Epic Taking on App Store 30%

The difference is Unity doesn't make an issue if you decide to sell your assets on a different marketplace or your own website. They also don't make you pay a commission for each in app purchase your customers do. Also you don't even have to pay to put assets in the assetstore.

 

This is the thing. Everyone who insists that 30% is too high doesn't have any data to back it up, or suggest what it should be.

 

Another difference between how Apple and Unity handle their stores, is that Unity doesn't make an issue if somebody steals your asset and republishes it on their store as their own. Unity gladly accepts their 30% from purchases of those pirated assets, while refusing to ban pirates and refusing refunds. Unity is not exactly a good example for how to run online stores. Unless you want to argue that all other stores should charge less money and then provide the same kind of service/protection/support (complete lack thereof) for its customers as Unity.

 

Sweeney tweets a lot about the real cost of running a store. It's why Epic does not charge 30%. Here's a link to one of the articles he cites.

https://telegra.ph/7-Myths-Apple-Is-Using-to-Justify-Their-30-Tax-on-Apps-07-27

 

I mean to have data we would have to be store owners. Epic said 12% still gives them profit, so there's that.

 

Edit: Nvm my Nvm!

Worth pointing out that this was written by someone currently suing Apple.

https://tass.com/science/1183381
https://gizmodo.com/telegrams-the-latest-company-to-file-an-antitrust-suit-1844561767

They are not a neutral source.

There's that, but the feature difference between Epic's store and most others is enormous. We don't know the cost of those features.

 

I'm pretty sure achievements don't need millions and millions of dollars to implement?

Doing some math here: in 2017 Steam had 4.3$ Billion in revenue. It takes 30% of that, which is 1.29$ billions. Let's say payment processing is 10% (and it's most probably less, but I'm being generous), that leaves them with 0.86$ billion..

Somehow I doubt that whatever features Steam has, they cost 0.86$ billion per year.

I mean, if after decades of development and many, many billions of dollars all go into improving steam, and that's what billions and billions of dollars get you... humanity is doomed.

Also Steam itself is able to take millions less from AAA (they drop to 20% after a game makes many millions of dollars), but somehow they *need* 30% from the 100k an indie game makes?

30% is arbitrary, whatever costs developing Steam has, or server costs, or support (although they don't really have a lot of employees) or whatever, divide them by a whole industry and I don't see them costing anything remotely significant.

 

I wonder what the real cost of v-bucks are...

Suffice to say I don't think that terms are being used consistently in this discussion.

 

Sweeney's entire point with this war is that Apple etc are taking money out of the hands of creators way above and beyond what they provide, and that money would be better off back in the creators hands so they can make more content etc.

v-bucks are a game specific virtual currency so you cant really compare there cost to the cost of running store's that millions of devs really don't have much choice in using.

 

Relevant. Your 10% is actually low. Let's go with 15% (that tweet also implies to me that the Epic store is not making any profit at all, because otherwise they could absorb the payment processing costs with profit from other regions).

Complaining about lower percentages for higher volumes is like complaining about Costco being cheaper than other places. Economy of scale, ya know?

Once again, you're not providing any data. You're just saying, "it's a lot, so it's bad/too much." It may indeed be too much. But we don't know that, and acting like we do does no one credit.

 

It's not, it's 5-6% for the majority of cases, but there are some edge cases in some countries where it's higher. I'd say 10% average is pretty generous.

But still. Let's say 15%

Now they only have 645$ million to develop Steam. Oh no! How do they manage to make a launcher with only 645$ million within a single year?!

Okay, where are your data that prove that it's not arbitrary? "everyone does it" is not data.

 

I get that. My point is that value is not derived from cost. Arguing that Apple shouldn't charge so much because their costs are less could equally be applied to plenty of other people, including their own products.

 

Assuming that 12% is a reasonable number (even though Apple's App Store and the Epic Games Store are not necessarily alike), would Epic really be satisfied if Apple dropped their cut to match? It just feels like lobbying / advocating for actual policy to regulate distribution fees on all digital marketplaces is the more appropriate behavior if that's really what they care about, not producing a slick call-to-arms public pressure campaign and flashy lawsuit against just two targets (in a crowded field) that they explicitly trolled.

 

Where did I say "everyone does it"? I haven't made any claims as to 30%'s legitimacy. That's the point; we can't based on what we (don't) know.

One might try estimating the cost that goes into the store's maintenance, salaries, research and development that produces things like Proton, the controller, and the Index, etc. to generate a profit margin, but no one critical of Valve does that. They just repeat iT's tOo mUcH bEcAuSe iT's tOo mUCh.

If (royal) you're gonna make a claim, back it up.

 

Yeah the good ole classic we don't know what we don't know so we just assume that the status quo makes sense and is justified.

Why would I estimate the cost of Index and the Controller? Don't they pay for themselves? If not, and they are just taking game developers money just to sink them into side projects, things are worse than I thought.

Valve has 360 employees, which isn't many employees at all, and does a lot more stuff than Steam, stuff that generate revenue themselves. If you think billions of dollars isn't enough, I don't know what to tell you. Keep repeating there is no data.

Next if I see someone at the groceries store selling a tomato for 100$ and I say that's probably way too much, you'll probably tell me I have no data to prove.

It seems you've already made your mind, and unless Gaben flat out actually comes out and says that "we charge too much", nothing will change your mind. So...

 

Here are salaries for Valve for mid to high tier jobs:
https://external-preview.redd.it/qE...bp&s=be704c516053ba413e5b3baf2d4d47a5268db713

Assuming an average of 150k * 360 = 54$ million (and for the record that's pretty high, I'm saying mentions of the average being close to 80k, but anyway). And most of the positions have nothing to do with steam. Let's say half have something to do with Steam (and I think I'm being generous here)? That's 27$ million to cover the employee cost for Steam.

 

That 360 number is old, it's from 2016. I'm certain it's larger now, but I couldn't find any hard numbers. For one, a couple years back they bought the studio who made FireWatch (who, predictably, shelved their in-progress project soon after).

The hardware prices might pay for their production, but not necessarily their development. R&D costs can be crazy, surely you know that. Here's an article that comes to the conclusion that Half-Life Alyx did not make money, so there's also that cost they're eating to push tech (just for the record, I still think VR gaming is mostly a gimmick, but that hardly matters to the point).

That article also mentions that average salary should be higher than 150,000 (which I too arrived at, from looking at glassdoor). They claim $250,000.

Then there's the claim that Steam is eating the cost of perhaps 30% of the keys generated for games, bringing down their actual revenue cut towards 20% instead of 30%

Did I already mention Proton? I don't remember. Stuff like Steam Audio. How much does it cost to develop these kinds of things?

I'm not saying to throw up our hands and say "oh well!" I'm saying to do what we're doing right here. If you say "I don't wanna give Steam/Apple/Microsoft/Sony 30% of my money!" no one will or can disagree with you. If you want to say "This digital storefront's percentage of revenue is much higher than they need, such that it's stifling innovation" or some such, you need more than opinion.

 

And I'm providing more than opinion, but you're ignoring it, since you arbitrarily decided that only cold hard data will do (which I can't have, since I don't run a store myself).

Also that Alyx article is wrong, 1. More recent estimates is it sold at around 500k copies. 2. It's completely ignoring that it probably drover sales of the Index (remember they quickly ran out of stock for a while after they announced Alyx).

But even ignoring that : as both a developer and a user (depending on your perspective), if the reason to "why am I paying 30% to you?" is "so we can fund completely unrelated projects", then that's even more outrageous.

 

How am I ignoring it when my last post says "we should do what we're doing right now"? I thought that was explicit enough, but evidently not. My internal response to your two posts before mine was: Good!

Good points about Alyx. But even with the higher sales, does that make it profitable?

In what world is increasing a developer's install base without requiring any work from them "completely unrelated" to their store for selling that developer's products? In what way is providing tools for developers to use in their games and other pieces of software "completely unrelated" to their store for selling that developer's products? Saying that profits shouldn't be used for R&D, diversification, and growth is...not something I would have expected from anyone on this forum.

My perspective is I want to give Steam less money for the same product. But that is only my perspective. There's no moral high ground. That's what people are fishing for when they say "Steam/Apple/whomever makes too much money."

 

I don't think anything over 20% is justifiable imo. It's not "fair". In the real world you typically see tax brackets implemented to those who make less money are a little better off. With the current situation someone who sells a $500 asset and someone who sells a $4 asset pay the same fee.

We wouldn't expect someone who earns $20,000/year to pay the same tax rate as someone who earns $1,000,000/year.

If I sell a £500 asset does unity really deserve £150 for essentially doing nothing? Also think about us poor people not in the USA. We get hit with currency conversion and usually a fee to convert it in the first place (as Unity only deals in dollars). I could theoretically sell an asset for £500 and end up with £270. That's almost 50%!

Then I have to pay tax on my profits. So I sell an asset for £500 but I only make £220 profit. This only gets worse the higher it goes. Sell £5000 of assets and get £2,200 profit. A loss of £2800. (That's like being in a tax bracket of 56%)

At the very least it would be nice if Unity would consider lowering the percentage rate for top sellers or use some kind of tier-based/bracket system.

 

The payment part alone the standard rate is 10% to 15%, for third party billing. I used to run a third party billing company years ago so I know that area well. Apple/PayPal ya they get good rates with banks discounts and chargeback rates etc but it takes significant overhead to manage it all.

Above that is what platforms charge for the market they created. If the market wasn't consolidated things would also be very different in terms of how you market your game and the costs involved. I think most likely not actually better for smaller studios.

It's easy to miss/discount the value of the market itself and the time and money that went into creating it and also sustaining it. This is where consumers don't understand business and start screaming not fair. It might not be fair by some amount but perception outweighs reality. But that itself is part of business so in the end if Epic can get it's way, more power to them.

 

do you think apple and google pay 10-15% for third party billing? I doubt it. Likely they roll their own or have a very good deal with their supplier.

 

At their scale it'd be entirely worth it to roll their own. I think the point is more that if you didn't use their store then you'd be looking at giving someone else 10% to 15% just for that anyway. That's already a big chunk of the 30% people are looking to cut down on and that's before you consider things like storage, transfer, account management, customer support, developing the store, getting customers into the store in the first place...

Edit: According to Humble about the the Humble Widget, after "benefit from our discounts on payment processor fees" those fees are "typically around 5%".

 

My point was to give more information on what the industry average is, not say that's what Apple's costs are. It was just as much to get people to realize if they had to use standard rates AND handle marketing over a splintered market what the costs might be.

 

I'm interested to know what people think about this. As far as I can tell all of the prominent game news media on this is focusing pretty much entirely on the 30% cut, but I personally think this bit is at least as important, if not moreso.

The point here is that it's not just Epic who would then be able to install 3rd party software, it'd be anyone. And Epic also complain about the "scary, repetitive security pop-ups" that Android shows when allowing people to do exactly what Epic are asking for here, so apparently that compromise isn't good enough despite things like this. What are they angling for here, a return to Windows XP era computer security?

 

Seems obvious they're angling for The Epic Store, Now On iOS With Even More Moneyhats.

 

Well, that much is explicitly stated in the document.

 

Nothing is guaranteed, but the way they've treated the Epic Store implies to me that that's their sole goal. Not to "free" gamers from the "tyranny" of a closed ecosystem, because as you say even for the Google Store they're still against it, and for Steam/PC especially--the whole "launch exclusively on our store or we don't want your game at all" thing makes it obvious they don't care about gamers having choice--all they care about is locking down the market their way.

It appears that literally all they're angling for is to have their own store where they don't have to pay any money to other companies for hosting their products.

 

What do you mean by this? Windows is still an open platform to this day. I can install stuff from someones website or multiple stores. But ya that is how I see Sweeneys stance on twitter. He is very against anything that can close a platform down.

 

As is Android, which Epic are also attacking for the "scary and repetitive security pop-ups" which appear when installing software not vetted by Google. Windows also has similar warnings now*, and didn't back in Windows XP's day.

I'm referring to the fact that back then it was much easier to pick up junk software on your PC of dubious quality and/or intent, particularly for non-expert computer users. Mobile devices are targeting a really broad range of people, including non-technical people. It's all well and good for you and I and Tim Sweeney to want to be able to install what we want without friction, but making that the default at large is asking for trouble.

And their angle to achieve that goal is to lobby for the removal of safety measures which, at least to me, seem to have made things far better over the last 10 years or so.

* "Do you wish to allow <software> to make changes to this PC?" and the one about software coming from an untrusted source, and so on.

 

Currently windows OS development path is heading towards default assumption that user is a moron, and cannot be trusted to do anything. Meanwhile, I pretty much prefer situation where I'm the one in control and not the operating system. I'd also prefer some sort of "Windows: Poweruser edition" that comes with shell but without explorer, cortana, edge, built-in games, and other garbage.

Scary security popups the way they are implemented on android, by the way, aren't helpful at all. For example, an application may have a legitimate reason to access media, but once you've granted permission, you have no idea what it is doing anyway.

While those measures did have a positive impact, they're still garbage, because "make changes" doesn't say which ones, untrusted sources are necessary and so on.

There's a need for a different paradigm.

 

Up to 5% would be a far more accurate assessment.

MyCommerce is Digital River which has been around for many years. They start at 4.9% + $0.90.
https://www.mycommerce.com/sign-up/

Shopify starts at 2.9% + $0.30 if you use their payment provider. It's 4.9% + $0.30 if you want a third party provider.
https://www.shopify.com/pricing

That said you're not restricted to paying a percentage of your sales.

SendOwl offers hosting but it's very limited compared to their self-hosting plans which start at $39/mo.
https://www.sendowl.com/pricing#self-hosting

FetchApp offers hosting starting with a free tier and self-hosting starting at $10/mo.
https://www.fetchapp.com/pages/plans

Square Space offers unlimited hosting starting at $26/mo or $18/mo with a 3% transaction fee.
https://www.squarespace.com/pricing/

 

I know in the past Sweeney has spoken out against Windows on Twitter, so he may genuinely be pushing for something more open. Have they stated anywhere what their end goal is, or what they'd like to see a given platform look like? I wouldn't be surprised if what they're doing stops after (if) he gets concessions from Apple and Google for him, rather than any universal ruling (though that would set a precedent for sure).

 

That $0.90 can't be ignored. On a $10 game that brings the total to 13.9%.

Very much. Sweeney's made pretty clear statements on Twitter, and my quote from before about them wanting to start an iOS store of their own is from their legal filing.

I agree, to some degree. Still, I'd much prefer an imperfect improvement than nothing.

 

It states right in the lawsuit that they don't want anything for only themselves

On twitter https://twitter.com/TimSweeneyEpic/status/1294386429833940994

 

Except for their own store on someone else's mobile platform without the requirement to share the income.

Not wanting monetary compensation is not the same as not wanting anything.

 

I edited my post after i wrote it cause I left out "for only themselves". They want to benefit but I was saying it says in the lawsuit they wont accept a solution that only benefits Epic. They want to open the platform.

 

It's obvious Epic are trying to expand and gain more of a market share in a bunch of different areas. That's what every company does, it's not a crime. Personally I don't even care if Sweeney is being honest about the motivations, although I have no reason to believe he's not.

The thing is that, besides Epic's goals aligning with many devs, if they did not establish a large presence that operates on the principles they espouse, those principles would vanish from the market. Nobody is going to reduce the percentage from 30% unless there is a serious competitor with clout offering less. A change has to be anchored in a presence of some kind, a continuous threat to the previous way of doing things. That's part of why a monopoly is a bad thing, because it prevents a different idea from gaining enough market share to provide a viable alternative option.

 

This. I find it frustrating that Epic is completely ignoring the convenience, security, consistency and quality benefits of a standardised app store. As a consumer, I feel like I do have a choice -- if I want open, I choose Android. If I want a closed ecosystem, I choose iPhone. Why are they trying to take that away from us?

I'm really not sure if I want an Epic Games Store on iOS.

 

I mean, you could potentially not install Epic's store, if that ever happens.

You know that Cydia exists, right? Does that affect you in any way?

 

The % is purely a psychological effect. It's like the 99 coins story (but in this case would be 70 coins)

All it matters is how the end result compares to using (or not) their product. If using their store means you multiplied x100 times your income, who cares if they take 30%. But if you're paying 30% and you'd be better off just setting up a little store yourself, then it stops making sense. In which case you stop using their service. It's a good thing you're not obligated to use their service!

 

Just because someone wants something doesn't mean it's good for them.

Android's openness is an illusion. A developer wanting to be successful has to go through the Google Play Store because that's where the overwhelming majority of customers will be. If it were possible to be successful outside of it then Epic Games wouldn't be wasting their time suing them and would simply upload an APK.

 

However what happens if major apps start becoming direct download only, with their own updaters? Or if stores like Origin and EGS pop up with their own way of downloading apps? Apple can no longer enforce the human interface guidelines, there will no longer be the ability to auto install all apps from an iCloud backup. The App Store will become as useless as the ones on Mac and Windows.

You could say that this hasn’t happened with Android yet, but it’s only because Android makes it slightly harder to install from unknown sources that the Play Store is still the default. Epic wants it to be even more open than that.

That’s a legit point of view, so I’m not trying to argue here, just curious how you’ll solve this.

You can’t say that with certainty. There are both benefits and drawbacks to walled gardens.

 

Yes, I can say that with certainty because I have seen many walled gardens over the years. Apple's walled garden is actually one of the younger ones.

 

Please explain.

 

I agree. But this goes both ways. For example if they took 70% but i still made more money on their store than not i may not be profitable enough to grow my business and userbase and therefore will be unable to grow their usebase. The same is also true if you compare apple and google taking 30% compared to say 20%. If i had 10% more margin it may make sense to do more user acquisition and i may make 2 times as much money, boosting apple’s overall revenue as well.

 

I don't expect you to know this, but are there any apps successful on "the Galaxy Store" that aren't on the Play Store? Granted, Google's been attempting to pay Samsung off to drop their store, but another option DOES exist.

Plus there's Huawei. We'll see how things shake out for them.

Yeah, I saw that. Regardless, I wouldn't be surprised if their lawsuit was dropped after they personally received some kind of concession from the two parties they're suing. Time will tell, I guess.

 

It is not very open. I mean, you're supposed to use google play, and for openness youd' need to enable "untrusted sources" and likely root the device.

This leads to interesting problem like this one:
https://forum.unity.com/threads/solved-self-updating-on-android-without-google-store.476110/
Where I needed to make a self-updating application on android, and got accused of trying to write a virus.

They aren't taking anything away from you. Alternative store would mean an alternative application downloader - because that's what a store is. A downloader application with a database. And you'd have a choice not to install it.

 

That's exactly correct. If I'm not mistaken there's an exact concept like that called the Laffer Curve (referring to taxes)... increasing fees will give you higher profits only until the entire thing gets cannibalized.

But if they were choking their own growth with super high fees, that situation of not growing would make them irrelevant.

What I mean is that, while I agree 30% is high for developers, if they had a 20% fee, everyone would rather have 10%.