Epic Games is a Money Whore

Epic Games, the American video game and software company, has been making headlines for its business practices. Known for its popular game store, Unreal Engine, and hit titles like Fortnite, the company has been criticized for its approach to monetization. Let’s delve into the various aspects of Epic Games’ business model and see why some might call it a “money whore”.

Monetization Through Game Store

Epic Games’ primary source of revenue comes from its game store, the Epic Games Store. While the store offers a range of games, it has faced criticism for its lack of competition and the high percentage of revenue it takes from developers. According to a report by Sensor Tower, Epic Games Store takes a 12% cut of game sales, which is higher than the 30% cut taken by the Apple App Store and Google Play Store.

Game Store	Percentage of Revenue Taken
Epic Games Store	12%
Apple App Store	30%
Google Play Store	30%

This high cut has led to developers expressing their dissatisfaction with the store. For instance, in 2020, game developer Aspyr Media announced that it would no longer distribute games through the Epic Games Store, citing the high revenue cut as a reason.

Exclusive Game Deals

Another aspect of Epic Games’ business model that has raised eyebrows is its exclusive game deals. The company has been known to offer exclusive deals for games on its store, which has led to accusations of anti-competitive behavior. For example, in 2019, Epic Games struck a deal with Square Enix to make “Final Fantasy VII Remake” exclusive to the Epic Games Store for a year.

This move was met with criticism from both developers and consumers, who felt that it was unfair to other platforms. According to a report by Digi-Capital, the exclusive deal for “Final Fantasy VII Remake” was estimated to be worth $200 million to Epic Games, highlighting the potential financial benefits of such deals.

Fortnite’s Free-to-Play Model

Epic Games’ hit title, Fortnite, has been a major source of revenue for the company. The game, which is free-to-play, generates revenue through microtransactions. Players can purchase in-game items, such as skins and cosmetics, which can be used to customize their characters. According to a report by Sensor Tower, Fortnite generated $1.8 billion in revenue in 2020, making it the highest-grossing game of the year.

While the free-to-play model has been successful for Fortnite, it has also raised concerns about the potential for addiction and the pressure to spend money to progress in the game. According to a report by the Entertainment Software Association, 9% of children aged 8-17 in the U.S. have spent money on in-game purchases without their parents’ permission.

Unreal Engine Licensing

In addition to its game store and hit titles, Epic Games also generates revenue through the licensing of its Unreal Engine. The engine is used by developers to create games and other applications, and Epic Games charges a royalty fee for its use. According to a report by Statista, Unreal Engine has been used in over 50,000 games and applications worldwide.

While the royalty fee is a significant source of revenue for Epic Games, some developers have expressed concerns about the cost of licensing the engine. According to a report by Gamasutra, the cost of licensing Unreal Engine can vary depending on the number of developers and the features used, with some developers reporting costs as high as $20,000 per year.

Conclusion

While Epic Games has been successful in the gaming industry, its business practices have raised concerns about its approach to monetization. From the high revenue cut taken from developers to exclusive game deals and the free-to-play model of Fortnite, Epic Games has been criticized for its focus on generating revenue at the expense of other stakeholders. Whether or not you agree with the label of “money whore”, it’s clear that Epic Games’ business model is a topic of debate in the gaming