Epic Boss Says Exclusives Policy Will Change If Steam Adjust Their Revenue Share

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Epic Games CEO Tim Sweeney has laid out an ultimatum in regards to the PC game store's plans for securing further exclusive titles: if Valve offers a revenue share for developers on Steam that matches Epic's then the Epic Games Store will stop signing exclusivity agreements. Epic will consider bringing some of its current exclusives over to Steam as well.

"If Steam committed to a permanent 88% revenue share for all developers and publishers without major strings attached, Epic would hastily organize a retreat from exclusives (while honoring our partner commitments) and consider putting our own games on Steam," Sweeney wrote. "Such a move would be a glorious moment in the history of PC gaming, and would have a sweeping impact on other platforms for generations to come."

The Epic Games Store has made a habit of securing major triple-A and high-profile indie games away from Steam. The Souls-like game Ashen was one of the first to leave Steam for an exclusive offering on Epic, but it was followed by more prominent titles like Metro Exodus and Borderlands 3. Ubisoft has entered into a partnership with the Epic Games Store and moved most of its PC releases over from Steam to Epic, starting with The Division 2 and extending to Anno 1800 as well.

There's been plenty of discontent for the Epic Games Store, especially when games that have been sold on Steam are moved to Epic during the pre-order phase. In most cases, this has caused outrage on Twitter and Reddit, as well as Steam users review bombing games that have sequels launching on Epic. Both Metro 2033 and Metro: Last Light were hit hard in the aftermath of Metro Exodus' move to Epic. The same happened to Borderlands, Borderlands 2, and Borderlands: The Pre-Sequel after the reveal that Borderlands 3 would be launching on the Epic Games Store.

Steam users' harsh reactions to games leaving Steam for Epic and Valve's slow response on some of the review bombings have rubbed some developers the wrong way. "Ironically, that this misuse is possible and that Steam has no interest in correcting this misuse makes me kind of happy about 2K's decision and makes me want to reconsider Gearbox Publishing's current posture on the platform," Gearbox studio head Randy Pitchford wrote.

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Avatar image for Shantmaster_K
Shantmaster_K

How noble...

Avatar image for dynamotnt
dynamotnt

Sweeney Tim the Demon game developer of Wall Street knows full well that Valve would have to significantly reduce infrastructure features and/or staff to commit to their ludicrous cut and never will, that's the only reason he said it.

lets be real, even if steam did make the cuts to hit that, who the **** would use EGS if there wasn't exclusives. Epic may have money, but if the store doesn't bring in revenue it may aswel end, Sweeney has no intention of ending exclusivity deals. His attacks on valve are just because they're salty they didn't have a product strong enough to carry a market place, or no idea to at the time.

Twats.

Avatar image for nyran125tk
nyran125tk

Activision should stop selling 10 yr old products like Call Of Duty games for full price retail release prices. In my country its like $99 to buy Modern Warfare 2 or Black Ops 1. Ridiculous pricing for decade old games.

Avatar image for borgking1234
borgking1234

Epic requires that employees give them 88% of their life or they'll be fired

Avatar image for Mamamf
Mamamf

@borgking1234: What do you mean? That's based on what?

Avatar image for BabeNewelll
BabeNewelll

??

Avatar image for Elranzer
Elranzer

Valve is patiently awaiting Fortnite to become irrelevant.

Might happen sooner than later, as Fortnite is depending in Marvel hype and Endgame turned out to be crap.

Also, none of us want to give any money to the Chinese government (Tencent).

Avatar image for alucardswrath
alucardswrath

::Steam goes into their own general discussion and types 'LOL"::

::Epic is scrambling for a piece of paper and pencil to reply::

Avatar image for bbq_R0ADK1LL
bbq_R0ADK1LL

Epic is trying to play hardball but it doesn't look like anyone here is buying the good-guy act.

Too many people have this weird loyalty to Steam. Sure, they offer a few good features, but they've been sitting on their yannys for a while. Alternatives like GOG Galaxy have come up but people are still hesitant to but even a single game off their platform of choice if they can possibly avoid it.

Avatar image for BigFeef
BigFeef

Oh wonderful! Epic is sooooo awesome for looking out for these poor game developers! Let us all praise Epic Games for their heroic stance standing up to Valve's greed!

OK; now let's all be real. Epic isn't doing this for game developers; they're doing this for themselves. This whole developer's cut thing is a farce; and has been a farce from the beginning. Epic is just using it as a shield to hide behind while they use anti-consumer tactics to increase their market share as quickly as possible. They have the cash to bribe greedy publishers and developers to go exclusive to their store; that is all. If it really was about "the cut"; other distributors who offered a lower cut than Steam would have already seen a bump in their market share. But it isn't and they haven't; it's all about the amount of money Epic has been willing to throw around.

Epic knows they can't compete with Steam on an even footing; so they target specific high profile games to go exclusive on their store. They know that gamers as a whole are going to talk the talk but won't be willing to walk the walk. Many will bitch and moan; but many of those same people will eventually go to their very inferior platform anyway rather than miss out on a game for 6 months to a year.

And seriously; who can now trust Epic and Tim Sweeney after all the lies they have told in the last couple of months alone. Remember "no more short notice exclusivity deals like Metro Exodus"? Yeah; that didn't even last a couple of weeks before they pulled the exact same thing with Anno 1800.

Screw Epic and screw whoever decides to go exclusive to their store. I personally will not support either.

Avatar image for Atzenkiller
Atzenkiller

But that would mean that they'd have to shut their store down again. Yeah, obviously that statement wasn't meant to be taken seriously, and they only made it because they knew that Valve wouldn't bite.

Avatar image for speed45823
speed45823

About Steam's cut, here's an article that explains it

https://arstechnica.com/gaming/2019/04/why-valve-actually-gets-less-than-30-percent-of-steam-game-sales/

Here's a developer's take on it

https://twitter.com/RobotBrush/status/1112204567394086913

Here's consumer's take on it

https://www.reddit.com/r/pcgaming/comments/b9i4yd/to_everyone_complaining_about_steams_cut_please/

And here's my take on it. In short, Valve's 20 to 30 percent take is justified for the amount of features and services they provide.

Let me tell you something. The whole debate about 20 to 30 percent cut from Steam vs 12 percent cut from Epic is a farce. Its a stunt pulled by Epic. Its not about the percentage cut. Its about Epic giving these greedy publishers a bag of cash to sign exclusivity deals on their platform, either on day one or a certain time afterwards and Epic lining their own pockets in the process. All the while trying to strong-arm customers to submit to this forced exclusivity and other anti-consumer practices while providing virtually nothing

If it was only about the cut then, these publishers would've moved to other platforms that has lower cut than Epic, who've been into digital distribution platform a lot longer than Epic. Platforms like Discord, which reduced their cut down to 10 percent after Epic store's announcement. Humble Widget through Humble Bundle, which asks for 5 percent of the cut. Itch.io, which asks for basically whatever percent of the cut you want to give them, which is lower than all the others combined. And yet a lot of developers and publishers choose Steam over any of them Why ? Because none of the other platform provides the massive visibility / discoverability of games that Steam provides and the subsequent big sales potential. Not to mentions vastly inferior features and services towards customers compared to Steam. Its because Steam provides THE most features and services to both developers and customers more than any other platforms in the gaming industry, PC or consoles.

https://blog.discordapp.com/why-not-90-10-3761ebef4eab

https://www.humblebundle.com/developer/widget

For the record, other major platforms like GOG, Microsoft, Sony, Nintendo, Amazon, Google, Apple and a lot of others also take the industry standard 30 percent of the cut while providing significantly less features and services to both customers and developers in return. I wanna emphasize on Sony and Microsoft (Playstation and Xbox) who are the biggest gaming platforms next to PC, Who've been taking that 30 percent cut from developers and publishers for decades now while doing business with them. They don't provide nowhere as near as many features and services as Steam does. Who takes hefty licensing fee from developers / publishers spanning in millions of dollars to sell their games on Playstation and Xbox. Who used to charge devs / pubs money everything they wanted to patch / update their games on those consoles. Who locks certain essential features and services behind monthly subsciption fee against customers. And yet, developers / publishers happily put all their games on those consoles and make huge profits. Now with Epic, while they do take 12 percent cut, they also provide virtually nothing in terms of features and services for customers. Steam on the other hand provides numerous features and services for customers for their 20 to 30 percent cut.

To give you a rough idea of the amount of features and services Steam provides, take a look at the following chart. It lists all the major features of Steam compared to other platforms on PC. These are just some of the features and services that are public knowledge and / or have been revealed by Valve themselves. There's a whole host of other infrastructures that Valve operates and maintains on a daily basis. All of these combined costs a lot of upkeep on a day-to-day basis. At the same time, Valve regularly innovates, improves and expands on all of these features, services and infrastructures to give customers and developers a better gaming and business experience.

https://imgur.com/P6cIq1u

https://steamcommunity.com/groups/steamworks#announcements/detail/1697194621363928453

When you look at all these features and services that Valve / Steam provides and are continuing to provide at an even greater capacity every single year, it is clear that out of all the other platforms, only Steam gives back the most to both consumers and developers. Unlike other platforms, Steam earns their cut AND they're adding and improving new features and services every single year for no extra charge. Not only that. Valve has also reduced their 30 percent cut to 20 percent for those who meets certain sales milestone.

https://steamcommunity.com/groups/steamworks#announcements/detail/1697191267930157838

In conclusion, what Epic is doing is using the 12 percent to undercut others using money generated from Fortnite, then trying to get developers / publishers on board with cash incentive and subsequent forced third party exclusives, and then trying to strong-arm customers with said forced exclusive deals and other anti-consumer practices while providing us virtually nothing since they cannot compete with Steam on fair grounds or match Steam's level of features and services with that 12 percent cut. Its all about greedy developers / publishers getting paid by Epic for exclusive deals while shoving down all sorts of anti-consumer / anti-competitive policies on us customers. Epic does not care about customers as they've openly proved it time and again but only care about lining their own pockets since they realize the money they generate from Fortnite is unsustainable.

Lastly, its about publisher getting a bigger share of profit while developers sees virtually no benefit from it. Most of the profit a publisher generates does not go to the developers but straight to the higher-up CEOs, CFOs, board members and the likes. If anything goes wrong, its the developers who suffers either paycuts or getting fired from those companies, while the higher-ups enjoys their every increasing profit margin. We've seen it time and again. Here are just some recent examples.

In short, Valve / Steam always has customers interest at heart followed by developers / publishers. Epic on the other hand, has only their own interests at heart, following by developers / publishers. We, the customers, will choose the platform to do business with that has our interests in mind. Because at the end of the day, we customers don't need their games to survive, its the developers / publishers who needs us, our business, to make their day-to-day living.

The following links are just some of the examples of how publishers fire hundreds of developers despite earning record profit

Here's Epic's own developers being abused and overworked

https://www.polygon.com/2019/4/23/18507750/fortnite-work-crunch-epic-games

https://www.youtube.com/watch?v=D7lecpA2zPU

https://www.youtube.com/watch?v=RT14-lyqofA

https://www.geekwire.com/2019/guild-wars-2-developer-arenanet-confirms-layoffs-canceled-projects/

https://www.youtube.com/watch?v=GN1uV57hE_w

https://www.youtube.com/watch?v=tmK43DV_wVY

https://www.youtube.com/watch?v=l9Y_PJ9lByw

https://www.youtube.com/watch?v=-bn3Ydzj-tY

https://www.youtube.com/watch?v=n6rwbKzrcd8

https://www.youtube.com/watch?v=Jz4qegmGoLo

https://www.youtube.com/watch?v=9jM_FL5VxO8

https://www.youtube.com/watch?v=rbEtxD9nU6o

https://www.youtube.com/watch?v=FdVLJ6mLT-U

https://www.youtube.com/watch?v=Tke1c83ceXI

https://www.youtube.com/watch?v=Wh0mKpzXf5A

https://www.youtube.com/watch?v=SrKDgDlbsS8The

Avatar image for Thanatos2k
Thanatos2k

@speed45823: Don't forget the amount of money developers get from cuts on transactions of game assets on the marketplace like trading cards and the backgrounds/emotes complete trading card sets produce.

Developers get this money for doing absolutely nothing.

Avatar image for Atzenkiller
Atzenkiller

@speed45823: Did you write a research paper on this topic or something?

There's one simple thing that you need to look at to see if their cut is justified or not: how much profit does the company make? And its CEO, who is a multi billionaire last I heard. Would they go broke if they reduced their cut? Doesn't seem likely, at all, looking at how much money Valve is making.

Or look at Jeff Bezos. I recently looked at a list of the richest people and that guy is now at the top of it. It only took him a few years to surpass guys like Bill Gates, by a lot. That guy made around $30 billion in one year alone. And yet what is it you keep hearing about Amazon all the time? How little they pay their employees and how shitty their working conditions are. He could pay all of his employees double of what they get now and it probably still wouldn't make a dent into his yearly earnings. But go on and tell me that his behavior is perfectly justfied, due to how big Amazon is and because it provides so many services, etc.

At some point there is nothing to gain from making even more money. Then all it seems to be about is greed. To try and get as much as possible just because, while trying to reduce costs as much as possible to achieve that. Steam could take a smaller cut and it wouldn't affect them in any way, other than Gabe getting a few less millions or billions in his bank account. But they won't because why would they? Profit is all it's about. Well, I guess Valve at least treats its own employees well enough.

Avatar image for Thanatos2k
Thanatos2k

@Atzenkiller: Oh please. Valve is a private company that compensates their employees extremely well. You don't know their numbers, so I'm not sure how you can start drawing conclusions about their profit.

Epic on the other hand treats their employees like dirt and is owned by the Chinese, and that company is publicly traded.

It's crystal clear which company is more greed driven.

Avatar image for Atzenkiller
Atzenkiller

@Thanatos2k: The one that takes the smaller cut from developers? Man, what an argument. Yeah, it's the Chinese. Blame them.

Avatar image for Thanatos2k
Thanatos2k

@Atzenkiller: You seriously need to read through the twitter thread the guy posted above:

https://twitter.com/RobotBrush/status/1112204567394086913

It contains facts from an actual developer that rip your "smaller cut" argument to shreds. It's long, and it'll be hard for you to accept, but if you're interested in facts and not spin, there it is.

Avatar image for Atzenkiller
Atzenkiller

@Thanatos2k: So why exactly did I just waste my time to skim through that link you posted? I have no interest in Steam dying. My only argument was that Valve is making shit tons of money, as is also apparent by the billions its CEO is making. So why do you keep telling me about whatever costs Steam has? They are obviously more than covered, otherwise they wouldn't be making those huge profits. That is the only thing of relevance here. Unless your argument was that Steam needs the money to ensure that people can keep playing their games on their platform for the next 100 years, even if Steam might eventually go broke. But we all know they'd just close down the platform in that case. Gabe won't spend his money to keep a dead game platform alive. So what exactly is it you're trying to say?

Avatar image for Thanatos2k
Thanatos2k

@Atzenkiller: So you just ignored the part where Steam really isn't taking a larger cut than Epic despite your whining otherwise?

Avatar image for Atzenkiller
Atzenkiller

@Thanatos2k: So were you saying then that Epic is going to increase their cut as they add all the same features that Steam offers? Or would they somehow survive anyway? I'd bet on the latter.

Avatar image for Thanatos2k
Thanatos2k

@Atzenkiller: They sure will. Their claims about being better for devs have always been a lie. It's a loss leading marketing stunt.

Avatar image for Atzenkiller
Atzenkiller

@Thanatos2k: I don't see how they could do so without losing face, but I guess we'll see. Building a business on a lie seems pretty stupid to me though. And I kinda doubt they'd be that dumb.

And you know, if you wanna make more money as a business, then selling more products is how most businesses do it. Nobody needs to increase their cut of the sales if they could just increase total sales instead. You increase your cut if sales are lacking and you're trying to survive. Which is not a situation Steam has ever been in though.

Avatar image for Thanatos2k
Thanatos2k

@Atzenkiller: "Building a business on a lie seems pretty stupid to me though."

https://appleinsider.com/articles/19/01/09/att-lying-to-customers-by-showing-5g-e-on-devices-under-fire-from-other-carriers

If they can get enough dumb people to believe them, they don't care.

Avatar image for Artwark
Artwark

If indies are having a hard time with Steam, why bother even releasing on steam platforms when you have sites like Playism or itch?

Avatar image for k0k066
k0k066

@Artwark: Exposition?

Avatar image for Naylord
Naylord

This is awesome! I want devs to succeed and really don't think the middleman of stores deserve a large cut so if we can get that down to 12% that's 18% more in the hands of every solid indie developer that deserves every penny.

Avatar image for Sakina
Sakina

But what about those key resellers you now allow on your platform epic? Don't they get the full 30/70 cut? How bout that?

Avatar image for k0k066
k0k066

@Sakina: What about it? like steam, developers generate keys to sell through third party sellers.

Avatar image for RELeon
RELeon

Oh gee, aren't you just a bunch of heroes, eh Epic? Doing all this out of the kindness of your hearts, are you? Sure.

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lonesamurai00

Forget Epic Games, who are they to give another company an ultimatum of any kind. The games are merely timed-exclusives and as long as they are I will gladly wait. I have so many games on Steam that it would keep me busy from now to the next ice age. There tons of games announced everyday that are coming to Steam and not coming to the Epic store. Devs know that they need Steam because they have the user numbers that Epic doesn't. Basically if they thought that Valve was so bad then they wouldn't want their games on the store at all, but they need Valve as much as they need us.

Epic knows that need a new revenue stream before the next Fortnight comes along over(nite), or their plans fail. Personally I hope that Valve doesn't respond to those scumbags.

Avatar image for lostn
lostn

So he created Epic in order to get Steam to reduce their cut? That sounds so magnanimous of him. He's doing it for the devs and the entire industry!

The way I read it is different. They don't have an unlimited budget to keep signing exclusives and paying for freebies to bribe people away from Steam. They were about to stop doing it anyway, and wanted to try and get something out of Steam for something they were going to do anyway. But they get to look like the hero.

All the major publishers already have their own launcher.

30% cut is the same cut Google and Apple are charging. But I don't see him going after them. They could create their own store on Android and not charge the 30% cut, and then put Infinity Blade on it, which is iOS exclusive. Then tell Apple, he'll sign more exclusives and put them on Epic Android store if they don't reduce their cut to 12%.

The devs who go over to Epic and ditch steam will make an extra 18% on each copy sold, but will sell fewer copies and overall make less money. They will eventually have to go to Steam a year later anyway (they're timed exclusives only). So these exclusives are not tenable long term, and Epic knows that. They don't want to continue moneyhatting these exclusives forever, so they want to pull out gracefully and in doing so, get Steam to lower the cut for their own games on the store (and everyone else's as a byproduct). They also get to look like the good guy, and get to save face over the fact that they really didn't want to continue paying for these exclusives out of their own pocket because it's not as worth it to them.

Epic have given away a LOT of free games now which will have cost them a ton of money. I haven't taken a single free one nor have I downloaded their launcher one, because it's a launcher that sucks and I don't want 6 different launchers on my system, and two, I don't think Epic's intentions are as pure as they want you to believe.

Avatar image for Vodoo
Vodoo

@lostn: I agree with what you said. However, the first 3 months after launch is when a game sells its most copies. A year, or even 6 months later, and most gamers have forgotten about it and moved on to the next thing. So most people that really want to play that exclusive will not wait. If they do, the stats suggest they won't pick it up at all. There's obviously people that will grab something on a great sale, but I'm talking about the majority.

Look at Metro. Its already been largely forgotten about. By the time that 1 year rolls around, there won't be millions of people waiting in the wings to buy it on Steam.

Avatar image for Thanatos2k
Thanatos2k

@Vodoo: That's true for console games, but PC games have a much longer tail, primarily due to Steam and its sales.

https://www.gamasutra.com/blogs/LarsDoucet/20131216/206916/The_Stegosaurus_Tail_when_quotThe_Long_Tailquot_grows_spikes.php

That's why Steam is just sitting and watching Epic flail with a smile. They have hard data that people on PC aren't obsessed with playing a game at launch and are well willing to wait.

Avatar image for Thanatos2k
Thanatos2k

@lostn: Yeah it seems he's desperate to try and force Valve to do something before the actual sales numbers for the exclusives Epic poached start leaking out. It won't make the devs who have upcoming Epic exclusives very happy about their deals.

Avatar image for bdrtfm
BDRTFM

Doesn't matter what Epic does, PC gamers are going to be mad. More money for devs can mean better games from those devs in the future. If I can buy a PC game from someone other than Steam, I do. Competition is necessary for a healthy industry. Whether or not Epic can provide that remains to be seen but I am willing to give them a chance without acting like it's the end of gaming as we know it. Games I buy off of other places than Steam play just fine.

Avatar image for NaturallyEvil
NaturallyEvil

@bdrtfm: But with the games that they're signing as exclusive, what are the chances that the devs will see a cent of that money? These deals are made by the big publishers that own those devs and who probably pocket all the money. I'd be more likely to accept your argument in the case of indy developers.

If Epic announces that Soldak Entertainment is releasing Din's Legacy exclusively on Epic Store, I won't feel bad buying it on release day because I'm sure that money will go to the guy who earned it.

Avatar image for Jinzo_111887
Jinzo_111887

@bdrtfm: You're right, competition is a good thing if done correctly. However, what Epic's doing is more like Walmarts running local stores out of business by lowering their prices until the competition is gone. If I was running Valve, I'd look into suing Epic for anti-competitive business practices.

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trust2112

@Jinzo_111887: I don't expect Epic to survive more than 3 years before tencent owns 100% of Epic. They are going to be like Sears. A slow death that only lasts as they sell off the company assets, piece by piece. I wonder how much I can buy the Unreal Engine for in a bankruptcy hearing?

Avatar image for Thanatos2k
Thanatos2k

@Jinzo_111887: It's more like Walmart running local stores out of business by preventing those local stores from selling the same things they used to sell. It's beyond anti-competitive.

Avatar image for Jinzo_111887
Jinzo_111887

@Thanatos2k: Indeed, that too. Honestly, I think it would be better for gamers if Epic got sued for their business practices.

Avatar image for cappy
Cappy

Amazing idea for consumers, but is it a “real” offer? Could Steam possible accept it? For example, it would be one thing if accepting this meant that Steam just wouldn;t have money to continue developing as aggressively and feature rich services, but, is Steam’s infrastructure, which provides more features, dependent on a continual revenue stream to maintain?

Personally, i’d Rather see more money to devs, more competition between stores, and less ‘extra’ features on storefronts, beyond what I consider minimum essential: cloud saves, user reviews, aggressive refund policy, (and I’m probably missing a few but I need to go to work).

Avatar image for lostn
lostn

@cappy: The way they cut the equation, I don't think it's worth it for Steam to cut it to 12%.

They have tens of thousands of games, and reducing the cut will lead to a lot more lost money than simply letting Epic continue to have those exclusives.

It remains to be seen how deep Epic's war chest is and how long they can continue buying exclusives. Can they keep this up forever?

That Valve isn't commenting tells me they are taking the long term approach and riding it out until Epic runs out of budget set aside for securing exclusives.

I don't think they are securing these exclusives without paying. The 12% cut is definitely a big incentive, but not enough to make up for lost sales as a result of not being on the #1 platform with 95% market share. Valve is just going to wait for Epic to bankrupt themselves (or at least all the money ear-marked for Epic Store expenses).

Avatar image for cappy
Cappy

@lostn: yes, great points thanks for reply.

Avatar image for m4a5
m4a5

Sounds like a bluff. Any intelligent person who compares the Steam platform to Epic's will pick Steam's every time (in Epic's current state).

Epic's isn't ready for head on competition (and this exclusivity deal BS shows they know that full well).

Avatar image for cappy
Cappy

@m4a5: I know what you mean. But I think it is real: I.e. they would follow through if Steam agreed. They just are pretty sure Steam won’t. But if Steam did agree I am sure it could devastate their lead. Forget charging forward, I wonder if they could even continue supporting their current system if they lost that revenue. Most likely the projected revenue is baked into their whole plan, and Epic is asking them to basically scrap that plan and reformulate on Epic’s terms. Still, who doesn’t like the basic premise of reducing the middleman so Devs get bigger share of the pie?

Avatar image for Flyin3lvl
Flyin3lvl

from my understanding or lack there off, developers get a sweet deal but the customer still pays full price ... so developers get a bigger chunk of money but the customer isnt get any savings or deals in the process

Avatar image for lostn
lostn

@Flyin3lvl: It was never about the customer. It was all about the dev.

Epic got sick of Steam taking 30% on their own games, so they started their own store like Ubisoft and EA. Then they got an idea of sticking it to Valve by trying to poach other devs over with them.

They're the only publisher with enough money to attempt this thanks to Fortnite but even they don't have enough money for a full on war with Valve.

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