Yesterday, Epic used it Fortnite essentially waging an open war against the mobile app markets of Apple and Google. First, it added the discounted “Epic Direct Payments”; option along with the standard iOS App Store and Google Play payment options in Fortnite, direct violation of the store’s policies.
Then when Fortnite Predictions were excluded from both platforms, Epic filed a lawsuit against both companies alleging “competition restriction and monopolistic practices” in the mobile app market. That move was accompanied by a strong PR move, including a video asking players to “join the fight to prevent 2020 from becoming ‘1984.’”
But through this entire public war for “open mobile platforms,” as Epic put it, there is a group of major closed platforms that the company seems very happy about continuing its business. We are, of course, talking about video game consoles.
Happy to pay
Most if not all of the complaints Epic raised against Apple and Google seems to apply to Microsoft, Sony and Nintendo in the console space as well. All three console manufacturers, for example, also cut all microtransaction sales by 30% on their platforms.
This DLC fee also represents a large portion of those console manufacturers’ sales. “Additional Content” accounted for all 41% of Sony’s Games and Networks revenue in the most recent financial quarter. Microsoft saw revenue from games grow 39% in the following quarter Fortnite has also been released, synonymous with the “third party title power” bug. And the Switch saw the same digital revenue increase following Fortnite after Nintendo announced that half of Switch owners had downloaded Fortnite.
On the mobile platform, Epic is calling the same 30% fee “exorbitant” and says it wants to offer a more direct payment solution that can “transfer savings to players.” On the console, however, Epic is happy to introduce a permanent 20% discount on all micro-purchases, although there is no indication that console manufacturers have changed. change their fee structure.
A quick overview of the dashboard control history
The major console manufacturers also exercise full control over what games and applications can appear in their own walled garden. When it comes to iOS, Epic says that “by blocking consumers’ choice in software settings, Apple has created a problem so they can profit from the solution.” When it comes to the console, Epic is silent about the same situation.
In this sense, the console is even more limited than Android where games and apps (included Fortnite) can be transmitted without using the Google Play Store. However, Google won a lawsuit because of its role in this situation, while the console makers remained undisturbed.
In addition to the business impacts, the panel manufacturers’ full control over their marketplace also has a direct impact on the types of content players can play. For example, any game that received an Adult Only rating from ESRB was not welcome on any of the three main consoles. And if you want to use UWP to code an N64 emulator that works on Xbox One, Microsoft will pull it down as quickly as possible.
Not always this way, of course. Back in the days of the Atari 2600, anyone with programming skills and cartridge manufacturing prowess could create games for consoles. That situation led to an abundance of poor quality Atari software flooding the market, a situation many observers blamed for the 1983 crash of the video game industry.
To prevent history from repeating itself, Nintendo created a key chip for the NES that gives it effective control over which cartridges can run on its hardware (and gives it the ability to extract royalties from vendors. game development for cartridge manufacturing privileges). When companies like Tengen tried to get around this limitation, Nintendo took them to court and won, consolidating Apple-style control of its own software market.
Decades later, this kind of absolute control over compatible software is considered the de facto standard in console space. But in the world of mobile phones, companies like Epic are increasingly making the same restrictions and publicity as anti-competitive monopolies. What’s the difference?
Break down the differences
Some might argue that the software restrictions on the console are less impactful since the hardware is only designed for gaming. As Epic put it in its own FAQs, “mobile devices are essential computer devices that we carry out in our social and professional lives and engage in commerce and entertainment. ” That FAQ only compares the mobile market to “other general-purpose computing platforms, including the Web, Windows, and Mac.” It seems that the console is not suited to the same “general purpose” framework.
But that’s an increasingly outdated view of what gaming consoles can do. Xbox One, to cite just one example, covers a wide range of non-game apps for functions like video on demand, music streaming, VoIP, email, etc. That might not put it together. The level of software selection is like a smartphone, but it pushes it closer to the “all-in-one” space.
Some may indicate very different nature of the revenue model for different ecosystems. While Apple makes substantial profits from every iPhone sale, panel makers typically sell their hardware at a loss or at almost no profit in order to increase the user base for the sale and license of the parts. soft future.
That might help explain why console manufacturers feel the need to protect a 30% cut in their software sales and micro-transactions. But it doesn’t really explain why a company like Epic would have agreed to pay that fee to Sony and not to Apple.
Maybe Epic is simply more worried about the potential loss of console revenue than the mobile platform. A mid-2019 Newzoo study on three main Battle Royale games, included Fortnite, which shows that 71% of players mainly play on consoles, compared with just 17% on PC and 12% on mobile. Being cut off from those console players in a fiery public battle would be a much stronger blow to the game’s revenue stream.
“The epic heart of Microsoft”
Or maybe Epic just has a better relationship with panel makers than cell phone makers. Epic has long made the console a major focus of its Unreal Engine development, in a way less true of mobile phones.
Sony recently invested $ 250 million in Epic and featured Epic’s Unreal Engine 5 in a recent big PlayStation 5 promo demo. Even Nintendo, the company has traditionally used its own technology. for game development, has also started using the Unreal Engine for its own titles in recent years. In a way, Epic cannot attack the holders of the platform without attacking itself.
And while Epic and Microsoft are famous for their popular Windows Platform on the PC, the two companies publicly buried their mark last year in the process of introducing the HoloLens 2 platform. “Epic loves Microsoft,” said Tim Sweeney. at that moment. “The epic heart of Microsoft.”
However, Apple and Epic are not exactly strangers in the business world. Epic’s Infinity Blade and Unreal Engine was introduced during a key iPhone keynote in 2010, and the company announced the “Zen Garden” demo for iOS 8 at WWDC 2014. But while the Unreal Engine was a key part of the In today’s console context, the high-end 3D graphics it allows still have more of a place on mobile platforms, which is often insufficient for those types of games.
Perhaps the answer is that Apple in particular is a difficult target these days. Everyone from Microsoft and Google to email app makers to European regulators has been targeting the anti-competitive nature of the iOS market in recent months. Perhaps Epic doesn’t want to be the only company to use the console three times in the same way.
With Epic still yet to respond to our request for comment, we are still guessing why the console was spared from the legal rage and corporate PR. But in the end, it might just be a question of timing. Maybe Epic has merely focused on the mobile market first, hoping to set a precedent that could also disrupt proprietary console makers wielding their own hardware.
Today, it is hard to imagine a world where non-approved control panel manufacturers run software on their systems. But if Epic succeeds in their attacks on mobile, that might be where we are headed.