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Court docs reveal Epic CEO's anger at Steam's 30% fees
- ganoushoreilly 3y agoThis whole notion of epic being the little guy is just dumb. These platforms were built and supply a value. Epic tried and they give away games no stop to entice users to use the platform. It’s not great, steam is better. Instead focus on making better games and content that push me to buy. It just comes off as greedy and whiney.
- TeaBrain 3y agoIt doesn't help that they've put in little effort to improve their platform. With all of the money that they've spent giving away games, they could have instead dedicated resources towards building a something akin to steam's community and rating system. Without that, Epic is unlikely to compete with steam as a vendor of non-exclusive games.
- happymellon 3y agoIt doesn't help that they don't push the platform, it is simply not as good on a device like the deck, or a TV, and Tim Sweeney is so hostile to Linux making it stuck with the awful Windows UX. Games get my money on Steam because Steam provides me with a great experience to play those games. It's far more than just a CDN, and all it takes is to try to use an EA game on the Deck to see how bad other platforms are.
- BoorishBears 3y agoI agree with the fact Epic isn't little, but I also agree it's crazy Steam is still taking 30% post the Greenlight deluge. When they launched, afaik they were being pretty selective. A game being on Steam meant it was a good game, and in a way they were actually a publisher providing you with high converting distribution channels. It was like marketing and PR were almost baked in. Now being on Steam means nothing. In fact they happily declared it means nothing: https://www.pcgamer.com/valve-says-it-will-no-longer-police-whats-on-steam-unless-its-illegal-or-trolling/ https://www.pcgamer.com/valve-says-it-will-no-longer-police-... Steam even normalized a class of game (Early Access) that actually means negative things in general. - Once they transitioned from publisher to glorified CDN + Forum Hosting, I think they should have reworked the pricing to reflect that.
- TylerE 3y agoWhy should they voluntarily reduce a price their actual customers seem all too happy to pay? A dev's game being on Steam and having access to that massive customer base is much more valuable to that dev than Generic Looter Shooter #8589 is to Steam.
- BoiledCabbage 3y agoThat's essentially the issue. Market effects competition failing. Compared to nothing, yes there is 30% value is CDN hosting and a forum. Compared to a competitor there isn't - it's mainly network effects. Or put differently, if you changed the name steam and launched them today along with a competitor that charges 15% is there enough more value to use Steam to downlad at that higher fee? The answer is very likely not; however, that competition can't happen because of past network effects. You want markets to compete on who has the better product, not on who got their first.
- TylerE 3y agoIf that was true, the competitors with lower fees would be flourishing while Valve struggles. Game buyers don't care about the cut. They pay the same price. They're absolutely going to use a more polished more reliable service that actually offers refunds for defective games.
- BoorishBears 3y agoThis is falling for the better mousetrap... trap: https://www.monash.edu/business/marketing/marketing-dictionary/b/better-mousetrap-fallacy https://www.monash.edu/business/marketing/marketing-dictiona... Game buyers are going to use the thing that's sitting on their desktop. Every other aspect of either store is tertiary. EGS has been shoveling money in a furnace, solely to also be sitting on some desktops, but Steam has a decade+ head start and it's going to be an absolute slog.
- TylerE 3y ago
- lern_too_spel 3y agoThere is no notion of Epic being the little guy. There's a notion of one big guy's interests being aligned with consumers' interests on a particular topic.
- superbman 3y agoThat's the best you can ever hope for from companies. Valve investing in Linux gaming? Same deal.
- swatcoder 3y agoThey're not the little guy, but the things they're pushing for are what many little guys have calling for but would never have the individual leverage to force negotiation or compromise. They're whiny and petulant and they play dirty with the press, but Epic is ultimately staking their deep pockets and public reputation on championing the cause of many little guys.
- pjmlp 3y agoNaturally the whole issue is that their store isn't as successful. It is similar to how Microsoft is now unhappy to have to deal with Apple and Google, after killing Windows Phone, when it was around 10%. Turns out 10% market share was still better than not owning any mobile platform where they can't really push XBox games as they wish.
- thih9 3y ago> killing Windows Phone, when it was around 10% According to the verge they killed it when it was 2.5% [1]. IDC also lists 2.5% by the second quarter of 2014 and a peak of 3.4% in 2013 [2]. [1]: https://www.theverge.com/2017/10/10/16452162/windows-phone-history-glorious-failure https://www.theverge.com/2017/10/10/16452162/windows-phone-h... [2]: https://en.m.wikipedia.org/wiki/Windows_Phone https://en.m.wikipedia.org/wiki/Windows_Phone
- pjmlp 3y agoMy numbers say otherwise, as I was focused on European market when I wrote my comment. https://www.ft.com/content/80972f3a-29c0-11e3-bbb8-00144feab7de https://www.ft.com/content/80972f3a-29c0-11e3-bbb8-00144feab... https://thenextweb.com/news/report-windows-phone-overtakes-ios-in-italy-and-makes-progress-in-europe https://thenextweb.com/news/report-windows-phone-overtakes-i... https://thenextweb.com/news/windows-phone-climbs-to-nearly-10-of-smartphone-sales-across-great-britain-germany-france-italy-and-spain https://thenextweb.com/news/windows-phone-climbs-to-nearly-1...
- thih9 3y agoI’m not seeing numbers that show otherwise. Unless you meant that the 10% was for europe only?
- pjmlp 3y ago> According to data from a Kantar Worldpanel ComTech report for the last three months up to August this year, Windows Phone-based devices accounted for 9.2 percent of smartphone sales in Great Britain, Germany, France, Italy and Spain. You can play pedantic and assert 9.2 isn't the same as rounding it off to 10, anyway.
- faeriechangling 3y agoI have confidence a game published on steam will be there 20 years from now. I have much less confidence games on epic games store will be there 20 years from now. That's a huge value-add.
- atomicfiredoll 3y agoThis is the elephant in the room lots of people seem to ignore. Sure, you could sell your game solely on your own website, but what's your support like? What's your refund policy if the support sucks? Will you be there 20 years later? Will your new CEO decide to start enshittifying things? People keep putting Steam on their desktop because Valve has spent decades cultivating customer's trust, meanwhile every other MBA has been burning it for short term gain. Partnering with Valve comes with access to things like APIs and tools, but you also receive a little bit of that trust by association. Not only has EGS seemingly failed to build something with equivalent features, APIs, tooling, etc. but in doing so they've failed to show a reason to trust them. So if the lower cut isn't resulting lower prices, what's the value prop for customers? GOG has an angles: games nobody cared to make available for a long time and being DRM free. To me it looks like Epic took the MBA route and wanted to build a moat via console style exclusivity, but that's not trust. Free games aren't trust. Just being on the customer's machine isn't trust. (Also, these letters aren't current. iirc Vale doesn't simply take a flat 30% cut in the current day)
- faeriechangling 3y agoThis is exactly it. A company giving away a product for free to me doesn’t remind me of an honest actor, it reminds me of a casino with a “free spin” voucher, or a drug dealer giving samples. I’ve seen the “create a monopoly at a loss and then enshittify and raise prices” playbook over and over. Am I supposed to be so stupid and naive as to think Tim Sweeney is my friend? Every game he gives away just sort of proves how much of an idiot he thinks I am. Steam has a track record of making their product better and better and the biggest scandal I can remember is when they introduced paid mods since that risked undermining the free mod market and GabeN did adjust the pricing afterwards and did personally get involved with the PR fallout. Otherwise the service has just gradually gotten better and better for the customer. Steam is privately owned instead of being owned by publicly traded companies and that helps with my confidence in the company.
- superbman 3y ago30% sounds high. Are there anticompetitive effects at play? I play so few games that I'm happy to buy mostly from the much smaller gog.com. I'm not sure if their fees are less, but it at least raises competition. I generally don't trust DRM platforms like Steam or Epic, but bravo to Tim Sweeney for championing smaller publishers unable to negotiate down from Steam's 30% fees.
- abdullahkhalids 3y ago> Are there anticompetitive effects at play? As much as some Mall in your city charging high rental rates. If they are not stopping other malls from being built (say by bribing politicians), and they are not stopping people from setting up solo shops, I don't see where the anti-competitive force is. Apple's case is much different. They are using oligopoly power in one area (high share of OS), to extract revenue in other area. It's like if one of the biggest cities in the country, had a Mayor who also owned the only Mall in that city and stopped any other Malls from being built and charged super high rental rates in that Mall.
- superbman 3y ago> As much as some Mall in your city charging high rental rates. I had a quick look. Per https://www.shacknews.com/article/130287/valve-faces-antitrust-case-over-steams-most-favored-nation-pricing https://www.shacknews.com/article/130287/valve-faces-antitru... , Valve are currently (?) being investigated for Most Favored Nation practices. This is the equivalent of a high rent mall demanding that its shops don't charge less for its wares in lower rent malls.
- abdullahkhalids 3y agoI stand corrected.
- saltminer 3y agoIf you sell a lot, Valve will reduce their cut on Steam to 15% IIRC. And Steam keys are free to developers - that is, you can generate Steam keys on your website and sell them and Valve gets nothing in return, and there's no volume requirement like there is for reducing Valve's cut on the Steam store. Steam also doesn't do exclusives (beyond Valve's own titles), nor do they pay any OEMs to pre-install Steam - with the exception of the Steam Deck, all Steam installs come from people who actively seek them out. It's not like Apple where (until recently) you had to go through them to get your app on iOS and pay them every step of the way for the privilege.
- blibble 3y agosteam is one of the very few products I use that doesn't feel like the company running is enshittifying it to make a quick buck it's a direct result of its private ownership, there is no need to constantly squeeze customers/suppliers for more every quarter if it was owned by a VC/PE fund, or a public company then it would be very different experience indeed
- luqtas 3y agogetting almost of 1/3 of your sales isn't squeezing customers? maybe (MAYBE) back in the days of physical distribution the 30% would make sense... and don't bring it "Steam offers more than distribution" because plenty of big fish don't use it or wouldn't want to but the brain-less gamer community seems to like fancy trophy, streaming etc. so they have to comply edit: wonder what if Nvidia, Intel, AMD and the likes starts charging 30% of all you created...
- Zircom 3y agoSteam also provides multiplayer support/matchmaking, social features, voice chat, download/update infrastructure, anti cheat, and other things I'm probably not listing because I don't directly interact with as a player, and the only up front money you have to pay is a one-time $100 that gets refunded if you end up making $1,000 in revenue. Pretty good deal.
- brnt 3y agoWhat cut did publishers take before Steam? Precisely. Can you and will you provide the service that Steam provides instead? What will it cost you? What will it cost another store? How will gamers know that those stores, maybe your own server, will not just disappear when you lose (commercial) interest? When dropping the game because you have three others you'd rather sell lined up? Even big fish like EA and Ubisoft can't run their shops anywhere near the reliability that Valve provides. Sure, 30% isn't holy for me and I'm happy for Epic try and beat Valve, but so far, which is now nearly two decades, it's been worth very cent of the thousands of currency I've thrown Valve's way. Especially Proton is something I don't see anyone else do, and it's saves me money too.
- 3y ago
- MR4D 3y agoI am so tired of this guy. He's a Class-A a*hole. He is fighting everyone's 30% fees. Perhaps, just perhaps, they are worth it because if they weren't the it would be easy to create a platform. Proof of his absolute stupidity is here [0], where he says (referring to MS, Nintendo, and Sony), "* Well, they subsidize hardware, so they sell their hardware, as far as I can tell from widely published reports, at a loss, and so the fee needs to cover that*". WTF???? So if you lose money, the he isn't going to sue you, but if you make money, then he will sue you. At this point, I hope someone destroys his damn company due to a slip & fall lawsuit. God, I can't take his shit anymore!!! [0] - https://www.gamesindustry.biz/epic-explains-why-it-hasnt-sued-nintendo-sony-and-microsoft-over-30-fee-epic-vs-google https://www.gamesindustry.biz/epic-explains-why-it-hasnt-sue... /rant
- Wowfunhappy 3y ago> Well, they subsidize hardware, so they sell their hardware, as far as I can tell from widely published reports, at a loss, and so the fee needs to cover that That seems totally reasonable to me.
- MR4D 3y agoEpic doesn't build any hardware, and charges Devs 12% to build an add-on for Fortnite. [0] Why 12% ? That's not cheap for what is essentially basic ACH billing service. If I go to get a service like that, I have several vendors to choose from and only pay about 1/4 that price. [1] Maybe someone should sue Epic for unreasonable pricing. [0] - https://www.theverge.com/2023/3/9/23630864/epic-games-store-self-publish-tools-ratings https://www.theverge.com/2023/3/9/23630864/epic-games-store-... [1] - https://quickbooks.intuit.com/payments/payment-rates/ https://quickbooks.intuit.com/payments/payment-rates/
- Onawa 3y agoAn ACH billing service.... That is built on top a game platform. 12% doesn't seem bad, compared to Roblox. Pretty sure last I saw, developers were only getting 30% of the sales from Roblox add-ons.