Monday, September 23rd 2019
Exclusivity Costs: EPIC Games Store's Control Cost $10.5 million to Become PC Exclusive
Control is one of the better single player releases of this year already, and has been enough of a success for Remedy and 505 Games to launch a content roadmap stretching all the way to 2020. The game is being served on PC exclusively through the EPIC Games Store, which, besides offering developers higher revenues than Steam, has also launched an all-out campaign to secure high-profile exclusives such as Control and Metro: Exodus (even if some of them are timed exclusives).
Now, an Italian earnings report from 505 games highlights that the developers received a lump, $10.5 million upfront from EPIC; according to the report, "Revenue comes from the computer version of Control (...) The game was released on August 27 but the structure of the marketplace who requested the PC exclusivity has made possible to gain the revenue starting from this quarter." It appears EPIC is offering a safety net for developers in exchange for the exclusivity deals, paying upfront the amount of revenue developers expect to receive from the games' sales throughout the PC platform. In this case, the $10.5 million correspond to a total of 200,000 individual sales of Control. Until that number is achieved, EPIC keeps the full revenue from every sale. Any units sold starting from 200,000, and the revenue is split between the developer and EPIC. It's a win-win, really: EPIC gets more and more traction and publicity on its store, and developers guarantee they get the minimum amount they'd expect to earn by selling the game across the full spectrum of PC marketplaces.
Source:
Ars Technica
Now, an Italian earnings report from 505 games highlights that the developers received a lump, $10.5 million upfront from EPIC; according to the report, "Revenue comes from the computer version of Control (...) The game was released on August 27 but the structure of the marketplace who requested the PC exclusivity has made possible to gain the revenue starting from this quarter." It appears EPIC is offering a safety net for developers in exchange for the exclusivity deals, paying upfront the amount of revenue developers expect to receive from the games' sales throughout the PC platform. In this case, the $10.5 million correspond to a total of 200,000 individual sales of Control. Until that number is achieved, EPIC keeps the full revenue from every sale. Any units sold starting from 200,000, and the revenue is split between the developer and EPIC. It's a win-win, really: EPIC gets more and more traction and publicity on its store, and developers guarantee they get the minimum amount they'd expect to earn by selling the game across the full spectrum of PC marketplaces.
129 Comments on Exclusivity Costs: EPIC Games Store's Control Cost $10.5 million to Become PC Exclusive
They also invested in supporting the Blender foundation with 1.2 m too, just to support free or cheap software and cheap labor
Don't think I am jumping on you I was the exact same way when I first experienced Steam coming from DVDs.
It still is a single player game in a time when multiplayer MTX ridden BS is the easiest way to invest.
Do the naysayers not question that at any time, I wonder... the fact that type of games EGS supports are exactly the games we always say we want more of... yet somehow its bad for us? :confused: When it flips... yeah that will be something to see. But I reckon EGS will just take its place in the regular scheme of things. Will they get a big share as a platform like Steam, no, I think Steam has that covered - the community part of it - and I also think Steam has the mod section locked down, though that is easily replicated for EGS exclusives. But I think EGS will keep making money and get a name as the 'premium' game platform while Steam gets lower quality / lower budget and F2P games more readily. Won't be black/white, but close enough (as it is already today, really).
I also think its a tide that even the great Gabe won't be turning around. Steam is oversaturated with nonsense and cutting back on that is a very painful affair for Valve and the userbase. The recent move where they made indie devs less prominently visible on the store will probably bite them in the ass hard - or those devs will move to EGS too if they haven't already.
Its probably too early to say this, but I think Steam is going to get a lot less influential over time, and its a good thing. It now falls to Sweeney to keep EGS 'clean' so it can keep a clear distinction from cluttered mess where no single release can ever get decent exposure. Harsh curating is key.
I am surprised people are so uppity about. From the games I have, you don't even need to use the launcher after it is installed.
I do think though, since the devs are getting guaranteed money, there should be NO drm. This mY be the case as I don't pay enough attention.
Thinking of it, it also makes sense wrt their lower price for distribution - they are not maintaining that layer, or perhaps only on request.
Nope, Just Nope.
So that's a real problem. Wading the pool is exhausting sometimes. It would be nice to be able to go in, pick from a smaller variety of surer bets, and continue with life. I think that's not so much an issue with Steam as it is the lack of an antecedent. Let's just say "They get by." regardless, heh. Epic has quickly built a model that is deeply contingent on careful curation... not so much in the sense that they aim to be a source of 'premium' games - it's not their implicit namesake, but rather in the sense that if the quality of the games they select for exclusives is not up to snuff, they go completely under after basically giving all of their capital away. Their survival is dependent on careful curation and favorable negotiations with people who provide stuff on the level necessary for everyone to make out well. They still need to go over well and even more importantly for them, sell well. They've pretty much bet everything on that (which to me says a lot about what they're going for... more on that in a minute.) I think that just so happens to be a pretty good way of keeping them in check... because backing seedy or just crappy games actually has immediate and long-term consequences for them, whereas Steam can keep puffing along no matter what games flood the platform. I wonder if that was a real consideration for them or if it just so happens to serve as an unwitting balancer for their platform. It's pretty unique now that I think about it that way.
It just made me wonder... if maybe by chance they might now gain a reputation for being a bit more cautious picking games to the point where they may continue to do so after their business model moves away from the capital-driven one they have now to something more cyclic and sustainable. Maybe that could be their thing. That in itself would be a pretty distinguishing feature. And one that a lot of people would likely appreciate. Not to mention it would put them in their own category, free to operate as they please without disrupting anything. I really do wonder about their intent there. I think they had to know how they would come off with their tactics, but the place they're trying to get to may not be as disruptive as it seems right now. They sure don't try to hide it well. People accuse them of being shady, but it's really all out on the open. This isn't some backroom shit, it's public knowledge. They're acting like they have nothing to hide, which again makes you wonder what their goal is. If they wanted to take the market by force, they might've considered adopting a little more... 'finesse' lol.
I dunno... just rambling nonsense. I see the potential in them being kind of in their own arena, perhaps serving a niche that's been in need of attention for a while. It would at least be a solid endgame for them... to ultimately settle into a position where they are not directly competing with Steam and don't need to. When you look at it that way, it's easy to conceive that they're taking the only route currently available to that point. Makes more sense to me than one ever beating out the other. People make a lot of comparisons there and bring up the ethics in competition between the two as though it must be one or the other... as though that's what Epic wants it to be about, but what if that's not Epic's goal? I personally don't get that vibe. Sometimes I really don't think it is quite what they want... or if it was, they don't seem to be in much of a hurry on many fronts. As many people have pointed out, it's like they're not even trying to offer anything that would sway you away from Steam. The launcher is so different, they're not as community oriented, they're not concentrating on features. A lot of people ask "why" as though these are things that are no-brainier things that they must do if their intent is to compete. But then, why indeed? You know? Why if they are attempting to compete with Steam are they simply snatching up exclusives and offering essentially nothing but the games themselves? It doesn't make sense if we are to assume the former. To me, it looks like they are attempting to build a library that stands out from the rest. Or at least, that has been their main accomplishment thus far. I wonder if they even care about becoming the next Steam. At least, from a survival standpoint it would be smarter not to fall on dominance to see them through. Very high likelihood of catastrophic failure, there.
Many people assert they're just trying to take a piece of the pie by force and pull the wool over all of our eyes. And maybe that's true. But if it is, they will undoubtedly fail, being that they are still the little guy. It's only a matter of time until they're eaten alive if this is truly all they have in mind. That notion puts them on the wrong side of a power dynamic, when where they really want to place high is on a competency hierarchy. If they can do one or two things really well, they don't have to win the whole damned enchilada to be massively successful. A big part of me can't help but think they choose to pursue the things they do and avoid the rest for a reason. Sure, they're going hard for a piece of the pie right now... that's just a necessity for survival early on... nothing short of aggressive moves will get you there in time. You kind of either take off fast or never make it off the ground in their world. Something tells me they must have their reasons, for what is a pretty strange way to piece together a launcher and establish yourself as a distributor. There must be a larger vision behind what they're doing... that they're probably very wisely not showing right now. I don't know if it's nefarious or not. It may just be that they want to take their piece of the pie and do something a little different with it, but still being in their infancy just can't afford to go there or take those chances. It's all they can do to string-up the heart of what they want to offer.
*shrugs* it's been pretty interesting so far. Gotta hand it to em for really shaking things up. Good or bad outcomes ahead, this was needed and important lessons will be learned. Honestly, I'd be happy to see them turn out as a no-bullshit, feature-light distributor with nothing on offer but good games. Maybe a bit optimistic, but I think that might be what they're ultimately shooting for. Imagine that! A distributor that put their main emphasis on maintaining a tight channel of quality games with good variety. Imagine if somebody did that and made their whole operation all about that and nothing else. That would be pretty sweet. Whether that'll happen, I have no clue lol. I'm sort of reaching here, but I'm nowhere near a conclusion. I think it's still too soon to really make sense of what they're up to just yet. Some good and some bad to it, for sure.
Big grain of salt. But that's the same reason I'm also not jumpy about it. I'm more just, "Hmm... well let them try and we'll see what they do." I'm trying to wrap my head around the ethos in the room when these people decided to go through with everything they have. What would they be thinking about that would make them think it was a good idea and spur them on? People say follow the money... which is like DUHH. But it can never just be about that. You only operate for profit and you ironically wind-up losing it. So to me there has to be more to it than just wanting to take some sales by force. They must have bigger ambitions than that. And to figure those out you have to think less about intent and look more at the outcomes sown... and in more than one way, too! None of these entities exist solely as greed machines. There has to be an underlying identity. A presence to the name. What will that be for Epic?
They are working to give developers an alternative place to sell games and make more money. However, that doesn't just happen overnight. In order for games to sell, you need to have buyers. In order to have buyers you need to have games. People likely aren't going to buy games on Epic because people are entrenched with their libraries and don't like change.
Epic needed to provides an incentive to get people to buy games on EGS in order to have a bigger audience to get developers to take the plunge to EGS and hopefully then Unreal Engine. How do you that? Play people against their own selves with exclusives. Will people care enough to have to wait 6 months to a year?
The other thing they needed to do was to show developers that they could be successful on EGS. But how do you get the developers to jump on the wagon when their literal jobs depend on it? Take the risk out of it by paying the developers up front. As other developers see successful launches, terms become favorable for each party.
I'm pretty sure Epic has been planning and researching "gamers" and know exactly who they are dealing with. After watching Steam ram whatever they wanted down developers throats and up "gamers" asses, they figured this wasn't going to be too difficult to pull off.
EGS confronted these problems with many, simultaneous strategies:
1) Curation: they will not accept shovelware (which is rampant on Steam).
2) 12% share, waiving the 5% UE4 share if you're using that engine: Sweeney sees the industry standard of 30% as stifling.
3) Exclusivity contract: protection against bad launches, helps developers get the game across the finish line, provides a marketing budget for publishers, helps promote EGS.
Keep in mind that Discord launched a game store that matches EGS in #1 and #2...but not #3. #3 is what made EGS a competitive platform in a short timeframe. It's attractive to publishers big and small because Sweeney knows the game market we're in better than Discord. Valve should know better but GabeN is sipping wine from atop his mountain of cash and he couldn't care less what sort of misery the ants below are wallowing in as long as the mountain continues to grow.
FYI Steam charges 0% for steam keys sold outside the steam store. GreenManGaming, CDKeys, Kinguin. Steam gets 0% for sales on those platform yet still provides steam service for those keys. By allowing the sale of keys on 3rd party marketplaces, steam actively allows other marketplaces to compete with them.
And yes I'm sure PC gamers want EPIC to decide what they can and can't play. No, fuck EPIC and their Apple like walled garden BS. You completely misrepresent steam and are disillusional about EPIC. They aren't here to bring competition to the market, they are here to make $$$. They have never given 2 shits about the PC market besides how much it will fill their wallet.
maker get the money in advance so can fund another project without having in mind the critical part of their businesses- is the game selling well?
is easier to work having the next project funded from the start vs checking how the game sell and waiting incomes from sales drop by drop....
i see it like a compromise even if means that only one store will sale the game; maybe in the future they'll change this and developer can sell on other stores also after reaching a number of sold games f.ex.4-500000 or when sales drop drastically (after the agreed 200000)