,
4 tweets,
1 min read
Read on Twitter
Why 12%? We chose this number to provide a super-competitive deal for partners while building an enduring and profitable store business for Epic.
From that 12%, we net around 5% after direct costs and that could grow to 6-7% with greater economies of scale.
From that 12%, we net around 5% after direct costs and that could grow to 6-7% with greater economies of scale.
Why did Activision, EA, and UbiSoft break away and build their own stores from scratch? Because it’s way more profitable to sell their games that way than to give 30% to a store.
You have to understand, 30% is an enormous markup.
When a grocery store sells an Amazon or iTunes or Steam card, their markup is maybe 10% to 15%. That’s for a physical retail store with shelves continually stocked by workers.
When a grocery store sells an Amazon or iTunes or Steam card, their markup is maybe 10% to 15%. That’s for a physical retail store with shelves continually stocked by workers.
When a credit card company processes those transactions, they take 2.5 to 3.5%, and that covers their costs of banking and customer service.
