Comment on Epic reduce their cut to 0% for the first $1 million in revenue for devs on the Epic Games Store

• 9point6@lemmy.world ⁨3⁩ ⁨weeks⁩ ago

  I’d argue it makes more sense for digital distribution, once the sale has been made in a physical store, there’s no ongoing cost for them.

  A digital storefront has the ongoing cost of downloads and updates, as well as the distributed storage costs (Steam many copies of games all over the world to mean downloads are quick)

  Data transfer costs back in the mid 00s mean that every install of a game like HL2 cost them a dollar or two. If a user ever uninstalled and reinstalled more than a couple of times (a lot more common back then with the limited storage everyone had), couple that with ongoing update transfer costs and most of the profit from a full price sale could be gone. If they never made any profit from the sales, Steam never makes it past its awkward years.

  Data transfer is definitely cheaper these days, but then games are bigger and they probably spend a lot more on datacenter space than back in the day

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  • halcyoncmdr@lemmy.world ⁨3⁩ ⁨weeks⁩ ago

    A physical storefront has to deal with asset depreciation however. A product can sit on the shelf and reduce in value as it ages, there is no such thing with digital distribution.

    Based on estimates, and various reports, leaks etc. since they aren’t a public company… Steam makde an estimated $10.8 Billion in 2024. They made $780,000 per employee as of 2018 based on an internal report, more than nearly every other company on the planet. They’re not spending anywhere near that on operations.

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    • 9point6@lemmy.world ⁨3⁩ ⁨weeks⁩ ago

      Surely the sales are an equivalent there? Both ultimately mean the total price goes down and the store’s cut goes down accordingly.

      Don’t get me wrong, they’re definitely profiting these days. $11bn is a massive amount of revenue* for a company with the number of staff they do. But Steam are going to have disproportionately high datacenter costs compared to most other companies. As a rough comparison: Watching an hour of netflix at HD quality is about 1GB of transfer or so, Call of Duty is something like a quarter of a terabyte. Someone who downloads call of duty once would have to watch 250h of netflix to cost them the same.

      Then remember they’re likely paying their staff very well, I would not be surprised at all if well over half of their revenue just goes to operational costs before any reinvestment.

      *Checked the figure was revenue and not profit.

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• FartMaster69@lemmy.dbzer0.com ⁨3⁩ ⁨weeks⁩ ago

  Also killed physical media for PC games, carving out a near monopoly for themselves.

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  • halcyoncmdr@lemmy.world ⁨3⁩ ⁨weeks⁩ ago

    Eh, I would argue that the expansion of broadband internet and the increased expectation of instant gratification by consumers made it a perfect time for Steam’s expansion. The death of physical media is a side effect of the ability to near instantly download anything you want.

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  • rtxn@lemmy.world ⁨3⁩ ⁨weeks⁩ ago

    Physical media died when games expanded beyond their capacity. Optical discs are physically fragile, they have a limited shelf life, they have to be reproduced by specialized equipment (not considering piracy here), they have to be physically transported to the customer, some regions are financially unviable (imagine the Helldivers 2 situation but with every game), and production has to end at some point. Having to set up a physical supplier also severely limits the ability of indie or solo developers to have any kind of success or even presence.

    Physical media is obsolete, and people clamoring for its return are nostalgic for a world that doesn’t exist anymore.

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  • spankmonkey@lemmy.world ⁨3⁩ ⁨weeks⁩ ago

    By offering a far better experience for the vast majority of people. Like how DVDs killed VHS, where some people who couldn’t afford to upgrade were left behind.

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