The Impact of Epic on the Business of Games
By Chris Hewish
When future historians look back at the evolution of the video game industry, Epic Games won't just be remembered for Fortnite. It will be remembered for reshaping the business of games at nearly every level.
The recent U.S. court decision in Epic v. Apple, combined with the expected return of Fortnite to the iOS App Store, marks a major inflection point. To understand the full weight of this moment, we need to zoom out. Epic's impact spans not just headlines, but the underlying infrastructure, economic models, and distribution strategies of modern gaming.
The Courtroom as a Battlefield for Business Models
The courtroom battle between Epic and Apple was never just about fees. It was about redefining who controls the player relationship and how value flows through digital ecosystems. While the final ruling wasn't a clean sweep, the most commercially impactful win was this: developers in the U.S. are now permitted to direct players to external web shops for purchases.
This ruling has far-reaching implications. Apple and Google have historically taken a 30 percent commission on in-app transactions. By steering players to external shops, developers can retain up to 95 percent of each transaction, depending on the payment provider. That represents a 20 to 25 percent gain in revenue per user transaction, which, at scale, adds up quickly.
To put this in context, mobile game spending in the U.S. reached 6.8 billion dollars in Q1 2024. If even 10 percent of those transactions shifted to direct web shops, developers could unlock over 170 million dollars in additional annual revenue. Epic made this legally viable, creating an opportunity that now extends to every studio.
Fortnite: From Blockbuster to Business Platform
Fortnite is more than a game. It is a cultural engine, a commercial ecosystem, and a testing ground for the future of direct-to-player engagement.
Epic has used Fortnite to experiment with monetization, cross-brand collaborations, user-generated content, and even payment structures. In 2020, Epic offered discounts for V-Bucks purchased through its own payment platform inside Fortnite, sparking the very lawsuit that would change the rules. Now, with Fortnite preparing to return to iOS in the EU under the Digital Markets Act, and likely returning in the U.S. soon, Epic is poised to use the game once again as a demonstration of how direct monetization can be done at scale.
The strategic question is not whether Fortnite will return. It is how it will return, and whether it brings with it a wave of innovation that sets new standards for web shop integration, personalized offers, and frictionless player purchasing.
Unreal Engine: The Infrastructure of Innovation
Epic's longer-term impact may come not from its games, but from the tools it builds for others to create them.
Unreal Engine has become the go-to platform for real-time 3D development across gaming, film, automotive, and other sectors. More than 7.5 million developers use Unreal globally. The engine's success lies not only in its technical capabilities, but in its business model. Epic pioneered a royalty structure that aligned its financial incentives with developer success, democratizing access to AAA-grade tools.
The Unreal ecosystem continues to expand with tools like MetaHuman Creator and RealityScan. These tools position Epic to become a central infrastructure provider for the emerging digital content economy. Rather than merely competing with other engines, Epic is building a platform that spans creation, distribution, and monetization.
Epic Games Store: Playing the Long Game
The launch of the Epic Games Store in 2018, with its generous 88 to 12 percent revenue split, was seen by many as a bold and possibly unsustainable move. Today, the store has over 230 million users and has given away more than 1,300 free games. These promotions have cost Epic over 500 million dollars, but they have also generated significant goodwill, user acquisition, and developer loyalty.
Epic's store strategy is not just about competing with Steam. It is about creating a cohesive ecosystem that links Unreal Engine, Epic Online Services, and the Store itself into a unified toolkit. This positioning becomes increasingly valuable in a future where cross-platform publishing, direct payments, and independent monetization gain prominence.
Conclusion: A Company Rewriting the Rules
Epic Games is not simply building products. It is challenging norms, reshaping business models, and giving developers new options for growth and autonomy.
With Fortnite's return to iOS on the horizon and new opportunities emerging in direct-to-consumer commerce, the industry is entering a new phase. The power dynamics that once favored platforms are starting to tilt back toward creators.
Epic, more than any other company in the last five years, has pushed hardest to make that shift happen.
Coming Soon: The Bigger Battle Behind the Curtain
Epic may be the most visible force in this transformation, but it is not the only one. Legal pressure is mounting across the games industry, from antitrust scrutiny of Microsoft's acquisition of Activision Blizzard to regulatory shifts under Europe's Digital Markets Act and California's Consumer Protection efforts.
In an upcoming article, I'll explore how litigation is becoming one of the most powerful forces shaping the future of games. From business models and monetization strategies to distribution rights and data privacy, the courtroom is emerging as a key arena in the business of games.
Stay tuned.