Epic Games confirmed in a Thursday blog post that it would continue giving out PC games in its weekly Free Games Program.
The company’s game store has been giving away free games since its inception in 2018, attracting gamers to its young and developing storefront. While it initially released a free game every two weeks, it became a weekly feature in June 2019, with Epic aiming to give one “tentpole” game every month.
The team behind Fortnite spent millions of dollars in financing its Free Games Program, with over $700 million worth of free games claimed throughout 2022. These efforts have helped the company gain over $355 million in third-party games, an increase of 18 percent compared to the previous year.
Epic also pays developers a flat fee for giving away their games to gamers, providing benefits on multiple sides. Alongside the fee, developers also see a rise in paying players both on Epic and its main competitor, Steam.
“The smallest free games on any given week get between six and a half and 7 million claims,” Epic Vice President Steve Allison said.
Allison added that major titles see over 25 million free claims. Epic CEO Tim Sweeney pointed out that many players from developing countries are reluctant to try games at higher prices, locking them out of certain game markets. By offering these games, the program helps developers expand their reach to different audiences worldwide.
Quality and competition
Since its launch, Epic has had to compete with Steam’s storefront monopoly. It has paid numerous developers for exclusivity deals and free game offers, spending around $444 million in 2020 for “minimum guarantees” (a minimum amount the storefront is willing to pay developers for exclusivity).
After suing Apple over antitrust laws, legal documents in 2021 revealed that Epic was sinking over $17.5 billion in retail value on its storefront games.
Journalists have speculated that the success of Fortnite has given the company enough capital to front these costs. According to video game industry analyst Daniel Ahmad, despite losing $330 million in its game store, Epic retained a $1.54 billion gross profit in 2021 because of its flagship game.
“Apple spins this as ‘losing money,’ but spending now in order to build a great, profitable business in the future is exactly what investment is. It’s equally true whether you’re building a factory, a store or a game,” Sweeney said.
The company has since gained over 723 million players across several platforms, with over 230 million PC players using the storefront, 36 million of which log into the platform daily. In addition, its monthly active users also increased to over 68 million from last year’s 62 million.
However, the company still saw a two percent downturn in its total games revenue, recording $820 million in total sales. Epic officials speculate that the pandemic’s end has led Fortnite’s active user base to fall off slightly.
“The funny thing that’s happened post-pandemic is that Fortnite monthly active users have held up, but playtime, hours played, and spending has gone down,” Sweeney said.
Despite this slight loss, Epic plans to continue its expansion into 2023. Alongside the Free Games Program, the storefront plans to add long-awaited changes and additions such as content hubs and launcher performance improvements.
