Epic is Not the Hero

By Shamus Posted Tuesday Aug 25, 2020

Filed under: Column 271 comments

So Epic Games is in the news again. This time they’ve picked a fight with Apple and Google. That’s fine. Both companies are very worthy targets, but I don’t have much else to say about the lawsuit itself. This story is evolving by the day, and I make videos much too slowly to keep up with fast-paced stories like this. 

The interesting thing is Epic’s Nineteen-Eighty Fortnite campaign, which tries to rally users to their cause. They even have the #FreeFortnite hashtag, but it’s not about making Fortnite free for us, it’s about making the Apple store free to use for Fortnite.

This is not the first time the company has tried to frame simple corporate business tactics as something brave or heroic. 

I don’t know Epic CEO Tim Sweeney and even though I disagree with him on many things, I don’t have anything personally against him. But whether he intends it or not, the way he carries himself on social media makes it feel like he thinks he’s the hero because other people are worse. It actually reminds me of Jack from the Borderlands series: 

Whatever, John.
Whatever, John.

Jack will do something self-serving and deeply frustrating to people and then assume he’s the hero because some of his foes are bad actors, and then he acts like everyone should worship his “heroics”. 


Link (YouTube)


I’m not saying that Tim Sweeney the person is a self-serving madman, I’m just saying that this is how the company comes off when it pulls one of these PR stunts.

The most obvious example of this behavior is the Epic strategy of securing platform exclusives. The company acts like they’re saving PC gaming by challenging the Steam cut, but in the meantime gamers are frustrated that they have to have to use this half-finished launcher and not preferred platforms like Steam or GoG. The Epic Store is pretty threadbare in terms of features and a lot of people are torn between passing up on a game they want, or getting that game on a platform they hate. This is even worse for people in Asian markets where Epic doesn’t accept common payment methods. For those people the choice isn’t between “Using Epic” and “not getting the game at all”. They just can’t get the game. 

So people asked Tim Sweeney what it would take to get him to stop paying developers to secure exclusives, and his answer was… less than ideal:

I'll stop annoying you if our much larger rival will give up a majority of their income for no reason. In other words: Never.
I'll stop annoying you if our much larger rival will give up a majority of their income for no reason. In other words: Never.

He said he wouldn’t stop until Steam lowered their cut to match the Epic store. If you run the numbers, you’ll discover this is basically impossible. 

But before we can discuss why Steam can never match the Epic store cut, we need to go back and discuss what the cut is, why it exists, and why the Steam cut isn’t as unreasonable as it might seem.

The Steam Cut

I've figured out how to beat the Steam tax: Give the game away. Yeah, have fun taking 30% of NOTHING, Gabe! That'll show you!
I've figured out how to beat the Steam tax: Give the game away. Yeah, have fun taking 30% of NOTHING, Gabe! That'll show you!

So how things work right now is that if you’re a game developer selling a game on Steam, Valve will keep 30% of the sale price. If you sell a game for ten bucks, then Valve gets three of those dollars. If you sell a game for sixty US dollars, then Valve keeps twenty for themselves. Obviously it’s a little more complex than this when you look at things like special deals for large publishers, regional taxes, trade regulations, and currency conversions, but to keep this simple let’s ignore all of that stuff for now. 

This 30% is called the “Steam Cut”. It’s how much of your income you need to hand over to Valve software for the privilege of selling your game on their platform. 

It probably seems like a lot. I mean, imagine if you’re a hardworking indie developer. You spend years of your life pouring your heart and soul into making a game. You work long hours. You do the game design. You hire people to make the art. You do the coding. You do the QA testing. You do the marketing. You do the support. 

And then you put the game on Steam and Valve helps themselves to almost a third of your income even though you did all the work and took all the risks. You can probably see why developers resent this so much, and why people have taken to calling this the “Steam tax”. Epic is trying to fight against this. That’s good, but while the Steam Tax might be anti-developer, artificial platform exclusives are definitely anti-consumer. Doing bad things in pursuit of a noble goal isn’t heroic. It just makes you a different kind of bad guy. 

The Bad Old Days

Downside: No internet. Upside: No Twitter. Downside: No email. Upside: Your phone never loses power. Downside: No online games. Upside: No Fortnite.
Downside: No internet. Upside: No Twitter. Downside: No email. Upside: Your phone never loses power. Downside: No online games. Upside: No Fortnite.

As annoying as the “Steam Tax” is, things are a lot better than they used to be. See, creative people have always faced this gatekeeper problem. You make something, and then you need a big company to help you distribute that work to the masses. If you’re an author then you need a book publisher, and if you’re a band then you need a record label. 

In the pre-internet world, all of the power was in the hands of those publishing companies, which meant they set the terms of the contract. So if your book or album sells for ten bucks, you might see a single dollar of that.  And that was the cut you’d get if you were incredibly famous and successful. If you were some kind of nobody, then you’d get even less.

And to a certain extent, this is understandable. Maybe this 10% cut makes the publisher look heartless and greedy, but if you’re selling a physical book then your effort as the author is tiny compared to the gargantuan costs of typesetting, printing, binding, and warehousing millions of books, shipping them all over the country, marketing the books to the public, and selling them at retail. That process involves hundreds of people, and they need to be paid too.

But then the internet showed up, and suddenly those publishing costs vanished. In the internet age, distributing digital goods is very close to free. The bandwidth needed to deliver a book or album is just a few pennies per user.

So then we had a long shake-out period where the old publishing conventions were challenged. In the video game world, we seem to have settled on a situation where the creator gets 70% and the store gets 30%. That’s a massive improvement, but it’s also reasonable to wonder… could we do even better? 

Enter the Epic Games Store, where the developer keeps 88% of the sale price and the store takes just 12%. That sounds really good, doesn’t it? More of our money gets to the people who make the games, and less of it gets eaten up by the middlemen. 

The problem is that people don’t like using the Epic Games Store, and rather than trying to bring people to the platform with better features and pricing, Epic has been offering developers money to agree to make their titles exclusive to the Epic Store. 

This does not sit well with the average PC gamer who has become accustomed to more developed platforms. So people asked Epic CEO Tim Sweeney what it would take to get him to knock it off. And that’s when we come back to Sweeney’s tweet.

On the face of it, this seems like a pretty cool challenge. He’s throwing down the gauntlet and saying that he’ll abandon the exclusives if Steam will lower their cut from 30% to 12%. He also hints that maybe he’d consider putting Epic games on Steam, although I notice a lack of commitment on that last point. 

This sounds like it would be a win for everyone. The problem is that this is impossible. It’s not just impossible because Epic has no leverage over Valve and annoying gamers will never motivate Valve to change. It’s also  impossible because you can’t compare these two services. If Epic began competing with Steam, then they wouldn’t be able to offer such a generous cut either. There are financial hurdles here that Epic is either ignoring or unaware of, because the Steam platform is doing a lot of things that the Epic Games Store can’t or won’t.

So let’s talk about retail for a second… 

Retail 

Six inches of shelf space. That's what you get for 30% of your income. (Assuming your box doesn't end up buried behind copies of Grand Theft Auto V and Skyrim.)
Six inches of shelf space. That's what you get for 30% of your income. (Assuming your box doesn't end up buried behind copies of Grand Theft Auto V and Skyrim.)

Stores like Walmart and Target take the same 30% cut that Steam does. 30% is pretty much the industry standard. That doesn’t mean it’s okay or that it couldn’t be lower, but it does mean that Valve isn’t some outrageously greedy outlier like Epic insinuates. 

In fact, Steam is quite a bit better than retail outlets. Walmart doesn’t offer any additional value to either the consumer or the developer. They give the developer 6 inches of shelf space, and in return they take 30% of their profits. For contrast, Steam has systems for support, beta programs, modding infrastructure, community tools, support for discount bundles, metrics for sales and playtime, a massive content delivery network, and a ton of other things that make a developer’s life easier.

In 2019, several Steam developers gave a talk at GDC. In that talk, they revealed the sheer scope of Steam’s massive content delivery system. See, Steam doesn’t just shove their content over the public internet. They have their own redundant pipes around the world that feature a direct connection to 2,500 different internet providers. If the non-gaming muggles of the world all start streaming the latest HBO offering at the same time, your game downloads and multiplayer sessions will be protected from that congestion.

In 2018, Steam’s parallel internet carried 2 exabytes of network traffic. That’s more than the entire combined internet traffic for planet Earth in 2003. Valve maintains this network and if you release your game on Steam then you get all of the benefits of this network for free. 

Yes, Steam keeps 30% of the sale price, but in return they offer a ton of things that retail doesn’t. Some of that 30% is going into infrastructure that benefits both developers and consumers.

I don’t want to sell the Epic Games Store short. It has a content delivery system of its own. Epic runs Fortnite, and I’m sure that game has given the company a lot of practice running huge networks at scale. And just like with Steam, you get free use of this network if you release the game on their store. 

I've always felt like like this game's dominance was a fragile thing. It's shockingly popular, and yet I never encounter fans. But then here we are a few years into it, and it's still huge. So I dunno.
I've always felt like like this game's dominance was a fragile thing. It's shockingly popular, and yet I never encounter fans. But then here we are a few years into it, and it's still huge. So I dunno.

My concern here is this: Is the Epic Network really being supported by the tiny percent that they’re making from games? Is that cut large enough to sustain these kinds of massive-scale networks? It’s possible the funding is coming not from the store itself, but from the cultural juggernaut that is Fortnite. That only works as long as Fortnite continues to be an unstoppable cash cow. 

I’m sure Fortnite has many years of life left in it, but sooner or later everything fades. Remember when Team Fortress 2 was the biggest multiplayer shooter? Remember when Starcraft was the premier title in eSports? Remember when Unreal Tournament and Quake III Arena were the titans of online shooters and everyone else was an also-ran?

Someday something new will displace Fortnite, and those juicy battle pass dollars will stop flowing in. When that happens, will Epic still have the cash to keep this massive network running? Or will they have to choose between taking a bigger cut or cutting back on services?

My other concern is the problems they face with payment methods.

So let’s talk about…

Gift Cards

I didn't know what to get you, but I know you like the video games so here ya go.
I didn't know what to get you, but I know you like the video games so here ya go.

You know how it works. You go to the store, you buy a ten dollar game card, then you bring the card home and buy ten dollars worth of games. From the consumer’s standpoint, it’s a pretty simple transaction.

What you don’t see is that this transaction absorbs a lot of the face value of the card. When Walmart sells you a ten dollar Steam card, Valve doesn’t get all ten dollars.  Walmart keeps between twelve and fifteen percent of the face value. So you pay ten dollars, but Valve only gets $8.50. 

Next you jump on Steam and use your card to buy a ten dollar game. Seven of those dollars go to the developer. Walmart keeps a buck fifty for themselves, and Valve gets the remaining dollar fifty. Valve doesn’t make as much money as they would have if you paid directly, but they still make money.

But what would happen if Valve were to do as Tim Sweeney suggests? What if they lowered their cut to just 12%?

You go to Walmart and buy a $10 Steam card. Walmart keeps $1.50 like they usually do, and Valve gets $8.50. Then you jump on Steam and buy a $10 game. Now Valve owes the developer $8.80. But hang on, Valve only got $8.50 from Walmart. Which means that Valve lost thirty cents on the deal. And that’s ignoring the other costs like payment processing, game delivery, support, and all the other expenses required to run the platform. 

We're not in Kansas anymore, although they do have 7-11's in Kansas too.
We're not in Kansas anymore, although they do have 7-11's in Kansas too.

This is a big deal because of countries like Japan, where these kinds of cash cards are a major part of the economy. Gamers go to a convenience store to buy cards for cash, and then they go home and use those cards to buy games. 

In the west we think of 7-Eleven as a place to buy fuel and cigarettes, but in Japan these stores are an important part of life, particularly for urbanites. A Japanese 7 Eleven is a grocery store, a take-out restaurant, a post office, a bank, a Wi-Fi hotspot, a transport ticket vendor, currency exchange,  a place to pay your utility and insurance bills, and most importantly, it’s where you buy your game cards. If your games store isn’t doing business in these places then you’re not doing business in Japan.

This presents something of a problem if you’re trying to sell digital games to Japanese consumers. If your store only has a 12% margin then you’re going to be losing money on every single sale, forever.

This probably explains why Epic doesn’t have any gift cards. It would also explain a few of the items on the development EGS roadmap. At some point the team is going to add “Additional Payment Methods” and “Additional Currencies”. The team is going to have to reconcile these unusual expenses with the low cut of the Epic Games Store. It’s entirely possible that there’s no good way to do it. Maybe you can’t get by on a 12% cut in some countries, and maybe you can’t maintain a massive content network if you’re only making 12% per game sold.

So yeah. Getting back to Sweeney’s Tweet. It boils down to “We’ll stop getting exclusives if Valve is willing to financially sabotage themselves.” 

How do we beat Valve? Hm. Maybe if we annoy our potential customers enough, and promise to STOP annoying them if Valve lets us win, then the masses will somehow apply pressure to the platform they love to help the platform they hate. This is a bulletproof plan.
How do we beat Valve? Hm. Maybe if we annoy our potential customers enough, and promise to STOP annoying them if Valve lets us win, then the masses will somehow apply pressure to the platform they love to help the platform they hate. This is a bulletproof plan.

I like the idea of applying pressure to Valve to loosen their grip on the PC platform. More competition is usually a good thing and a more generous platform cut is certainly feasible. But sooner or later Epic is going to need to stop relying on exclusives. Eventually their platform needs to be able to stand as a viable alternative to Steam and exist as something that people are glad to have on their machines. Eventually it needs to be a platform that people will use willingly, not just when they’re forced to. If I ever go back into game development, I know I’d rather keep 88% of the profits from Epic as opposed to the 70% on Steam. That’s a huge difference that can make or break a studio. But I’d also like to make sure my audience can use the game on a platform they enjoy, not a platform that’s been annoying them for years.

 


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271 thoughts on “Epic is Not the Hero

  1. Gargamel Le Noir says:

    I enjoyed the video and appeased the algorithm, but I thought it had a lot more repetition than usual, especially at the start. It felt like you took 5 minutes to explain and reexplain what the Steam tax is.

  2. Olivier FAURE says:

    See, Steam doesn’t just shove their content over the public internet. They have their own redundant pipes around the world that feature a direct connection to 2,500 different internet providers. If the non-gaming muggles of the world all start streaming the latest HBO offering at the same time, your game downloads and multiplayer sessions will be protected from that congestion.

    I’m very tempted to start a Net Neutrality debate right here.

    I mean, this remark is interesting, because I strongly suspect a lot of people (including Shamus) see NN as a non-negotiable rule and think the lack of it is a danger to the free internet, while also thinking that the infrastructure Shamus describes is a net positive.

    If I’m right, then these hypothetical people don’t really have a coherent model of what NN means and how these market forces work.

    1. BlueHorus says:

      Well, yes and no.
      A lot of people have opinions on how Net Neutrality could/should work, and a lot of those opinions will be coherent. Not all, by any means – but like a lot of things, eventually it’s going to come down to assumptions about human nature* and underpinning moral principles*. Which will be different, because humans disagree.

      It’s not that there is no answer, it’s that there’s lots and lots of different answers.

      *How far can you trust a government to run an infrastructure everyone uses? Should it be paid for by taxes? No? Okay, so a private company will do it, but they’re only going to do it if there’s a profit in it for them. How far do we regulate that? And those considerations are just the ones I thought up in a few seconds…

    2. Mephane says:

      I am generally a big proponent of net neutrality but I do not see the issue here. This is not one type of data (or data source) being throttled in favour of another, this is a piece of redundant infrastructure. If a company pays for dedicated lines from their servers to your ISP in order to have a connection that is faster, more robust or whatever, that is fine. Net neutrality is about how data is treated over shared lines, e.g. the line between your ISP and you, or between different ISPs, public nodes etc.

      1. Decius says:

        This is a discussion of a network backbone that only allows content that has been specifically paid for.

        If Netflix had some backbone that preferred Netflix traffic but if there was spare capacity allowed general internet traffic, that would be the central issue of net neutrality.

    3. Bloodsquirrel says:

      The NN debate should be over at this point. It was repealed. The apocalypse didn’t happen. Which is no big shock, since it wasn’t happening before had been instituted only a few years earlier.

      There needs to be a much greater burden of proof placed on whoever wants to claim that a hypothetical problem will exist before we hand over power to regulate things to the government.

      1. Ninety-Three says:

        What objection do you imagine people have that they should be convinced by no apocalypse after repealing Net Neutrality, given that they weren’t already convinced by decades of no apocalypse before implementing Net Neutrality?

        1. Bloodsquirrel says:

          Well, as I said, the lack of an apocalypse beforehand really should have been enough. But the people who freaked out over NN being repealed weren’t invested in the issue back before it was instituted. For them, the repeal was the point at which they began to make predictions about what would happen. At the time, I pointed out that NN had only been on the books for a few years, and that no past activity justified said predictions. That wasn’t convincing enough, however, for, uh, reasons. But now NN is gone, and people’s predictions have turned out to be wrong. That *should* be enough to make people re-evaluate. Probably won’t be, but it should.

          1. Shrikesnest says:

            I know I’m just a data point of one, but I’m eating the crow on this one. I got swept up in the argument and believed some things that were, in retrospect, pretty fanciful. I was wrong. It’s been business as usual, and I think it happened long ago enough that if we were going to see negative externalities they’d have manifested by now.

            1. Olivier FAURE says:

              It’s kind of petty of me, but it makes me really happy to see at least one person say that. =)

              A lot of wild predictions were made during this period.

      2. BlueHorus says:

        An apocalypse? Who said that? How would a Net Neutrality apocalypse even work?

        The issues of Net Neutrality aren’t some overblown, easily-dismissed single issue. It’s about search terms like ‘Free Tibet’ or ‘Tiananmen Square’ being monitored and/or censored in China. It’s about companies like Facebook or Twitter bothering (or not) to vet fake news that gets circulated. It’s about Google being the biggest, most well known search engine, which allows it to decide which websites get to be on the front page of searches. And many, many other things.

        So – like all politics – it’s a constant, unending power struggle, with thousands of participants.

        1. tmtvl says:

          Wasn’t Net Neutrality about big companies being able to pay ISPs for high-performance connections leaving smaller actors on slow connections, causing people to flock to big companies and ignore the small fries? Which would naturally happen anyway, but whatever.

        2. Hector says:

          I think you may be confused about Net Neutrality. It has nothing whatsoever to do with free speech. Rather, it’s an argument over whether or not service providers can prioritize traffic in some way. This may sound technical and irrelevant, but it’s an issue because of changing patterns in how people use internet these days.

          1. Bloodsquirrel says:

            NN does have to do with free speech, because it involves granting more government control, which can always be abused in some way or another, over the internet.

            What would be more accurate to say is that the kind of threats that we’ve actually seen to free speech on the internet have turned out to have nothing to do with the problem that NN was supposed to address.

          2. BlueHorus says:

            That is technical, and I’ve never heard of it in that context. I HAVE heard the phrase used in people complaining about Youtube’s copyright and fair use policy, the Chinese government, comments being moderated in and so on…
            …’net neutrality’ seem like an adequate describe these situations.
            There might well have been a more specific use for the term (and the capital letters) in the past, but it’s fairly universal that whoever provides (any) service has a measure of control over who gets to use it…which is something to discuss.

            Still, ambiguous term is ambiguous.

            1. Bloodsquirrel says:

              Well, no, it’s not really ambiguous. It refers to a very specific regulation (which has since been repealed). What you’re describing is just people who don’t know what they’re talking about.

              Which… yeah… there were an awful lot of those people running around at the time, saying all kinds of things. But just because a lot of people who don’t understand economics like to talk about tax policy doesn’t mean that phrases like “progressive income tax” or “capital gains tax” are ambiguous.

              1. Hector says:

                Bloodsquirrel is correct.

                The actual argument over Net Neutrality has nothing to do with free speech in any context. Rather, it was solely about whether or not ISP’s (and others) could prioritize internet traffic in different ways. This somewhat lined up among political boundaries but the big issue was more than the changing nature of internet use (way more hd video, for one) meant some arguments about bandwidth allocation. There was a great deal of sensationalizing a fairly mundane and technical topic where there were (and are) legitimate differences of opinion. For instance, many feared that ISP’s with interests in one video platform would sabotage others, although so far this doesn’t seem to be a major concern.

                1. Daimbert says:

                  I commented on it in a couple of posts on my blog, but as someone who works in telecom I can say one thing: the ship of prioritizing traffic has already sailed. It sailed over 20 years ago. The Internet could not function and even companies like Netflix could not function without it. While there were lots of rants about what companies COULD do, for the most they … already could (there was an analogy that I think Shamus mentioned here about being able to stop or delay the delivery of parcels to you specifically, which ISPs cannot do in the core as that would require expensive deep packet inspection to do, and that ISPs already could and DID do that at your connection specifically) do and were doing. The big argument was over the Fast Lane, which was badly misinterpreted (see the previous analogy) and was a way for ISPs to provide guarantees of service for sites that needed it without having to pay for expensive infrastructure that they might not need. Under Net Neutrality, if they built a super-high-speed architecture ALL applications could and would use it … even ones sending E-mail that didn’t need it, and they’d get no extra revenue for the outlay of capital expenses. Given that the Internet was ALREADY using priorities for traffic that needed specific qualities of service — and video, specifically, is high-bandwidth low-latency and so needs the fastest and most reliable infrastructure it can get — to me it really was an argument over a buzzword when most people didn’t actually understand the technology the issue was about.

                2. Steve C says:

                  many feared that companies with interests in one video game platform would sabotage others, although so far this is the crux of the legal merit of Epic’s lawsuit.

                  FTFY.
                  Yes, Sweeney cares mostly about the 30% cut and any merit is secondary to his power plays. Yes, that’s what everyone is talking about, including Shamus. However that entire aspect will be mostly irrelevant when it comes to the lawyers and courts except as contributing evidence.

                  Punitive measures (such as the Unreal Engine stuff) is sabotaging others. The courts take a dim view of retribution over filing a court case. It will come down to “Is Apple a monopoly? Is Apple using its monopoly power to create contract terms that are unfair? (Aka sabotage.) Are the terms unfair?”

      3. tmtvl says:

        I definitely wouldn’t want Net Neutrality to be regulated by the govt., see China for how well that works.

        1. Daimbert says:

          Um, Net Neutrality is the idea that all traffic on the Internet, no matter what its origin, should be treated the same. China explicitly REJECTS Net Neutrality by taking origin and content into account. So this is not really an argument against Net Neutrality being regulated by the government since a government regulating it would, at least in theory, be forcing everyone to not block sites in the way China blocks sites.

          1. Bloodsquirrel says:

            …except that that’s not how government regulation works. When government has the power to decide how ISPs handle their traffic, whether they decide to force companies to treat traffic the same or block websites is all a matter of how they arbitrarily decide to use it. Case in point: Net Neutrality was never even established by law in the US. it was an administrative policy that was arbitrarily decided upon by a bureaucrat, and eventually repealed by the next bureaucrat to hold that office.

            Once the precedent is set that a bureaucrat can unilaterally decide to regulate the flow of internet traffic there is no guarantee that it will be used benevolently. Giving the government power on the assumption that the person in charge will always be someone who agrees with you is a terrible idea.

            1. Erik says:

              And THAT is not how net neutrality was started, nor how it ended, nor how reimplementation regulations that have been proposed would work.

              You are not arguing in good faith here, and are seeding the information flow with a lot of rubbish.

              1. Bloodsquirrel says:

                Please, do provide some actual facts to back up your claims. I’d hate anyone to read your blatant flaming and think that maybe it’s you who is posting in bad faith.

                1. Steve C says:

                  Line crossed there Bloodsquirrel. That’s a straight up personal attack alongside your host of strawmen and logical fallacies . This entire exchange about NN has had nothing to do with Shamus’s post. It has everything to do with your own personal brand of American politics.

                  Fact: The rest of the world exists. There is not one bureaucrat who decided something for the world. Nor did a second bureaucrat for the world decide it no longer applied. NN does not apply to one specific regulation in one specific country.

                  1. Shamus says:

                    (Not a direct reply to Steve C, I’m just trying to stick this at the end of the thread.)

                    Huh. I walk away from the site for a quick little 12 hour coding binge and when I come back I’ve got 150 comments and political fights about things that I didn’t even bring up in the post.

                    Let’s let this particular thread rest, thanks. I’m considering shutting down this whole post, but there are a couple of threads here that I’m into and I’d hate to see them end.

                    Just try to be chill, everyone.

                    Thanks!

                    1. Olivier FAURE says:

                      Sorry. Won’t start that kind of thing again =(

                  2. Allan Hambrick says:

                    Wow, just wow. There is NN and then there is what people think NN is when, in reality, what they think it is is what they want it to be or were told it was. I am guessing by the comments that none of the commenters have read the actual legislation or it’s amendments. I have. So should you if you want to have an informed rational argument. The actual bill was full of weasel words that amounted to nothing more than platitudes to calm and engender the technocrati boors while while allowing the government an insidious level of control over the internet. It is quite a read and most people are shocked after reading it to learn that they were mislead by the media and a whole lot of people who claimed to be “in the know”and made outlandish claims about how it was critical to the internet as we know it. The entire thing is a solid candidate for a case study on propaganda and how lies and half truths, if repeated enough times by enough people, become dogma that shall not be questioned.

                    There is good grist for debate about NN, but before engaging, please at least read the darn bill :)

            2. Daimbert says:

              By this, you aren’t talking about Net Neutrality anymore, but government regulation of the Internet. Net Neutrality was a specific regulation, which was avoiding things like “Fast Lanes” where companies could pay for faster traffic, which had attendant problems for what would happen to those who couldn’t or wouldn’t pay for it. There’s still a lot of misinformation about it, but you aren’t complaining about Net Neutrality in and of itself, but about government regulation writ large.

            3. Fizban says:

              It was an administrative policy because Congress has barely been able to blow their noses for more than a decade and never voted on any of the bills to make it more than an administrative policy, IIRC. Which is a far cry from “some bureaucrat did it.”

              1. Daimbert says:

                To be fair, for regulations like this often it’s only an “administrative policy” because the government has set up regulatory bodies to do all of that so that the legislature doesn’t have to. Such as the CRTC in Canada, set up specifically to regulate things like that so that you don’t need to have a law to bring in regulations as necessary.

    4. Timothy Coish says:

      People still support Net Neutrality in the year 2020? I mean one of the arguments in favour was supposedly “muh censorship,” and yet we have seen massive censorship by these multi-national tech conglomerates who’s entire existence is owed to the peasants who’s taxes paid for the internet infrastructure in the first place. But no, if YouTube, an absolute caricature of an evil censorious company (and I might add, the people who lied us into Iraq are not being censored by them) whines about some ISP maybe possible thinking about slightly throttling their bandwidth a little bit sometime in the future, we the filthy peasants should get all up and arms about this oppressive Multi-National Conglomerate, because it isn’t MUH GOVERNMENT.

      Ignoring of course, that the people who lobby the government to do what they want, eg. YouTube, Apple, InsertLargeCorpHere, effectively ARE the government, since the government works for them. But no, we still have borderline retarded LOLbertarians in the year 2020, obediently making the arguments given to them about how Trillion Dollar Coroporations are the real victims here of abuse and “muh government,” while those very same ADL ran organizations will squeal with joy at the opportunity to ban them from the internet that their taxes pay to maintain. LOLOLOLOL. Okay, peasant.

      1. Shamus says:

        You’re WAAAY off-topic and you’re throwing around childish insults at political groups. Moreover, you missed the comments where other people covered this exact topic, only did so with some level of maturity and respect for the norms of this site. Also, they hammered out some problems with the term having multiple meanings, which you also seem to have missed.

        And then you bring up Iraq for some reason?? The fuck?!?

        When I say “No Politics”, this is EXACTLY the sort of flame-bait bullshit I’m talking about. As the only moderator, I don’t appreciate people making messes I have to clean up.

        1. Mousazz says:

          Just an unrelated note: The avatar of this Timothy Coish guy is a “Clown World” Pepe meme variant, which took off mostly on the “/pol/ – Politically Incorrect” board of 4chan. It seems to me that, in political discussions, the entire “Clown World” idea has been associated almost exclusively with the Alt-Right strain of American politics (and similar movements abroad). Regardless of the merits of the political ideologies themselves, the avatar is in itself an almost purely political expression, and the poster would nearly transgress the No Politics rule based on that alone. It’s kind of like commenting with a Hammer and Sickle avatar, or a Swastika avatar – you’re just asking for trouble at that point, regardless of the text content of the post.

          1. Shamus says:

            I had no idea about any of that. Thanks for the heads up.

  3. Philadelphus says:

    I’ve seen the 30% cut called “unreasonable” a lot, and I’ve never understood why; it seems pretty reasonable to me for a lot of the reasons pointed out here, so I’m starting to wonder if maybe I’m just the unreasonable one for not seeing it as unreasonable.

    1. Gethsemani says:

      The chief idea behind it being unreasonable is because it is the standard cut for retailers, no matter if the retailer is a brick and mortar store or a digital store. A digital store will have much less overhead then a brick and mortar store, yet still takes the same cut and thus makes a bigger profit. The argument is that digital retailers should take a smaller cut, thus giving more to the developer or lowering prices, instead of making more profit.

      In the case of Steam, they charge a lot and provide a lot but much of what they provide might not apply to any particular developer. A more reasonable system would be to have different pricing tiers depending on what the publisher wants from Steam. So at 12% you get a basic package with some telemetry, deal possibilities and whatever exposure you negotiate and then you have a variety of options up to 30% where you can hog out on beta branches, early access and what not. Because Bad Robot, for example, probably doesn’t need subscription services, beta branches, early access and preferential download priority while Shoot Guy 5: Shootier might want all of those and then some. With that said, I don’t think the “lower your cut” tweet was particularly great.

      1. ElementalAlchemist says:

        it is the standard cut for retailers

        Standard for some retailers, but not all. At least outside the US anyway. Back in my retail days, 100% markup over wholesale (i.e. a 50% cut) was standard practice. Some things had less, certain things might even be sold at a loss (i.e. “loss leaders”) because it was worth it to get people in the door. Other things might have more like a 150-200% markup. In my current business making custom electronics, expenses dictate something more akin to 300-500% markup over cost to make it worthwhile (albeit this is not your typical retail type situation).

        1. Bubble181 says:

          Yes, they’re talking about the standard specifically for games. Whether it’s GameStop, Walmart, or Steam, *when it comes to PC games* they all take 30%. obviously, when selling something else, the margins may be 1% or 500%, depending on the item. Heck, there are specific markets and objects with margins in the thousands.

      2. Shamus says:

        I almost made this point in the video, but cut it for time. Those awesome Steam features are mostly only useful to AAA games. Little indies don’t need it. Yet Valve is the most indie-friendly platform thanks to their incredibly lax standards with letting stuff on the platform.

        There was an indie a year ago that approached Epic and wanted on their platform, and Epic replied with “Sure, if you’re willing to agree to an exclusivity deal”. Epic is mostly interested in landing AAA stuff and not really courting indies, even though their platform is perfect for indies and lousy for AAA.

        I see a lot more indies on Epic these days, so I’m hoping that policy changed.

        1. Echo Tango says:

          What about itch.io? As far as I know, they’re even easier to get onto than Steam, and let you set the cut that they take for your games. They’ve got pre-release download-links for sending to beta-testers, comments-sections, and lots of tags for grouping genres and styles, showing if your game supports Windows/Apple/Llinux, or even for separating adult games. They seem to have most of the same features of Steam (at least that an indie might need), but without a fixed 30% cut.

          1. Karma The Alligator says:

            Much less well known, Steam has a massive advantage by being widespread.

            1. Echo Tango says:

              It’d depend on who your target demographic is; If it’s people who don’t play very many games at all, or if they only play major AAA games, then Steam is better. But if you’re counting on word of mouth instead of The Algorithm to spread news of your game, then Itch would make more sense.

          2. tmtvl says:

            Everyone should use itch, it’s the only good guy in a world of bad guys. Of course, that’s like saying everyone should buy fairtrade, it’s easily said but people won’t change their habits because it’s “inconvenient”.

            1. etheric42 says:

              Itch doesn’t give me a launcher, or manage my library, or patch my games, or have a very good system to help me discover games. I have bought one tabletop game on Itch and one video game, only because they were exclusives (because you can’t by them elsewhere, not because they were paid to be so). To me, Itch seems to be a gaming version of Shopify, best to integrate into your personal site/sales system so you don’t have to manage payment/content delivery, not to work as a storefront.

              Epic covers my basic desires while still giving a higher cut to the artist. Steam/GOG lets me get games I can’t get on Epic. It’s a compromise that works for me as a customer.

              1. tmtvl says:

                Itch doesn’t give me a launcher

                You’re right it doesn’t. It also doesn’t give as high a cut to the publisher as Epic. On an unrelated note space is really small and the Earth is flat.

                1. etheric42 says:

                  A) Thank you for letting me know. The last time I looked for it was before 2015 and both when I picked up Lancer and when I looked at their recent charity megabundle I didn’t see that was an option.

                  B) There isn’t any official GOG Galaxy 2.0 integration and the third-party integrations aren’t in solid shape yet. Not trying to shift goalposts, I’m downloading the launcher now, but I wish it did. (Also, why does it refuse to install to program files, I’m the admin on this computer?)

                  C) Did you know that what you said came across like a jerk? Are you okay? No harm, no foul on my side, and again you corrected an incorrect fact which I thank you for. But why not just speak plainly? I almost didn’t bother clicking on the link and just ignore you.

                  1. tmtvl says:

                    I apologize for my mean-spirited tone, I got a bit frustrated when I found out that GOG Galaxy has gained a ton of new features while it still hasn’t been ported to GNU/Linux despite stating that it would be “coming soon” since its very inception. There was no need for me to take it out on you and it was very petty of me.

                    1. etheric42 says:

                      You are a fair and honorable person.

                      That sucks that they still haven’t finished/started support for Linux.

                      Linux gaming has been in a hard spot for years and I know that Steam has done a lot to normalize gaming on the platform. I wish there was a good solution for cross-compatibility.

            2. stratigo says:

              I make the vast majority of my electronic game purchases through gift cards.

              Which locks me into steam (or microsoft),

              1. etheric42 says:

                Visa does physical gift cards (but those are expensive). I heard somewhere that Paypal does too (don’t know how that works).

                Some countries have stores that let you load onto prepaid cards at the store. They usually have fees, but it makes it an option.

              2. Nimrandir says:

                I feel you and generally follow the same practice. Data breaches have left me very paranoid about how many entities can access my financial information. I have a low-limit credit card I can use when I feel the need for a GOG purchase.

                1. etheric42 says:

                  Many credit card providers offer temporary credit card numbers specifically for online shopping. I’ve thought about using them before but not bothered. Is there a reason that’s not a good alternative?

                  1. Nimrandir says:

                    I honestly didn’t know something like that was an option, because I do very little online shopping. Until the pandemic, simply stopping by my local GameStop or Wal-Mart for a gift card has done the job.

        2. etheric42 says:

          While I agree with a lot of what you are saying, I’m going to have to contest you here on a a variety of different points.

          Steam features: Steam multiplayer is a lot easier to implement than the various homebrew ways of doing it unless you’re okay with requiring your audience to punch holes in their firewall (and even then it may still be easier). Having your own forum and moderators is also easier when you’re a big company, for smaller companies having a Steam forum is easier.

          On the other hand: Yes, it is easy to get on to Steam, which lets a lot of stuff that isn’t necessarily good enough quality for general audiences but great for their target niche get on board. But for indies that would have qualified under old Steam standards, being on Steam just means being lost in the crowd. In Wal-Mart you’ve got your six inches out of a linear shelf space of 10-20 feet (wild guess). On Steam your one foot of virtual shelf space is against miles of other products. Indies that were successful 5-10 years ago on Steam are in trouble now. On the other hand Epic has terrible filtering/searching capabilities, but because the shelf space is much smaller, you are more likely to get seen. This was in fact Epic’s exact reason to turn down that game, they are trying to get games to drive traffic to their store, not just any game that they might be able to sell. Without exclusivity, any game they add to their catalog makes it harder to navigate so they have to be picky until they improve their store.

          And they have a number of indies on their store, exclusives too. Hades. Satisfactory. Industries of Titan. Afterparty. I know you said that you’re seeing things improve in that directly, but I don’t think it was ever a bad ratio for a small storefront.

          Echo Tango and Karma The Alligator mention Itch, which is a great store that also takes a lower cut, but is overlooked precisely because they only have indies and make no attempt at platform adoption. Why does Epic need to another Itch? Itch exists, I’m glad it does, and I don’t think Epic would be any better at being an Itch.

          (First attempt to reply seems to have been eaten, trying again, sorry if it ends up a doublepost)

        3. Geebs says:

          Surely though, those indies are being subsidised by the big developers? Steam famously has laxer requirements for indies getting on their platform than, say GOG. The most logical reason (by virtue of being entirely based around money) for Steam being able to host a bunch of games that, individually, won’t make them enough dollars for Gabe Newell to even finish wiping his bum once, is that they make their money off having the big guys on the same platform, paying the same cut. Kind of like how tentpole movies paid for the more interesting stuff under the old studio system.

          I get that indie developers are frustrated that their games get buried, but, seriously, what are you going to do? The tools are out there to allow pretty much anybody to make a game. There are Dev studios all over the world, and some will have a way lower cost of living while still being able to earn money in dollars on Steam. Competition is going to be fierce. I don’t blame The Chosen indie studios for taking Epic’s money, but they’re a tiny, tiny minority of indie developers as a whole.

          TL:DR Epic is good for some indies, but can’t possibly be good for all of them, and Valve’s cut surely subsidises the indie market in some ways that the indie devs who get interviewed in those think pieces about Valve Bad* don’t really consider, because they’re preoccupied with getting on the front page and not going broke.

          *Valve are Bad, but that’s due to normalising microtransactions for cosmetics and enabling money laundering, not the 30% thing.

      3. Thomas says:

        It can’t be overstated just how much lower the overhead is for Steam than a retail store. Staffing alone is orders of magnitude smaller for Valve, and that’s before you get into rent and heating, which are probably the largest costs.

        Game retail (was) a fairly competitive industry, so you can assume what they were charging developers was close to what it cost to run their business. In fact it might even have been at a loss, because I think most of the profit was in second hand sales. That’s not true of digital stores.

        Valve absolutely could be forced to take less from developers if they weren’t able to use their network powers and lack of competition to keep the price as it is. But without competition they can charge pretty much anything and publishers and devs will struggle to negotiate in a meaningful way.

        1. Thomas says:

          To look at it in terms of productivity savings. Technology shouldn’t keep things the same, it should be making them better and cheaper. It’s not enough to compare to the past.

          Netflix invented a technology that massively reduces the costs of distribution, and improves convenience for the customer. But Netflix have a huge amount of competition, that keeps their profit margins close to 0%. So almost all the productivity savings are being passed on to the consumer.

          As a result the cost of watching a film in 2020 has fallen to pretty much £0. For £10 I can watch a hundred films in a month. 10 years ago that would have bought me 2 or 3 films.

          Valve also invented a technology that massively improves the productivity of game distribution. It costs Gamestop over $6 billion a year to distribute games, I wouldn’t be suprised if it costs Valve less than $500 million. However despite other companies now having the technology to roughly recreate the features of Steam, Valve has very little real competition.

          As a result almost none of the profits from that productivity gain are being passed on to developers, and only a few are being passed on to consumers (some definitely are though, in terms of enabling sales, but sales often don’t go much further than the cost of a second hand physical copy on a console platform). At some point those profits should be reaching people other than Valve employees, but they aren’t because they’re being rewarded just for being first.

          I doubt we would see Netflix like price drops (although Sony and Microsoft are proving that is possible). But in the long-run more of that profit should have passed down to the chain to us.

          But perhaps Sony and Microsoft will have enough success with GamePass / PSNow that they’ll be able to conquer the issue. As much as I would like another platform to win, the network effect is a natural phenemona. We need something more fundamental than Fortnite to beat it.

          1. Richard says:

            Netflix also have a stonkingly huge set of pipes, with “local” datacentres all over the world to serve their wares.

            On top of that, Netflix commission a lot of TV series and films – which is an immense cost. Even something like “Nailed It”, which is probably the cheapest format possible will likely cost somewhere around half a million per series.

            Valve have been resting on their laurels watching the money roll in for several years. They definitely can reduce their rate, by quite a lot.
            In their shoes I’d do it by unbundling, so developers/studios can decide to pay Steam a higher cut in order to use certain features.

        2. Bloodsquirrel says:

          Here’s something to keep in mind though: A retail store doesn’t have to worry about a game after they sell it, and they aren’t selling $5 games unless it’s a clearance sale.

          On Steam, you can download a 30 GB F2P MMO and never give them a dime for their trouble. You can buy a full AAA game when it goes on sale for $5 and then spend the next ten years downloading it time after time because you like re-playing it but don’t have the hard drive space to keep it.

          I’d have to see some actual accounting numbers before I made any definitive statements about Steam’s overhead. It might be larger than you think.

          1. etheric42 says:

            Steam/Epic/GOG are just pyramid schemes! We need to keep recruiting people to keep buying games to keep their content delivery pipes alive! In 40 years when all the younguns are playing their holo-sports and the system is upside-down, think of all the unfunded liabilities!

            (This was a joke. Grain of truth maybe, but a joke.)

      4. Tom Insam says:

        It’s the standard cut for _some_ retailers. The article itself says that the cut on gift cards is between 12 and 15 percent. Suppose Walmart decided that it wanted 30%, because “That was the standard”. Would that be reasonable? Valve would of course stop selling the cards through Walmart. And the situation with Apple is one where there are no retailers other than this single one, that wants all of your revenue.

        There are products where a retailer can take 30% and it’s “just” overhead. There are products where 30% is more than the profit the seller is making, and the seller can’t fix that by charging more because the seller’s profit is _also_ tied to a percentage of the cost (which is why for instance there are no Kindle books on the app store).

        And finally, of course, Steam clearly (to my mind) do justify their cut, because there are alternatives, and people still sell things on Steam. Sure, it’s a big storefront, and there are expectations that you’ll be there, but _that’s one of the things they’re offering_. So the market has determined that 30% is ok here. You don’t like it, you can sell on Epic’s store! Not a problem.

        Whereas the problem is that Apple do _very little_ to justify that 30% cut. There’s no post-sales support channel, developers can’t even offer refunds. If there was an actual market for this, Apple would almost certainly need to reduce the cut otherwise noone would use their system.

      5. Philadelphus says:

        That’s certainly an interesting idea, a sort of tiered system. Like, if your game is never going to need Steam Workshop integration you get to keep an additional 4% (or whatever). Some features are probably non-negotiable from Valve’s point of view, but if you really don’t care about having beta branches or achievements or whatnot being able to keep a bit more might be a good thing from a developer’s perspective.

        1. Sleeping Dragon says:

          Considering how standardized these features are and that Valve have a very hands-off approach to most of them (for example they do not moderate the forums or take no responsibility whatsoever for what the stuff downloaded from the workshop might do) I doubt this would be a pratical solution from their point of view. It would be more work for Valve to handle various “tiers”, “plans” or provide these features piecemeal than it is to just bundle them in and leave the dev/publisher to manage them.

          1. Richard says:

            True, and also an indication that the market has failed to date.

            If Epic and GOG get ‘sufficiently large’ and have lower cuts, then Valve will have to start slicing their offering, as developers will say “Sure, the Steam XXX is cool, but I don’t need that so I’ll just sell on Epic/GOG”

  4. ivan says:

    Excellent article, you look at this issue from a completely new perspective. For me, at least.

    Might help to change the title though, it really doesn’t relate much to the real content/points you’re making, and tbh going in I assumed this article would be redundant since others have already covered what the title purports it to be.

  5. Lino says:

    It was a good video, but I feel it could have used 5 more minutes at the end where you talk about the actual 1980-Fortnite video. As it stands, some people might say it’s a bait-and-switch – you say you’re gonna talk about the Epic vs Apple case, but instead you talk about Epic vs a company that has nothing to do with that lawsuit (and the title of the video which implies it’s about said lawsuit).

    Still, I enjoyed the video, and the way you broke things down. I just prefer your 20-minute-or-so videos. They don’t feel as rushed, and you have the time to really get into the topic.

    1. Steve C says:

      I mostly agree. I would not call it bait and switch, nor would I describe it as rushed. I did feel like it would be addressing more aspects than just the 30%. I can’t complain about not addressing the case due to the very first paragraph.

      you say you’re gonna talk about the Epic vs Apple case

      Shamus said the exact opposite first thing.

  6. General_Karthos says:

    The volume argument is a good one, I think. If 75% of your potential audience (conservatively) won’t use the epic store, then you’re only getting 25% of the audience you’d get on Steam. This may be an inaccurate estimate, but I know a lot of people who wouldn’t touch Epic with a 20′ pole. There are people who are the same towards Steam, but not nearly so many, it seems to me. But I only speak as an observer; I don’t have data, and IIRC, this data is very hard to come by.

    But granting the above premise. Epic offers to make you an Epic Exclusive. If your game sells 1000 copies at $10.00 apiece on the Epic store, and you get to keep 88% of that, you’re making $8800. But then if you go to Steam where you sell 4000 copies at $10.00 apiece, and you get to keep 70% of that, then you’re making $28,000. You’re making nearly $20,000 more than you would if you gave your game to Epic. Epic has a smaller market share and they can’t compete with Steam. It’s why games are STILL built for Windows-only. Because making games work on both systems is expensive, and the extra small market share of Mac gamers (like myself) don’t add a whole lot of value. If you determine it’s not enough to be worth the programming, then we get screwed.

    We’re also ignoring the fact that Steam’s store page is infinitely better than Epic’s. It’s still a cluttered nightmare of advertisements, but at least those advertisements for your games are KIND OF tailored to your target audience. Like Epic, they want people to buy the games so they can make their money, but they take the time and effort to find people who might actually buy your game, so that people don’t just ignore the store page automatically, because it never shows them anything they actually want to buy. So Steam perhaps boosts your sales even more through there.

    I’m not a developer. If I were, I’d want to put my game where I could make the most money. If I had the option, I’d put my game on Steam and GOG (as these seem to be the two most popular), but I doubt there are many people out there who won’t use Steam OR GOG and WILL use Epic. But I suspect that if I could only put them on one platform, right now, I’d have to pick Steam.

    I guess what I’m saying is, doesn’t the volume of potential customers a platform like Steam gives you outweigh the extra money that Epic gives you?

    1. tmtvl says:

      Because making games work on both systems is expensive, and the extra small market share of Mac gamers (like myself) don’t add a whole lot of value.

      *vein pop* I hope you aren’t overlooking GNU/Linux, because that would be a very nasty mean thing to do.

      1. Echo Tango says:

        You know, people would respect Linux more if you didn’t use an overly-wordy pedantic name for it. ;D

        In all seriousness though, Linux is like, 2% of the gaming market. Theoretically that would be higher if all games supported Linux, since people wouldn’t need Windows for AAA games that can’t be (feasibly) Wine’d. But supporting all the bugs and quirks of another OS doesn’t make much sense for a tiny market share. It’s great that lots of engines and tools make it easier to support Linux and Apple machines, but it’ll be a long time before we’re at anything close to parity. ^^;

    2. RFS-81 says:

      75% seems awfully high to me, but I have as much data as you about that.

      As far as I remember, the exclusivity deal with indies involved some number of “guaranteed sales”, so they would receive the money for X sales up front, regardless of whether or not they actually sell that many. It may not be ideal in the long run, since Epic haters exist, but it ensures that there is a long run, and that’s kind of a big deal for an indie dev.

      1. Geebs says:

        Yeah, but as Shamus alludes to in the video, the money Epic spends on these deals doesn’t come from Epic Store sales, it comes from Epic’s contractors crunching themselves to death to add cosmetics to Fortnite. That’s not a long term business model, regardless of how many people do or don’t tolerate the Epic launcher.

        1. RFS-81 says:

          Oh, sure. I was just answering why anyone would want to be Epic exclusive at this moment.

          1. RFS-81 says:

            To clarify some more, by “long-term”, I meant “survive to make another game”. As far as I understand, that counts as long-term if you’re an indie dev.

  7. Ira says:

    I know I’ve said this before at some length, but I still find it very hard to actually sympathise with the hate for Epic. Yes, Epic are aggressively going after exclusives, but I have no idea how anyone is supposed to compete with Steam without exclusives. Every other launcher does this – Origin, Uplay, Blizzard, you name it – and we use their launchers.

    You can’t compete with Steam by just offering a better service. Not possible: Steam was first and has the network effect. A platform perfectly identical to Steam except 20% faster would fail to compete, despite being objectively superior. You have to offer something that Steam doesn’t in order to get people to switch, and that means games. That means exclusives.

    As far as I can tell, Epic’s main offense has been being the only major competitor to aggressively pursue those exclusives. They’re playing hardball and genuinely trying to carve away part of Steam’s market in a way that EA, Activison Blizzard, Ubisoft, Bethesda, or even GOG are not. I realise this is frustrating for people who just wanted to buy their games on Steam instead, but…

    …look, around a decade ago I was really angry when I discovered that the games I wanted to play were Steam-exclusive, and I had to put up with this useless DRM storefront between me and my games. Eventually I grew up and figured that the bargain on offer was game-with-Steam or no-game-at-all, and game-with-Steam was the better option. I didn’t like dealing with that, but, well, the free market. So in light of that experience, I find I have very little sympathy for people who hate using the Epic store and want to use Steam instead. Hurrah for you. I don’t want to use Steam, but want to buy games independently. I dealt with it. It sucked, but I dealt with it.

    I think it’s a good thing if we have more storefronts competing with Steam. I don’t see any internally consistent way for me to criticise Epic for doing the only thing that could possibly work to try to compete with Steam. I have no illusions about morality. Both Epic and Valve are purely motivated by profit here. Both of them would grab a monopoly over digital storefronts if they could. But multiple profit-motivated corporations competing are better than one profit-motivated corporation in a position of utter dominance. If this can lead to a future where games are released on half a dozen different storefronts and the competition lowers prices for all, then that’s the best possible outcome.

    1. Ninety-Three says:

      Yes, Epic are aggressively going after exclusives, but I have no idea how anyone is supposed to compete with Steam without exclusives.

      The people complaining don’t care. Exclusives make their experience worse by forcing them from their preferred Steam to EGS, and the fact that EGS couldn’t possibly take off without doing that (it remains to be seen if they can take off with doing that) does not address the objection of “But I don’t wanna use EGS.”

      Now I think resentment of EGS is wildly out of proportion to how inconvenient it is to use, but given that such resentment exists “the megacorporation just can’t operate without inconveniencing you” is going to generate little sympathy and a lot of “maybe it shouldn’t operate then”.

      1. sheer_falacy says:

        The alternative is “literally just have Steam and no other options”, and it turns out that monopolies have a lot of negative effects.

        1. baud says:

          But even before the EGS arrived, there was other options: GoG, Itch, the Microsoft/EA/Activison Blizzard/Ubisoft/Bethesda editor stores and all the Steam key resellers, starting with Humble Bundle. Or even selling directly from the developer, like Positech Games.

          Granted, I think none of the other store reached the same market share as EGS, but saying that the alternative is “literally just have Steam and no other options” is flat-out wrong.

          (and since I’ve not told it yet: I dislike EGS for buying up exclusives, but I dislike even more Sweeney for saying that he’s making the market better, all the while reducing consumer choice)

      2. etheric42 says:

        These exclusives means the developers I like have more financial security. The competition improves their future. Better conditions for them means better games in the future for me. Win-win.

        And Epic’s integration with Galaxy 2.0 is better than Steam’s so it’s actually easier for me to use than Steam at this point.

    2. BlueHorus says:

      There’s other ways to compete with Steam beyond exclusives. Better infrastructure, different cuts of the final sale, GoG offers you the ability to have the game and play it outside of the platform. I don’t know their market share, but it IS substantially different from what Steam offers…and there are people who appreciate that and buy from them when they can.

      It’s also relevant that the article isn’t really criticising the PRACTICE of buying exclusives, it’s criticising the tone and framing of what Epic are doing.

      …look, around a decade ago I was really angry when I discovered that the games I wanted to play were Steam-exclusive, and I had to put up with this useless DRM storefront between me and my games. Eventually I grew up and figured that the bargain on offer was game-with-Steam or no-game-at-all, and game-with-Steam was the better option. I didn’t like dealing with that, but, well, the free market…I dealt with it. It sucked, but I dealt with it.

      Ah, the classic ‘deal with it’…’argument’. AKA the ‘you can’t change it, so stop complaining’ or ‘just shut up’. Defending the status quo from complaints since time immemorial.
      (not that we’re going to change the world via comments on one guy’s blog, but still.)

      I mean, you’re never going to stop ALL the rapes, murders, and other crimes that people commit, so why bother reviewing or considering how better to run a police force? Crime’s gonna happen, just deal with it.

      1. Daniel says:

        Besides, going skull-and-crossbones is also a way of ‘dealing with it’, which (arguably) makes it worse for everyone.

      2. ElementalAlchemist says:

        I don’t know their market share

        If you look at CD Projekt’s financial statements, you’ll see that GOG essentially just barely breaks even. I think last financial year they made something like ~€30,000 profit. And that was with some government tax rebate/incentive. At this point, GOG exists purely as a marketing tool and an avenue to sell CDPR’s games without any storefront’s cuts. Without CDPR, it would almost certainly have been shut down.

        1. RandomInternetGuy says:

          This is interesting. Never would have guessed.

          I’m partial to Steam because I like Valve, they saved PC gaming from Microsoft, created this huge PC gaming market to rival consoles (I don’t like consoles), and because of what they’re now doing to push VR. But nowadays when I can, I prefer buying from GOG. They really go the extra mile to provide the best possible version and assets of the old games, and they are the best from a consumer point of view – no bullshit DRM, no bullshit microtransactions, EU privacy and consumer protection laws… they provide the best service on what counts.

      3. Ira says:

        I mean that in a free market sense. You are offered a product on certain terms: you can accept or reject those terms. You can also try to negotiate to change those terms, but that requires a large movement. On the individual level…

        Well, put it this way. I don’t have a right to non-Steam, DRM-free versions of games. I wanted those things and I argued for them, and I lost. So it does rankle a bit, to me, when I hear the same argument made about Epic. The boat has sailed on this: mandatory storefronts are part of the industry now. I can’t see any fair way to criticise Epic for that while giving Valve a pass.

        1. John says:

          So let’s not give Valve a pass then. I know I’m not. Who is?

          1. Ninety-Three says:

            Everyone buying from Steam. If most people’s idea of not giving them a pass is merely to complain before buying, dollars handed over resentfully spend just as well as any other kind of dollar and Valve’s going to behave accordingly.

      4. Steve C says:

        Yeah. I was right there with Ira until that section.

    3. Cinnamon Noir says:

      It’s remarkable to me that people claim to be in favor of small or competitive businesses and to dislike monopolists when their buying behavior and even activism, as in Shamus’ case here, rewards only the entrenched incumbents in an industry. Valve has a de facto monopoly in the digital games distribution market (GOG’s market share is tiny), and as you say, competing on features is a failing strategy. Since no one has really tried to compete with Valve before, consumers haven’t observed what kind of tactics are necessary to challenge it, and the result is that they think these tactics are “unfair” or “illegitimate”, when really they’re just unorthodox. Since the orthodoxy was created by Valve, it’s no surprise that playing by the rules massively favors them.

      People also seem to think that the only fair way to compete is to give consumers a better deal, which is narrow-minded and selfish. The supply side also exists, and a company that gives the developers more freedom and/or a larger cut is doing good for the market. Consumers are so wrapped up in our side of the market that we ignore the importance of the other side. Valve was/is not only a monopoly, it’s also a monopsony in that it’s the only place that will “buy” your game for digital distribution, and that causes its own distortions in the market.

      Shamus seems to think that Epic is engaging in predatory pricing (an assertion he makes no attempt to prove, incidentally), which is a common criticism that lazy incumbents throw around to accuse more efficient competitors of not playing fair. The fact is that predatory pricing has almost never existed, and most low prices are legitimate and don’t lose money for the company that offers them. The only time it makes sense is when it’s part of a two-part tariff; for instance, Nintendo sells both consoles and video games, and often loses money on the console to get more units sold so that the profit-generating games can sell more copies.

      I was very disappointed when Jim Sterling, who was more than ready to criticize Valve when it was unchallenged and there was no chance of fixing it, turned on the Epic Game Store and decided that every game being on Steam was more important than a healthy business environment for digital games. He set his own comfort and convenience as a higher priority than the future of the market, and now Shamus is making exactly the same mistake. It’s disturbing to see such intelligent and influential commentators defending corporate monopoly like this.

      1. Bloodsquirrel says:

        You’re almost correct here, but-

        Consumers are so wrapped up in our side of the market that we ignore the importance of the other side.

        Consumers should be *more* wrapped up in our side of the market here, not less. It isn’t the consumer’s job to worry about the contract negotiations between different upstream suppliers. The consumer should just be looking at the best deal each competitor is offering him.

        When consumers start taking sides based on either Epic or Valve being “the good guys” they’re falling for corporate propaganda. Neither Valve nor Epic are representing the moral high ground here. They’re just two different corporations offering both developers and consumers a different set of options. The developers will pick which they think are best for themselves, and then consumers will get to decide whether to buy the final product or not. If Steam’s “distortions” are so bad that developers can easily provide a better product by going with Epic, then we’ll see both consumers and developers gravitate toward Epic. If Steam’s extra features and infrastructure really justify that 30% cut, we’ll see consumers and developers stay on Steam. If, as is most likely, different circumstances and different consumer preferences mean that neither model is superior in all cases, we’ll see a split.

        There’s no need for consumers to worry about the supply side. That’s what price signals are for.

      2. Shamus says:

        “which is narrow-minded and selfish.”

        Won’t someone please think of the corporations!

        I mean, yeah. I’m looking at this from a consumer perspective because I’m a consumer.

        “Shamus seems to think that Epic is engaging in predatory pricing (an assertion he makes no attempt to prove, incidentally)”

        Uh, I phased that as a question, not an assertion. And it’s a perfectly legitimate question / concern. Also, my thinking isn’t that they’re doing predatory pricing because “evil lol”, but because I honestly don’t think they’ve thought this through. The fact that they set up a store which – by its pricing model – is completely unable to enter Asian markets kind of hints that they started building this thing without understanding the costs or challenges involved.

        “It’s disturbing to see such intelligent and influential commentators defending corporate monopoly like this.”

        Maybe because I’m not? I very specifically said I like the idea of more competition and putting pressure on Valve. Your entire argument is predicated on the idea that exclusives are the ONLY way to compete with Valve, and that’s simply not true.

        I’ll point out that GoG – not Steam – is my preferred platform. Their anti-DRM stance and slightly more responsive launcher makes it a nicer place to buy games. Epic could compete in these areas. You’re taking the position that Epic MUST use exclusives to get customers. I’d counter by saying that their tactics is making their customers hate them. Yes, growing through features and policies is slower than the sledgehammer of exclusives, but it brings in people who WANT to use the platform instead of people who GRUDGINGLY use the platform.

        I think that’s a more stable long-term solution.

        1. Cinnamon Noir says:

          “Won’t someone please think of the corporations!”

          I wasn’t talking about the corporations. I was talking about the developers. Offering developers a better deal is a legitimate business strategy, and is better for the industry, whether or not it directly benefits consumers.

          “I phrased that as a question, not an assertion.”

          Fine, but I still think you’re wrong. If you’re assuming that Epic is incompetent, maybe consider that you could be wrong about that. Epic didn’t pull its 12% figure out of nowhere, and if you think that was just a publicity stunt, the fact that it hasn’t changed in a year should be evidence against that.

          “I very specifically said I like the idea of more competition and putting pressure on Valve.”

          You seem to like the idea of putting pressure on Valve in the abstract, but you’re very quick to denounce Epic for doing it in the “wrong” way. My argument actually isn’t based on the idea that exclusives are the only way to challenge Valve, just that it’s a legitimate strategy and it seems like it could work.

          I understand that you like GOG better than Steam or the Epic Games Store, but it’s been around for 12 years and still has a fairly small share of the market. If competing that way worked, then GOG would already be the competitor to Steam that Epic is trying to be. You can patronize whatever storefront you like, but I don’t understand the virulence of the response to Epic. They’re not “heroes” in the self-sacrificing Superman sense, but that’s not a reasonable standard for corporate ethics. Isn’t it enough that they want to bring the retailer’s cut down to what’s necessary rather than all they can get like Valve does? Whether that surplus goes to consumers or developers, it’s still better than it was. I always thought gamers liked the people who made their games and wanted them to do well. If a little bit of inconvenience makes you angry enough to oppose that, I think you’re being a dog in a manger.

          …And by the way, back when Steam was new, Valve was acting just like Epic is now. As you should remember, since you talked about it back then, Valve forced people to install Steam to play Half-Life 2 regardless of how they bought it. They locked a popular, hyped-up game behind a digital storefront, which is what Epic is doing. Valve made me install Steam to play Bioshock Infinite, a game I bought for full price in a store. They’re just as heavy-handed as Epic; it’s just that they’ve been doing it for so long that people are used to it.

          1. Bloodsquirrel says:

            Fine, but I still think you’re wrong. If you’re assuming that Epic is incompetent, maybe consider that you could be wrong about that. Epic didn’t pull its 12% figure out of nowhere, and if you think that was just a publicity stunt, the fact that it hasn’t changed in a year should be evidence against that.

            May I suggest that you do a lot less assuming about what Shamus thinks here? He never said that Epic was incompetent. If anything, he’s suggesting that Sweeny is being disingenuous by demanding that Steam match that when he knows that they can’t.

            Meanwhile, Epic not changing their cut for a year doesn’t really prove anything. A company their size could easily afford to lose money on a new product for a few years while they build up their customer base. Or maybe they’re just not planning in competing in all of the same markets as Stream.

            Like I said, you’re (almost) right about how we should be looking at this, but I think you’re being way too quick to cast Shamus as your foil here.

          2. Ashen says:

            Valve forced people to install Steam to play Half-Life 2 regardless of how they bought it. They locked a popular, hyped-up game behind a digital storefront, which is what Epic is doing.

            I wasn’t a big fan when they did it, especially because Steam really really sucked back then, but at least HL2 was their game. They made it and sold it where they wanted to sell it.

            Like, nobody ever complains that Fortnite is an Epic exclusive. It’s their game, they’re free to put it wherever they want. It’s when they snatch up third party titles and specifically lock them up in their store is when people start getting their pitchforks up.

            Valve made me install Steam to play Bioshock Infinite, a game I bought for full price in a store. They’re just as heavy-handed as Epic; it’s just that they’ve been doing it for so long that people are used to it.

            That makes zero sense. It was up to 2K to sell their game wherever they wanted. They could have sold the game on GOG, Origin or wherever else, they just chose not to. Valve didn’t pay them for exclusivity to their platform, which is what Epic is doing.

            1. Mistwraithe says:

              Huh? So when 2K choose to put their game exclusively on Valve (presumably because it is where they thought they would make the most money due to whatever deal they did with Valve or because Valve were already a monopsony) that is fine but when company XYZ chooses to put their game exclusively on Epic because it is where they think they will make the most money (due to an exclusivity deal with Epic) that’s BAD ™?

              I really don’t understand much of the logic in this thread.

              1. tmtvl says:

                If a judge rules in favour of a defendant because the evidence supported their claims or because they gave the judge a bunch of money, that’s the same thing. Got it.

                1. Mistwraithe says:

                  That’s a complete non-sequitur.

                  We’re talking business here, not the legal system. One of the primary goals of business is precisely to make money! Being given a bunch of money is in many cases the win state.

                  So yes, it is the same thing.

                  1. The Puzzler says:

                    Putting it on a store that everyone can use is pro-consumer. Putting it on a store that is only available in certain countries is anti-consumer. I don’t really blame the developer who took the bribe (sorry, ‘deal’) but I don’t have to like it.

                    1. Mistwraithe says:

                      Huh again. According to the Epic Game About Page the Epic Games store is available world wide except where prohibited by US law such as North Korea and Iran.

                      Perhaps you are referring to fact that Epic Games don’t accept some overseas payment systems which take very high commissions? This does limit the availability overseas so it is a point against them but I feel it is more a point against those payment systems. If I was running a store I wouldn’t want to allow payment using a payment system which takes 15% commission – or if I did then I would pass that fee back to the consumer who was choosing to use that payment system.

            2. The Dark Canuck says:

              I don’t think that’s at all fair. 2K didn’t randomly decide to make their game require Steam, nor did they do so out of the goodness of their heart. Rather, Steam offered a set of features (DRM, achievements, patching, etc) that made it an attractive platform to work with. Epic is doing exactly the same thing, except that their feature set includes guaranteed sales. Why is that worse?
              Any developer who has made an Epic exclusive could have sold their game on GOG, Steam, Origin, or anywhere else, they just choose not to.

          3. Dreadjaws says:

            Fine, but I still think you’re wrong. If you’re assuming that Epic is incompetent, maybe consider that you could be wrong about that. Epic didn’t pull its 12% figure out of nowhere, and if you think that was just a publicity stunt, the fact that it hasn’t changed in a year should be evidence against that.

            You make it sound as it 1 year is a long time for a publicity stunt, when some of them can last decades. The job of a publicity stunt is not to get a quick result, but to get a result with a quick effort. The more its results last, the better, as long as it’s sustainable.

            I understand that you like GOG better than Steam or the Epic Games Store, but it’s been around for 12 years and still has a fairly small share of the market. If competing that way worked, then GOG would already be the competitor to Steam that Epic is trying to be.

            Except that GOG hasn’t tried to be a direct competitor to Steam (or at least not for the majority of its existence). When GOG launched, their purpose was, like their name says, to be a haven for old games. Then they started welcoming indies and then expanded into some relatively old AAA releases (which are still a secondary concern). GOG isn’t pushing to be a competitor so they can remain in their relatively cozy place in the industry. Hell, they have all the right to keep their own first party releases as platform exclusives, like Valve and EA do yet they never did that. That alone should be a sign that competition isn’t their interest.

            …And by the way, back when Steam was new, Valve was acting just like Epic is now.

            Ugh. This BS argument again. No, it’s not the same when we’re talking about first party exclusives. No one would be mad at Epic for using their own platform to wall off their own games. Many companies do that and the worst they get for doing so is a groan for having to install a new launcher, but that’s it. It’s their own games we’re talking about, they have all the right. If you buy a third party game in a store and you have to install Steam to use it, it’s not Valve forcing you, it’s the publisher. They never signed exclusivity deals with Steam, they did it out of personal convenience.

            1. Mistwraithe says:

              You don’t think the publishers signing exclusivity deals with Epic are doing it because it suits them? Of course they are. I fail to see the difference between a publisher only publishing on Steam because its a monopsony and hence the best way to make money and a publisher only publishing on Epic because Epic is going to guarantee them income and hence it is the best way to make money.

              Yet you believe the monopsony is good and the paid exclusive is bad. Huh?

        2. Matt says:

          [GoG’s] anti-DRM stance and slightly more responsive launcher makes it a nicer place to buy games. Epic could compete in these areas.

          I don’t think, as should be evident from the failure of GoG to become a true Steam competitor, that these points are simply not persuasive enough to a sufficient number of customers. Not many casual games fans, and few enough hardcore fans, care about DRM. Competing on another axis, by trying to pull away developers, seems like the only way Epic might be able to compete.

          You’re taking the position that Epic MUST use exclusives to get customers. I’d counter by saying that their tactics is making their customers hate them. Yes, growing through features and policies is slower than the sledgehammer of exclusives, but it brings in people who WANT to use the platform instead of people who GRUDGINGLY use the platform.

          From a business ethics perspective, as Cinnamon Noir notes, there isn’t really any difference between HAPPY customers and GRUDGING customers. Happier customers are only better if they buy enough product to justify the additional cost. New features seem to be more expensive than exclusives without delivering much in the way of new customers (see GoG). Epic should be focused on delivering the minimum viable platform that customers are willing to pay for in order to keep costs low while trying to compete with Valve along a new axis.

        3. Mistwraithe says:

          Shamus, I think the essential error in your stance is the assumption that there are other ways to compete with Steam other than exclusives. I see no evidence currently that it is possible to compete with Steam *at all*, even with exclusives.

          GoG are a perfect example of how difficult it is to compete with Steam – they have been around for years, have a nice store, no DRM, a good launcher, and GoG Galaxy 2.0 allows GoG to act as a central point for multiple game storefronts. They are trying to gain market share and yet they remain minnows. They publish their financials publicly and GoG consistently loses money or makes a small profit. It seems very likely that they GoG would have gone out of business or would have even less features if it wasn’t for CD Projekt requiring them for commission free distribution of their own games (that will be where the main financial benefit to CD Projekt comes from given GoG itself makes no money).

          Epic don’t want to spend a decade trying and failing to compete with Steam. They actually want to succeed and become a viable competitor by presumably getting at least a quarter or a third of the market share that Steam has. Platform exclusive have worked elsewhere, the consoles have them, Origin has them, Ubisoft has them, it’s a common play. They have also decided to compete on the supply/developer side by offering a far more favorable deal than Steam does.

          To date it doesn’t seem to have worked very well due to mass push back by consumers (hence my assertion that there is *no evidence* to date that it is even possible to viably compete with Steam) but I can certainly understand their mindset. I think a strong case can be made that Epic’s approach is the ONLY way to attempt to compete with Steam.

          To be sure, Epic should also be competing much better on their storefront features – they need to match Steam there and then gain their edge with exclusives and through being the favored platform for developers (ie the revenue split). Their slow rate of adding features is a big problem for them, but that doesn’t mean the exclusives are a bad part of their strategy – it means that the storefront part of their strategy has let them down.

          1. Syal says:

            Platform exclusive have worked elsewhere, the consoles have them, Origin has them, Ubisoft has them, it’s a common play.

            Steam could have them if it wanted. That’s the fun part of Epic’s strategy; if it succeeds, Steam will start doing it and swamp them out that way. And the customer will be back where we began, only wetter and worse off.

        4. Gndwyn says:

          Epic is doing the exact same thing Steam did. Steam didn’t get started by offering consumers a service they liked. They had exclusive games (Half-Life 2, Team Fortress 2, Portal, Counter-Strike, Left 4 Dead) and if you wanted to play those games you had to grudgingly install their sucky Steam platform. Steam got better, but only because the install base created by those exclusives gave Valve the opportunity to make it better.

      3. Matt says:

        I agree. As a consumer, I am in favor of pro-consumer practices in a market that favors me. For the same reason, I favor the lowest possible prices. However, I also understand that my preferences are not the sole factor in determining how the market is shaped. Other actors, with their own preferences, are in play. There doesn’t seem to be anything illegitimate about what Epic is doing, just trying to compete along a different axis. That may not be an actual improvement for consumers but, as you said, may lead to a healthier, more sustainable market for digital games.

      4. baud says:

        I disagree that Steam is a monopsony (learned a new word today!), since other stores (including EA’s Origin, which sells Ubisoft games, Final Fantasy XV, THQ Nordic games and indies) can sell games, in addition to selling outside a store.

        I was very disappointed when Jim Sterling, who was more than ready to criticize Valve when it was unchallenged and there was no chance of fixing it, turned on the Epic Game Store and decided that every game being on Steam was more important than a healthy business environment for digital games. He set his own comfort and convenience as a higher priority than the future of the market

        I rather think he decided he’d get more views/engagement by only focusing on EGS, rather than covering both. Also EGS is current events and the situation with Steam doesn’t really change, so there’s less for him to cover there.

    4. krellen says:

      Every other launcher does this – Origin, Uplay, Blizzard, you name it – and we use their launchers.

      Actually, I don’t use those launchers, for all the same reasons I don’t use Epic. Stop making me make new logins. Making a new account is a security risk.

      1. Distec says:

        I’d also like to point out that the nature of how some of Epic’s exclusives came about matters here.

        I can completely understand why World of Warcraft is on Blizzard’s launcher; it’s their product, they made it, and they can do with it as they wish. If Epic wanted to release the next Gears of War or Unreal Tournament exclusively for their launcher, that makes total sense. I’m not gonna bite, but I respect it and don’t feel entitled to any complaint.

        This isn’t what happened with their first round of exclusives. In my eyes, it’s the example of Metro Exodus that will tar their reputation with me for the foreseeable future. That was a game that advertised itself on Steam with an imminent release date of a few months, and Epic swooped in and snatched it with payola. That move leaves a very different impression with me than if some indy dev decides to work with Epic from the onset. The case with Darq is just icing on top.

        There was nothing stopping Epic and Deep Silver from doing what they did. It’s not illegal, and businesses are gonna business. But I think they broke an informal – but very real – contract with their customer base and pulled what common folk would describe as a “dick move”. I wouldn’t be surprised if Epic slowed down on being that blatant with the exclusives that followed, but that mark will last with me.

        There are many games on this planet; old and new. The deals are better than ever. My patience can be infinite. And it’s no skin off my back to pettily dismiss the entire catalogue of certain publishers and platform owners if they piss me off, for whatever reason.

        1. etheric42 says:

          When Empire: Total War (or was it Total War: Empire?) came out it was released through all the normal brick and mortar retailers through normal pre-order and off-the-shelf buying practices.

          What actually came in the box was a CD with a link to download the Steam launcher and a Steam Key to put in. I didn’t even have an internet connection at home at the time.

          This was a Steam store exclusive done to increase its install base and enter the market (and even more of a bait and switch than Metro was, as it crossed from physical to digital and didn’t really strike me as an unplanned market opportunity).

          1. Distec says:

            Did Steam/Valve pay them for platform exclusivity, or was that what the devs and publishers internally thought was best for the product? Did Valve actively pursue such a deal, or did the game makers just decide to take advantage of the opportunity that was presented to them? Did Gabe Newell wire over extra cash to the publisher to make this happen, or did they decide to hook up with Steam because that just made the most sense to them, with no extra effort required from Valve? To my ignorant eyes, it seems that Valve’s had the approach of “If we build it, they will come”, which is in marked contrast to deliberately seeking out targets to poach. If you know anything that would contradict that, I’d be happy to hear it!

            If my view is accurate, though – I can’t say I’m angry at Valve in that instance. They won out by making a platform with intrinsic value that game companies recognized and seized, not injecting themselves into an existing relationship and “paying off” their targets to move to a sub-standard platform with fewer users and features. Is such a move legitimate? Absolutely. But it wasn’t something done for my sake as a consumer, and Epic has essentially stated as such multiple times. Deep Silver traded a larger customer base and fandom for bags of money from Epic, and I’m not really in the picture (nor is the health of the product itself, arguably). So that’s fair – and it’s fair of me to not respect it and walk away.

            This isn’t to minimize the frustration of what you detail with your Total War example. I fully respect anybody for being anti-Steam if that was how they first encountered it, and I respect that stance for ongoing reasons as well. But I think the contexts here are different enough that I don’t really see this as an apples-to-apples comparison. Irritating nonetheless, for sure. And yet for different reasons.

            1. etheric42 says:

              It’s hard to get news on that situation this many years later. (And I definitely don’t see Creative Assembly deciding to remove the install code for their game from the CD without having some kind of contract with Steam that they would fulfill the game for their customers.) But I don’t see what the difference is between saying: if “you make your game exclusive to our platform, we’ll handle patches and DLC sales and maybe someday in the future you won’t have to print as many boxes and CDs” and saying “we’ll guarantee that no matter how poorly your game sells, you’re going to make X much.”

              Because remember that’s what Epic’s deal was. It wasn’t “here’s a truck full of cash” it was “if you sell less than X, we’ll pad it up so you at least make X.” (I don’t think a truck full of cash is that bad either, but they are different).

              The feature that Epic sold people was money. It always has been money. They take less of a cut. They give these financial guarantees. They give free games to players (and I’m assuming they give some $ to the devs for that arrangement). They give discounts to players (in the form of their unlimited coupons) that come purely out of their cut. Why is having a financially better arrangement a dirty thing? We’re okay with buying cheaper things that have less features, or accepting a job that pays more but has a worse working environment, or buying fair trade even if it costs us more and doesn’t taste any better.

              The developers that took the Epic guarantee that had previously promised (or planned for) Steam keys. That is frustrating. I agree. Same as all those developers that promised features that didn’t get implemented, or were broken, or just never released their game at all. Some of those developers were faced with choices between changing their promises or not releasing the game at all. Or if they could fulfill their promises, they face the risk of closing their doors immediately afterwards. And the Epic deal likely wasn’t on the table when they made those promises originally. Fulfilling those promises would have definitely been the honorable thing to do. But Epic shouldn’t be the one to blame because they offered something the developer wanted/needed (stability, cash infusion).

              If you’re dating someone and someone “came on the market” that caused your significant other to dump you and hook up with them, it’s understandable to be angry. But even then that’s not really that third party’s fault that your partner dumped you. Even if they flirted with your partner, it’s entirely your partner’s choice to dump you. Even worse, in this circumstance they didn’t even dump you. They dumped a friend of yours (Steam) and started dating a stranger (Epic) who also wants to be your friend (in the same way Steam does) even if they are a little awkward.

              1. Steve C says:

                BlueHorus said it well:

                There’s GOT to be a term, in English or another language, for Epic’s approach to their PR. Pretending to be the scrappy underdog when they’re not; invoking principles they don’t believe in for their own, selfish ends; shit-talking their rivals for doing things that are near-identical to things that Epic themselves do…there HAS to be a term for this specific type of behavior.

                I don’t have a problem with why Epic is doing what it is doing.
                I don’t have a problem with what Epic is doing what it is doing.
                But holy crap I have a problem with how Epic is doing what it is doing. A company trying to weaponize their teen demographic as PR stunt backdrop to a court case between multi-billion corps? Epic has done some seriously gross things, but that takes the cake. I don’t think Epic’s goals are wrong. I think they are slimy as fuck. Epic is the real world Little Lisa corp.

                @etheric42 To use your example, it would be divorced parents using the kids to sabotage each other’s relationships. Regardless if it true, legitimate or warranted, it will always be unsavory and gross.

                1. Mistwraithe says:

                  Poor analogy. But if you want to carry it through then I think Valve is using the kids against Epic at least as much, this whole thread is about consumers (the kids) pushing back against the concept that they might have to use Epic as well (allow Epic joint custody if you want to continue your analogy).

                  1. Steve C says:

                    Uh I don’t know why you say poor analogy and then restate what I stated. I was referring to everyone here. Both parents were doing the same thing.

                    1. Mistwraithe says:

                      Fair enough, both parties are engaging in it.

                      My poor analogy comment was more because I have much more sympathy for children with divorced parents than I do with consumers who are being forced to install a second games storefront. The two situations are not even close to being comparable.

                2. etheric42 says:

                  I don’t know. Parents have a prior commitment both to eachother and to create a healthy environment for their children together. The commitment to eachother was broken, but there are sometimes good reasons for it. I don’t see Epic and Apple’s relationship to the consumer as a partnership for the best interests of said consumer, and even if you do, I don’t see Epic trying to break up Apple and King games. Flipping it to Epic/Steam, I definitely don’t see a situation where Epic and Steam had a partnership to create a supporting environment for the players. I just don’t think the analogy works.

                  I don’t think Epic is strip-mining game developers and repackaging it as wholesome. If anything they are investing in developers. Is the moral of Little Lisa Corp that when a vision partners with business, the visionary had best retain control, or else they’ll find the business has optimized for business at callous indifference to the vision? Or is it a retelling of the scorpion and the frog? Either way if you say you don’t think Epic’s goals are wrong but they are still Little Lisa corp, there’s still a disconnect, as Mr. Burns’ goal (regain his fortune at all cost) is wrong.

                  And yes, a $17 billion corp entering a new market is absolutely an underdog compared to a $2 trillion incumbent (although I’ll cede that their estimated valuation is higher than Valve’s $10 billion, but storefront is Valve’s primary business model and is the incumbent, and Epic’s tertiary.)

                  What is your limit for what is proper for a company to do to promote itself? Maybe I’m missing some nefarious deed that Epic did.

                3. Gndwyn says:

                  If you are talking about Epic and Apple, that is not a battle between two multi-billion dollar companies. It’s a battle between a $17 billion-dollar company and a TWO TRILLION dollar company. Apple could buy Epic’s parent company, Tencent, twice and still have a TRILLION dollars left over. Apple has $200 billion IN CASH. The idea that Epic isn’t an underdog compared with Apple is ridiculous.

                  The difference between a million and a billion is *nothing* compared with the difference between a billion and a trillion.

              2. baud says:

                Because remember that’s what Epic’s deal was. It wasn’t “here’s a truck full of cash” it was “if you sell less than X, we’ll pad it up so you at least make X.” (I don’t think a truck full of cash is that bad either, but they are different).

                Though it’s more of an advance on the sales (Y amount of money corresponding to X sales), given once the deal is signed.

          2. baud says:

            Well, it was written on the back of the box that it requires an internet connection and a Steam account

            1. etheric42 says:

              You’re absolutely correct. But there are a lot of things written on the back of boxes. And this was the first time (one of the first times?) anyone had tried putting a download code on a CD on a store shelf for a single-player game. Why was it even a CD instead of a scratch-off? To fit in with the rest of the herd. Why did it not at least come with the pre-patched game? To get you locked into Steam.

              1. baud says:

                I would have a hard time believing that, when delivering only a code, CA wanted to lock the buyer into Steam. I rather think they just went for the cheapest way of delivering the games to those who bought the game at a store.

                Also, regarding “you make your game exclusive to our platform, we’ll handle patches and DLC sales”: has Steam ever asked for an exclusivity contract when offering to sell/distribute games?

    5. Gndwyn says:

      Also, Epic is spending money to get games made that otherwise wouldn’t get made. Or to get games made better than they otherwise budgeted. Epic’s money saved IO Interactive and made Hitman 3 possible. I wonder if people would be less mad at Epic if they just bought the studios outright and published the games themselves the way Valve and Microsoft do it.

      Valve didn’t pay Campo Santo to make In the Valley of Gods a Steam exclusive. Instead they bought the studio, killed the project, and put the talent to work on their Steam-exclusive Alyx game. If it was Epic, they would have paid Campo Santo to make In The Valley of Gods, let them continue to be an independent studio, and gotten a bunch of criticism for wanting a return on their investment with a limited exclusive right to sell the game.

      You’re not gonna see Half-Life: Alyx for sale in the Epic store a year later. Even if In the Valley of Gods ever gets made, it will be a Valve game and exclusive to Steam forever.

  8. John says:

    I’ve always felt like [Fortnite’s] dominance was a fragile thing. It’s shockingly popular, and yet I never encounter fans.

    I don’t know any Fortnite fans either, but like Shamus I am a boring old middle-aged man. My daughter on the other hand is only 11, and she says that Fortnite is the second most popular game at her school. (The most popular is Roblox. Minecraft is a distant third.) The lesson, I suppose, is not to assume that the people you know are a representative sample of the broader population.

    1. Christopher Dwight Wolf says:

      I work in a high school. LOTS of kids play Fortnite.

      1. Jared Smith says:

        This

        I was going to say you’ve never met a Fortnite fan because you don’t hang out with enough people < 20.

        1. Geebs says:

          This is the main reason why the Fortnite “1984“ spoof really hurts my brain. Like, how many of their fan base know what in the hell that is even referring to? I didn’t even know about the original ad until about 15 years after it aired, and I was alive at the time. It’s such a bizarrely Boomer thing for Epic to refer to, for a company in touch with The Kids.

          1. stratigo says:

            I feel like it’s an add for the boomers who make decisions in court. Not the kids that buy their game. It’s trying to influence the perception of the public as a whole, a public where all the power and wealth is in the hands of boomers, and hasn’t been really filtering down to the rest of us.

          2. etheric42 says:

            I don’t know, riffing on hold the “old timers” are so out of touch that they have become what they fought against in their youth is a classic generation war meme. It fits in nicely with the “ok, boomer” meme. The ad gets referenced again every few years and was brought up in the recent congressional hearing. And even if they don’t get the reference, the fact that it is a reference will made clear in the reporting/comments on the issue.

            I was born in 1984, but when I was a youth I knew all about Abbot & Costello, Lucille Ball, Bing Crosby & Bob Hope, etc. even if their heyday was decades before I was born. While not everyone gets every reference, I feel it’s insulting to assume “kids these days” don’t get references or have access to tools to help them get references for things before they are born. Especially with much easier access to the archives of our culture than we had in the days of VHS and broadcast television.

            1. Nimrandir says:

              I also try to avoid generalizing about later generations’ knowledge, but I can say anecdotally that almost none of my college students know who Cary Grant and Leslie Nielsen are. I also get many blank stares when I tell them my favorite movie is The Maltese Falcon. Granted, they’re often quick to look something up (like when I forget the fifth Jackson or can’t remember all the Fireside Poets), but let’s not get me started on how one of my few talents has been made obsolete by the ubiquity of the Internet.

            2. Geebs says:

              I feel it’s insulting to assume “kids these days” don’t get references

              Fair enough, although the point I was making was more that I didn’t even know that reference when I was a kid, in an all-Apple household, at the time.

              I do wonder how much of your knowledge of those entertainers is due to frequent re-runs on TV being the only thing available to watch when you grew up, though. Kids these days have way more current media to consume, let alone having time for the old stuff. I don’t know if it’s that I tend to work around particularly culturally oblivious people, but surprisingly often I have to explain to colleagues who e.g. Nirvana were.

    2. Joshua says:

      I have no desire to engage in all of the arguments that have popped up here about NN, monopolies, etc., but apparently Fortnite is on average played by a much younger than typically visits this site.

  9. tmtvl says:

    I love everything that Valve has done for the GNU/Linux community (and I mean, they’ve spent so much time and money on a community that has a whole 1 percent market share, that is simply altruism at it’s finest), and now I respect everything they do even more in face of what I’ve learned from this post and video.

    Now I’m not in on the whole iDevice/MacOS scene, so I don’t know if iPhone users can get their apps anywhere else than the Apple store. However, if the Apple store is the only place iPhone users can get apps, then I hope Epic wins the antitrust. Even Apple customers deserve the freedom to install apps from alternative sources, just like how Android users can use F-Droid or other alternatives to Google’s App Store.

    As to Steam’s monopoly, I would love for more people to start using Itch.io for their indie purchases. EA, Ubi, Beth, Paradox, and MS have their own stores so you can get your AA(A?) games there.

    EDIT: To manage the different storefronts you could use something like Lutris if you’re not the type to manage everything by hand.

    1. Echo Tango says:

      I try to use GOG and Itch before I buy from Steam. I at least get some benefits from not using Steam[1], but it’s a tough habit to break, since Steam is always running, and GOG-Galaxy doesn’t run on Linux yet. :)

      [1] DRM-free copies I can keep backups of, and a better cut for indies.

  10. BlueHorus says:

    There’s GOT to be a term, in English or another language, for Epic’s approach to their PR.
    Pretending to be the scrappy underdog when they’re not; invoking principles they don’t believe in for their own, selfish ends; shit-talking their rivals for doing things that are near-identical to things that Epic themselves do…there HAS to be a term for this specific type of behavior.

    That tweet is a perfect example: ‘If Steam deliberately sabotages themselves in our favour, we might consider not buying up exclusives’. It frames their behavior as someone else’s fault (they’re forced to do it, guys!) and then says they’ll stop once [conditions that will never occur are met]. Dishonest, sure, but in a very…specific way.

    The only word I can think of is ‘disengenuous’, but I don’t think it fits. Maybe ‘mendacious’?
    …Disingenuous mendacity?

    1. Bloodsquirrel says:

      There already is. You used it yourself- “Public Relations”.

      PR is always propagandist nonsense.

      1. Redrock says:

        Hear, hear. As someone who’s worked in PR and seen their own soul wilt in the process I wholeheartedly agree.

      1. BlueHorus says:

        Not quite. They’re pretty hypocritcal, sure, but there’s more to it.

        It’s similar to apophasis, in which you bring up a topic by denying it should be brought up –
        (I.e ‘I won’t bring up my client’s celebrated military career, because it’s not relevant to this trial…’)
        – same kind of underhanded approach.

        1. Bloodsquirrel says:

          That would be passive aggressive.

        2. Daniel says:

          You’d be surprised ;)

          https://en.wikipedia.org/wiki/Hypocrisy

          “Hypocrisy is the contrivance of a false appearance of virtue or goodness, while concealing real character traits or inclinations”

          “Other kinds of hypocritical deception include claims to knowledge that one lacks, claims to a consistency that one cannot sustain, claims to a loyalty that one does not possess, claims to an identity that one does not hold”

          Etc, etc (the entry is kinda big :P)

          Good enough for me ;)

        3. Asdasd says:

          it’s sort of adjacent to cry-bullying, or two-facedness, but not the same.

    2. Levi says:

      Duplicity is what I like best, I think, though they’re being disingenuous as well.

      Going to be turning this one over for a while…surely the Romans came up with something for this. ;)

      1. Syal says:

        I propose “pig shit”.

    3. Ibb says:

      I’d go with “astroturfing.” It’s not quite accurate, as astroturfing usually attempts to have non-corporate faces spouting the nonsense, but that does seem to be what Epic is aiming for.

  11. Tomas says:

    If you sell a game for sixty US dollars, then Valve keeps twenty for themselves.

    That would be 18 dollars, if they’re taking 30%.

    1. Shamus says:

      HEAD. HIT. KEYBOARD.

      Dangit. I kept doing this through the whole video, substituting a 1/3 cut for a 30% cut. They’re very close, but not the same thing! I thought I caught them all, but clearly I didn’t.

      That’s going to bug me forever now.

      1. CrimsonCutz says:

        I don’t see the problem. Getting worked up over the difference between 30% and 33.33~% is almost as bad as getting worked up when I insist pi should stop trying to look cool with extra numbers and just settle on 3.14 exactly

        1. Nimrandir says:

          I don’t know; if I were a circle, I’d be pretty annoyed at your insistence that I either adjust my circumference or my diameter to match your perceived standards.

          Shape-shaming isn’t cool.

          1. General_Karthos says:

            Best. Comment. Ever.

          2. Richard says:

            That’s fine, we can just bend space to fit

        2. Mr. Wolf says:

          pi is 3.142, anything less is pedantry.

          And acceleration due to Earth gravity is 9.8m/s2 no matter how many times my high school exams insisted it’s 10m/s2

          1. Philadelphus says:

            Bah, all this pi talk! We all know the real circle constant is tau!

            1. The Puzzler says:

              And tau, for those who don’t know, is 6.

            2. Nimrandir says:

              I feel like this is just propaganda by the physicists and engineers who never remember to close their parentheses when putting h-bar into a calculator. On the upside, Tau Day has the neat side effect of being the only day in our calendar whose month and day are distinct perfect numbers.

              Real talk, though: as a differential equations guy who has to teach a lot of financial mathematics, I hold that e is the more important constant.

        3. Gndwyn says:

          MEDIA PORTRAYAL OF A PHYSICIST: recites pi to thirty places

          ACTUAL THEORETICAL PHYSICIST: rounds pi to 1

          1. Nimrandir says:

            I give physicists the benefit of the doubt that they know they aren’t rounding. Rather, they just call constants 1 because “we can put them back in later.”

            1. Urthman says:

              I think it’s more like if you’re comparing the size of a star to the size of a galaxy, you can just use radius-squared to approximate the area of a circle and it’s plenty close enough. All that matters is getting the order of magnitude right.

              1. Nimrandir says:

                Maybe for some physicists, but I’m referring to a statistical mechanics professor who started the semester by setting a dozen or so constants equal to 1, including the speed of light and Planck’s constant. I will admit I got this story from an officemate, but she never gave me cause to believe she was trolling me.

  12. Mathhorse says:

    If you sell a game for sixty US dollars, then Valve keeps twenty for themselves.

    Thirty percent of sixty dollars is eighteen dollars, not twenty dollars.

  13. Bloodsquirrel says:

    Good video, but there’s a deeper point that needs to be made here:

    It’s absurd to moralize the competition between Valve and Epic, the deals that they make with developers, or anything else that involves purely voluntary transactions between willing actors. Neither Valve or Epic are the “good guys” or “bad guys” here. They’re competing companies. Said competition presents the market with different options for buying games, and it’s up to us to decide what’s preferable. In the end, it’s likely to turn out (as with most things in the market) that people have different ideas about what’s preferable, and thus the market as a whole is best served by having multiple platforms that offer different values to the consumer.

    When people start trying to make things like how much of a cut Steam takes or Epic paying for exclusives into moral issues they’re ignoring one simple truth: That the only way that Steam or Epic can make money is by offering a deal that is beneficial to all parties (themselves, the developers, and the consumers), If either the developers or the consumers don’t benefit, then they can walk away, go to other platforms, and Steam or Epic don’t get any sales.

    Shamus’ video does a good job of pointing out why developers benefit from Steam’s services. Is that worth a 30% cut? The developer has to decide that. It’s not a moral issue, it’s an economic calculation. If putting their game on Steam means getting 50% more sales because of their having access to a popular storefront, then it’s a good deal.

    Likewise, Epic paying for exclusives should not be dismissed as “anti-consumer”. Epic isn’t forcing developers to only release on their platform. They’re paying them. This means that the developer is doing the same kind of math as they would be in deciding whether to let Steam take a 30% cut: Does the amount of money that Epic is paying us make up for the lost sales that come from not releasing on Steam? If the answer is “yes’- which the developer must think that it is if they’re taking the deal- then it means that the developer is going to walk away with more money, which means that they’re going to be in a better position to provide more games and more value to the consumer.

    I’d rather get Pillars of Eternity 3 (A game which may not happen because PoE 2 sold poorly) on the Epic Games Store than not get it at all, and that’s the kind of option that Epic being willing to pay for exclusives creates for me.

    Everything here is about trade-offs, and the only way to figure out the “correct” answer to each trade-off is to let each interested party decide which option is the best for themselves. That’s how economic calculation works. That’s how the market provides us with greater efficiency and a greater number of consumer options. Moralizing parts of this machinery makes about as much sense as moralizing about whether the next Xbox should use an Nvidia or AMD graphics card.

    Where people often go wrong is in assuming that, if they have one option presented to them that is sub-optimal from their point of view, then it’s because better options have been taken away from them. But that’s an unfounded assumption. Usually, it’s the other way around: without Steam taking their 30% cut, they would have to be far more exclusive in terms of what they put on their store. Without getting the extra revenue and financial certainty from Epic, the developers would be more likely to go out of business or have to provide a game with fewer features or lower quality control. But since those outcomes are a lot harder to see (since they haven’t happened), people don’t take them into account, and only see the current options plus what their optimistic assumptions tell them the hypothetical options would be. And, since they think that better options are being taken away from them by those mean ol’ corporations, they think they’ve got a valid moral complaint to make.

    But they don’t. There is no inherently moral issue to any of this. Just a bunch of parties working out a business arrangement that maximizes the benefit to each, consumers included. Making a hero or a villain out of Steam or Epic is just going to let one side or the other take advantage of you. Let the two compete, take the best offering, and be thankful that neither has a monopoly control over games distribution.

    1. Hector says:

      Yeah, but I object to one of those parties insisting on their moral glorification. Act selfishly in the market, sure. But I’ll kick their teeth in (metaphorically) for pretending their motives are anything but selfish and sneer at them for self-aggrandizement. Plus, if they get in my way, I’ll be pissed.

      1. Bloodsquirrel says:

        “Get in your way”?

        1. Hector says:

          Cause me irritation, prevent me from buying the goods I want at stores where they would otherwise be available, interfere with direct developer-customer agreements a la Kickstarter, etc.

          1. Bloodsquirrel says:

            Cause me irritation

            You can decided to be irritated just because you don’t like Sweeny’s face. Your emotional reactions are not their problem.

            prevent me from buying the goods I want at stores where they would otherwise be available

            As I described above, you’re assuming that said goods *would* be otherwise available. Developers wouldn’t be taking up Epic on their offer if they could make more money selling in retail stores. It’s impossible to know exactly who would go out of business or which features would be cut without running the counterfactual, but providing more financial security to developers *will* mean that certain marginal products will be brought to market that would otherwise be cancelled.

            interfere with direct developer-customer agreements a la Kickstarter, etc.

            First off, if a developer decides to break their contract with you, then that’s on them. It isn’t Epic’s job to ensure that a developer meets obligations that they were not a party to. Second, this is a problem inherent to using Kickstarter as a pre-order platform. Having to use the EGS instead of Steam is certainly better than the half-finished or just completely abandoned projects that have come from crowdfunding. Kickstarter does not, and never has, come with guarantees. Backer beware.

            1. Hector says:

              You can make that argument all day, but that will not at any point stop me from kicking Epic. Regardless of whether or not it was rational *for them*, Epic made things worsde for me. And I have not the slightest compunction about kicking them in the face for it. Epic made it clear it doesn’t care about me and mine, and therefore I feel quite happy about retaliating.

              Plus, even to make some of your arguments you have to handwave Epic’s involvement in those actions or the facts of the situations. Games that would have been available elsewhere were not – because of Epic. Epic actively interfered with developers who already announced on Steam for Kickstarters & etc. And ti goes back to the topic at hand: Epic, and Time Sweeney in particular, act as though they are to be publicly congratulated for their self-interested behavior. They should receive a right smack instead of plaudits.

              1. Bloodsquirrel says:

                You can make that argument all day, but that will not at any point stop me from kicking Epic. Regardless of whether or not it was rational *for them*, Epic made things worsde for me. And I have not the slightest compunction about kicking them in the face for it. Epic made it clear it doesn’t care about me and mine, and therefore I feel quite happy about retaliating.

                Serious question: do you realize how unhinged this comes across as? Because if I had a customer taking this attitude with me, I would cut my relation with them immediately and tell my staff to call the police if they ever come around again.

                1. Hector says:

                  I can assure you that the “kicking” in this case is a common metaphor. I can’t actual injure an abstract corporation, and I choose not to be an Epic customer, so there is no relationship. If you’re incapable of understanding that, too bad.

                  1. Bloodsquirrel says:

                    Okay, so not let me not phrase this as a question:

                    You sound unhinged, down to the “if you don’t understand, to bad”. Seriously, whatever point you think you’re making, it isn’t coming across. Maybe you should cut out the violent imagery and the “you can’t stop me” stuff from your language if you want to sound like you’re taking a reasonable stance instead of legitimately sounding like you might send a mail bomb to Tim Sweeny.

                  2. Matt says:

                    Not to step on Bloodsquirrel’s toes, but this just seems unnecessarily antagonistic. “I chose not to do business with Epic,” or even, “I boycott Epic’s games and store” are what you seem to be saying that you do. I’m American and I’ve never heard these activities described as “kicking them in the teeth (metaphorically).” It implies that your refusal to do business with them is far more injurious and humiliating than it is. The people who routinely use this type of rhetoric are the types of who take direct action against corporations, which it doesn’t sound like you’re doing.

                    1. Hector says:

                      I may be no more than a mosquito, but I shall keep on biting as long as Epic wallows in the swamp.

                      And you haven’t even heard me rant about Sony yet.

                    2. Shamus says:

                      To a certain extent, I suspect this… spirited rhetoric is the fault of Epic. I can’t escape the feeling that if Epic was just quietly running their store it would be easier for people to accept the argument of, “Hey, it’s just business”. But Epic keeps doing this PR stuff that seems to be engineered to piss people off. Sweeney claims he’s going to “save PC gaming”*. They paint themselves as heroes. They praise rhetoric that paints all EGS boycotters at irrational lazy children. They launch PR campaigns where they’re a heroic underdog fighting against an authoritarian regime.

                      It’s not like the Epic hate is coming out of nowhere. Sweeney is deliberately running his mouth in public (Twitter) and picking fights. We can talk about the harsh realities of business all day, and we can put it all in a spreadsheet and prove that Epic isn’t really worse than many other tech companies. But those other companies aren’t asking us to praise them and even join them in hating OTHER companies.

                      I can’t prove this is the case, but I do notice that people react more negatively to self-aggrandizing PR than to the announcement of new exclusives. Like, people get more riled up over Epic pretending to be heroes than when Epic actually does something “bad”. (Yes, I realize that part of the argument is that those bad things aren’t all that bad. I’m just trying to make the case that the tone-deaf PR is the real source of hate.)

                      * Annoyingly, I can’t find the source for this anymore because the search results are filled with second-or-third generation quotes. But I know it was said early in the days of EGS.

                    3. Matt says:

                      Can’t reply directly Shamus’ post, maybe it’s too far nested?

                      Anyway, as to spirited rhetoric, I agree that it certainly riles people up, but….that’s pretty much all that’s going on everywhere, right? Everybody asks us to see them as the hero: Epic, Facebook, Twitter, Apple, drug companies, political parties, etc. Every one of those has their obnoxious PR people that loudly proclaim on social media how great they are and how evil their opposition is. It just forms part of the background of social (and traditional) media that gets ignored by most people most of the time. It’s not wrong to get riled up about any particular occurrence of this, but I just roll my eyes. Same as it ever was.

                    4. Asdasd says:

                      I think it’s two things, for people with longer memories.

                      Valve saved PC gaming. Like, they actually saved it. By the mid ’00s PC gaming was dead in the water. All the major developers had moved to console-only, or console-first with a terrible outsourced port job 1-3 years later. Piracy was widely cited by publishers as justification. Piracy was a problem, but as Steam proved, not an unsolvable one. You just had to be prepared to put in some work and investment.

                      It was apparently easier to write off everyone on PC off as a freeloader and migrate to the walled garden of consoles, including for Tim ‘software freedom fighter’ Sweeney and co at Epic, who plumped for the Xbox as their home platform from pretty much Gears of War 1 until their smash and grab raid on PUBG’s game mechanics exceeded their wildest dreams of success and turned Fornite from a moribund albatross to a golden goose overnight.

                      Meanwhile Valve, alone among the major players, stuck to PC and built Steam. Steam was in many ways the same bitter pill that EGS is – it was janky as fuck for many years, it was a step backward in terms of game ownership, and it had exclusives (HL2 was the original digital storefront exclusive, although at least Valve never bribed devs not to release on their main competitor’s store.)

                      This not only stemmed the exodus on PC, it also ushered in a completely new ecosystem that made independent development viable for the first time in nearly two decades. There was simply no market for the bedroom coder to operate in after the days of shareware were over and the industry consolidated around a publisher – retailer model. As the middle tier ‘AA’ software houses died under a ratcheting up in the cost of making games, indies were the lifeblood that staved off AAA stagnation.

                      And so it was that PC gaming had a slow, steady recovery that turned into a great flourishing. And in doing so it turned Valve into a behemoth, who, as Shamus notes, were completely liberated from the need to be a developer (although even as people say that, I note that I’ve spend thousands of cumulative hours on Portal 2, TF2, Dota 2, CS:GO, Underlords and Half Life: Alyx in the years where they ‘weren’t making any games!!111!!’).

                      People have a tendency to fixate on the present and act as though it’s all there’s ever been. But not so long ago, PC gaming was a near-deserted wasteland. Now it’s fertile soil, thanks mostly to Valve doing a lot of hard tilling which eventually hit paydirt. The idea that Epic are now showing up as heroic liberators is invidious, but that’s the narrative everyone’s latched onto. Even dedicated PC gaming sites are asking ‘what have the Valve-ans ever done for us?

                      Where this ties into Shamus point is that yes, Valve absolutely could use some competition. But the narrative that paints them as a terrible monopolistic company that inherited a market position they didn’t deserve, and Epic as a plucky newcomer who doesn’t have a dubious history with the platform, is a denial of reality, and feels a little like gaslighting. I think this is what people really react poorly to.

                    5. stratigo says:

                      read good ol’ bloody’s posts in this comment section and you’ll see where they are coming from. It’s concern trolling

                    6. etheric42 says:

                      @stratigo

                      That’s uncalled for. I’ve read Bloodsquirrel’s comments in a number of posts, and he is consistent and coherent in his values. I don’t always agree with how he expresses himself even if I agree with what he says. But to call him disingenuous in his posting on this article is wrong and I think bears a higher burden of proof than just calling names.

                      @Asdasd

                      What’s the old saying? Live long enough to become the villain?

                      I don’t think Valve is a villain either. I like that they have been challenged and I feel like a ton of tools that have been pending forever have been kickstarted into release not-coincidentally after Epic began its big push. Just because someone did something prosocial 15 years ago doesn’t mean they deserve market dominance forever. And honestly, I don’t think Epic will ever achieve market dominance, but the fight is contributing to a rising tide.

                    7. Asdasd says:

                      Etheric, I agree with everything you’ve said. The arrival of the EGS seems to have poked Steam into several moves which have been beneficial to its users, and I hope there are more to come. And hey, Epic have given me a lot of free games. I can’t be too ungrateful, although I might try.

                      I expect I will continue to overcredit Valve for their prosocial precedent for some time to come. Sentiment is a strong thing after all. And I’ll continue to push back against the ‘Valve = villain’ rhetoric, which I think is disingenuous and causes a lot of unnecessary harm and division across gaming communities – even if it means I get caught up in a different rhetoric which has its own difficulties mapping onto reality. But I’ll try to leave a little room for doubt in my worldview. It would be nice if we all could.

                      By the way, I keep thinking that your name sounds familiar.. did you ever play Blood Bowl in an online league, by any chance?

                    8. etheric42 says:

                      @Asdasd

                      Played Blood Bowl, yes. Multiplayer (online or tabletop) no. You might have seen me around SSC, League of Legends, Dawn of War 2 Last Stand, or the old Warmachine forums.

              2. etheric42 says:

                I don’t want to pile on here, but I both disagree with you and think saying you sound unhinged was uncalled for. So I’m going to try to take what you’re describing out of these circumstances and mirror back what I’m hearing.

                You say

                And I have not the slightest compunction about kicking them in the face for it. Epic made it clear it doesn’t care about me and mine, and therefore I feel quite happy about retaliating.

                and

                Epic actively interfered with developers who already announced on Steam for Kickstarters & etc.

                These seem to be the core of your anger. That because of the existence of Epic, you are worse off and providing the developers with other options counts as interfering.

                Now I’m going to change the situation and actors. Say you’re shopping for a home. You find one you really like. You put in an offer, but someone else does as well, and their offer is higher than yours, or maybe it is lower but is all-cash. The seller goes with their offer and signs their contract. Now there is basically no way for you to get the home you wanted. Does this make you upset at the situation? I sure would be! Does this make me want to kick/hate the person who outbid me? No. Why would I kick/hate the person just because their offer was better? It could have been me that won and I wouldn’t want them to hate me for it.

                Or what if you’re buddies with a co-worker and they get the promotion and not you? I wouldn’t cut off my relationship with them just because the employer liked what they thought the co-worker was bringing to the table better

                A new grocery store (Store B) opens up. They position themselves as selling international foodstuffs. The original grocery (Store A) store loses market share from shoppers who want a diverse international foodstuff section. As a result they decide to reassign the international shelf space to compete in a different sphere and some products you like are no longer on the shelf at Store A. I wouldn’t be angry with Store B over that, even if it was a likely outcome of specializing in international foodstuffs.

                That is how your comment comes across to me.

                Edit: fixed tags

                1. tmtvl says:

                  Or what if you’re buddies with a co-worker and they get the promotion and not you? I wouldn’t cut off my relationship with them just because the employer liked what they thought the co-worker was bringing to the table better

                  Well, if after my co-worker gets the promotion the manager suddenly starts driving around in a much nicer car than before I may raise an eyebrow.

                  1. etheric42 says:

                    I think in the “bribe the manager” situation, the major problem is that the co-worker is trying to get the boss to behave in a manner that benefits herself instead of benefiting her role/the company. That’s why I was referring to the employer and not specifically the boss.

                    In the case of Coffee Stain taking EGS money the deal was done in alignment with the company’s goals. Now if we find out that EGS have been padding the personal pocketbook of decision-makers, or treating them to hookers-and-blow, then that’s more comparable to your buddy bribing your boss.

                2. Steve C says:

                  Well said etheric42.
                  Needlessly insulting and confrontational Bloodsquirrel.

                3. Syal says:

                  Two parts:

                  Does this make me want to kick/hate the person who outbid me? No.

                  It makes me want to kick/hate the person who accepted the higher bid without giving me a chance to change my bid to match. That would be, roughly, the devs signing the deals with Epic.

                  Second, it’s not one house. It’s the same guy outbidding you at the last minute five, six, ten houses in a row. Fuck that guy!

                  1. etheric42 says:

                    I don’t think any of us could have outbid Epic, not even collectively through Kickstarter.

                    And that’s also just how real estate works (at least in the US). It’s usually not an open auction and competing bids are usually hidden information. Most of the time you get to do a Best and Final (make a second bid) but it’s with no knowledge of how many people are bidding or what their bids are. The information asymmetry can benefit the seller, but not always as a third round could improve things (and some people attempt third rounds anyway. The problem with an open auction is it can drag along and bidders can get overextended and back out.

                    And if the same guy is outbidding you 10 houses in a row, maybe it’s time to raise your price (or get a consortium together to identify that the bidder is secretly trying to amass a parcel to redevelop, and then snipe their needed properties and resell for profit).

                    Because, in this analogy, the other bidder isn’t out to get you specifically.

                4. Pink says:

                  The house analogy doesn’t quite fit. It is more like someone raising money to put in a playground or whatever in your neighborhood and then after collecting your money and keeping you waiting for several years, at the last minute they announce that they playground will be opening up in a neighboring town. It will still be available to you, but what that availability means will be very different.

                  Even if you get a refund at that point it is annoying in a way that doesn’t quite match ‘someone else bought the thing I wanted.’

    2. King Marth says:

      TL;DR: What makes you think one ‘side’ has to be right?

      Common debate trick – pose two positions, establish one is wrong, and conclude without argument that the other is right (with all the overloaded meaning that implies – correct, moral, superior…). For this to make sense, it isn’t enough for the positions to be opposed, they also need to cover the entire space of possible positions – if there exists a third option, that could change everything.

      1. Bloodsquirrel says:

        It isn’t even about one side being right or wrong, though. It’s about the argument being in the entirely wrong domain. Neither side is right or wrong. They’re offering competing services to consumers and developers, which may suit their needs better or worse depending on their preferences and situation.

        The “third option” is GoG, Humble, etc.

        1. Steve C says:

          Not at all. Anyone can be right for the wrong reasons. Or they can be wrong for the right reasons. These companies aren’t just offering competing services to consumers and developers. They are also sabotaging contracts with third parties, (like OnePlus) engaging in punitive retribution (like Unreal), weaponizing consumers (Fortnite players), etc. It’s a long list of bad actions by these corporations. Everyone sucks here.

          They are both right and wrong in different ways. But the one thing that is definitely not true is that “Neither side is right or wrong.” The fact they are both simultaneously does not somehow cancel it out to zero.

    3. John says:

      I think I broadly agree with your conclusions, but I can’t agree with your reasoning. It’s true that any trade between two parties is generally welfare-improving, but only for the two parties directly involved in the trade. There’s no reason to believe that trade between entities A and B is necessarily beneficial or even welfare-neutral for entity C. A and B are doing the best they can for themselves, which, if it does not harm C, is perfectly fine. But if C is harmed, then it’s reasonable to call A and B’s actions anti-C and for C to get justly and rightly irritated with A and B. Intermediate microeconomic trade theory is of scant comfort to C in these situations and I say that as someone who has taught (and loves) intermediate microeconomic trade theory.

      The real question, obviously, is whether or not Epic’s exclusivity deals are harmful to consumers. I’m inclined to say no. I can’t bring myself to characterize either (a) using the Epic Games Store or (b) waiting until the game is available elsewhere, at which point it is likely to be available at a substantial discount, as serious harm. Inconvenience, yes, but not real, substantial and quantifiable harm.

      1. Matt says:

        The problem with involving externalities, effects on Party C, is that it creates a rabbit hole that ultimately derails any fruitful action. Who is party C? Is it just video game consumers, or is it adults in general, or African rare earth miners, or the economy as a whole? Each could stand to benefit from increased sales and demand, or suffer from the burdens of their particularly industry and environment as a result of same increase. There is no one in a position to quantify the benefit/harm to all Party C’s in a given transaction, nor would such a person (or government or AI) be empowered to place taxes on any of these parties to reflect that benefit/harm.

        Given that, I think, there’s little sense to invoking Party C in an economic discussion. It only makes sense politically, in which case we’re talking about practical power, not theory. Can this company use the mechanism of government to enforce some kind of trade law that outlaws practices that it doesn’t like? Can “Moms Against Video Game Addiction” force changes to the industry using their leverage as voters.

        1. Echo Tango says:

          Those external parties can be reasoned about, using similar economic reasoning. Sure, the rare-earth miners aren’t directly involved in me manufacturing a new phone[1], but I can reason about what my customers might think, if my supply of materials involves harm to miners. I can choose to get a different supplier if I think my customers find out, and if their non-economic morals and values influence their purchasing decisions. The amount of separation between the direct parties and “external” parties, and the size of those external parties can be taken into account. Dismissing those parties entirely is ignoring people who can affect your cold, rational dollars.

          [1] Let’s say I make Android phones, for the sake of argument.

      2. Bloodsquirrel says:

        What you’re talking about is what we call “externalities”, but they don’t really apply here. They’re something you bring up when, for example, deciding to run a tannery in my back yard lowers the property value of my neighbor’s house, or when my getting a flu shot benefits someone who doesn’t because I’m contributing to herd immunity. Video game developers, distributors, and consumers all need to be in agreement in order for the final sale to be made, so if a deal between developers and distributors harms the consumer, then it can’t go forward.

        Mind you: this requires us to recognize the difference between “harm” and “I didn’t get everything I wanted”. The deal that consumers get may be sub-optimal from their point of view, but the worst case scenario for the consumer is that they keep their money and don’t get a game, in which case they’re no worse off than if the developers and distributors did nothing at all. It’s no more fair for the consumer to call it “anti-consumer” when their best offer is a product that he doesn’t like than it is for a developer to call a consumer “anti-supplier” if he decides that their latest game isn’t worth his money.

        1. John says:

          I know what an externality is, thank you. As I said, I used to teach this stuff. I’m not talking about externalities. What I mean is that the trades between A and B can affect the set of possible trades available to C. Let’s suppose that A is a wholesaler, B is a retailer, and C is a retail consumer. In that case, the better the deal that B gets from A, the better the deal that B can offer to C. Conversely, the worse deal that B gets from A the less scope he has to trade profitably with C and the higher the price that C is likely to pay. It does not necessarily follow that the price B obtains from A determines the price that B sets for C. Since you know what an externality is, I won’t insult you by suggesting that you don’t know what a perfectly elastic demand curve is. But, by that token, you should also know that the prices of inputs tends to affect the price of outputs. It’s foolish to believe that two-party trades never have welfare-affecting consequences for third parties, even if you are willing to assume away externalities.

          Here’s the thing. Your statement:

          Video game developers, distributors, and consumers all need to be in agreement in order for the final sale to be made, so if a deal between developers and distributors harms the consumer, then it can’t go forward.

          isn’t true. You’re suggesting that everything happens simultaneously and that developers, distributors, and consumers are all party to a single agreement. The truth is that in the age of digital downloads there are three separate deals here: one between the developer and the distributor, another between the developer and the consumer, and a third between the distributor and the consumer. The deal between the distributor and the and developer and the deal between the distributor and the consumer both have to take place before the deal between the developer and the consumer can occur. As with the wholesaler-retailer-consumer example above, the terms of the deal between the distributor and the developer affect the set of mutually welfare-improving trades between the developer and the consumer.

          The point that I really want to make here is that the harm–here specifically defined to mean the decrease in consumers’ utility relative to the counterfactual–that Epic’s various dealings create isn’t something that you can determine by recourse to pure theory. It depends on the game, the consumer, and, yes, the counterfactual. It’s an unavoidably empirical matter. It simply does not follow that because any observable trade is welfare-improving, relative to non-trade, for the two parties directly involved that any observed sequence of trades is the welfare-maximizing sequence of trades for all parties involved.

    4. Matt says:

      Based on some conversations in this thread, many people are just unable to rationalize away the emotional reaction that they get from being “cheated” when sub-optimal choices (from their perspective) are presented. They get the same indignant response as if they had been stolen from or mislead, even when the unconsidered alternative is that “thing doesn’t exist at all.” I don’t know if it’s a monkey brain thing, where we haven’t mentally evolved past small group interactions, or if it’s just the sometimes unintuitive nature of the dismal science, or if we’re primed to think that way by media and political actors.

      ETA: This came across as a little more dismissive than I wanted it to be. We all, obviously, have our blind spots and I don’t mean to imply anyone’s position is just “monkey brained.”

      1. galacticplumber says:

        Thing is, for much of what people are angry about, the alternative is demonstrably, factually, not “thing doesn’t exist,” but “thing I threw money at for a promised, specific reward if said thing was completed still gets completed, and the promised reward is doled out.”

        Now, we’ll be fair about this. Not every Epic exclusive is that conclusively an interference in a deal that was going fine, but enough were that there is a real position of legitimate anger to be had.

      2. Echo Tango says:

        Dismiss peoples emotions as irrational as much as you want – it still affects their purchasing decisions. Any company which doesn’t take their customers feelings into account is gambling with their income.

  14. Syal says:

    30% of $60 would be $18, not $20.

  15. smash says:

    Epic isn’t the hero, but Apple and Google sure could use getting taken down a peg.

    1. Pink says:

      Establishing precedent on that basis is bad because next time the target might not ‘deserve’ it.

  16. EOW says:

    i hate how epic planned all of this.
    They prepared a full event with skins and an animated short. They broke the contract then acted like they were the victims, all the while framing this as “fighting for consumers” when all they want is to get more money.
    But the way it’s shaping they are just gonna lose the entirety of Apple platform and google support. It feels like they got too cocky and gambled with boys far bigger than they are

    Actually, now that i think of they are risking to remove EVERYTHING made on unreal engine from apple devices, effectively fucking every apple consumer out of their products.

    So yeah, Epic essentially risked removing all unreal engine games from apple users just cause they wanted to get more money from the apple store.
    Fuck them

    1. etheric42 says:

      I don’t know. I’m happy they went into this prepared on both the PR and legal front as opposed to just doing it on a whim.

      I don’t think they’re obliged to sell their product to Apple device owners.

    2. Fizban says:

      They’re galvanizing their player base. I think it might have been in Jim Sterling’s video, though not as major of a point as I think it it is, but-

      -Triple-ayyy publishers all have their own core of completely and utterly loyal fans who believe anything they say after years of indoctrination.
      -Fortnite is relatively new, but has a massive following of far younger players. Who don’t watch or care about “gaming news” yet.
      -The only thing those Fortnite players will notice or care about this thing is that Fortnite told them Apple was bad and their precious Fortnite was under attack. And even better, all the older people tried to tell them that Epic/Fortnite was bad.

      Thus, the only real effect, and quite possibly the only real goal of this whole fiasco, is that some, much, or even most of the Fortnite playerbase will be galvanized, drawn together and hardened by this “attack.”

      Epic is jumpstarting their legion of mindless followers. Who, in another 5, 10, 20 years, will increasingly be taking over from the current generation of games media.

    3. Ninety-Three says:

      This is an odd form of status quo bias. However many years ago Fortnite was first released, if Epic had looked at the Apple Tax, said “nah” and stayed off the appstore, no one would be mad at them. But because they made a decision about it years ago, it’s now an outrage that they’ve switched over to the “don’t pay the tax” model?

      1. galacticplumber says:

        Because they made an agreement, formed relationships with both a distributor, and their customers, deliberately broke that agreement, and the legal side of the relationships, and are in fact actively galvanizing the customers of that distributor to harass said distributor.

        Agreements have power, in senses both legal and in public relations. People do not like being used as attack dogs, nor in seeing others who are more willing for such a role treated in such a way.

        1. Crokus Younghand says:

          And now they claim that the agreement was illegal. If you were duped into signing an agreement someday, and later realized that it was illegal, would you not sue the offending party? If not, then why not?

          1. galacticplumber says:

            Except it wasn’t illegal. Even if it were to be ruled that Apple is a monopoly, this would apply to now, and the future. Changes to the rules, or the positions of people or groups of people within the rules does not apply retroactively.

            They were not considered a monopoly then, and thus all that would change is things in the here and now.

            1. Crokus Younghand says:

              Monopoly is not illegal, anti-competetive behaviour is. Their crime, if accepted by the court, won’t be being a monopoly from now – it will be indulging in anti-competetive behaviour in the past. And if the agreement was part of that behaviour, then it will be retroactively held illegal.

        2. Ninety-Three says:

          Is your objection really that they broke the agreement by pushing a game update that stayed in the store for a couple hours, rather than politely withdrawing from the store themselves? If they’d withdrawn citing the same appstore policies and run the same #FreeFortnite campaign, would you be content because they no longer broke their agreement?

          I somehow doubt that the core of your complaint is that the faceless megacorporation broke its promise to another faceless megacorporation.

          1. etheric42 says:

            IANAL, and possibly UANAL, but if they had withdrawn instead of being removed, would they still have standing in court?

            1. Ninety-Three says:

              Yes, although forcing Apple to remove them is the sort of thing that could end up helping them win their case (Epic certainly thinks so, unless they have some really wild ideas about Apple bending to public pressure from Fortnite fans).

          2. galacticplumber says:

            It actually is. One is a fully recognized right to cease doing business within the bounds of a contract while the other is a PR stunt. Well the core of that particular bad move.

            The other important issue is having several different forms of manipulative ad campaign ready to galvanize their fans to harass people.

  17. Gift cards present an even bigger overhead issue than you’d expect due to a lot of regulations concerning them, some of it rather recent. They’re a money laundering concern due to how difficult they are to track, and you need an entire infrastructure setup devoted to maintaining them now because, since they’re treated like cash, they *do not expire*. IIRC they are legally mandated to never expire in the U.S. Dunno about Japan.

    But from what I dimly understand, issuing money cards basically means that you just became a bank-of-issue on top of whatever other business you do.

  18. Moridin says:

    You keep bringing up gift cards as an argument for why the 30% cut for Steam is reasonable, but to me that just brings up the question of how much of the 13% extra share Valve gets from non-gift card transactions(I believe the transaction fees for credit cards and other online payment methods are around 2%, but I could be wrong? I tried to look up how much credit card transaction fees are, but apparently there are lots of variables. Paypal charges 2.9%+$0.30 in the US, which makes me believe that if you have the infrastructure to just accept credit card payments, the fees for that will be substantially less, especially if you’re a company the size of Valve) is going directly into Valve’s pockets as pure profit. Surely it would be fairer to both developers and consumers if Valve didn’t just slap the extra cost of handling gift cards on every other payment method as a “tax”. Exactly how Valve might handle that if they ever have the motivation to do so I leave as an exercise to the reader(there might be regulatory hurdles on charging customers more based on the payment method used, but surely those don’t apply to giving the developers a bigger cut of those other transactions).

  19. Nimrandir says:

    Question for Shamus: do you have monetization turned on for your videos?

    I usually let the ads play when I watch your stuff (I’m watching YouTube on PS4, so ad-blocking isn’t really an option), because my understanding is that the creator only gets credit if the ad runs to completion. However, if the Content ID system is sending that revenue to JerkFace LLC who is claiming to own something that happens to be part of the video, I’m going to save myself the inconvenience.

    1. Shamus says:

      So far, there are no claims on any of my TDI videos, so I get that money. I’m pretty careful to avoid getting ambushed by content ID.

    2. Moridin says:

      The ad revenue on youtube is fractions of cent per view. I wouldn’t worry about it.

      1. tmtvl says:

        A dollar per month on Patreon is worth like 1,000 views per month? Or 10,000 I forget.

      2. Nimrandir says:

        That’s a totally reasonable position. However, I have this condition, called superego hyperplasia*, or in layman’s terms, an ‘enlarged conscience.’ As a result, in a situation where someone can benefit, in however small a manner, from an action of mine, I tend to perform that action in the beneficial manner. I understand the logic behind tossing Shamus five bucks to cover the ad revenue for every video he, Issac, and any grandchildren of Issac’s ever produce, I still know that he would have at least slightly more money if I still watch the ads. Therefore, I end up doing both. I genuinely cannot prevent myself from worrying about it.

        This is also why I end up on more faculty committees than I otherwise might.

        *Name is a work of fiction. Any resemblance to actual psychological or medical conditions is purely coincidental.

        1. RFS-81 says:

          Would it help if Shamus made an Adblock Absolution Patreon tier? I’ve seen a couple of Patreon pages that use that name for their lowest tier.

          1. Nimrandir says:

            Only if it somehow turned off the ads for me. I’d see the ad, get ready to skip, and then tell myself, “Eh, it still gets him a bit of money. I’ll just let it run.”

            I’m like a case study for preserving children’s sense of self-interest.

  20. etheric42 says:

    @Shamus

    Was Apple the hero when they fought back against Microsoft in the 80’s? Was (insert internet content provider) the hero when they fought back against Net Neutrality? Was (insert activist) the hero when they (fought for movement they were a member of)?

    I think at some point we have to be okay with heroes that aren’t selfless. We should probably be okay with heroes that benefit a group of people that aren’t us (if Epic doesn’t settle for a deal that only benefits them, this would benefit other developers that sell to the app store).

    Even if Epic accepts a settlement that benefits themselves only, they could still be considered a hero because they shouldered the risk and the expense to fight, and if the winds start blowing against them in court they may be forced to cut losses. I don’t blame activists that stop fighting when the Eye of Sauron gets turned on their personal lives and they get hit harder than they expected. Now I certainly would have a lower opinion of Epic if they were to take such a settlement. And I personally would have preferred if they had just decided to withdraw all their products from Apple products and focused on supporting platforms that are voluntarily open (so I am personally conflicted over this Apple v Epic situation, I would love for there to be more options to sell to iPhone users, but I’m not a big fan of gunboat diplomacy and antitrust suits).

    1. Shamus says:

      I’m actually ALREADY ok with heroics that aren’t selfless. What bugs me about Epic is the outrageous self-aggrandizing and pretense of heroics.

      Now, there’s a point here that I think is getting overlooked in this thread. These are two very different statements:

      1) Ugh. I hate this and I’m going to bitch about it on the internet.
      2) Ugh. I hate this because it’s totally immoral. And maybe it should be illegal!

      I very much lean towards #1. (A lot of threads on this post seem to people making arguments against #2 with people who seem to be coming from #1.)

      And yeah, if Epic wins, I agree that it will be a Very Good Thing.

      The horrible problem here (I’m sure you already know this, I’m just providing context for other people reading the thread.) is that there’s probably something anti-trust-violating in Apple’s ecosystem. (I don’t actually understand this well enough to say so for sure. I’m just guessing based on anecdotes.) So someone can sue Apple and get them to knock it off. But to sue, you need deep pockets. And when someone like that shows up (Netflix) Apple cuts a special deal with them. Apple is designing a system that lets them bleed the little guy while avoiding problems with the other big dogs. It’s like a bully taking lunch money from all the underclassmen, but then someone in his weight class walks by and he leaves them alone.

      So yes, a win for Epic would be a win for lots of other tech companies and maybe consumers as well. I’ll be happy to acknowledge that a good thing happened, but I’m not going to become BFFs with Sweeney. I’m not going to pat him on the back, because he’s been patting himself on the back for over a year, and annoying the crap out of me along the way.

      1. Crokus Younghand says:

        Shamus, every corporation pats itself on its own back all the time. Usually, it is does by oily propagandists (sorry, PR people) in such a smooth way that you don’t even realise when you end up believing in that self-aggrandisement.

        Epic’s flaw, if I understand correctly, seems to be that its CEO – who is not good at the subtle projection of genuineness – is doing the back-patting. In other words, it’s not the self-promotion that is offensive, it’s noticeable self-promotion. It doesn’t matter that what he claims may be more true that not, it is not the substance which seems to be the issue here but the form.

        In other words, manipulate us behind our backs all you want, but don’t you dare show anything but perfectness to our faces.

      2. etheric42 says:

        I don’t follow twitter feeds, so I haven’t really seen how annoying Epic’s personality is there. I admit I was similarly annoyed when every platform had a net neutrality statement or comes out with a political statement du jour that they then don’t do anything about except in a token way.

        And although there are a lot of arguments in this thread arguing against 2, there sure seems to be a number of people arguing for 2. Or at using language that would imply 2, but rolling it back to 1 and saying it was just internet-bitching (looking like a motte-and-bailey). So I hope there’s some understanding why some people are spending time arguing that it isn’t immoral.

        But on the heroic side: What does it take to not be hated when pulling off something like this? It takes big pockets, as you said. It also takes standing, which means you have to be injured or face potential injury. While it’s possible a consumer could say they are injured by the ecosystem being closed, it’s much less likely to work. Epic is having to spend $$$ and risk $$$ to do this. They stand to make $$$ off of it too, but a lot of advocates for change benefit personally. So taking the above as given (and if it’s not, please correct me how it could/should be different in the modern ecosystem), how should they be behaving?

        Should they just keep mum about it while the lawyers hash it out? That’s the common lawyer-advice “shut up”. But I feel like as much planning as this campaign has, the lawyers probably vetted it to fit in their strategy.

        Should they be humble? “What we’re trying to do is no big deal. Sorry about how this might inconvenience our players.” This seems counter-productive, since if it is no big deal, I’d be upset if you’re inconveniencing me. In fact I need Epic to make it clear it is a big deal that I’m going to have to play on an old patch/not at all for 6-12-24 months and possibly have the Unreal Engine stop updating for a number of games.

        Should they be pointing out their self-interest? “We’re doing this because we stand to make a lot of money!” I feel like that would tick people off even more. I know you’re going to benefit from doing this, but that’s kind of rubbing it in.

        Should they leave their fan-base out of this? Popular support might motivate politicians to get involved. Popular support might convince Apple to relent. Judges are human and can be swayed by sentiment. Customer engagement could improve sentiment for the company, which will help cover some costs of attempting this.

        In American culture, I see a lot of confidence=smugness, self-promoting=lying, money=evil and unfair. That’s a natural reaction when you see snake-oil salesmen kicking people when they are down and bribing their way above the law. Those people absolutely should be looked down upon, but there aren’t a lot of them. It’s also very historical. Protestant virtues and all that. But I feel like we’re throwing the baby out with the bathwater. I want my kids to have and project the confidence that lets them keep trying to push their limits, to promote themselves to people who might value them (employers, significant others, friends, audiences, opportunities), and to know how to use money as a tool.

        So in a lot of articles you’ve rewritten the script on a number of video games. Why don’t you rewrite Epic’s script? It’s two months before lawsuit time, you’ve got time to plan the offensive with your team. You’ve got the following constraints/goals: you want the best chance to win, you want to find ways to mitigate the damage it will do to your company, you can’t stop operations because you don’t know how long this will take, you can’t tip off Apple, and you want Shamus Young to have the best opinion possible of your actions, even if he doesn’t call you a hero, a bloody icon.

        Or am I spoiling the part 2?

        1. Crokus Younghand says:

          Popular support might motivate politicians to get involved.

          To expand on this, Apple is an old company. Senators, judges and lobbyists own Apple shares. Apple’s executives are on a first name basis with numerous elites. Apple will play a pivotal part in the cold war with China.

          What is Epic, when compared to this? A video game company? Don’t those cause school shootings? Why would be want to support them, against the Apple of our eye?

          A grassroots (or astroturf, take your pick) movement is the only way Epic wins this fight. And Shamus, as you agreed above, Epic winning here will be better for the consumers.

        2. Shamus says:

          “Why don’t you rewrite Epic’s script?”

          I was seriously considering making another video: “The video Epic should have made”. (That is, the video they should have made instead of 1980 Fortnite. Or at least, a video BEFORE 1980 Fortnite.)

          But the video to go with this column is performing hilariously poorly on YouTube. (Under 5k views on the first day??? WTF?!?) I’m not sure if the algorithm hates it, or if this topic is just not that interesting to the younger set. In either case, making a video about it would be unwise. (Also, this thread is more contentious than fun. So I’m feeling kind of unmotivated now.)

          But the short version: It’s not hard to make the argument that Apple is being destructive. But the Fortnite audience trends young, and they probably have no idea about the particulars of the App Store. Moreover, they’re not likely to care. Like, even if the PR stunt gets all the kids on your side, so what? That doesn’t help you.

          Instead I’d make a video that explains all the stuff people have been talking about in this thread:

          The way Apple takes a cut even if you don’t sell through their store: “If you want to sell through Walmart, then you need to give them 30% of ALL items you sell, even if you sell it out of your car.”

          The way they take things down that competes with their own products. “Imagine if Walmart comes out with a knock-off version of your product, and then takes YOUR item off the shelves so it won’t compete with theirs.”

          (Uh, I’m not sure if I got those facts exactly 100% right. I’ve obviously never been a developer for Apple Apps.) I’d need to do a little research to build my case.)

          There are a lot of points like this that are factual, eye-opening, and potentially angering in a GOOD (for Epic) way. When you’re done, you don’t NEED to put on the pretense of being a hero. The audience will build that narrative for you. Now, this won’t instantly un-do the last 18 months of pissing people off, but at least it won’t come off as deeply dissonant and delusional.

          THEN release your cute little 1984 diss track, if you must.

          1. Lino says:

            The low views could be because you haven’t uploaded in a while, and the Allmighty Algorithm has decided to lay its wrath upon you. Or maybe it’s because you didn’t wait for a full moon to make your Algorithm-appeasing goat sacrifice (did you remember to light blood-red jasmine-scented cndles?)

            In any case, what you describe here sounds like an extremely interesting article or video. I’d love to hear what you would do if you were Head Honcho at the EGS. What would your strategy have been for EGS’s launch? Or – better yet – what would you do if you had that position now? Does the EGS have any shot of redeeming itself after more than a year of pissing people off?

          2. etheric42 says:

            Sorry that I’ve contributed to the confrontational vibe here and made it unfun. There’s a lot of anger here, both over things that have happened and motives/futures that have been assumed. The original article was a mix between complaining and “let’s look at it from Steam’s side”, but I think with Apple being so topical the conversation stayed on the complain end and not as much on an exploration of the nuts and bolts of Steam end. Don’t know how that could have been improved.

            Again, I don’t follow twitter, so I don’t know how much of a jerk they are being there, but have you read https://www.epicgames.com/site/en-US/fortnite-mega-drop-faq

            Epic’s newsreal isn’t a source of longform articles discussing economics. You have to fit your audience. The video is a 48-second direct riff on Apple’s classic ad, which seems both a gotcha and something eyecatching to grab engagement to hopefully get to those additional details (and like the original Apple ad, completely disconnected from the novel 1984 which deserves a level of mockery and eyeroll).

            So in order to get in the same attention span, would you basically do the “you wouldn’t steal a car” ad, but with “you wouldn’t stop your customers from shopping at a different grocery store” type cues?

            Edit: I didn’t watch the video either other than a quick scan. I’m generally text-only when it comes to news/essays, except for a few specific genres.

  21. RandomInternetCommenter says:

    The overarching point here seems to rely on the assumption Steam needs a cut between 12% and 30% to generate profits. I am just an Internet guy and any credentials I claim would be dubious by nature, but if you look at other sizeable Internet services like Etsy, Shopify, Ebay, rather than real life retailers with massive infrastructure needs, you will see cuts closer to 5-10% than 30%.

    Great comparison with Handsome Jack.

    1. mdqp says:

      Well, I don’t know about that. Patreon takes 5% for themselves and 5% to handle process payment fees (so 10% total). They don’t run a super complex system, yet I never heard Patreon is making good profit (instead, I heard them having to come up with plans to make it sustainable). They even raised their cut for new creators, so I am not sure what’s the current percentage.

      If I am totally honest, I do believe the various services, bells and whistles on Steam weren’t cheap to develop and the maintenance is a bit higher than what people believe. When you talk about percentages, I don’t think Steam makes insane amounts over each individual game, it’s just that they move a lot of units. Cutting their share to 25% is probably doable, but you quickly start running into problems if you go lower than that (namely, having little money to expand and develop, and eventually maintain the store). They don’t have an external cash cow, Steam is currently Valve’s main business, they don’t have anything else that could prop them.

      1. tmtvl says:

        Well, what about Artifact? …Oh, right, what a shame.

        I really want to like Artifact, but I just don’t.

        1. mdqp says:

          Well, you are not alone. Almost nobody liked it, that’s why it’s dead. Personally, I like card games, but didn’t find anything that appealed to me in it. I am also kind of tired of CCGs monetization models, so I pretty much gave up on card games that aren’t single player, at this point.

        2. Asdasd says:

          The new artifact 2.0 is supposed to be a big revamp of everything people disliked about both the economy and the game mechanics. If you own a copy you might find you have access to the beta.

          I suspect it will be far too late to save the game, but I’m one of the strange folk who find it fascinating when a developer ‘admits’ failure and tries to address it (a la Final Fantasy XIV), so I’m probably going to end up checking it out.

  22. Redrock says:

    I’ve often been critical of Epic’s PR strategy, the state of their store and their general attitude towards PC gamers, but one thing I never understood is all the negativity about the exclusives. I’m not talking about the markets where people don’t have access to suitable payment methods, I’m talking about all the wailing along the lines of “but it’s SO uncomfortable to use and it’s SO unfair to give developers MONEY to get exclusives”. Maybe that’s because I’ve been a console gamer for almost as long as I’ve been a PC gamer, so the idea of exclusives doesn’t really rub me the wrong way. Money for exclusivity is essentially an investment, it’s usually money a developer really, really can use.

    And, frankly, while the EGS is a half-baked mess compared to other stores, is it really such a huge pain to use that particular launcher for the odd game that you just have to play at launch? Because, remember, most Epic exclusives are timed exclusives. But how much time do you really spend in the launcher? Hell, these days GOG Galaxy 2.0 features native Epic integration, so you don’t even have to open the Epic launcher to actually launch your game. Sure, there’s some fiddling, but PC gaming is by definition around 70% fiddling and 30% actually playing games.

    To reiterate – there’s plenty wrong with Epic, their behavior and rhetoric. And I’m pretty certain that Fortnite was mentioned in the Book of Revelation as a sign of the end times. But the exclusives seem to me to actually be the least of Epic’s sins, and a good source of much needed financial support for developers. Kinda good to see whatever tiny fraction of that Fortnite money be used to support development of indie and AA titles. Really hard for me to get all that angry about that part.

    1. mdqp says:

      Well, I don’t love exclusives in general, but yeah, I assume some of the hate is excessive. Still, it’s worth noting that paying for someone to not sell their stuff to others, is illegal in some industries and countries, for a good reason. Imagine if Steam was paying devs to not sell their IPs through GOG, and killed the store before it really took off (if we want to call GOG’s current share “taking off”). Just because Epic is doing it against a giant, doesn’t mean that there aren’t some aspects which can be deemed reprehensible and/or damaging to the industry. It’s especially egregious because often they didn’t pay for full exclusivity, but mainly just to keep the game off of Steam.

      They also were quite heavy handed early on, picking games which were supposed to come on Steam, including certain games which were accepting pre-orders or promised Steam keys.

      I am not saying the other competitors are all squeaky clean, perfectly upstanding businesses, but Epic really handled things quite brutally (and poorly).

      As it is, I don’t think the store is good enough to buy things there. I find Steam’s reviews too useful when browsing games, and exclusives usually mean no reviews there for a long time, without even talking about how nice the library is and how many tools there are for discovering games.

      With all that, GOG is still my first choice, so that should tell you a lot about how little room there is for yet another store (I tried Origins and Uplay, but in the end I just can’t stand them).

      When you pick a store online, you’ll end up having to use it for years to come (since your games are tied to it), so it’s not hard to see why people would be resistant to the idea of another poorly implemented store.

    2. The Puzzler says:

      Console exclusives probably ought to be significantly more infuriating to the consumer. “Here are two games you want, but in order to play them both you need to buy two near-identical consoles.”

  23. evileeyore says:

    But Shamus, I want them both to lose. Can’t we just let Epic and Apple fight have the miracle of them both losing? Apple is forced to relax their “walled-garden” app store and Epic goes bankrupt fighting Apple. Win-win for consumers.

    1. tmtvl says:

      I like the cut of your jib. Both parties suffering would be optimal.

  24. Gautsu says:

    So if Epic loses their case and their assets are removed from the Apple store, including other publishers/developers games using their engine, would all of the people defending them have no problem with how they would have effectively taken money for the licensing of their engine and then deliberately torpedoed those games ability to be sold or played? Reminds me of their sketchy deal with Bluehole over helping them utilize their engine for PubG before going around and completely changing everything about Fortnite, turning it from a single player and cooperative zombie survival crafting game, to a free to play Battle Royale juggernaut. Or their severing all ties with Paragon and reimbursing early supporters with Fortnite currency.

    Besides, even though they have a play offline option in the EGS app for PC, it doesn’t actually have that functionality, as it still forces an attempt to connect to prove that my account is the one trying to launch a game installed on my laptop offline.

    And yes you can apply morality to economics. Capitalism is in no way tied to morality, and what is good business sense doesn’t automatically equate with “good”. None of these companies are heroic, they are companies; they want money, they don’t give a shit about us (referring to Epic, Apple, Google, and Valve mainly). If there best interest is served by being helpful or friendly (at least the appearance of) that is what they will do. If it’s to appear to be a monolithic behemoth and continue business as usual, the same. But don’t equate doing something altruistic or even maybe slightly heroic as being a “hero”.

    Factional loyalty is an inherently big problem creeping into all factors of life. In reality a lot of these factions wouldn’t even recognize an individual as being a part of them before they needed to use or take advantage of said individual. I won’t go any further to try not to either divert or meander any more than I have already done.

    I am really curious about people’s responses to my first question though. If say, all of the Infinity Blade games could no longer be purchased or played due to Apple being prevented from selling games using the Unreal Engine, how would it be the third parties fault, and would be people still be cheering Epic if their case damaged other companies directly?

    1. Crokus Younghand says:

      The judge just prohibited Apple from denying Epic access to a developer license for purpose of developing Unreal Engine. Apple is not a sovereign entity (not yet anyways), they can’t just do whatever they fancy.

    2. etheric42 says:

      I’m pretty sure they were just going to block access to the dev tools, which means the Unreal Engine could not receive further updates, but existing games using Unreal would be able to continue on an old engine (which would only start being a big problem when an IOS/Mac update caused a compatibility issue, or a security flaw was discovered). But as Crokus said, the judge bocked that.

      I get that when you say capitalismmorality. I’m right on board with you. Even democracymorality. A firm’s job is to return value to its owners/shareholders, not “make the world a better place”. But incentives are important. If democracy’s job is to fulfill the desires of 51% of the population and 51% of the population’s desire is to kill 10% of the population, let’s talk about mitigating pure democracy. On the other hand, if the incentives are aligned as part of returning value to its owners, the firm does things that are prosocial, shouldn’t we congratulate it, or at least have a positive reaction to it? I know it’s just “doing its job” but wouldn’t we want to keep the the incentives pointing that direction?

      If we give our daughter pocket money for doing chores, and our daughter mows the lawn and then comes inside and says, “Hey look Dad, I mowed the lawn!” do we tell the her to shut up and stop talking about herself, because obviously she gets paid for it. Or do we say, “Thanks”?

      1. Gautsu says:

        I guess what I said rambled too much because the intent was what you posted. Pretending that morality doesn’t factor into economics, politics, business, etc is disingenuous at best. Yes there are certain practices better for the corporation than the consumer, but eventually blatantly evil, or at least immoral behavior should hopefully cause us, as the consumer to boycott said businesses, no matter what service they are providing.

        And I wish I could trust my son to mow the lawn

  25. Preciousgollum says:

    People are talking about these platforms as if they are somehow incapable of failure.

    My personal concern is that an Epic Store that fails means it takes whatever monetary investment, and a game library with it.

    If anybody remembers Onlive, that was a game streaming service that eventually failed. They had a $1 sale when they first launched, and that included Deus Ex: Human Revolution. The experience of streaming this game… well it didn’t work for me, so I actually bought the game (Steam Activation) and prefered a lower framerate to what is bad bandwidth issues. Now, all these years later, I can still play Deus Ex:HR on steam, but I cannot play it from Onlive, where I initially purchased it from. Just imagine if I actually spent more on Onlive – I’d have even less. Microsoft GFWL also had that problem where, although in theory it should have redeemable purchases to download, in reality they don’t work properly and a lot of people had this problem – hence why a lot of Capcom games ended up having keys transfer over to steam from GFWL – because Capcom, Bethesda etc initially backed the wrong horse with Microsoft and GFWL. We’ve already seen this crap play out before, where alternatives come along because they seem trendy, and then they fail, and Steam ends up picking up the pieces, wheras the late competitor doesn’t seem to give a rat’s ass about the viability of their own platform – it is seen as yet another gimmick. Heck, Steam have even outlasted your old boxed CD copy of a late 90s or early 2000s game that, in theory is an ‘owned’ product.

    So, it makes we wonder if competition is good, for those that don’t lose out. OTHER people are going to have to put their game buying money into the Epic Store just to be there to see if it will succeed or fail. That’s great if you don’t mind a bit of risk in losing stuff. IF you believe that the value of competition is in other people wasting their money for that purpose of competition, then yea I can see why having alternatives *seems* great for those that are on the winning side and then don’t have to buy twice or even more than that.

    Seriously, it is quite possible that one of the only ways that a new company wins is if it somehow manages to degrade Valve and Steam, which is bad for many people because they have their libraries on Steam. Especially when it becomes less about taking profits, and more about scorched earth. If Epic can actually gain a legal restraining order against Apple trying to tear a piece out of them, on the grounds that ‘customers potentially losing out is bad and unfair’, then doesn’t the same sort of thinking apply to the entirety of the wider debate?

    Epic would appeal to many more people if it created a store with its own positive gimmick – and one that didn’t revolve around “We only exist to poach from and provide the exact same (or worse) service than our rivals, because we think our rivals suck”.

    1. etheric42 says:

      Burger King exists without McDonald’s going bankrupt.

      Epic does have a positive gimmick. It guarantees games will receive a minimum income (and provides an advance). It gives developers a higher cut than most (but not all). It regularly gives consumers discounts out of its cut, not the developer’s cut. It pays developers to give games to consumers for free.

      These are all a positive gimmick.

      There are bodies everywhere of failures. Betamax. Virtual Boy. The Impulse/Gamestop store. That laser tag system that synced to your cell phone app. A number of Google apps. A percent of Kickstarters. Failed MOBAs after failed MMOs after failed multiplayer online games. Businesses that fail or flounder and lay off their employees. Lost and broken relationships. It’s nice when a company or person can fail gracefully, but it’s hard to. Maybe we need to stop looking at things as permanent. I might be less inclined to buy games I might play some day.

      But because people are willing to risk failure and loss, we have a lot of good things too. Choice. Quality. Quantity. Sometimes a headache and a step backwards, but sometimes an innovation that opens a new door. (And sometimes, just a really good Thai restaurant.)

      1. Daimbert says:

        Epic does have a positive gimmick. It guarantees games will receive a minimum income (and provides an advance). It gives developers a higher cut than most (but not all). It regularly gives consumers discounts out of its cut, not the developer’s cut. It pays developers to give games to consumers for free.

        These are all a positive gimmick.

        The problem is that these are pretty much all gimmicks aimed at developers, not customers. While that may seem like a good move as it can encourage developers to put the games there, until customers actually start to use the platform developers will be hit with the precise problem mentioned in the post: the bigger cut and extra features don’t mean much if the other platform can overwhelm that simply on the basis of volume. So they’ll want to put their games on both platforms, but if the games are on both platforms then that won’t help Epic grow, especially since, again, they aren’t really doing things that benefit CUSTOMERS more.

        So Epic really does need exclusives to draw customers to the platform and so grow into something where developers can really take advantage of the things they do to make things better for them. The question is if the money Epic has to pay to make that worthwhile for developers is going to hold out long enough for enough customers to be drawn to the platform so they don’t have to do that anymore.

        1. Asdasd says:

          It’s worth mentioning that Epic are doing something aimed at customers: they’ve spend over a year giving away game after game for free, at what I can only assume is eye-watering cost, unless they’re being extremely strategic (only targeting games at end of effective revenue life/developers who are especially hard-up to leverage favourable terms).

          Whether that’s translating into paying customers is difficult to tell: have the giveaways continued so long because they’re effective so why stop pursuing a winning strategy, or because they’re ineffective but they haven’t come up with any better ideas?

          1. The Puzzler says:

            Another thing to note: the people who got so annoyed at Epic over exclusives that they refused to install it have missed out on all these freebies. I doubt missing out on free gifts makes them any less annoyed.

          2. etheric42 says:

            Plus the extra discount. There have been three+ periods of infinite $10 coupons that coincide with their major sales, which means the developer cuts the price of their game and then Epic cuts it even further out of their own pockets.

        2. Decius says:

          Giving me a lot of games in exchange for my eyeballs on their store for a second is pretty well-aimed at me.

        3. Preciousgollum says:

          I say this with respect to developes and people who, in some cases it seems, seek a perfect outcome :

          Why should I care?

          It seems as if people are becoming invested in this argument, and its outcome, to a point where they have already decided that they need more video games. We are really giving a lot of attention to a company that has yet to really prove itself. Personally, I’m looking at Epic as if it has the potential to be another Onlive or GFWL (as I said above), so I am steering clear of it until it can really entice me, if ever – it may be a store I simply never need to use, and that’s it. Like going into a pet store and not wanting to buy a pet, look at a pet, or not owning a pet – maybe it is an ‘Exclusive’ or ‘Exotic’ pet store, but I just need some cat food – I don’t need premium cat food, especially when I can get it later on from somewhere else – for now I might just want to buy sone cheap cat food. Exclusive games do not temp the majority of the audience that might not have a good enough PC to run these games – heck that’s why PIRACY happened. It is ironic that Crysis Remastered is now an Exclusive, when that 2007 game, with Crytek complaining so much about piracy and the need for DRM, was the reason that Steam became popular in the first place.

          To be honest, even the free stuff hasn’t (and it was stuff I would be interested in) and that is simply because there are so many options for free or very cheap games – if I choose YET ANOTHER store with free games, I’m gonna spend all the time redeeming the things, and no time playing them. It can become all-consuming at times.

          And, yea, it seems weird to have this business that says it wants to have people buy from it, and their biggest way of doing this is by NOT selling games to me, but giving them away as if they have no value. Not even selling them for a penny or cent.

          I know why they do it: because it has been said that a timed free giveaway actually makes those who forgot about it want to buy the game. So, GTAV sold more *after* it was given away.

    2. RFS-81 says:

      I think it’s a legitimate concern. At some point, Epic will get tired of throwing money at the store. If they’re not competitive with Steam by then, well…

  26. Lanthanide says:

    There are two fairly easy solutions to the gift card problem with Japan etc:
    1. Sell a card for $11 that lets you redeem for $10 on the platform. That’s going to be inherently less popular for consumers when they pay $10 for a Steam card and can redeem $10 on the platform, but that that’s what competition is all about. Customers might be willing to stomach the $1 surcharge on game cards for the Epic Store if it has the exclusive games they want that they can’t get any other way.

    2. Treat card currency on the platform as different from other purchase currencies. When a customer uses card currency to buy a game, Epic takes a bigger cut than the 12% they do for standard currencies. This is pushing the bricks and mortar surcharge directly onto the developer, but it is likely that many sales they make through these cards they wouldn’t get at all otherwise, so the bigger cut they pay to Epic is acceptable for them, and a direct trade-off for this card service Epic offers (compared to Steam, where all indies get access to all the platform features they don’t care about, but are important to AAA titles, and still pay the same 30% cut that the AAA titles do).

    #2 seems like the more likely route to take since #1 will likely have problems with consumer acceptance.

    1. tmtvl says:

      You think Epic cares about customer acceptance?

      1. Lanthanide says:

        I did say ‘consumer’ acceptance.

        A relative of yours wants to buy you a present and they know you like games. They go to the store and see game cards, they can pay $55 to get a $50 redemption card for the Epic store, or they can pay $50 to get a $50 redemption card for the Steam store.

        They buy the Steam card because why would you pay $55 for $50 worth of value when you can pay $50 for $50 worth of value?

        1. tmtvl says:

          Oh sorry, I misread. With age my eyes seem to be going toward the non-functioning side of things.

        2. etheric42 says:

          I think you have your descriptors flipped. The person buying the card is the customer. The person playing the game is the consumer. (Unless you are posing the store is the customer, since they are buying on consignment.)

          1. Lanthanide says:

            In this case I’m using “consumers” more generally, as in “consumers in the economy”, as opposed to “customers of a specific business”.

            I gave an example of someone who is not a specific target customer of Epic appraising their merchandise on the shop floor and comparing it to the merchandise offered by competitors.

            I guess in practice it’s more likely they’d both have the same $50 cost up front, but Epic’s card would need to say on it that it only gave you $45 credit in the store, not $50. In such a case, it’s likely that many of these non-engaged consumers would probably overlook that, like the well-meaning grandparents who buy their kids Yu Gi Oh toys instead of the Pokemon toys they asked for because the grandparents can’t tell the difference and think the grandchild won’t mind either.

    2. etheric42 says:

      Anyone have any info on how gift cards work in Japan? They may have regulations or standards that are very different than the US. Since they are much more common in everyday use, they may have much lower (or higher) rates.

      Of note, Visa cash cards typically go with solution 1 and seem to be successful.

    3. etheric42 says:

      Interesting update: in countries with higher processing fees, Epic charges the customer an additional fee to cover it. This tends to imply that route #1 is their preferred choice.

      (I’ve recently learned to use a card that does not charge for international purchases when buying through GOG, which avoids the effective additional fee they charge.)

  27. Decius says:

    Why is it considered remotely acceptable for Wal-Mart to take 15% of gift card sales?

    Why is the physical goods distribution system that Wal-Matt has equivalent in cost to the digital goods distribution system that Steam has?

    1. etheric42 says:

      Because they have ship those cards from their central warehouse, put them on the shelves, and not put something else on that shelf because they only have so much space (and also heat/cool the store, make sure it has security, etc). A $200 gift card probably is way more than they spend on it, but a $15 gift card is a more modest return. Also if Valve insists they charge less, then they’ll just not put them on the shelves, and then Valve gets people attacking them for being anti-consumer because they only use gift cards to buy.

      Another question, is why is it remotely acceptable for (Humble/Green Man/Fanatical) to charge X% of the sales when they only provide a storefront, shopping cart, and payment processing, when Steam and Epic then have to fulfill for the life of the customer without a single penny of cut?

      I mean, I appreciate and use those off-store storefronts, but they don’t really do much other than improve price discrimination for the publisher/developer. Perhaps one of the reasons Steam has to keep the 30% is to subsidize all these unfunded obligations (although Epic allows this too.

      Edited for clarity

      1. Decius says:

        Wal-Mart gives more shelf space to large jars of pickles, which have a lower per-item and percentage markup, require more time to stock, and suffer higher shrinkage.

  28. Allan Hambrick says:

    Tim Sweeney is a genius. He and his little 15 billion dollar company is attacking Apple, a 2 trillion dollar company, and now no one is talking about how absolutely God Awful the Epic game store is, You would think with their resources and countless good industry examples of how it’s done right they would have done better. Instead we get the pile that is the Epic store. Seriously? “Just give people exclusives and free stuff and we can half ass this until the asteroid hits” must have been at the bottom of some Epic MBAs burn down chart.

  29. sock puppets! says:

    So I’ve been pondering the Epic Games thing and it feels even more scuzzy than before but I don’t know if I’m right about this. This kinda sounds conspiracy theory ish but I can’t really knock it out of my head.

    So, thinking hypothetically. Pretend Epic proves that the business model is sound. It completely works. All the other stores adopt the 12% cut that Epic Stores has. No stores go out of business. Sounds good right?

    But now, rather than a publisher, like Activision, only getting a 70% take, they instead get a 88% take. 18% extra from Steam, itunes, Playstation Store, Xbox marketplace, etc. Just those four 18% come up to 72%. That’s more than the profits of second game at the original cut. All those 18% add up. So all those 18% are now going to Activision, every one of them.

    So now, Activision thinks “Hey, we made a lot of money. We love money. We should make another game so we can have more money”. So they head on over to Epic Games and ask “Hey Epic Games, can we license your Unreal Engine for our new game?”.

    “Sure”, says Epic Games. “But because we know that those 18% have all gone into your company, now it’s going to cost you a lot more now.” And all those 18% go right into Epic.

    So the whole process goes like this. Epic Games uses Epic Store as “marketing” for lack of a better word. Epic Store is never suppose to make a profit. Epic Store is used to change the cut that the other stores have. 12% instead of 30%. Now all of those countless 18% have gone to a publisher like Activision. So when Activision goes to get their license of Unreal Engine all of those 18% that would have stayed with their original stores have now transfered to Epic Games through the licensing deal. From Steam to Activision through Unreal Engine to Epic Games, for example. All of those new 18%, all coming from the original stores. Now consider that sometime in the future the price of games goes up. $100 or $150 or $175. Now imagine all of those 18%. All moving from their original stores over to a publisher, then through Unreal Engine to Epic Games. That’s a huge amount of cash.

    Of course none if this is exactly perfect math or anything. A lot of things will eat into the publishers profits after the 88%. But the idea running through this feels like one of those “so crazy it just might work” things.

    Is any of this sensical?

    1. Boobah says:

      Not really. Unreal is popular, true, and lots of devs have practice using it. But it is by no means the only game in town, and devs build their own engines all the time, too. Jack the price of Unreal up and all the other engines (including custom jobs) get relatively cheaper.

      1. sock puppets! says:

        True.

        My thingy is that Epic Store is claiming that all the other digital distribution stores should go down to 12% because they are doing it and that it’s financial viable to do so. If Epic Store is not running on just the 12% but also has a secondary income from Epic Games itself and the Unreal Engine license supporting it, then all the other stores that don’t or can’t have a secondary income stream should be able to consider how that would affect them if they lowered their cut by 18%.

        I think the after-the-fact ramifications and follow-through for market and industry happenings of this are not really things that people are considering, I guess.

        I was going to expand on this and give more bullet points to support my assumptions of how I’m concerned about how I think all of this would play out, and maybe a better “example reason” of how and why Epic is trying this, if anyone thought it had any validity. But if this bit is wrong, then the rest of it is probably completely wrong. So, whatever. I was wrong.

      2. sock puppets! says:

        (This is super rant-y. And this does have a very anti Epic Games tone through it and I make a lot of assumptions about the intent of Epic Games. I’m just focusing on them because they the ones trying to make this happen so a lot of their reasons should be questioned, and maybe see if there is a few unstated reasons too. And I’m using Activision for the reasons stated when they are mentioned, this is not about them in any other way. Imagine a generic publisher when I’m not referencing Activision’s recent earning statements. Just remember that most of these assumptions are not presented as fact, more like concerns and questions. Maybe it’s one of those “opinion pieces” that other video game news sites have all the time. I’m really aware of how this reads as a hit piece. I’m not saying this is exactly what Epic Games is thinking or doing. I’m just challenging the idea of how Epic Store handles itself, presents itself, and why it tries to have the rest of the market use 12%. And why other digital distribution stores should look closely at Epic Stores’ financial model before deciding anything. It is also, admittedly, fairly loose when it comes to math and price estimates. If this is completely wrong, then whatever. I was wrong.)

        Epic Store isn’t a “store.” Not in an applicable sense of the word. It doesn’t have the same function as other stores. It doesn’t have the same purpose as other stores.

        Stores exist, primarily, to bring in a profit or at least break even. To keep the business running. Just basic capitalistic sense. Not getting into politics right now.

        Stores bring in profit from sales of products and lose money with expenses such as employees, maintenance, servers, etc. Employees want their pay so they can eat, drink, sleep, pay their bills, etc. Just so we’re aware of the costs and expenses of running a store/business.

        Digital distribution stores don’t have a need to purchase products because they don’t buy the games that they sell. They’re essentially taking the product through themselves from the publisher to the consumer and taking a cut. So that’s not an expense we really need to consider. Just bringing it up for completeness sake.

        Games sold through Epic Store gets 12% of the sales, the other 88% goes to the publisher. Other digital distribution stores are set at 30%, so 70% goes to the publisher.

        Epic Store gives free games weekly. Sometimes two or three. Publishers, for example Activision, generally don’t give away free games to anyone. If publishers want that extra 18% from the other digital distribution stores, they would want the 88% from all those Epic Store free-games too. That’s how Activision made 5 billion in profits, I would think.

        Epic Store also has a minimum-sales-guarantee for some, or maybe even most, of the titles on their store. Again, if Activision wants that 18%, they would never give up on their 88% of all the games that are not sold. They wouldn’t have a deal to sell 500,000 copies of a game and only sell 320,000 and have Activision say “you don’t owe us our 88% on those 180,000 copies that didn’t sell”. That’s not how Bobby Kotick made 5 million.

        Epic Store has to buy maybe tens or even hundreds of thousands of games every month. All of which Epic Store has to pay for. Bobby Kotick wants his share.

        So, sometimes people think that if a game is torrented from somewhere like Pirate Bay, it technically doesn’t count as a copy being sold/stolen. But, publishers are very self-interested in their own companies wealth. They don’t like Pirate Bay. Bobby Kotick again. A legal game-key given away for one of their games without getting their 88% isn’t something I can really imagine. I don’t want people saying “well, maybe Epic Stores is getting them for free” just outright. Publishers would never act like that. The cost of a game that Epic Store has to pay to the publishers just something we need to remember.

        GOG does sometimes gives away free games, but those are generally old games, one game at a time, and it happens every three or four months. GOG also doesn’t have a minimum-sales-guarantee that I know of. GOG still has a 30% cut. Rather than suggesting that other digital distribution stores lower their cut to 12%, Epic Store should show all the other digital distribution stores how to acquire so many free game without the 88% going to the publisher and only having a 12% cut of the games they do sell. That be more convincing for all the other digital distribution stores to switch to 12%. Epic Store telling everyone how to give out many, many free games and still make a profit. I’m sure Microsoft and Playstation would love to give two or three free-games a week to all the people who use their store too and their users would love that too.

        So, a 12% cut of a game sold on Epic Store counts for roughly 1/8 of the price of a copy of a regular priced AAA game. A regular priced AAA game that Epic Store itself needs to buy because of minimum-sales-guarantee or weekly free-game giveaways. Well, technically 12% times 8 would be 96% but I don’t want to go into a lot of math right now. And Epic Store probably buys game-keys in bulk which assumedly would have a lower cost than regular individual MSRP. So we can’t really take the figure as hard fact, just a basic assumption needed to create the context to think of the base cost of a game. Older games probably do cost them less too.

        It seems to me that in order for Epic Store to constantly give away all those games at the 12% cut it receives, it would need huge injections of cash, very frequently, to not go bankrupt.

        Epic Store is a part of Epic Games. I’m just stating that, if it needed pointing out.

        Epic Games has made hugely massive amounts of money primarily by selling two products. Loot boxes and one other thing that I’ll get into later.

        Loot boxes are usually criticized as being bought by a large amount of players. Even though they cost a few dollars, all of those sales quickly add up. The cheaper they are the easier it is for a player to rationalize a purchase. It’s a very large part of Epic Games income, assumedly. Publishers love them for a reason. Epic Games is publishing Fortnite now.

        So, in order for Epic Store to continue giving away free games and buying unsold minimum-sales-guarantee games it’s probable that Epic Games is dumping large amounts cash into Epic Store to keep it running. Unless Epic Store has some other secondary income stream that no one has noticed, other than the 12% cut. It’s their own store. It’s their own company. That’s not illegal (pretty sure).

        Now Epic Store doesn’t have to rely on 12% or 5% or any percent. They could easily set it to whatever they want. They could cut out every profit they could have made from selling any game. Epic Store doesn’t really need it. Epic Games is dumping money into it. Epic Store doesn’t have to make a profit as a store, it doesn’t need to. That’s not it’s purpose.

        So, there seems to be a massive disparity between what Epic Store brings in in profits and what their expenses are. For all the other games Epic Store has to buy from publishers they would have to sell roughly 8 games for every free game they gave away or bought because of the minimum-sales-guarantee, every month. And that’s just for games, it doesn’t count servers, maintenance, programmers, or other factors that would come into a standard business model. All covered from just 12%.

        Maybe. Cause no one knows. Epic Store, as far as I can find with a handful of google searches, has never released any kind of data on their profits/expenses. They’ve never released fact-based, referenceable, records of how many games are sold. They never reveal how many of them were actual sales and how many were ones Epic bought. Never released how many free games are given away. Never any records on any of their costs or their expenses. Those are the kind of records other digital distribution stores like Valve, GOG, Playstaion, or Microsoft should read before adopting the 12% model. To show how it would be applied to their own companies’ profits/expenses.

        Every bit of information that we have about the financial situation at Epic Store, we only have from Epic Games themselves. We have no option other than to believe their word rather than any form of legitimate legal document. If there is any problems with the way Epic Store operates, or it’s finances, then we have no way of knowing. Unless Epic Games themselves tell us. I find that very not trust-worthy.

        So, if Epic Games dumps huge amounts of cash into their store, then no other stores business model could ever be compared to Epic Store. Or even try a similar business model. When a store tries to exist as a store, they should never consider Epic Store’s 12%. It might not even work. Because very few other stores can have huge piles of money constantly pumped into them by large corporations to keep them afloat. Steam is used to keep Valve in business, not the other way around. Steam’s purpose is to make a profit for Valve and keep the business going. Epic Store’s purpose is to make 12% happen to all the other stores, I’m just going to assume that because I want to right now.

        Metaphorically, think of a laundry mat owned by the mafia. I’m not saying that any of Epic Games’ actions are any way criminal, or like those of the mafia I’m just trying to make this understandable. When the laundry mat is used as a front for the mob, it doesn’t really matter if the business itself makes any kind actual profits from actual sales/use. All of the real stuff, all of the real money is because of the “back-room shenanigans” that go on. It never needed to make a profit for it to be “profitable” for the owners. The laundry mat is not a store. It has a different purpose. Epic Games doesn’t need Epic Store to succeed as a store. It never was supposed to make a profit. Again, I’m not claiming that Epic Games is doing any kind of illegal or criminal activity. Just kind of dickish behavior.

        If you have the time I suggest looking up why Wal-Mart never caught on in Germany. It’s strange how it’s considered legal here in the states. When Wal-Mart opens store at a new location here, they start by selling products at a loss compared to their competition. They actually, really, sell items at a loss. When ever a Wal-Mart opens, all the other local businesses have to close down shop. They just can’t compete with a corporation that is so massive and has so much money that they can sell their own products for less than it costs to make them. Then afterward when they’re all alone just bring the prices back up, maybe even higher, to gain back anything they ever lost. And more with no competition. It’s called “penetration pricing.” That’s what Wal-Mart does. That’s why it never caught on in Germany, they have laws against doing that. No store is allowed to sell a product for less than it costs to make it. Read about how Uber tried to undermine the taxi-cab business by operating at a loss too. A massive billion dollar loss. Really. Billion with a “B”. Multiple billions.

        So no other digital distribution company like Valve, GOG, Playstation, Microsoft, etc. could ever compete with a corporation that is able to dump huge amounts of money into their digital distribution store, from outside of the store itself especially if it’s operating at a loss. Nor should they ever have to try. And I’m not counting various other options of revenue streams like self-funding and self-ownership, and if those records are not hidden from view but that one’s just personal preference. When they are trying to tell anyone how to run their business while not revealing how their own is run, I think it’s a fairly reasonable to not treat them as perfectly altruistic. Or even mostly altruistic.

        So now, rather than a publisher, like Activision, only getting a 70% take, they instead get a 88% take. If a publisher sells a game through a digital distributor with 12% and does not use the Unreal Engine this is still applicable. That extra 18% from Steam, that extra 18% from GOG, that extra 18% from Playstaion Store, that extra 18% from Xbox marketplace, etc. Just those four 18% come up to 72%. With just those four original digital distribution stores they manage to get the equivalent of a fifth game sale. An increase of almost 25%. The original 70% from Steam, the original 70% from GOG, the original 70% from Playstation, the original 70% from XBox, and the 72% from all those new 18%. All those 18% add up. So all those 18% are now going to someone like Activision. All of them. At least for the games they publish. By the way 25% of 5 Billion is 1.25 billion, so now it’s up to 6.25 billion for Activision. So Activision would support that. They love money.

        So the whole process “could” look like this. Epic Games uses Epic Store as “marketing” for lack of a better word. Marketing for that 12% that everyone now has, because Epic Store told them to. Epic Store is never supposed to make a profit. Epic Store is used to change the cut that the other stores have. 12% instead of 30%. Now all of those countless 18% have gone to a publisher and also has been removed from the profits of their competition who can merely act as stores, not single owner conglomerates with multiple revenue streams.

        So if a publisher goes to get their license of Unreal Engine all of those 18% that would have stayed with their original stores have now transferred to Epic Games through the licensing deal. From Steam to publisher through Unreal Engine to Epic Games. All of those new 18%, all coming from the original stores that lowered their cut because Epic Store told them to do so and Epic Games itself can profit off of it.

        Now consider that sometime in the future the price of games goes up. $100 or $150 or $175. Now imagine all of those 18%. All moving from their original stores over to a publisher, then through Unreal Engine to Epic Games. That’s a huge amount of cash.

        Everything related to the Unreal Engine and the higher 18% cut going into the publisher can be thought of as a future bonus not the single determining factor in our hypothetical idea where the stores haven’t necessarily closed. Just an additional future possible income coming from their current practices.

        Epic Games currently having a next-gen engine and leveraging it to keep Epic Store, assumedly operating at a loss, financially stable now while others have to take major losses from the reduced cut is the central idea. Or at least the closest thing I could think of to explain Epic trying to have everyone use their 12% cut. If Epic Store continues to receive outside sources of income, from Epic Games, and the other digital distributor stores are unable to keep pace in the market at 12% then those digital distributors will eventually fail. When or if the other services fail, there wouldn’t really be any reason for Epic to stay at 12%. Or even stopping at 30%. As the Wal-Mart of digital distributors they could re-coup the current losses now by later having market domination later. More so than they say Steam currently has.

        There are many other engines for use, like Unity. Unreal doesn’t dominate the market on those. Most large companies probably have their own engine too, Frost Engine for Bioware/EA, Creation Engine for Bethesda, I think Source Engine hasn’t been licensed in maybe twelve years but it’s still there. With Unreal being the most up to date next-gen engine that is available to many big publisher or independent developers at low cost for entry, compared to other proprietary engines, it will probably have large enough market saturation to justify the current losses.

        Of course none of this is exactly perfect math or even good english. And I’m not a mind reader. I can’t guarantee what Epic Games or Epic Store is doing.

        But even still, it’s very absurd that Epic Games would ever challenge other digital distribution stores to try a practice that they don’t really use themselves honestly or can even show it to be economically healthy in any way.

        At the end of all this if, and I admit it is a big if, Epic Games are using the 12% to not just to establish themselves as a digital distribution store but to make it financially impossible for the other digital distribution stores to operate then the other digital distribution stores just shouldn’t do it.

        1. sock puppets! says:

          Ok so seriously this is driving crazy thinking it. Does this really badly done math make sense or am I totally wrong? How completely and utterly wrong am I? Is it asylum time?

          if (Steam 12%) = (88% to total gross revenue for publisher)
          if (Unreal Engine 5% of total gross revenue)
          ((Steam (30% – 18%)) = 12%) = ((total gross revenue for publisher (70% plus18%)) = 88%)
          If ((total gross revenue = 70%) (Unreal Engine 5% of total gross revenue)) = 3.5%
          If ((total gross revenue = 88%) (Unreal Engine 5% of total gross revenue)) = 4.4%
          (Steam Store down) = (Epic Store up)

          if (stores = 30%) = (publishers = 70%)
          ((70%) x (Unreal Engine license 5% of total gross revenue)) = 3.5%
          ((70% from X Box) x (Unreal Engine license 5% of total gross revenue) = 3.5%) ((88% from PlayStation) x (Unreal Engine license 5% of total gross revenue) = 3.5%) ((88% from Steam) x (Unreal Engine license 5% of total gross revenue) = 3.5%) = (3.5%) plus (3.5%) plus (3.5) = Epic 10.5%?
          if (number of stores up) = (Epic 3.5% up)

          if (stores = 12%) = (publisher = 88%)
          ((88%) x (Unreal Engine license 5% of total gross revenue)) = 4.4%
          ((88% from X Box) x (Unreal Engine license 5% of total gross revenue) = 4.4%) ((88% from PlayStation) x (Unreal Engine license 5% of total gross revenue) = 4.4%) ((88% from Steam) x (Unreal Engine license 5% of total gross revenue) = 4.4%) = (4.4%) plus (4.4%) plus ($4.4%) = Epic 13.2%?
          if (number of stores up) = (Epic 4.4% up)

          if (game price up) = (total gross revenue up)
          (X Unreal games) x (total gross revenue ) x (Epic Games 5%) = ($ up)
          if (game = $60)
          (steam 12% = ($7.2)) (publisher 88% = ($52.8)) = ( $52.8 x (Unreal Engine license 5% of total gross revenue) = $2.64)
          (Unreal Engine 5% of total gross revenue) = $2.64
          if (game = $90)
          (steam 12% = ($10.8)) (publisher 88% = ($79.2)) = ( $49.2 x (Unreal Engine license 5% of total gross revenue) = $3.96)
          (Unreal Engine 5% of total gross revenue) = $3.96

          (also some of the symbols keep disappearing when I post it so you might not see them)

          1. sock puppets! says:

            Gross revenue is the total amount of sales recognized for a reporting period, prior to any deductions, right? Then the 70%/88% would be the total gross revenue of those games sold for the publishers before Epic takes it royalties?

            Right now if those three stores sell an Unreal Engine game each at 3.5% Epic will get 10.5% of the cost of the game. If Epic sells it too they’re at 22.5% of the cost of the game , if two more stores (like Origin which has Star Wars: Fallen Order) sell an Unreal Engine game they get to 29.5% of the cost of the game. Almost 30% that the others get. So I think I was totally wrong about the Wal-Mart thing. Now I think Epic wants as many digital distribution stores as possible. Every store that sells Unreal Engine games will add 4.4% to Epics royalties while all the other stores stay at 12%. At 12% with just those three royalties Epic would make more than the other stores individually: 13.5%. If Epic Store sells the game too they’ve made more than double: 25.2%. Every additional store would add another 4.4%.

            So with the 70% the royalty from one sale would be 3.5% which is 1/9th of what other three get 30%. With 12% the the royalty is 4.4% which is 1/3 of what other three get 12%. With 3.5% the other three would have to sell nine copies total between them, or three each, to give Epic the same that they get for one sale. With 4.4% the other three only have to sell three copies in total, one sale each.

            If one of the three stores sells a $60 game at 30% they get $18, the publishers get $42, and with 5% royalties Epic gets $2.10. For Epic to get the same $18 as all three stores, the three stores would make $54 individually or $162 all together.

            If one of the three stores sells a $60 game at 12% they get $7.20, the publishers get $52.80, and with 5% royalties Epic would get $2.65. That is more for the publisher and also for Epic. For Epic to get the same $7.20 as all three stores, the three stores would make $7.20 individually or $21.60 all together.

            That’s before Epic sells the game themselves, which they get another $7.20. So with four games sold Steam gets $7.20, X Box gets $7.20, PlayStation gets $7.20, and Epic gets $15.15.

            Is this really not a problem? I’m ready to be wrong about this one too. I don’t know. I’m just running myself in circles thinking about this.

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