{"id":106022,"date":"2019-12-20T15:54:00","date_gmt":"2019-12-20T15:54:00","guid":{"rendered":"http:\/\/www.gamasutra.com\/view\/news\/355994"},"modified":"2019-12-20T15:54:00","modified_gmt":"2019-12-20T15:54:00","slug":"blog-why-epics-attempt-to-go-fee-free-on-google-play-is-bad-news","status":"publish","type":"post","link":"https:\/\/sickgaming.net\/blog\/2019\/12\/20\/blog-why-epics-attempt-to-go-fee-free-on-google-play-is-bad-news\/","title":{"rendered":"Blog: Why Epic’s attempt to go fee-free on Google Play is bad news"},"content":{"rendered":"

The following blog post, unless otherwise noted, was written by a member of Gamasutra\u0092s community.
The thoughts and opinions expressed are those of the writer and not Gamasutra or its parent company. <\/small><\/i><\/strong> <\/p>\n

\n

There is a long-running dispute between Google and Fortnite<\/em> creator Epic Games, which revolves around the 30 percent cut Google takes when Android apps are officially listed on its app store Google Play. This fee encompasses both premium titles and in-app purchases.<\/p>\n

In August 2018, Epic opted to boycott Google Play and instead, Fortnite players on Android had to download the title from publisher\u2019s own website. This allowed the company to pocket 100% of the revenue.<\/p>\n

However, in December 2019, Epic submitted Fortnite to be listed on the Play Store, on the condition that it could use its own payment platform and be exempt from Google\u2019s 30 percent fee. Its submission was rejected by Google, who stated that it expects all developers to participate under the same terms.<\/p>\n

Epic\u2019s fight to change the industry standard masks mobile decline<\/strong><\/p>\n

Epic Games CEO Tim Sweeney is a vocal critic of the 30 percent cut typically taken by third-party store fronts, which is now widely accepted as the industry standard. He has called for companies such as Steam to rethink their revenue share models and commit to providing developers with a more substantial cut.  The Epic Games Store on PC \u2013 a Steam competitor \u2013 takes a lower 12 percent cut, with 88 percent going to the developer. Despite Epic\u2019s aggressive approach which includes pursuing paid exclusives, other storefronts on console and mobile have remained resistant to any significant change to the 70\/30 revenue share model.  <\/p>\n

In October 2018 \u2013 and likely in response to the upcoming Epic Games Store launch – Steam revised its revenue model slightly. For games generating more than $10m, Valve would take a reduced cut of 25 percent, dropping to 20 percent on earnings above $50m. While not a seismic change, this move was beneficial for big sellers, and perhaps demonstrates that Valve is not immovable on this subject.<\/p>\n

Sweeney argued that his intention was to trigger a general change in smartphone industry practices, rather than pursue a special exception for Epic Games and Fortnite<\/em>. However, Fortnite\u2019s<\/em> declining performance on iOS suggests that Epic may well need Google Play support to recapture growth.<\/p>\n

Fortnite on iOS is down $100m net revenue since Q3 2018<\/strong><\/p>\n

<\/a><\/p>\n

As with other battle royale titles, Fortnite<\/em> has seen a general decay across PC and console platforms since its mid-2018 peak. However, whilst PUBG Corporation\u2019s PUBG<\/em> IP has flourished in its transition to smartphone via Tencent, Epic\u2019s title is flatlining. According to Priori Data, in Q3 2019, Fortnite<\/em> saw a decline of -65% year-over-year in net revenue on iOS. It now generates just over a third of the revenue it did at peak, and Q4 looks to remain flat, with marginal recovery from the Star Wars<\/em> event.<\/p>\n

As App Store users are monetized far more effectively than those on Google Play, and due to a lack of easy access, it is likely that Fortnite<\/em> is generating less than half its total mobile revenue on Android.<\/p>\n

Is Epic finally looking to emerging markets for growth?<\/strong><\/p>\n

If Fortnite<\/em> were to launch on Google Play, it would likely see a surge of interest in emerging markets such as India due to greater exposure and accessibility. IHS Markit Technology data shows that 95% of smartphone devices in India are Android, and high-growth territories across South America and Southeast Asia are also Android-first. These markets have already been tapped by competing publishers and titles, such as PUBG Mobile<\/em> and Garena\u2019s Free Fire<\/em>, which are highly visible on Google\u2019s app store: PUBG Mobile<\/em> now even has a lite version.<\/p>\n

Fortnite<\/em> is available to download on Android from the Epic Games website, but its lack of presence on Google Play will have been damaging. Although its battle royale competitors have already established audiences across high-growth territories, none really replicate the Fortnite<\/em> aesthetic. Its global renown coupled with the mobile-first approach of these games markets could attract new users of the IP, in addition to enticing across the small number already playing on other platforms.<\/p>\n

Android Store delayed on the roadmap for Epic Games Store<\/strong><\/p>\n

An Android version of the Epic Games Store has been a target since the store\u2019s inception, and was listed on the roadmap from the beginning. At the end of August, however, its position was pushed back into \u201cFuture Development\u201d. This suggests that improving the PC storefront is now the strategic priority. This shift in approach may reflect Epic\u2019s experience of trying to get the Android version of Fortnite<\/em> into gamers\u2019 hands, and the marketing and resource investment needed to make this happen. Epic\u2019s subsequent attempt to distribute Fortnite through Google Play Store reinforces the view that an Android storefront from Epic is a long way off.<\/p>\n

Smartphone revenue share format seems unlikely to change<\/strong><\/p>\n

It seems unlikely that Google will be willing to revise its 70\/30 revenue share model in the near future, especially as it gives developers the option of distribution via their own channels \u2013 something which is currently not even permitted by Apple on iOS. As such, Epic will have to decide if the exposure and potential new growth afforded by the Play Store is worth surrendering 30 percent of its Fortnite<\/em> revenue.<\/p>\n","protected":false},"excerpt":{"rendered":"

The following blog post, unless otherwise noted, was written by a member of Gamasutra\u0092s community.The thoughts and opinions expressed are those of the writer and not Gamasutra or its parent company. There is a long-running dispute between Google and Fortnite creator Epic Games, which revolves around the 30 percent cut Google takes when Android apps […]<\/p>\n","protected":false},"author":2,"featured_media":106023,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[20],"tags":[],"class_list":["post-106022","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-news"],"_links":{"self":[{"href":"https:\/\/sickgaming.net\/blog\/wp-json\/wp\/v2\/posts\/106022","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/sickgaming.net\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/sickgaming.net\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/sickgaming.net\/blog\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/sickgaming.net\/blog\/wp-json\/wp\/v2\/comments?post=106022"}],"version-history":[{"count":0,"href":"https:\/\/sickgaming.net\/blog\/wp-json\/wp\/v2\/posts\/106022\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/sickgaming.net\/blog\/wp-json\/wp\/v2\/media\/106023"}],"wp:attachment":[{"href":"https:\/\/sickgaming.net\/blog\/wp-json\/wp\/v2\/media?parent=106022"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/sickgaming.net\/blog\/wp-json\/wp\/v2\/categories?post=106022"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/sickgaming.net\/blog\/wp-json\/wp\/v2\/tags?post=106022"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}