Why 12%? We chose this number to provide a super-competitive deal for partners while building an enduring and profitable store business for Epic. From that 12%, we net around 5% after direct costs and that could grow to 6-7% with greater economies of scale.
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Why did Activision, EA, and UbiSoft break away and build their own stores from scratch? Because it’s way more profitable to sell their games that way than to give 30% to a store.
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You have to understand, 30% is an enormous markup. When a grocery store sells an Amazon or iTunes or Steam card, their markup is maybe 10% to 15%. That’s for a physical retail store with shelves continually stocked by workers.
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Replying to @TimSweeneyEpic
what percentage of the revenue of a typical game company would be spent creating their own distribution software with comparable features and stable CDN with multiplayer backend and existing install base?
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I’d estimate the effort of building a highly scaled (millions of concurrent users) store and set of multiplayer game services at several hundred engineering years. To weigh Epic’s online feature efforts, look at Store+Fortnite as most features aren’t surfaced in the store yet.
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