The Epic Games Store is nothing if not generous with its free games. For several years, the company has released a free game every week, and in the last few weeks, these free offerings have massively increased in quantity. This practice of releasing free games stands in contrast to a lot of Epic Games' more controversial business practices. Be it accusations of spyware, unexpectedly draining battery life with its store app, or the hordes of exclusives, Epic Games is no stranger to controversy. Combined with recent news that the store is hemorrhaging money for Epic, why is the studio only ramping up its delivery of free games?
In short: the Epic Games Store can afford to lose money. In return, the Store attracts a ton of returning customers who are likely to spend a lot of time in the app. Having a weekly reward for loading up the store app massively increases the likelihood of repeat customers. Further to that, the ability to add free triple-A games to the store can attract impassioned players, ones more likely to buy something in the Epic Games Store. This is the case with the coming week's two free titles, including 2020 classic Alien: Isolation.
In general, the store has to fight an uphill battle against Steam, which is currently the market leader in PC game stores. So, with its many investors, the Epic Games Store can risk money on exclusive games and free titles as long as it causes some egress into the marketplace as a PC storefront. Ultimately, not having a competitive audience is more problematic for the store than anything else. A storefront being a loss-leader is nothing new, and it is entirely necessary for the Epic Games Store right now.
Just How Much Is the Epic Games Store Losing?
Well, the answer is in the hundreds of millions. In the anti-trust lawsuit between Epic Games and Apple, Epic filed a few court documents that put how much money it was losing into perspective. Epic Games lost over $450 million in the last two and a half years. This comes from around $181 million of losses in 2019, and a further $273 million in 2020. If current projections are accurate, Epic stands to lose another $139 million throughout 2021. A large majority of this comes from the combination of buying game exclusivity and making many of its premium titles free for users.
It is not unusual for a company to have an initiative operating at a loss. However, for that loss to be nearly half a billion dollars would spook an awful lot of companies. In spite of this imposing loss, Epic remains adamant that the 12% revenue share that the company gets from developers will be enough to support that, as it predicts that the store is likely to be profitable by 2023. With over 745 million free Epic Games store titles claimed since 2018, the store certainly may have the audience.
How Many Free Games is Epic Giving Away?
In a tweet responding to news about the cost of competing with Steam, Tim Sweeney revealed how many free titles were released on the Epic Games Store: over 103. In the last week, 3 games became free on the Epic Games Store in one go. These included the full Deponia collection, Ken Follett's The Pillars of the Earth, and The First Tree. These games have a combined base retail price of nearly 100 dollars. By giving a staggering three games out in one week, the store could be seen as losing a lot of potential sales.
Both Deponia and The Pillars of the Earth are two very tonally different games from Daedalic Entertainment. While both focus on some heavier themes and story based puzzles, Deponia is much lighter in tone and aesthetic. However, both are premium titles (with Deponia including 4 titles of a long story arc spanning several years). Increasing the number of free titles (including The First Tree) is reminiscent of the 15 Free Christmas Epic Games Store games. However, this time it is not due because of any holiday. With the two games being released next week, it may be possible that having more than one free weekly game will become the norm.
Alien Isolation and Hand of Fate 2 Are Coming Free To The Epic Games Store
The Epic Games Store seems to be continuing its strategy of releasing really high-value games entirely for free on its "Discover" page storefront for the coming week. On the 22nd of April, Creative Assembly's seminal survival horror title Alien: Isolation will be made free. The game received huge critical acclaim, alongside popular recognition as one of the best Alien games. Hand of Fate 2 also releases free on the 22nd. While less popular than its Alien accompaniment, the game is a deck-builder turn-based RPG that plays with elements of the genre fantastically.
These are both really big games to make free. In fact, Alien: Isolation has already been free on the store, so it is an interesting move to bring it back. Putting such premium products pride of place in its free games section is a fascinating move. Games that appear more than once are even less likely to actually be bought, and Epic is setting a precedent for games reappearing as free on its store. The store is also setting an expectation for more than one free game a week. This could prove problematic - what if players end up buying fewer games to wait for them to become free?
Why Does The Epic Games Store Not Care About Losing Money?
To answer this question, and the one from the previous section: The Epic Games Store is a storefront that is not meant to sell games. At least, it is not yet. Sure, some players will spend some money in the store, but with the litany of discounts, vouchers, and just plain free games, the likelihood of a player to pay full price for a title on there is low relative to other retailers. Of course, phrasing it in this way makes a few assumptions. The first, and most obvious assumption, is that Epic Games actually needs the money immediately. With Epic Games' Tencent backing, this $450 million loss is but a drop in the ocean of one of the largest companies in the world.
In fact, Epic Games' CEO is the richest man in North Carolina. Facts like this should prove that Epic is not exactly hurting for money. The company's CEO Tim Sweenwy thinks the Epic Games Store's losses are an investment. In the tweet reacting to the news of the store's loss, Sweeney had this to say:
The whole point of the store right now is to build an impassioned, engaged fanbase who will buy games in future. If Epic wants to duke it out with Steam for the top spot as a PC marketplace, it still has catching up to do. This is likely the real reason that the Epic Games Store gives away so many games when it costs so much.
Alien Isolation and Hand of Fate 2 will be free on the Epic Games Store from April 22nd-29th.