Epic Games to Charge 12% Fee for App Sales From Alternative iPhone Store

[MacRumors]

Epic Games in February said that it would launch an Epic Games Store on the iPhone in the European Union, and today the company held an event at the Game Developers Conference (GDC) to provide additional information on the upcoming store debut and the fees that it will charge for apps distributed through its marketplace (via 9to5Mac).

For games distributed through the Epic Games Store, Epic will collect a 12 percent share of revenue, which is the same fee that it charges on Windows and Mac machines. Apps will get 100 percent of the revenue they earn for the first six months, with Epic taking no cut, and there are no fees for apps that offer in-game purchases and use their own payment processing method.

A game sold through the Epic Games Store will need to pay both Epic's 12 percent fee, and Apple's 0.50 euro Core Technology Fee (CTF) for each "first annual" install after one million installs. Apps distributed through the App Store under Apple's updated EU business terms will pay the CTF and a commission of 10 to 17 percent, down from the standard 15 to 30 percent cut that Apple takes.

App Store apps making under $1 million annually will pay 10 percent under the App Store Small Business Program, and that's also the fee that Apple charges for subscriptions that customers keep for over a year. More successful apps earning over $1 million and new subscriptions are subject to a 17 percent fee. Note that Apple also charges an additional three percent fee for using the in-app purchase payment system, so developers who distribute through the App Store and use in-app purchases will pay 13 to 20 percent.

As an example, an app with fewer than one million downloads that is distributed through the App Store under the new business terms would pay the CTF and 10 percent fee, a total ultimately lower than the CTF + 12 percent fee that the Epic Games Store would collect. From Epic Games:

"The Epic Games Store has a 88/12 revenue split for developers who distribute paid-for apps on PC and Mac and that will continue on mobile platforms. Developers do not pay Epic anything to distribute free apps. If developers offer in-app purchases, they can choose to either use our payment processing system with the 88/12 revenue share or use a third party payment processor and keep 100% of that revenue, just like they do today."

Epic Games CEO Tim Sweeney has called Apple's EU changes and fees a "devious new instance of Malicious Compliance" and has promised that Epic Games will continue to "argue to the courts and regulators that Apple is breaking the law" even as it prepares to launch the Epic Games Store.

The Epic Games Store is set to come to the iPhone in the European Union before the end of 2024. It will not be available in the United States and other countries.

Article Link: Epic Games to Charge 12% Fee for App Sales From Alternative iPhone Store

 

[Think|Different]

Hypocrites. Plain and simple. Tired of hearing whiny Sweeney.

 

[LordSandaime]

Damned hypocrites.

 

[nojkepop]

What a strange timeline we live in.

 

[mvwoensel]

Before Apple fans get confused again and start calling Epic hypocritical: the key difference is that Epic is not a gatekeeper and does not have complete control over game distribution. If developers don't like these terms they're free to use web distribution or alternative stores. That's how competition in a free and open market works.

 

[canadianreader]

and there are no fees for apps that offer in-game purchases and use their own payment processing method.

Ok this is fair but 12% cut is still too high

 

[GizmoDVD]

Its OK if Epic charges a fee, but NOT Ok if Apple does it.

 

[EvilEvil]

Unpopular opinion, but a 12% cut sure beats a 30% cut.

 

[walnuts]

I feel like there was definitely a meeting where they proposed charging 50% and someone had to point out the hypocrisy and they lowered it to 12% begrudgingly
\

 

[kmm333]

Before Apple fans get confused again and start calling Epic hypocritical: the key difference is that Epic is not a gatekeeper and does not have complete control over game distribution. If developers don't like these terms they're free to use web distribution or alternative stores. That's how competition in a free and open market works.

But what costs is the fee intended to cover that isn't true for Apple as well? I think it is quite hypocritical, but I do see your point.

 

[zelativity]

LOL what did I tell y'all? He's a big hypocrite that likes to whine because he can't get a big piece of the pie and wants it free to get all the profits.

 

[vegetassj4]

I bought two apps when I was overseas, and requested a paper copy of the associated fees:

 

[AeroEd]

Unpopular opinion: 12% sure beats 30% cut.

I’d rather pay 30% tax than 12% tax /s

 

[vipergts2207]

Awesome. Will be nice to see some actual app distribution competition.

 

[jlc1978]

Unpopular opinion: a 12% sure beats 30% cut.

Except most developers pay 15%, and subscriptions 15% after year one.

 

[yabeweb]

It’s OK if Epic charges a fee, but NOT Ok if Apple does it.

Only an apologist would defend Apple with that argument.

I mean you do realize Epic is asking way lower than Apple…..
Proving their point, Apple is asking way too much!

 

[sw1tcher]

Hypocrites. Plain and simple. Tired of hearing whiny Sweeney.

Damned hypocrites.

You'll have to elaborate on how Epic are being hypocritical because from what I'm seeing

(1) the 12% fee is less than the 15% or 30% fee Apple charges;

(2) they're allowing app developers to use their own payment processing method, something Apple doesn't allow ("there are no fees for apps that offer in-game purchases and use their own payment processing method.");

(3) they're not blocking app developers from advertising alternative payment methods, something Apple doesn't allow

 

[Jamie0003]

I feel like there was definitely a meeting where they proposed charging 50% and someone had to point out the hypocrisy and they lowered it to 12% begrudgingly
\

Lmao no. Why would anyone sell in epic’s store in that case?

 

[LordSandaime]

Before Apple fans get confused again and start calling Epic hypocritical: the key difference is that Epic is not a gatekeeper and does not have complete control over game distribution. If developers don't like these terms they're free to use web distribution or alternative stores. That's how competition in a free and open market works.

Nice try, but Apple now no longer has complete control over distribution in the EU and Epic as late as *checks notes* today is still bitching about having to pay Apple. Also, there should be nothing illegal about making a profit off of your platform. That's how competition in a free and open market works.

It's also hilarious how people in here are saying 12% is better than 30%, as if Apple doesn't lower the fee to 15% after a year....

 

[GizmoDVD]

You'll have to elaborate on how Epic are being hypocritical because from what I'm seeing

(1) the 12% fee is less than the 15% or 30% fee Apple charges;

(2) they're allowing app developers to use their own payment processing method, something Apple doesn't allow ("there are no fees for apps that offer in-game purchases and use their own payment processing method.");

(3) they're not blocking app developers from advertising alternative payment methods, something Apple doesn't allow

Epic is a much smaller store and reaches much less people so...12% seems like a bargain for those that don't really want to sell their games. Did you expect them to be the same as Apple who has a 1000x consumer reach?

 

[Arsenikdote]

I think the bigger question is what is Epic offering for a 12% cut? We know Apple is offering the development tools, entire ecosystem, constant relevance through new products, etc.... Epic is creating a store on that foundation and then offering what? Nothing.

 

[mrochester]

It’s going to be interesting to see whether developers prefer paying 15/30% to Apple and have access to the entire iOS user base or pay Epic 12% to access a far smaller set of users.

I suspect the Apple App Store will continue to be the most profitable place for developers to be.

 

[vipergts2207]

Nice try, but Apple now no longer has complete control over distribution in the EU and Epic as late as *checks notes* today is still bitching about having to pay Apple. Also, there should be nothing illegal about making a profit off of your platform. That's how competition in a free and open market works.

Apple seems to profit enormously from their platform, even if they were to receive $0 in App Store revenue.

 

[pacalis]

O la an apologist would defend Apple with that argument.

I mean you do realize Epic is asking way lower than Apple…..
Proving their point, Apple is asking way too much!

Fortnite was being distributed for free on the App store and EPIC sells their workaround v-bucks at grocery stores. While I'm not thrilled with many things at Apple today, the value Apple was offering was way less than it was being compensated by EPIC.

What EPIC seems to be offering is way less distribution, less trust and less QC for less cost. That's fine, and probably great for Tencent, but i'd be pretty suspect of apps on that store.

 

[mrochester]

I think the bigger question is what is Epic offering for a 12% cut? We know Apple is offering the development tools, entire ecosystem, constant relevance through new products, etc.... Epic is creating a store on that foundation and then offering what? Nothing.

Apple is also offering access to every iOS user. Epic will only have access to a relatively tiny set of users (remember folks, it’s not consumers who want more app stores, so they are going to be resistant to installing them unless forced by app developers. App developers would be wise to keep their apps in the store that consumers want to shop in else those users might just switch to alternative apps).