How Epic Games Changed the Gaming Industry?

The gaming industry is notorious for being full of fads. Games tend to become popular very soon. However, their popularity dwindles at a greater pace as the next attraction hits the market. This is the reason that gaming customers have been known to be fickle and inconsistent. As a result, building a multi-billion dollar in the gaming industry was thought of as being an impossible task. Epic Games has changed this perception.

Epic Games is valued at over $30 billion making it one of the most valuable organizations in the history of the gaming industry. This valuation has led to criticism from many investors who believe that such high valuations are not justified for a gaming organization. However, the stellar success of Epic Games continues to break through preconceived notions.

In this article, we will have a closer look at how Epic Games has changed the nature of the gaming industry. We will understand how Epic Games has created innovative ways to monetize the gaming industry.

How Epic Games Became Popular?

The gaming industry is one of the most fiercely competitive industries in the world. Developers all across the world continue to launch games continuously. Hence, developing a sustainable enterprise in such a market was never an easy task.

Epic Games was able to achieve this breakthrough with their revolutionary game Fortnite. Fortnite can be considered to be the most popular game of the past decade. There are more than 200 million people across the world who play Fortnite regularly. The reasons behind the success of Fortnite are many. Some of the important ones have been listed below:

  • Fortnite is one of the most updated games in the world. Epic Games has made sure that it keeps adding new modes so that gaming enthusiasts keep coming back to play the game. Epic Games has the highest retention rate amongst gaming companies. Fortnite adds new features every week. This is what has helped keep the game popular for over two years. In fact, the popularity has continued to show an upward trend over this long period of time.

  • Fortnite is also one of the first games that provide users with a similar experience across gaming platforms. The company spent a lot of money to ensure that the game has been developed in such a way that it can be played on smartphones, gaming consoles as well as low-end computing devices as well. In fact, a player can begin playing a game on one device and can continue playing on other devices. This feature is very useful to their target market which comprises of millennials who prefer to travel.

  • Epic Games has also turned gaming into a social experience. There are special versions of the game which are suited for large groups of people. In such versions, people compete against each other individually or against other groups of people. The result is that there are many social groups that play Epic Games as a way to bond with their social group. Playing Fortnite or other such games has become a time-bound ritual and this has helped sustain the popularity of Epic Games.

How Epic Games Makes Money?

Over the years, Epic Games has created several different revenue streams. These revenue streams have allowed the company to earn revenues of more than a billion dollars. Some of the ways in which Epic games makes money have been listed below:

  • Almost all of the games launched by Epic games are free to play for the user. This helps them attract a lot of users and make the game popular. Once the users start playing the game, they tend to make microtransactions on the gaming platform. These microtransactions include in-app purchases which allow users to make cosmetic changes to their gaming character. Sometimes, in-app purchases allow users to unlock certain extra features. These in-app purchases are the largest source of revenue for Epic Games.

  • Epic Games has created a gaming engine called the Unreal Engine. This engine is allowing the company to monetize its products better. The Unreal Engine is a free tool that enables developers to make video games. Once these games have been created, they can be listed on the Epic Games platform and monetized. After these games have crossed a certain revenue threshold, Epic Games gets a 5% cut on the revenue generated by the game.

  • Epic Games has also created its own gaming library. This is seen as an alternative to the Play Store or Sony’s libraries. Since Epic Games already has 250 million users, any game listed on this library gets a large amount of exposure. Also, the transaction fee charged by Epic games is much less than the competition. The competitors charge almost 30% of the revenue generated by the game. On the other hand, Epic games charges a mere 12%. As a result, more and more developers prefer to create and list their games in the Epic Games library. The end result is that the popularity of the company is increasing by leaps and bounds.

  • Epic Games has recently launched other revenue streams as well. A virtual concert has also been conducted on their platform and that allows the company to generate another revenue stream.

The bottom line is that Epic Games has completely transformed the entertainment industry. It can be used by other entrepreneurs as a case study to understand how a company can create a sustainable brand name and enterprise in a highly fragmented market.


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