The pinnacle of Epic Games’ profitable business model

Tim SweeneyThe founder and current CEO of Epic Games was the first to speak recently at “State of Unreal,” an event dedicated to highlighting the technical performance of the new in-house engine: Unreal Engine 5.

After several tech demos, some of which are playable like The Matrix Awakens, this meeting confirmed the incredible quality of rendering allowed by the new graphics engine.

Touch Photorealism rendering enabled by Unreal Engine 5

Behind precise staging, announcements of partnerships with various studios, and Hollywood montages of in-game video, Epic Games’ philosophy is reiterated several times: to provide developers with the tools to enable games to create even more beautiful content. For. free.

Because where Epic differs from the rest of the competition is in the design of its business model, which is focused solely on sharing. When the company was created, Tim Sweeney had the first software. The shooter/editor Lyra, presented during this conference, is thus a true tribute to it, and the emphasis on the company’s guidelines focused on exchange.

Today, Epic Games relies on three financial components: the sale of games produced by the studio, leading Fortnite; its online game store; and the fee for using the graphics engine, Unreal Engine.

And on these three points, we find the shareware aspect intrinsic to Epic. Fortnite is free, it is the in-game purchases that ensure its profitability. Use of Unreal Engine is also free, subject to three types of licenses: If you use it for a purely creative purpose, you will not have to pay anything; On the other hand, if you make a profit from it, you will have to withdraw 5% of your profit, but only if you have over a million dollars in revenue (which leaves a slight margin…).

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revenue epic vs steam
Epic Games’ margin on game sales is lower than Steam’s, which benefits creators

Ultimately, the Epic Game Store wants to be an open door for all studios, with the company only realizing 12% of sales against 30% on Steam, a real opportunity for independents who want to make the same margin. do not have the capacity. as major publishers.

This last event allowed the general public to become aware of the ecosystem around Unreal Engine 5 provided by Epic Games. The free software, availability of various educational tools (tutorials, forums, Q&A,…), and the sense of reach for a company of such stature are commendable.

Unlike the big names in the software suite, such as Adobe or Microsoft, Epic Games does not impose itself in the restrictions and security of its solutions (facilitated by a permanent connection to the Internet), but in the greatest number and exchange of openness. A virtuous and profitable business model for all, which should inspire other companies.

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About the Author: Tad Fisher

Prone to fits of apathy. Music specialist. Extreme food enthusiast. Amateur problem solver.

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