Epic Games Store would not be known to anyone if they didn’t generously give away so many quality games. For many years, the company has always given away free games every week, and the quality of free games is also increasing. Giving away games for free runs counter to many of their controversial business practices: From accusations of installing tracking software and resource-consuming apps to monopolizing games. Recently, the media reported that Epic Games Store is increasingly costing Epic money, so why does the studio continue to increase free games?
In short: Epic Games Store is willing to take a loss. But in return, they are attracting a lot of returning customers who will spend a lot of time using the app. The weekly game bonus in the store will most likely attract these loyal customers. Additionally, the ability to add free AAA games could attract passionate players, increasing their chances of purchasing games in the Epic Games Store.
In general, the Epic Games Store is in a war with Steam – this is considered the leading game selling company on the PC platform. With so many investors, the Epic Games Store can risk spending money to own exclusive games and give away games, as long as it creates volatility in the PC game sales market. Ultimately, not having the customers to compete with will be a big problem for any store. These are the current necessary steps that the Epic Games Store can use to shake Steam’s position.
How much money is Epic Games Store losing?
The answer is hundreds of millions of dollars. According to the lawsuit between Epic Games and Apple, Epic filed several court filings showing how much money they are losing. Epic Games lost more than $450 million over the past two and a half years. That includes about $181 million in 2019 and an additional $273 million in 2020. If this continues, Epic will lose $139 million in 2021. Most of this money comes from buying exclusive games that give away free games to people. use.
It is not unusual for a company to have their initial operations at a loss. However, the loss of nearly half a billion dollars is a nightmare for many companies. Despite such a loss, Epic is sure that a 12% share of the revenue that the company has from the developer will make up for it. According to predictions, the store will be profitable when entering 2023. With more than 745 million Epic Games games downloaded since 2018, the studio certainly has a lot of customers.
How many games is Epic giving away?
In a tweet about the cost of competing with Steam, Tim Sweeney shared that they have given away more than 103 games on the Epic Games Store. Recently, Epic Games Store gave away 3 games in a week. They include Deponia, Ken Follett’s The Pillars of the Earthand The First Tree. These three games do not have a normal price close to $100. Giving away three such games in a week, the store lost a lot of potential revenue.
Deponia and The Pillars of the Earth are two very different games from Daedalic Entertainment. Although they both have puzzles, deponia has a softer shade. However, both are premium games (with Deponia having 4 storylines spanning many years).
Why doesn’t the Epic Games Store care about losing money?
To answer this question, the Epic Games Store is not a store for the purpose of selling games. At least for the time being. Of course, there are still some players who put money into the store, but with the amount of discounts and free games, the chances of you paying enough for a game are quite low compared to other stores. To confirm this it is necessary to make some assumptions. The first is that Epic Games doesn’t really need the money right now. With Tencent backing it, the $450 million loss is like a drop in the ocean for one of the largest companies in the world.
And yet, the CEO of Epic Games is also the richest person in North Carolina. This information shows that Epic does not really lose money when it comes to losing money. The company’s CEO Tim Sweeney thinks the money lost on the Epic Games Store is an investment. In a tweet about the loss, Sweeney said the following:
That’s right! And it has proven to be a fantastic success in reaching gamers with great games and a fantastic investment into growing the business! https://t.co/MN8OjM5FEP pic.twitter.com/Yl0LmCZjKB
— Tim Sweeney (@TimSweeneyEpic) April 10, 2021
The current store’s goal is to build loyal fans who will buy their games in the future. If Epic wants to win Steam’s No. 1 spot, they still have a lot of work to do. This is probably the real reason why Epic Games Store gives away so many valuable games.
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