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Paradox Interactive: "The 70/30 revenue split is outrageous"
- Thread starter NoblesseOblige
- Start date
I didn't say they should only take a 10% cut. I said they should take 10%, plus payment processing costs. I don't really know or care what, exactly, a proper number would be, anyway. I picked 90/10 as an example because it would be roughly equal to Epic's cut in the absolute best case (very low payment processing costs) and pretty close to Valve's existing cut in the worst case (~15% lost on gift cards). The point I'm trying to make is that Valve could give developers/publishers a better cut by varying it based on checkout costs, instead of just taking a bigger profit on the cheaper payment methods.
First:
The royalty fee from Sony/MS/Nintendo on physical copies is 20% according to ubisoft.
Second:
Excuse me but, what does the digital share has to do with "manufacturing and selling consoles" ? Are those consoles given for free ? No, they're sold at a profit in the long run. They also sell accessories with a huge markup. And they also make online paywalls.
Lol, how are you even beginning to quantify what 5% amounts to, features/support wise?!
Screw Paradox and shit like EGS. No cloud saves, mods, Family share, achievements, streaming, big picture mode, universal game pad support, Linux support, user forums, reviews, basket in store, crap search feature, etc. Also, 0 discounts for consumers in general since keys won't be on 3rd party sites for free - this typically would allow 15-25% off new titles for both AAA and indie games. Let's ignore the cluster fuck of the EGS $10 off sale that significantly devalued brand new indie games (75% discount on a brand new title) and really screwed over AAA titles in other regions with the straight discount that didn't take into account regional pricing...
I think you can advocate for Steam while also agreeing that a 30% cut is too much.
I've never found the two sentiments to be mutually exclusive.
I've never found the two sentiments to be mutually exclusive.
I obviously can't get you the exact numbers but running a data center that just does downloads is way cheaper to do at scale then making and shipping physical copies.
The thousands of indie games we've gotten in the past 15 years wouldn't be possible with physical being their only option.
The real problem these days are publishers in the game industry. Publishers take a percentage from honest hardworking devs - sometimes money that is the difference between making a profit or a loss on a game - and they funnel it to their CEOs to spend on cocaine and lambos. Sometimes they take money from other people to do something with the game that developers aren't too happy with! Publishing a game costs nothing these days, it's all digital. Just a few clicks in a spreadsheet I'm sure! Someone needs to do something about this so called industry standard.
Wester: "To clarify I'm not taking about Steam."
Era: "Let's make this about Steam."
LOL.
Yea. I guess my point is people are throwing around "this is crazy" but don't actually have any financial perspective on what is or is not crazy to base their opinions on.
Is 30% too much? I don't know. I don't know how much it costs Steam to run all of their services and data centers for free (for the consumers) along with the value of access to the Steam market and its audience which costs next to nothing to get your game on. Are Sony, Apple, Samsung, Google, and Microsoft also taking too much? Because in this same thread not a few posts up we have people defending platform holders as offering "a magnitude more" value but they are not selling hardware at a loss and are simultaneously charging gamers monthly just to play online (which they could offer for free) and offering comparatively inferior online services, slower download speeds, etc. If they are taking to much, again, what is that based on? How much does it cost THEM to run their online services with 99.9% uptime and support staff?
Is 20% too much? Again, I don't know and am not sure how anyone can suggest that is more or less fair than 30% for the services provided.
I sort of feel like people think some of these services they use and enjoy are free or close to free to own and operate. It feels like the access to tens of millions of users isn't being considered.
Are these things cheaper than the pennies it costs to print and ship a DVD or Blu-ray? Are you sure? If people are sure, they should clarify just how much cheaper and show their work.
Oh, didn't know that. What's the split for smaller devs?
It needs to be the other way, the big devs that sell millions of copies can afford the 30/70 split, it's the smaller devs that needs a lower percentage to not run away to EGS.
I'm confused about this too. If Steam lowered their cut to 20% but instead devs had to give AMD/Nvidia/Intel a 10% cut on top of that, would everyone be ok with that? It's suddenly fine?
What the hell do devs have to do with that?
Taking a lower cut so consumers who use certain payment methods don't have to pay more is absurd, but helping fund someone else's hardware is perfectly reasonable?
Should Valve's cut be bigger for SteamVR games? I mean, it uses their hardware.
Don't buy the DLC then? DLC keeps their games supported and updated over many years instead of being dropped quickly after release. The base games are feature complete.
That's the most clueless argument I seen indeed.
"They deserve their cut because they sell you a hardware"
Sorry but, the cut you take from a sale is justified by what you provide to each parties. Selling hardware isn't a service they provide to anyone but themselves uh.
I want someone to prove that 70/30 split is too much rather than just repeating it. A lot of people seem willing to accept that statement, but where is the breakdown? It seems like small stores will die with a smaller cut and EGS can't support a robust feature set with a 12 percent cut. Steam's policy of giving better cuts to games that sell more seems reasonable to me because digital distribution + services likely scales better than physical distribution.
I'm not surprised a publisher wants more money anyway.
I'm not surprised a publisher wants more money anyway.
Because it's easier to operate a PC storefront than establishing and operating a whole console ecosystem, that requires billions in investments and carries a very high risk?
Nearly every dev ever that didn't need those features would take that in a heartbeat
People absolutely think it costs effectively nothing to run a service like Steam. The tip off is that they simultaneously want great customer support, a client overhaul, tons of features, refunds, etc. while wanting the company to earn two thirds less revenue.
Meanwhile other stores that take as much while charging you for online play aren't subject to the same demands.
Lol no one will read this post and thus cue outrage.
Also as if the argument "well your DLC practices are outrageous" invalidates his????
This is a more interesting topic and I'm surprised doesn't get discussed much.
Wait, are you saying console manufacturers should stop charging royalty fees really? Royalty fees have always been a thing. If you have an issue with them, go back 40 years and ask console manufacturers why they are charging a royalty fee. thats their entire business. or at least used to be before the digital store front and PS+ subs. That royalty cut is how they made their money. Consoles only become profitable later in their life cycle and even then the margins are barely even there.
If the royalty cut is 20% like you said, then their vendor cut is only 10%. compared to the 20% retailer cut, thats half off. 20% rotalty cut on physical sales seems ridiculously high since retailer cut is 20% and other distribution costs mean they barely get a 50% return after factoring everything in. 20% would mean they make 40% per copy which if true is ridiculous and unsustainable.
On Steam, smaller devs are allowed access to the same features as larger devs. Besides that, they can freely generate their own keys to sell through other means, essentially allowing them to take a 100/0 split.
A lot of publishers/devs seem to think it's equitable since they are willing to pay people hundreds of thousands of dollars to stream their games for exposure.
Here I am laughing at how some people here automatically had a "but steam...!" reaction.
Even if you don't read the article, steam isn't mentioned in any of the quotes on the OP.
It's kind of funny how exacerbated the hate for EGS can get.
Even if you don't read the article, steam isn't mentioned in any of the quotes on the OP.
It's kind of funny how exacerbated the hate for EGS can get.
It is almost as if the OP mentioned Steam... It is funny how you just see what you want to see.
IK the guy clarified that he wasn't talking about Steam, but the people railing on Steam here need to understand that they largely use that 30% cut to eat losses on Gift Cards & payment methods that charge larger % amounts (which are very common outside of the USA).
It's why on the EGS they pass those payment method % charges onto the consumer buying the game, rather than Valve who will eat the loss. With the cut Epic takes, they can't afford to eat the loss without actually losing money, as there are payment methods whose % cut is already almost the entirety of the cut they take.
Valve can take the higher amount of money they make from people utilizing lower cut payment methods to eat losses on the higher cut payment methods people use in other countries. EGS can't afford to do this.
It's why on the EGS they pass those payment method % charges onto the consumer buying the game, rather than Valve who will eat the loss. With the cut Epic takes, they can't afford to eat the loss without actually losing money, as there are payment methods whose % cut is already almost the entirety of the cut they take.
Valve can take the higher amount of money they make from people utilizing lower cut payment methods to eat losses on the higher cut payment methods people use in other countries. EGS can't afford to do this.
What exactly should be discussed about that topic?
The reality is that publishers pay Streamers millions of dollars to promote their games.
The idea that content plattforms should license the use of games from publishers so Streamers can show these games is a pretty dumb thought.
Did you read the OP or were you too busy laughing at everyone?
It's kind of telling that what the vast majority of publishers do with their keys is just selling them to other stores like GMG and Nuuvem, instead of building their own stores to sell as much as GMG does while making more money from each copy.
I'm sure many would. And then be thoroughly ignored by most of Steam's playerbase. Which would solve no problem.
As long as they have the only PC storefront that isn't hot garbage I'd say the split is as justified as the console maker's.
Deadass it wouldn't fucking matter lol they would take an extra 20% and still be on Steam
Okay, didn't read the third quote. Admittedly I was actually busy laughing at the "But steam!" reactions. Not like I am one to talk.
Still, I have to admit my fail. Sorry
I agree that developers and developers alone should be getting more money from each sale. The trouble is publishers want this increased share too. A great scenario would be developers who self-publish get 88%, while games going through publishers retain the 70%. Or if publishers want the 88%, they have to a signed and notarized contract stating that developers will get a healthy cut from each sale directly.
I'm not saying 30% is right or wrong. But if you're arguing for a smaller cut out of solidarity to actual development *workers*, you're really just making the bosses argument for them.
A smaller cut does nothing for worker's salaries or work conditions/hours. It's just more profit for the publisher... and even that is assuming equivalent revenue, which is far from assured.
A smaller cut does nothing for worker's salaries or work conditions/hours. It's just more profit for the publisher... and even that is assuming equivalent revenue, which is far from assured.
Quick question: What do you think is the cut for retail copies for the publisher ?
As for the rest: Did I say they should stop charging royalty fees ? No.
What I'm saying though: Saying that "They deserve their 30% more than Valve because they sell hardware" is silly to say the least. Why do you charge ? Because you provide a service. Either to the customer or the developper. Selling a hardware at a profit in the long run isn't a service. It is one for Sony/MS/Nintendo indeed. But they're not handing consoles for free. Establishing a userbase has nothing to do with the cut you take from each sales, it's ridiculous.