Connect with us

Reviews

Report: Steam’s 30% Cut Is Actually the Industry Standard

Last year the Epic Games Store swooped in and started hoovering up game exclusives like they were Pokemon cards, offering PC publishers an alternative to Valve’s 30% cut on Steam by taking just 12% from the games sold through its new platform. Since then, the cuts game retailers take and the effect it has on…

Published

on

Report: Steam’s 30% Cut Is Actually the Industry Standard
Last year the Epic Games Store swooped in and started hoovering up game exclusives like they were Pokemon cards, offering PC publishers an alternative to Valve’s 30% cut on Steam by taking just 12% from the games sold through its new platform. Since then, the cuts game retailers take and the effect it has on both players and developers alike have been a hot topic – and, as it often goes with the internet, a lot of misinformation can get mixed into those conversations.We reached out to nearly half a dozen sources within the games industry (as well as the game retailers directly) in order to get the actual numbers on what cuts most major retailers take. While many of these sources prefer to remain anonymous, they paint a picture that could be surprising to some players, one where Valve’s now infamous 30% cut isn’t actually out of the norm. In fact, it’s pretty much the industry standard.

Here’s an easy-to-read infographic breaking down how much the biggest game retailers take from the sale price of a video game, and keep reading below to find out why it’s not quite as straightforward as these simple percentages:

As you can see above, a game retailer taking a 30% cut is fairly common – that means if you buy a game for $60, the retailer generally gets $18 of it. Epic’s 12% cut is actually the major exception to this rule, while Valve’s cut gets lowers as a game passes certain sales thresholds and itch.io lets publishers themselves pick the cut it takes.

Another exception is the Humble Store (which is owned by IGN’s parent company, Ziff Davis, but does not influence coverage in any way, full disclosure at the bottom of the page), which takes a 25% cut but only keeps 15% of that for itself, letting the buyer choose whether the other 10% goes to charity or back to them as store credit. Meanwhile, Humble Bundles outside of the store let the buyer set what cuts go to the publisher, Humble, and charity entirely manually.

One source told IGN that there is currently tremendous pressure across the industry to lower the cut stores take.

On the console side of things, the 30% baseline holds true. IGN was told this 30% also includes the licensing fees associated with publishing your game on each system. One source even explained that Nintendo used to take a 35% cut from games released as part of WiiWare, but has adjusted its policy since to be in line with its competitors.

Additionally, physical retailers generally stick to a 30% cut too, but keep in mind that publishers often have to invest more themselves to pay for the process of manufacturing the physical media alongside other fees not present in digital distribution. For mobile gaming, the Apple App Store and Google Play Store take 30% as well, both for game sales and in-app purchases – though developers have recently raised concerns over the “Spotify-model” that is gaining traction with the introduction of Google Play Pass and Apple Arcade.

Hear about Valve’s recent response to its initial EGS comments in the video below:Despite the relative ubiquity of this 30:70 ratio, a source told IGN that there is currently tremendous pressure across the industry to lower the cut stores take. Ubisoft recently called Steam’s business model “unrealistic” after making the jump to the Epic Store last year, though clearly Steam isn’t the only store using this scale.

Valve even adjusted Steam’s rates late last year in what seemed to be a response to the pressure from Epic, but this change is likely only impactful to major developers. After $10 million in sales through Steam, Valve’s cut drops to 25% on all new sales, and drops again to 20% on sales after $50 million. For reference, earning $10 million would mean selling just under 170k copies of a $60 game, and far more for independent games that are rarely that expensive.

One source said their final takeaway from sales through a physical retailer is often between 10-15%.

Not all 30% cuts are created equal either, I’m told. One source explained that although Steam only takes 30%, other fees and deductions mean they are usually collecting closer to 65% on their end, while they say console sales return much closer to the full 70% but are stingier with refunds and the like. Meanwhile, GOG.com also takes a 30% cut, but requires publishers to invoice the site manually for the sales made to actually receive payment, something one source explained was a more time-consuming process than Valve’s regular automatic payouts.

[Update 10/8/19: A representative from GOG reached out to IGN after publish to clarify a few of the points above, most crucially that while a 30% cut is sometimes taken, they don’t actually use a single revenue share for every game. “We have a very individual and flexible approach to every partner and game that is being released on our platform,” they said, explaining that terms of a contract can depend on many different factors, including release timing with other platforms, integration with GOG Galaxy, and more. To that end, they explained that, for GOG, “the industry standard 30% revenue share is only a starting point for individual talks.”

Additionally, they also explained that “as a company we’re also in the process of introducing invoice-less payments to our partners. It wasn’t possible in the past due to tax regulations in Poland, where we operate, but this has changed recently.]

Another source also stressed that just because a retailer takes 30% doesn’t mean the developer of the game actually gets the other 70%, saying publishers often earn between 30-70% of a sale themselves depending on the deal that has been struck. There are also engine licensing fees to consider (games that use Unreal have its 5% fee waived if they are sold on the Epic Store), taxes, and other costs not factored into what many people assume the actual creator of a game earns. One source said their takeaway from a physical retailer at the end of the day is often between just 10-15%.

Flip through the gallery below for a condensed version of the info in this article:

How Much Does Each Major Retailer Take From a Game’s Sale?

IGN reached out to Nintendo, Sony, and Microsoft to confirm the numbers we had found and inquire as to whether any non-standard deals were made for major publishers, similar to Valve’s reduced cut after certain sales thresholds. While Sony and Nintendo didn’t respond before publish, a Microsoft Spokesperson sent the following statement:

“We are continually evaluating the industry landscape to ensure we remain fair and competitive in our approach to offering developers a revenue share on par with what they come to expect. A number of factors contribute to the revenue share structures we have today, including the unique aspects of each individual gaming platform across console, PC and mobile.”

To be clear, none of this is meant to assuage judgment of Valve for taking 30% or praise Epic for taking far less. Instead, I hope this information simply provides a more accurate representation of what developers and publishers experience when selling games across multiple platforms in a complex industry. While percentages can be compared, the real-world impacts they have are rarely so cut and dry.

Did these numbers surprise you? Do you think retailers should start moving lower than the 30% mark? Let us know in the comments below!

Disclosure: Humble Bundle is owned by Ziff Davis, the parent company of IGN. Humble Bundle and IGN operate completely independently, and no special consideration is given to Humble Bundle for coverage. A representative of the Humble Store was contacted for inquiry into its retail cut in the same fashion as the other storefronts listed.
Tom Marks is IGN’s Deputy Reviews Editor and resident pie maker. You can follow him on Twitter.

Click to comment

You must be logged in to post a comment Login

Leave a Reply

Reviews

We Played Half-Life: Alyx – Ask Us Your Burning Questions

This month’s IGN First for Half-Life: Alyx is officially in full swing, with brand new gameplay and some commentary on it from Valve! As part of our coverage, Ryan McCaffrey and I played through roughly the first four hours of Alyx, and now we want to know what you want to know. While we can’t…

Published

on

We Played Half-Life: Alyx – Ask Us Your Burning Questions

This month’s IGN First for Half-Life: Alyx is officially in full swing, with brand new gameplay and some commentary on it from Valve! As part of our coverage, Ryan McCaffrey and I played through roughly the first four hours of Alyx, and now we want to know what you want to know.

While we can’t reveal everything we saw just yet (and you can read Ryan’s full Half-Life: Alyx hands-on preview for his in-depth impressions), we want to open the floor to any burning questions you have about what it’s like to play Valve’s long-awaited return to the Half-Life universe.

Leave any questions you might have about our time playing Alyx in the comments below! We’ll grab a bunch and update this post with our answers next week.

Keep in mind, Valve has asked us not to share certain details about the story, some of the later mechanics we saw, and other spoilery things like that just yet. But maybe you’re curious about the movement, how its weapons feel, or what the pacing and atmosphere is like from within VR? We had a lot of fun playing Alyx, and we’re excited to tell you about it!

You can find all our Half-Life: Alyx IGN First coverage here, and be sure to keep an eye out all month long for even more exclusive reveals.
Tom Marks is IGN’s Deputy Reviews Editor and resident pie maker. You can follow him on Twitter.

Continue Reading

Reviews

IGN’s Staff Reviews the Sonic the Hedgehog Movie

Video game movies have often proven worthy of disdain in the past but the new hybrid CG-animated/live-action Sonic the Hedgehog is shaping up to be better liked than most, at least according to the IGN staff who have seen the movie.In addition to the official IGN review posted on Tuesday, below you’ll find reactions from…

Published

on

IGN’s Staff Reviews the Sonic the Hedgehog Movie
Video game movies have often proven worthy of disdain in the past but the new hybrid CG-animated/live-action Sonic the Hedgehog is shaping up to be better liked than most, at least according to the IGN staff who have seen the movie.In addition to the official IGN review posted on Tuesday, below you’ll find reactions from six staff members across all of our content-making departments — from editorial to social to video — all of which are kept as spoiler-free as possible.

In addition to the staff review roundups for tentpole entertainment properties such as Star Wars: The Rise of Skywalker and Netflix’s The Witcher, we also had several members of our team chime in about what they thought about Star Wars Jedi: Fallen Order.

These roundup pieces are a bit of an experiment that we will continue tweaking and refining, so we’ll be taking all your feedback left in the comments as we produce more of these in the future.

IGN’s Review, by Akeem Lawanson, Host/Producer

From the official IGN Sonic the Hedgehog review: While this family-friendly action-comedy suffers from a simplistic story and leans too heavily on tired visual cliches, Sonic the Hedgehog is nevertheless boosted by solid performances from Ben Schwartz as Sonic and Jim Carrey as Dr. Robotnik. Their ongoing cat-and-mouse game is entertaining, and passionate fans of the Sega franchise should appreciate all the nods to Sonic’s history.Make no mistake, this frantically-paced film is made first and foremost for Sonic fans. If you’ve been there for the little blue fella these past 29 years, from his humble beginnings on the Sega Genesis to his current iteration, then Sonic the Hedgehog is the love letter you’re probably looking for. If not… maybe save your gold rings.

Terri Schwartz, Editor-in-Chief, Entertainment

Sonic the Hedgehog is a sweet and simple adaptation of the beloved video game franchise of the same name. This is a movie aimed at kids that certainly is charming as an adult viewer — and pays loving homage to the Sonic video games — but also isn’t especially edgy or adult with its humor. Instead, this is a sweet story about friendship and family, with the strongest bond being between Ben Schwartz’s teenage Sonic and James Marsden’s Tom Wachowski, a cop who crosses paths with Sonic and needs to protect him from Jim Carrey’s villainous Dr. Ivo Robotnik.

Carrey channels his full The Mask energy for a pre-Eggman Robotnik, with all the mustache-twirling zeal you’d hope from him playing this character. As someone who didn’t grow up playing Sonic and who didn’t have a deep attachment to the character, I found his big-screen debut pleasant and inoffensive, but it’s not something I would rush to theaters to see again any time soon.

Sonic the Hedgehog: All the Easter Eggs and Hidden References From the Movie

Zach Ryan, Director of Social Content and Strategy

I didn’t expect much from the Sonic film. To be honest, I’ve never really been much of a Sonic fan, but from the moment we saw those first renders, I knew that this movie would certainly be… something. Fortunately, for all of us, Sonic the Hedgehog is surprisingly fun and full of heart. Yes, it’s chock full extremely online jokes and there are a couple of genuinely bizarre product placements, but that’s not enough to bring down the absolutely bonkers action sequences or distract from a genuinely charming performance from Ben Schwartz as Sonic.

My only real gripe with the film is Jim Carrey as Dr. Robotnik. He’s got a very ‘90s era Jim Carrey vibe about him throughout the whole movie and his over-the-top “I’m better than you” schtick is more annoying than it is funny. It captures a Saturday morning cartoon feel in the same way the recent TMNT films did: absolutely crazy, occasionally cringy, and ultimately a good time.

Nick Limon, Video Producer

The Sonic movie is charming and perfect for kids, with little substance for the adults bringing them to the movie outside of the fantastic bar fight and, of course, Jim Carrey chewing up every scene he’s in.

But other than that, not much of the movie sticks with me outside of the glaring omission of City Escape. Like, why have Sonic travel to San Francisco and have him run away from something and NOT play City Escape? It’s probably in a previous draft of the movie that’s forever lost in time. Like tears in rain.

Brendan Graeber, Editor, Games

I went into the Sonic movie with pretty low expectations – I was a Nintendo kid that played a handful of Sonic games at my friend’s house growing up, so I honestly wasn’t sure what was going to happen. The movie relied heavily on making Sonic a believable character on screen, and to that end, the design of Sonic was exactly what it needed to be to carry the film (I honestly don’t think I could have stomached a movie’s worth of Sonic’s initial gremlin design). Ben Schwartz did an impeccable job voicing a version of Sonic I actually liked: wisecracking, but not too snarky. Schwartz also managed to make Sonic a goofy chatterbox that never crossed the line into becoming a true annoyance, which I consider a pretty impressive feat. There were a few fun nods to Sonic’s source material, and I’m glad the movie didn’t get lost in the weeds with pointless references or lore that wouldn’t make sense to the plot.

I also felt like Sonic the Hedgehog worked as well as it did thanks to the efforts of its small but talented main cast. Similar movies like Detective Pikachu lost me whenever the camera cut away to the bland human characters, but I felt James Marsden ended up having great chemistry trying to keep up with the hyperactive hedgehog, and Jim Carrey absolutely stole the show by channeling his ‘90s-era zaniness to make every scene he was a part of absolutely over-the-top. I did find the plot revolving around Sonic and Tom Wachowski’s quest to get to San Francisco a bit odd and ultimately underused. The pacing didn’t feel quite right at times with Sonic rushing along with secondary plots by getting mad at something that didn’t make sense, and certain scenes just ended up feeling trivial. That said, Sonic’s slow-motion action scenes were pretty enjoyable, and actually translated Sonic’s signature “spin dash” to look as cool in a movie as it does in a video game.

Francesca Rivera, Associate Producer

I never played the Sonic games growing up, so everything I learned about Sonic’s tragic life-on-the run was straight from this movie. That being said, I love James Marsden, Jim Carrey, Ben Schwartz, and Ben Schwartz’s love of Sonic, and would’ve tried to watch this movie for them regardless. Sonic is the kind of self-aware kids’ movie that would entertain both the young children and the grown-ups who brought them alike.

Although it is a fun time for the kids, Sonic doesn’t really say anything about anything, especially for its human (and actual) lead, James Marsden’s Tom Wachowski. Marsden, by the way, carries the film expertly and is clearly having a lot of fun, especially against Jim Carrey’s Robotnik. The cat-and-mouse road trip that covers the second act really builds Tom and Sonic’s friendship and fulfills each character’s needs the way a neat movie should. There are also some truly creative “freeze time” sequences with songs that, indeed, slap.

It’s obvious that this film is the first of a franchise, setting up the Sonic/Dr. Robotnik rivalry over the course of what felt like one long first act. The way Tom’s story ends does leave a bad taste in my mouth and Jim Carrey’s Dr. Robotnik, unfortunately, is a little too out-of-place against everyone else’s dialogue and performances. So while the larger lesson of maybe staying in your comfortable space instead of challenging yourself may be troubling to expose to children, it still is a sweet story of helping those in need.

Yusuf McCoy, Social Media Designer

With a commendable performance from Jim Carrey and the titular hero voiced by Ben Schwartz, this live-action adaptation brings the joy and excitement for fans and children alike. Though the film does an adequate job of introducing some lore to Sonic, it falls short in the final act. With some surprise appearances making their way into the film leaving room for possible sequels, this is a strong start to a possible film franchise.

Let us know your thoughts on Sonic the Hedgehog in the comments below! And for more on the movie, here’s our breakdown of the end credits scene and what it could mean for a sequel, all the video game Easter eggs we caught in the film, find out what the critics are saying about Sonic, and what Jim Carrey had to tell us about the evolution of Robotnik’s look.

Continue Reading

Reviews

‘Keep Fighting’ For Persona 5 on Switch, Atlus Says

Persona 5 still hasn’t been announced for the Nintendo Switch, but publisher Atlus says it doesn’t want fans to give up hope just yet. Rumors have swirled around a potential Persona 5 Switch port for a long time, with a bogus Best Buy listing even popping up in 2019, but that momentum has slowed considerably.…

Published

on

‘Keep Fighting’ For Persona 5 on Switch, Atlus Says

Persona 5 still hasn’t been announced for the Nintendo Switch, but publisher Atlus says it doesn’t want fans to give up hope just yet.

Rumors have swirled around a potential Persona 5 Switch port for a long time, with a bogus Best Buy listing even popping up in 2019, but that momentum has slowed considerably. So IGN asked Atlus Communications Manager Ari Advincula if it was finally time for fans to give up on hope for a potential port during a Persona 5 Royal preview event earlier this month, to which she responded “I am a strong believer in ‘never ever give up on hope’.”

The fervor for a port was spurred on by protagonist Joker coming to Super Smash Bros. Ultimate early last year, but ended up being squelched somewhat when the teased P5S turned out to be Persona 5 Scramble, an entirely new game (and essentially a full-on sequel) coming to Switch. But Advincula says fans making their voices heard is the only way it’ll happen.

“You want what you want,” she explained, “and if you don’t let us know it we’re never going to be able to make it.” Advincula said Atlus is listening and does see the desire for Persona 5 on Switch, saying “it’s important to always voice your opinion.”

Advincula encouraged fans to “keep telling us what you want,” saying she was fighting for it internally as well. However, it’s important to point out that she also said she’s obviously “not the decision-maker” in a situation like this despite being an “internal champion” for it, so this shouldn’t be taken as an indication of what is happening or could happen down the line.

Still, Atlus has made it clear it is listening to the Persona community and taking feedback seriously, notably also revealing that it will change a handful of scenes in Persona 5 Royal fans previously condemned for being homophobic for its Western release on March 31.

Tom Marks is IGN’s Deputy Reviews Editor and resident pie maker. You can follow him on Twitter.

Continue Reading

Recent Posts

Title

Categories

Trending