Paradox Interactive Head Sides With Epic Games Store, Calls Steam’s 70/30 Split “Outrageous”

While speaking as part of a panel at Gamelab last week hosted by GamesIndustry.biz, Paradox Interactive’s Executive Chairman of the Board, Fredrik Wester spoke against the 70/30 revenue split distribution platforms like Steam offer to game developers.

According to Wester, the 70/30 revenue split offered to developers by most platform holders such as Steam is “outrageous”. Instead, Wester praised Epic Games’ efforts to offer a more reasonable alternative with its own Epic Games Store. While Steam’s terms dictate a 70/30 revenue split, Epic Games dictates an 88/12 revenue split. This is, of course, tremendously good for game developers.

Speaking to press during the Gamelab panel, Wester said,

“I think the 70/30 revenue split is outrageous. I think the platform holders are taking too much money. Everyone in the press here, just quote me on that.”

Wester argues that the 70/30 adopted by Steam and other platform distributors is obsolete now. It used to be the norm when the media relied on analog tapes and optical discs. Distribution of physical media is harder as compared to digital media. Physical media needs to be physically shipped while digital media can simply be put online for downloads. This was the reason why distribution companies used to take a big chunk from the product’s sales revenue. But since everything is digital now, distributors like Steam shouldn’t go for the 70/30 revenue split cut as it was common in the past.

“That was physical. It cost a lot of money,” he said. “This doesn’t cost anything. So Epic has done a great job for the whole industry because you get 88 percent. Fantastic move. Thank you very much.”

Dan Da Rocha, the founder and game director at Ten Hut Games says,

“That [the 88/12 split] is a huge boon. It’s a huge advantage. In some cases, that 30% taken is more than the profit for a small studio. That’s just crazy, right? So that [distribution on Epic Games Store] is a huge incentive for some of us.”

Gamers aren’t particularly very fond of the Epic Games Store. In fact, a majority of gamers are against games and their distribution on the Epic Games Store as compared to Steam. Steam has more features which the Epic Games Store doesn’t simply offer.

Earlier this year it was announced on the Metro Exodus’ Steam page that Deep Silver and Epic Games have reached an agreement to sell Metro Exodus solely on the Epic Games Store. This decision was met with a ton of backlash from disappointed users who had already pre-ordered the game on Valve’s Steam.

While speaking about the decision to go with an unpopular distribution platform like Epic Games Store and the potential backlash that can come with it, Da Rocha said,

“It’s a tricky one. If you have a fanbase on Steam and you go to Epic, there could be a massive outcry there — a fallout. But it depends on: Is the price right? Does it make sense financially? Is that just a vocal minority on Steam, talking about that and making those arguments?”

Wester also argues that game developers shouldn’t be blamed for going with Epic Games Store as compared to Steam because of the great revenue split Epic offers. Wester says,

In any case, the reality is that people will obviously side with that particular distributor which offers them a better deal. Steam vs Epic Games Store, it doesn’t really matter. What matters is what the people like. Game developers can side with any distributor they like. But there is something I think everything should understand. Whether it is discounts, better features, and accessibility, support options, or refund policies, at the end of the day, the decision rests with the people.

The moment game developers start focusing on profits is the moment they lose everything that is good about games. Video games are a form of art. They are about the experience and emotion a player feels when playing a game. Video games shouldn’t be all about the money. Game developers should just focus on making a good quality game, revenues and profits will automatically follow.