, now 40% off on the Epic Games Store! This Complete Edition includes the base game, plus the massive Frozen Wilds expansion, all for just $29.99 until April 25. 🧡🏹 epic.gm/hzd-pc

2 hours ago


HITMAN 3s first Elusive Target arrives today! Take on the ultimate Hitman challenge and take down this unique, time-limited target in Dartmoor. Make your shots count, there are no second chances. The Collector will be available in HITMAN 3 for 10 days.

3 days ago


Risk it all in the upcoming expansion for Path of Exile: Ultimatum, coming to the Epic Games Store on April 16! Get details on Ultimatum & catch a glimpse at the first look at Path of Exile 2 here: www.epicgames.com/store/n…

3 days ago


FM21 and FM21 Touch are on sale now! Footballs biggest moments beckon – end the season on a high 👔🏆

3 days ago


Join our friends at @FootballManager at 12:00 PM ET as they strive to finish Borussia Dortmund’s Bundesliga season on a high and secure a place in next season’s top European club competition 🏆⚽ Catch the fun on our Twitch channel, well see you in chat: twitch.tv/epicgames

3 days ago


Epic – Kids Books & Reading on the App Store – App Store – Apple

apps.apple.com › app › epic-kids-books-reading
Rating

(427,554) ? Free ? iOS
Description. Welcome to Epic – the leading digital library for kids, where kids can explore their interests and learn with instant, unlimited access to 40,000 high-?…


Learn more


– April 12, 2021