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GameRager: 10% might not be enough on smaller stores(who have thinner margins due to various factors), but it is pretty fair for bigger stores imo.
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RWarehall: So YOU say, based on absolutely no knowledge about their business and revenue streams and based on not knowing 10% of what...

If 4% of that 10% is processing fees, can the business really run on 6%?
Even Epic and their 12% is projecting losses for the year with no real storefront, forums or anything else...

I can't think of a single retailer anywhere that only marks up 10% from wholesale.
By 10% I meant 10% NET(as in AFTER any overhead is taken care of). Also, it's just imo...as in I don't have any data to back it up, and was merely making an opinion.
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RWarehall: ... Even Epic and their 12% is projecting losses for the year with no real storefront, forums or anything else...

I can't think of a single retailer anywhere that only marks up 10% from wholesale.
Give them some time. They are still only a short time in business and need money to expand, but they might make lots of money later. And I would make a big differentiation between online and offline retailers. It looks like a waste of resources if the merchant gets a large cut and the manufacturer who actually does the stuff a comparatively small one.

It seems you have exactly the same insufficient knowledge about their business and revenue streams. Saying 10% is enough or is not enough is simply a matter of opinion and we are bystanders anyway. This is a matter that Steam and Epic (and the others) will decide between themselves not us.

If I would be asked for my preferences I would say that the game creators should get as much of the revenue as possible and the storefronts should get the absolute minimum on which they can still operate because I feel like they do not add sufficient value to the whole product overall. I would even go directly to the game creators if that would be possible always.
Post edited May 01, 2019 by Trilarion
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RWarehall: So YOU say, based on absolutely no knowledge about their business and revenue streams and based on not knowing 10% of what...

If 4% of that 10% is processing fees, can the business really run on 6%?
Even Epic and their 12% is projecting losses for the year with no real storefront, forums or anything else...

I can't think of a single retailer anywhere that only marks up 10% from wholesale.
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GameRager: By 10% I meant 10% NET(as in AFTER any overhead is taken care of). Also, it's just imo...as in I don't have any data to back it up, and was merely making an opinion.
Except the 10% or 12% or 30% cuts talked about publicly seem to be BEFORE overhead. They talk about processing fees. Who are any of us to say that 30% off the top isn't just 10% after overhead?

For example, I can give real numbers for GoG since they are publicly traded:
Cut Determined by (1 - Cost of Goods / Sales Revenue) and Profit by (Net Profit / Sales Revenue)
2018: Cut 31.6% - Profit 0.0%
2017: Cut 36.7% - Profit 9.4%
2016: Cut 33.9% - Profit 3.6%
2015: Cut 34.3% - Profit 9.0%
2014: Cut 34.6% - Profit 9.7%
2013: Cut 28.7% - Profit 14.9%
2012: Cut 39.4% - Profit 17.8%
Average: Cut 34.1% - Profit 7.5%

People seem to forget about all these other storefronts that have gone bankrupt like Shiny Loot or Desura and any number of others I can't remember anymore. People act like these distribution platforms just print money, but they have costs and overhead as any other business. Else why do so many go out of business...

And Trilarion, I clearly have a lot more knowledge of the subject than you. How about you speak for yourself...
Post edited May 01, 2019 by RWarehall
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RWarehall: People seem to forget about all these other storefronts that have gone bankrupt like Shiny Loot or Desura and any number of others I can't remember anymore. People act like these distribution platforms just print money, but they have costs and overhead as any other business. Else why do so many go out of business...

And Trilarion, I clearly have a lot more knowledge of the subject than you. How about you speak for yourself...
This may sound harsh/callous, but if that is the way of the market then.......

In short: I am like Trilarion...a client/storefront should make a small profit and most of the profit should go to the ones actually making/providing the games/IPs.
Well... I guess we'll still have Epic Games Store taking away cool games cause exclusivity
the more the hysteria against Epic the more im inclined to buy from there. its a store, I buy what i want and if the devs make more money then more power to them. I dont see it as a gaming apocalypse, just a continuing evolution of gaming as we know it. the market will decide in the end
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GameRager: This may sound harsh/callous, but if that is the way of the market then.......

In short: I am like Trilarion...a client/storefront should make a small profit and most of the profit should go to the ones actually making/providing the games/IPs.
Look, even at 70%, they are still making most of the profit. You seem to act as if storefronts should exist for free which is rather naive. And you would have that all go away to a heartless storefront that provides nothing to the consumer. No reviews, no friend's lists, no guides, no walkthroughs, no PMs to other users. Buy a game and that is it, in the cheapest way possible. Even if that means paid advertisements and the selling of user data. Maybe they can cryptomine while you are visiting the site for their store to make their profit another way.

All this as these same developers find a way to profit with $20 cosmetics and other microtransactions. Loot boxes or the closest thing staying one step ahead of legislation. Because remember, this is all coming from Fortnite. How is that game currently making its money? Because making over $1 billion in microtransactions just isn't enough that they should nickel and dime any storefronts selling their game as well. Because they think they deserve ALL the profit themselves.

I just showed you how much it costs for one of the larger storefronts to stay in business. I guess you'd rather see the rest go belly up all because Tim Sweeney says every storefront should make do with almost a third of what they are currently making. And when everyone else dies, how long do you really think it will take Epic to change their mind's and say they were wrong. That 12% was never reasonable after all and raise it...
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GameRager: This may sound harsh/callous, but if that is the way of the market then.......

In short: I am like Trilarion...a client/storefront should make a small profit and most of the profit should go to the ones actually making/providing the games/IPs.
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RWarehall: Look, even at 70%, they are still making most of the profit. You seem to act as if storefronts should exist for free which is rather naive. And you would have that all go away to a heartless storefront that provides nothing to the consumer. No reviews, no friend's lists, no guides, no walkthroughs, no PMs to other users. Buy a game and that is it, in the cheapest way possible. Even if that means paid advertisements and the selling of user data. Maybe they can cryptomine while you are visiting the site for their store to make their profit another way.

All this as these same developers find a way to profit with $20 cosmetics and other microtransactions. Loot boxes or the closest thing staying one step ahead of legislation. Because remember, this is all coming from Fortnite. How is that game currently making its money? Because making over $1 billion in microtransactions just isn't enough that they should nickel and dime any storefronts selling their game as well. Because they think they deserve ALL the profit themselves.

I just showed you how much it costs for one of the larger storefronts to stay in business. I guess you'd rather see the rest go belly up all because Tim Sweeney says every storefront should make do with almost a third of what they are currently making. And when everyone else dies, how long do you really think it will take Epic to change their mind's and say they were wrong. That 12% was never reasonable after all and raise it...
In the case of micro transactions, why should a store front get part of that sale? I hate Microtransactions, however the store front is not developing the new content, so why should they get a cut of the costs of loot boxes, extra currency (Not sold on their store) or subscriptions (not sold on their store)?
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mintee: the more the hysteria against Epic the more im inclined to buy from there. its a store, I buy what i want and if the devs make more money then more power to them. I dont see it as a gaming apocalypse, just a continuing evolution of gaming as we know it. the market will decide in the end
To be clear it's not just a store. It's a client, a DRM platform, an online multiplayer service, a DLC provider... it's a lot of things. Some of those things are not up to par with Steam or even Origin, which is one reason people complain. I roll my eyes at the "I want everything on STEAAAAAM" whiners too, but there is a legitimate concern about Epic buying all these exclusive titles without a great client to play them through. Especially for multiplayer titles like Borderlands 3.
only launchers i have is battle.net and GOG dnt want steam,origin,epic etc. soon enough there will be a launcher to hold all your launchers to launch your games
Gog would've been my only choice, if I'd decided to use it sooner.
Sadly, I gotta put up with having Steam, as my library of already purchased titles. Any more launchers? No thanks. I pretty much end up playing indie and retro these days.
Now if some indie do end up elsewhere, I'll just wait. Not like I buy games day 1, can't afford at full price.
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Erelah: In the case of micro transactions, why should a store front get part of that sale? I hate Microtransactions, however the store front is not developing the new content, so why should they get a cut of the costs of loot boxes, extra currency (Not sold on their store) or subscriptions (not sold on their store)?
Then why should Steam or any other platform carry a "free-to-play" game like Fortnite? And by "free-to-play" I mean a game that one survey found the average player pays over $85 on microtransactions? Out of the goodness of their hearts and at a cost to them?

The real problem is this...
If 12% were truly realistic, some other storefront would have already tried undercutting the market at 25% or 20% and succeeded. This is the basis of free market economies. The idea that prices set themselves to fit supply and demand. The fact that 30% became a norm means that this is the price that works. And even at 30%, many online retailers have gone under which proves the point.

For someone to swoop in and claim that online retailers are making 2.5x too much is just hard to believe. Especially from someone who is becoming such a storefront. What did your mother tell you about deals "too good to be true"? That there is always a catch?

The catch here is likely one of 3 things...

1) The first one is FREE... Join us, the first month is free (or cheap). I hope you remember to "unsubscribe" before we bill you for next month. Or in other words, they have no real intention of maintaining a 12% cut. They are luring developers to their storefront, hooking them. When they raise the price, developers then have to worry about angering their customers who "bought in" to Epic in order to leave.

2) They are planning to make their real profit elsewhere. Selling client data; directed advertisements; or maybe their real goal isn't the storefront at all but a negotiation tool to their endgame to get a better rate for their games in other stores as they fold the storefront soon after.

3) 12% is their cut but with far more qualification than a normal storefront and 12% vs 30% is just an apples to oranges comparison and thus mostly a marketing tool. Or in other words what they call 12% is in actuality closer to what Steam or GoG or Humble call 30%. That would also explain why most of the games aren't any cheaper for the consumer.
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RWarehall: ...
For example, I can give real numbers for GoG since they are publicly traded:
Cut Determined by (1 - Cost of Goods / Sales Revenue) and Profit by (Net Profit / Sales Revenue)
...
Average: Cut 34.1% - Profit 7.5%
But this was GOG. GOG is so small and sells so few units for some games, surely they have higher fixed costs (had 150 employees at some point) and need a higher cut than big stores like Steam or Epic. Surely, Steam or Epic can get away with fractions of it. Nobody said, GOG should have a smaller cut.

Do you have the numbers for Steam or Epic by chance? Because these would be the relevant values in this case.

As for the knowledge. Maybe you know a lot more than me. That can well be. I just judge each contribution on its own. That's why a referal to some more knowledge is not enough for me unless it's shown directly. But that's just me.
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RWarehall: ... If 12% were truly realistic, some other storefront would have already tried undercutting the market at 25% or 20% and succeeded. This is the basis of free market economies. ...
The problem with these kind of arguments is that sometimes they are true and sometimes wrong. In general it's a good idea to take the average of the industry and assume that's a good as it gets, but then every now and then there comes somebody and makes things somewhat different than all the others and somewhat cheaper. All that rise of new companies, all that disappearing of old stuff, it cannot be explained easily if we follow these kind of arguments.

It's a hint that 12% is surely challenging, but not more. Epic could indeed be the one who can do it.

It's always that some things sound totally impossible .. until the moment they are done.
Post edited May 01, 2019 by Trilarion
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Erelah: ... In the case of micro transactions, why should a store front get part of that sale? I hate Microtransactions, however the store front is not developing the new content, so why should they get a cut of the costs of loot boxes, extra currency (Not sold on their store) or subscriptions (not sold on their store)?
Maybe because of fairness. The cut is relative. So if you do not take microtransactions into account, those games without microtransactions would have to pay more cut (relative to the total revenue) than those games with. That would be unfair.

Maybe the cut should not be relative. Maybe it should be absolute. Like, say, 1 dollar per copy sold regardless of how much the game costs (at least 1 dollar then I guess). After all the costs per copy are probably quite independent of which game it is.
tim sweeny's head is too small for his boxy frame.