Epic Games Store Is A Great Thing For The Whole Industry, Cities: Skylines Publisher Says
Fredrik Wester says it's a "matter of decency" to pay developers a bigger share of revenue.
Fortnite developer Epic Games shook up the video game industry when it launched its own PC store. The Epic Games Store pays developers/publishers 88 percent of revenue, with Epic itself taking 12 percent as the store owner. This is a far more developer-friendly percentage than the industry average of 70/30 that holds on Steam, as well as PS4, Xbox One, and Apple.
Fredrik Wester, the executive chairman of the board at Cities: Skylines publisher Paradox Interactive, said at an event this week that the 70/30 split is "outrageous." He made the comment at a Gamelab panel in Barcelona this week attended by GI.biz.
"I think the 70/30 revenue split is outrageous," he said. "I think the platform holders are taking too much money. Everyone in the press here, just quote me on that."
Wester went on to say that the 70/30 revenue split is antiquated. It might have made sense in an entertainment world dominated by physical media, but now that games are increasingly digital--especially PC titles--the revenue split should change, he said.
"So Epic has done a great job for the whole industry, because you get 88%. Fantastic move. Thank you very much," he said.
Wester went on to say that Epic paying 88 percent of revenue is advantageous for new, less established studios because they get to keep a larger portion of revenue. Apart from business considerations, Wester said giving developers more money is the decent thing to do.
"I think it's also a matter of decency. I mean, how much does it actually cost to deliver a game" he said. "When the competition is low, the platform holder can get a big share of the pie; as competition increases, they need to lower their part of the pie, as well. That's how the market works, right?"
It is a complicated matter. Developers who take Epic's money are often criticized for doing so, especially in cases where a Steam version was previously promised. But at the same time, taking the money can offer a level of financial stability that is rare in the gaming industry, especially for smaller teams. Qube creator Dan da Rocha said on the panel that Epic's 88/12 revenue split is a "huge boon" for developers."
For what it's worth, Epic has said it will stop pursuing exclusives so aggressively if Steam changes its business policies to pay developers a bigger share. It remains to be seen if any change will happen on console, where store-owners like Microsoft and Sony keep 30 percent of revenue.
Epic Games CEO and founder Tim Sweeney recently defended the company's exclusivity strategy, saying it is the only way to spur change and encourage storefronts to pay developers a bigger share of revenue.
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