Maybe next they can decide what Epic’s 12% fee for their own marketplace should be
So, to you answer your question, the fee that Epic should take is exactly the same as Apple's. It is exactly Zero dollars for all apps that do not go through their app store. Thats already how it works though.
It, of course, would be absurd if Epic was able to force you to pay them money for apps that don't involve Epic in any way and dont go through their app store!
"Royalty". It's common to charge a royalty when allowing someone to distribute your copyrighted property.
> Why can’t Apple collect fees for any apps that are built on their software AND hardware?
Because that's not a royalty - you aren't distributing Apple's copyrighted property when you send someone an iPhone application.[1]
When you send someone your game built on Unreal Engine, you are sending them Epic's copyrighted property.[2]
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[1] If people could side-load iPhone apps, that is. I don't believe that they can.
[2] If you sell someone code to your game and tell them to to download Unreal Engine, then compile and/or link it against Unreal Engine themselves, then sure, Epic won't get a dime. But your customer might still have to pay for that, depending on whether Epic makes single-user no-sale licenses free (I believe they do).
The only other category you can really compare this to is game consoles, but the hardware is sold at a much smaller margin and they still (for now) support physical media.
12% is if you sell directly through Epic's platform - nobody is claiming Apple shouldn't get a cut of that for their own platform.
"0% Store Fee For First $1,000,000 in Revenue Per App Per Year Starting in June 2025, for any Epic Games Store payments we process, developers will pay a 0% revenue share on their first $1,000,000 in revenue per app per year, and then our regular 88%/12% revenue share when they earn more than that. "
Aren't Epic's 12% fee less than half of what is usually charged?
Since courts work on what is reasonable, what makes you think that they will reduce it?
But I also recognize that few out there are pressing strong opposition to the idea of paying 3% for someone else to manage their financial transactions, or to host their own business. If I make a million dollars, paying 50k to Patreon or Kickstarter for hosting the service seems to make sense in my mind
Like, if all major marketplaces only charge 12% from the get-go, we probably would have had much less fuss and lawsuits over this.
This issue was always the disproportionate size of the fee, not the fact that they charge a fee.
The scaling also helps so that some (probably most) games aren't losing money to be hosted kn a store. That would be catastrophic as at some point games would need to remove themselves to name financial sense.
Do you object to other sorts of royalty-based compensation, like for Unity engine or Unreal engine?
There should be caps overall and under the caps there should be the option to choose between lump sum and royalties.
Nobody should be collecting unlimited revenue for a brilliant idea at the start and benefit from cheap or free scaling.
This entire model is ripping apart the fabric of modern society.
And yes, I known this is blasphemy on this website.
You should look at it the other way, where ANY income or income equivalent, of any kind, should be taxed like income.
So when Bezos spends $5bn per year, that means he made $5bn per year (at least), so his tax statement should show him paying $2bn or whatever the top tax rate would imply.
Doing it this way makes no economic sense for either the seller or the buyer but it's coincidentally the absolute best way for a middleman to maximize the tax they can extract from a two-sided marketplace they control. In competitive markets, blanket taxing on total gross revenue generally only occurs when there's a single fundamental cost structure tied to that revenue, or the amounts being collected are so small it's de minimis. App stores are highly profitable, multi-billion dollar businesses.
Perhaps the most perverse thing about this is that electronic transactions for purely digital goods which occur entirely on real-time connected digital platforms make it trivial to price each service for maximum efficiency. It's easy for the price a 2GB game with frequent updates pays for electronic delivery to reflect the cost they impose on the infrastructure while a 100k one-time purchase app can pay a vastly smaller amount. And that's exactly the way the competitive marketplaces evolve - from moving shipping containers around the planet to residential propane delivery.
Pick 3 imaginary games for sale priced at $1, $10 and $100. Any one of those games could be a million download a month success, and any one of them could be a complete dud.
What flat rate would you suggest to:
* Pay the developer for their work (ongoing per sale)
* Review each game and ensure it meets store guidelines (once per update)
* Host said game regardless of how popular it is (ongoing)
* Process transactions for the game (ongoing)
The alternative would be pricing based on revenue tiers (similar to what Unreal Engine does now), which aren't known in advance and don't take global variance into account (USD$200 in Eastern Europe might be a month's salary).
Percentage is just simpler. It also means that they'd be taking a loss on every free app or in the case of Free-to-Download In-App purchase apps - until users start transacting.
If something gets super popular, it presumable costs Epic more. But does 100 sales cost 100x more than 1 sale? That seems unlikely.
Does Microsoft earn their 30% cut on Xbox since they do provide the OS, hardware development and gaming APIs?
Wherever competing services drive it. If Epic can charge 90% margins while remaining attractive to users, more power to them.
> Does Microsoft earn their 30% cut on Xbox
It's an irrelevant comparison. No serious person can accuse Microsoft of having a gaming monopoly.