Epic Claims Exclusives Strategy Success after Metro Exodus Outsells Last Light at Launch

Discussion in 'HardForum Tech News' started by Zarathustra[H], Apr 2, 2019.

  1. GoldenTiger

    GoldenTiger [H]ard as it Gets

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    Yep, it really is. Wriggle wriggle little EGS hating worms.
     
  2. tetris42

    tetris42 [H]ardness Supreme

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    Yeah, then they'd be like GOG, which is barely making a profit, except with less games. Ruthlessness is usually rewarded in corporate America and good will is often penalized. I'm amazed the level of naivety in the thread. Going up against an entrenched de facto monopoly takes either a complete industry upheaval with an overwhelmingly superior product or dirty tactics. Epic is choosing the later, since I'm honestly not sure what a storefront could do to ween people off Steam otherwise. I honestly can't remember the last time an established software giant with over 50% marketshare was upended.
     
  3. Zarathustra[H]

    Zarathustra[H] Official Forum Curmudgeon

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    I'd rather they don't succeed, than they dabble in exclusives. Exclusives should be universally shunned whomever is doing them. They are the biggest cancer on the industry.

    Valve may have been a defacto monopoly, but they were more or less a benevolent one. It is Epic that is coming in and doing harm.

    If Epic instead were determined to create a better user experience to attract more users, and use their huge Fortnite user base to show developers that they can bring numbers, I would have been all for it. I still probably wouldn't have used the store as I already have my library elsewhere, but others would, especially the younger generation now who started with Fortnite. I wouldn't use them myself, but I'd be supportive of the competition entering the marketplace.

    Exclusives are - however - a cancer, a form of mini monopoly on a single title and hey have to be destroyed, as does anyone who pursues them.

    The end NEVER justifies the means.
     
    Last edited: Apr 8, 2019
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  4. sharknice

    sharknice [H]ard|Gawd

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    Steam may appear a benevolent monopoly but if you look into the details you realize how it's been bad for the gaming community.

    The 30% cut Valve takes is a huge part of it.

    It's the reason why you have to install uPlay to play Ubisoft games and all those games on Steam that just launch another launcher that has to update the game itself and all the games that have their own friends lists etc. The reason you have to deal with all those extra clients instead of Steam just launching an executable is because Valve takes a 30% cut. Every mid sized developer releases their game a month or more on their own platform before they bring it to Steam so Valve doesn't eat away 30% of their launch profits. Then they keep all that extra crap with it to keep the steam copy compatible.

    I hear people complain a lot about digital copies of games being the same or even more expensive than retail copies. "It's just a download they don't have to pay for the box or shelf space etc why is $5 cheaper for a physical copy?." Well it's because they only get 70% of the money from Steam while regular retailers actually have to compete with each other.


    In my opinion that's worse than having to click a different icon to play a game.
     
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  5. Zarathustra[H]

    Zarathustra[H] Official Forum Curmudgeon

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    The 30% cut is completely irrelevant in an industry with essentially zero unit costs of goods sold.

    All that matters is volume, and Steam delivers more than any other store front.
     
  6. M76

    M76 [H]ardForum Junkie

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    Sigh.

    Still stuck at this excuse are we?

    You're not creating competition by bribing developers to only sell trough you. That's literally the end of competition in the marketplace.

    As soon as you're the only seller, it doesn't matter what is the quality of the service, and it does not matter what is the price, people are forced to buy trough you or don't buy at all.

    Steam was not a monopoly, people could buy the games directly from the devs (uplay / origin /etc) or from 3rd parties. Which created a price war, and competition to provide better service. Steam still came out on top because it provided a better service and earlier. With the epic store there is no better service, the prices are are set freely by them since there is no competition. You're being bullied into buying from them, and you applaud them for it. FFS.

    I just can't fathom how some people can think that this is a good thing.
     
    Last edited: Apr 8, 2019
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  7. Delicieuxz

    Delicieuxz Gawd

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    Lol, what?

    Steam pretty much single-handedly saved the PC gaming community, and added a ton of new comfort and ease of use features to the experience of PC gaming.

    Also, Steam made it possible for developers to self-publish and not have to sell their studio, IPs, and all rights away to a publisher to get their work out.


    No way. Before Steam, publishers and developers combined would be very fortunate to get 40% of the sale-price of their games (and normally got a lot less than that): Retail vs Steam - profits distribution

    Steam made it possible for developers to easily self-publish and thrive financially without a parent company.

    Also, the noise about Steam's 30% fee (now 30/25/20%) is misrepresentative of the actual situation: Why Valve actually gets less than 30 percent of Steam game sales

    Tim Sweeney would know that while he's hyping a false comparison between Steam and Epic's fees (also proven by the fact that Tim Sweeney hides additional Epic fees not included in the cited %12 fee). And so, he is exploiting public ignorance to propagandize against Steam and Valve. He is playing people for fools while offering nothing comparable to what Steam does.


    That's assumptive BS! Retail copies cost far, far more to distribute and sell than a digital copy. There's physical production costs, transportation costs, and store shelf costs - in addition to the cost of unsold units and their returns to the publisher. That's why, before Steam, publishers and developers would receive a maximum combined 40% of the sale-price of their games, and would be normally receive less than that.

    If a game is priced less in retail than digitally, it's probably because the physical copies are not moving as much, or because the store wants to free shelf-space for something else, or maybe because it's an older game and they want to dump their stock.
     
    Last edited: Apr 8, 2019
  8. Zarathustra[H]

    Zarathustra[H] Official Forum Curmudgeon

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    Yeah, people forget how huge a chunk of the pie brick and mortar retail takes.

    Right off the bat, a typical B&M establishment usually has a minimum of a 100% markup. Then they have guaranteed buybacks of anything damaged opened or returned.

    Then there are the costs of printing the boxes and manuals, pressing the media, warehousing and distributing the product, etc. etc.

    The reason Steam has been as successful as it has, is precisely because of what an incredible bargain that 30% cut was compared to the status quo.

    Now, the rest of the market has caught up, and they need to change with it to stay competitive. It irks me that exclusives are the way this battle is being fought rather than through the merits of the stores themselves. Exclusives hurt consumers. Full stop. They are a cancer to the industry.
     
    Last edited: Apr 8, 2019
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  9. rudy

    rudy [H]ardForum Junkie

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    Valves 30% cut is very normal, to say its a disease on the industry is to not really based on reality. If a game is sold at a brick and mortar store guess what, the store takes around 30%, apple, around 30%, google play store around 30%. We also know that the most likely scenario is that Epics, 12% is not sustainable. Its just a move they are making to try and win the market, over time they will probably raise the percentage. I would bet money on this. Right now though they have money from fortnite and a massive investment from China to subsidize as many exclusives and contract wins as they can get to put their store on the map and a massive fresh new customer base in the form of millions of brand new PC gamers.

    I hate to say it but if I was valve I would right now today make an announcement that I am cutting my rate down to 15% across the board, and also fight back with exclusive and see just how deep epic and their investors are willing to go. I think the mistake valve is making is thinking this is just a temporary thing and it will blow over. I think what valve should be thinking is during this temporary disruption I will use my billions to give everyone a break and bleed epic dry and make their investors pay.

    Also from the perspective of big studios, I dont think they see epic as a risk, because they can always go later in time and add their game to steam. I think the way they view it is this, the steam userbase is the old gamers they are knowledgable and know how to install other stores like origin, if they want our game they will download epic game store and do it or wait for us on steam. The new ignorant user base is the young fresh epic gamers and those people, a lot of them dont understand steam or know how to use it. Second we want to create a competitor to steam so that we can negotiate in the future more what our rates will be.
     
  10. Delicieuxz

    Delicieuxz Gawd

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    Came across one place where Tim Sweeney stated that he's paying for exclusive deals:




    Tim Sweeney paying for exclusives.PNG


    And, of course, Tim goes into his conniving claim of Steam costing developers 30% versus EGS' 12%, which is a false claim (both about how much Steam takes and how much EGS takes) when the details are examined.

    The responses blasting him for overtly anti-competitive practices are very on point.
     
  11. tetris42

    tetris42 [H]ardness Supreme

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    Here's the thing:

    You're comparing percentages on a physical product with only so much room in the store to digital distribution. If you compare a so-so deal to a bad deal, of course the so-so deal is better. That doesn't mean it's good. 30% is the so-so deal, not a good deal. If that wasn't the case, Valve wouldn't have been the most profitable company per employee, far exceeding the likes of Google, Microsoft, Apple, etc. They brought in 4.3 billion in 2017. At 360 employees, that's almost 12 million dollars brought in for every employee working there. Gabe Newell is also in the top 100 richest people in America. You'd have to have your head in the sand to think that's not a lot of extra money being paid for nothing. Honestly, with their marketshare, I wouldn't be surprised if they could operate at 10% or less. Their main costs are indexing Steam and hosting servers. That's absolute peanuts compared to the revenue taken in. Whatever percentage they need to operate, 30% means so much additional money they're breaking records.
     
  12. M76

    M76 [H]ardForum Junkie

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    Valve might only have 360 direct employees, that doesn't mean 360 people runs steam and there are no additional costs. They manage tens of thousands of games, they support all the games on their platform, they run forums for all games on there, and they allow keys to be taken by the developer for third party distribution. People tend to forget that steam only takes 30-20% from the copies sold trough the steam store, not from retail sales and 3rd party key selling. Epic on the other hand doesn't even offer the option of 3rd party keys with no commission.

    That 30% number is not the actual revenue they taken in from every game that is now activated on steam. Between 3rd party sale, and retail copies it might be close or even lower than the 12 percent that epic waves around.
     
  13. tetris42

    tetris42 [H]ardness Supreme

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    It doesn't change the point. The costs are absolutely minimal for a company worth billions, breaking records it's so much. In fact, I think it would take some real effort to find a company that profitable that has LESS expenses than Valve. I think a lot of people don't understand the scale on this. If I have 10 million per year in ongoing costs, that's a lot of money. If I'm making a billion dollars, that's 1% of my revenue.

    As for your argument that the real number could be closer to 12% or less, that doesn't change the numbers any. If that were true, that would mean they're STILL one of the most profitable companies in history per person and their CEO being one of the richest men in America. In which case, operating costs could be closer to 3-4% of revenue.
     
  14. Revdarian

    Revdarian 2[H]4U

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  15. dark_reign

    dark_reign 2[H]4U

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  16. Armenius

    Armenius I Drive Myself to the [H]ospital

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    They're at the mercy of their publisher, Deep Silver.
     
  17. Flogger23m

    Flogger23m [H]ardForum Junkie

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    They're making more exclusive deals by selling on two client programs? What?

    We also don't have sales numbers, all we know is Metro Exodus sold 2.5 times better on PC than Last Light while the console versions only sold 1.5 times better. This can mean the following:

    - Maybe LL was an poor seller on PC
    - Maybe LL was a great seller on console
    - Maybe Exodus was a poor seller on console
    - Maybe Exodus was a great seller on PC
     
  18. Revdarian

    Revdarian 2[H]4U

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    What?

    https://www.google.co.ve/amp/s/www....exodus-sales-majority-on-consoles/amp/?espv=1

    The absolute majority of exodus was on consoles, not on pc dude, so the exact opposite to what you wrote, and this happened in a franchise that had been overwhelmingly pc based.

    The total sales of pc went down, what you mentioned were the pre-order numbers not sales.
     
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  19. Revdarian

    Revdarian 2[H]4U

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    And don't kid yourselves, even if more people who main consoles bought in, the pc fan base who happens to have a console won't say "f this, I'll forego kb+m superior control scheme to play my favorite fps on console instead!" and they know it.

    Consoles are great for lots of games but only a tiny amount of pc fps players would be willing to compromise the controller and these would then be a subset of that group that had a pc+console.
     
  20. TheSmJ

    TheSmJ 2[H]4U

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    I couldn't find this statement anywhere in the article you linked. For all we know this deal was in the works before the game's release.
     
  21. Flogger23m

    Flogger23m [H]ardForum Junkie

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    That is nice and expected but has nothing to do with what I said. Console copies always outsell PC copies. PC makes around 1/3 of total sales for AAA games.

    Exodus saw a 2.5 increase in sales over LL on PC, but only 1.5 times on console. Even with those numbers, LL likely sold more on console than LL and Exodus combined on PC.

    No AAA game sells more on PC than console. Not Fallout, Witcher or Battlefield.

    Exodus did make the most revenue on PC when it comes to digital platforms unit sales:
    https://www.pcgamesn.com/metro-exodus/sales

    Might have to do with lower selling fees, although it was cheaper on PC than consoles. But I suppose console versions have been discounted as well. Exodus is currently $40 on the PS store.
     
  22. dark_reign

    dark_reign 2[H]4U

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    If Metro Exodus is selling on EGS and now the MS store how can it be considered as an exclusive?
     
  23. odditory

    odditory [H]ardness Supreme

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    It's kind of sounding like the Epic contract is "just don't sell it on Steam" -- which would be hilarious if true since it'd be ripe for anti-trust.
     
  24. TheSmJ

    TheSmJ 2[H]4U

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    The real problem some people have with this is that it isn't available on Steam. The Outer Worlds was also announced to be released to the MS store and EGS, and people threw the exact same fit.
     
  25. TheSmJ

    TheSmJ 2[H]4U

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    IANAL but I don't think anti-trust laws have anything about this specific scenario.
     
  26. sharknice

    sharknice [H]ard|Gawd

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    They definitely don't. Antitrust laws are basically for the opposite of this. Steam and EGS making an agreement with each other so they don't have to compete with each other would fall under antitrust laws.
     
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  27. odditory

    odditory [H]ardness Supreme

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    There was an episode of Suits that dealt with this. I know what I'm talking about. I've probably watched more legal shows than anyone here.
     
    Last edited: Jun 13, 2019
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  28. Revdarian

    Revdarian 2[H]4U

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    They admit that absolutely consoles outsold pc, the fact that digital pc outsold digital console doesn't matter much when pc is digital only basically, and again for that to happen + for the exclusivity deal to be set aside discreetly it is obvious that it undersold.

    The mental gymnastics to claim that Microsoft, which is actually bringing his games to steam since their private store sales are terrible, instead paid whatever was required on the epic contract to break exclusivity of 1 year and nab themselves the game knowing full well that it won't sell, sure, of course that is possible, I mean, who doesn't want to just burn a couple millions...
     
  29. Jim Kim

    Jim Kim 2[H]4U

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  30. GoodBoy

    GoodBoy [H]ard|Gawd

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    Keep in mind that putting a game out on a console, the console maker gets a cut of each sold unit (so Microsoft and Sony).

    I don't know the exact figures, but its possible a game could sell more console copies, but make more money for the developer from the pc sales.
    (and there was that huge thread where some people whined that steam takes too big of a cut...)
     
  31. rudy

    rudy [H]ardForum Junkie

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    I have heard as little as $7 and as high as 30%, I am pretty sure that the number has been shifted around largely because at one time it was important to make sure the retailer was paid, but with digital sales they can skip the retailer and the console maker can just take a strait 30% cut. In all cases I heard the developer always has lost about 30 to 40% to the supply chain. That is part of why the whole 30% cut for digital stores started.

    If you think about it consoles are the original model for an app store, get someone trapped in your ecosystem and take a cut of every sale that happens in that ecosystem, doesn't matter if its a controller, accessory, or game the console maker takes a cut. If you make a hit the captive audience is so lucrative you make billions. However if things go wrong you can lose money too.
     
    Last edited: Jun 13, 2019
  32. Armenius

    Armenius I Drive Myself to the [H]ospital

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    Simultaneous availability on the Microsoft Store wasn't announced until after the deal to acquire Obsidian was completed.
    I saw a breakdown of the cost of a game back when they originally increased from $50 to $60. It showed that retailers got up to 50% and distributors got up to 20%. Something like only 7-12% made it back to the publisher who then decides how to dole it out to the developer. There are a few exceptions, but nearly all digital distribution platforms take a 30% cut, including the Xbox and PSN stores. To bitch and moan about a platform taking 30% is frankly insulting in the grand scheme of other consumer product sectors.
     
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  33. Hatriot

    Hatriot Limp Gawd

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    The fact that I can't watch Stranger Things season 3 on HULU proves that Karl Marx was right and that all corporations murder families. Excuse me...have to decide whether I want to upsize my 1200 calorie value meal or not. The struggle of being alive today makes me wonder why all those WW2 vets are always whining for attention.

    Only today can minor inconvenience be transformed into a global crisis. Anything for a tribal battle I guess.
     
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  34. Flogger23m

    Flogger23m [H]ardForum Junkie

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    Good point. Many were convinced that Epic wouldn't allow you to sell games on a different client.

    First it started with stores, which wasn't the case (they showed up at some B&M stores). Then clients. Wonder what the goal post will move to next.

    No idea what PSN/MS charges, but doubt it is anywhere near 12%. 30% seems to be the industry standard.

    But anyone who thinks a AAA PC game will sell more than the console versions hasn't been paying attention for the last 2.5 decades.
     
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  35. Newbie_52

    Newbie_52 n00b

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    I wonder at what point they will stop throwing money at exclusives? i mean they can't do it forever no matter how much $$ fortnite brings in, investors will want to see some returns.
     
  36. Revdarian

    Revdarian 2[H]4U

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    Mind you but if this is true it would be wildly illegal, one thing is paid exclusivity which is legal but paid exclusion isn't, which is what a term that singles out steam would mean.
     
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  37. rudy

    rudy [H]ardForum Junkie

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    Investors are the ones paying for it they will do it for several years to solidify egs as a market player if needed
     
  38. Jim Kim

    Jim Kim 2[H]4U

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    The gold mine that is FortNite created a big big large huge overflowing bottomless War-Chest.
    no investors necessary
     
  39. Jim Kim

    Jim Kim 2[H]4U

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    EGS is doing nothing illegal, it's just business.
     
  40. rudy

    rudy [H]ardForum Junkie

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    https://www.investopedia.com/news/how-tencent-changed-fortnite-creator-epic-games-fortunes/

    Just because you dont need investors doesnt mean you dont take them. The thing is once you have the fame investors are still valuable why float out your own money when you can float out or risk someone elses. The investors are the ones driving this, they dont give a shit about epic as a game company they care about them being a game store, thats where the real value is.
     
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