Fortnite Takes On Apple In Epic Showdown

Author

Michael Beach
August 20, 2020

Well, that escalated quickly: Apple removed Fortnite from the App Store within hours of them launching a discounted (20% off) payment option from within the app.

The response: Epic filed an antitrust lawsuit and launched a marketing campaign shortly after being kicked out of the app store.

Why this matters #1: Apple currently takes 30% of every digital goods purchase from within an iPhone and prohibits any attempt to circumvent that.

Why this matters #2: This is not just a problem for Epic/Fortnite.  Spotify customers need to visit a website to upgrade to Spotify Premium, but Apple prohibits them from pointing that out from within the app.

Other companies waging similar battles with Apple include:
1) Spotify
2) Netflix
3) Facebook

Apple revenue from Fortnite (% of total) since 2017:
1) Epic/Fortnite share – $840M (70%)
2) Apple share – $360M (30%)
3) Total – $1.2B

Fortnite registered users according to Epic Games:
1) Aug-17 – 1M
2) Jan-18 – 45M
3) Jun-18 – 125M
4) Nov-18 – 200M
5) Mar-19 – 250M
6) May-20 – 350M

Wow: Epic added 100M users (40% growth) between March 2019 and May 2020!

FYI:  The average Fortnite player spends 21% of their free time playing the game!

Quote from Matthew Ball – Venture Partner @ Makers Fund:
“Compared to Facebook, Amazon, Apple, Microsoft and Google, which are worth $600B to $1.4T, Epic’s valuation is modest. However, Epic has the potential to become one of the largest, most influential tech companies in the world. This might seem hyperbolic to those who know Epic only as the marker of the hit video game Fortnite: Battle Royale. In fact, even long-time fans of Epic’s games might find such a pronouncement odd given Fortnite has generated more revenue in three years than the rest of Epic has in almost as many decades. But behind the scenes, it looks increasingly likely that Epic will be at the very center of society’s digital future.”

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