Epic Paid The Makers Of Control A $15 Million Advance For Exclusivity

Many game developers have shifted to release their games on the Epic Games Store, but the upstart platform has proven surprisingly controversial. A report outlining Control developer Remedy Entertainment’s deal with Epic grants a clearer picture into the money and percentages that draw in high profile games.

A financial report from Digital Bros (via gamedaily.biz) indicates that Remedy and publisher 505 Games got a deal of 9.49 million euros in bringing the game to the Epic Games Store.

That’s around $15 million, which was then divided between the two parties, with 505 taking 45 per cent of that total and the larger sum of 55 per cent going to Remedy. This deal is part of a larger exchange between 505 Games and Epic that will also see the upcoming sci-fi exploration game Journey to the Savage Planet released exclusively on the Epic Games Store.

The 9.49 million euro number has been reported as a deal for Control’s exclusivity, but that payment is not merely a cash sum paid in exchange for the rights to sell the game. It is an advance on future sales revenue.

This payment ensures that developers are making a lump sum right away, rather than waiting for money to dribble in as copies of the game are sold. Said security and up-front payment might make releasing games on the Epic Games Store more appealing, particularly for developers of independent games, like Hades developer Supergiant Games or Ooblets’ designer Gumberland. Both of those games initially released exclusively on the Epic Game Store, although Hades will be available on Steam starting in December.

“The upfront money they’re providing means we’ll be able to afford more help and resources to start ramping up production and doing some cooler things,” Ooblets designer Ben Wasser explained in a blog post last month. Gumberland was later targeted in a harassment campaign after this announcement.

The deal between Remedy and Epic isn’t new for the platform, but the release of these numbers does help put some of the inner workings in perspective. Steam is facing increased competition from the Epic Games Store and has been adjusting its look and its algorithms recently. Epic continues to draw in developers and games, including the loot shooter Borderlands 3. The model seems to be working, to the presumed delight of some publishers and the continued confusion and occasional frustration of some gamers.


Comments

    is Control on a timed exclusive or fully exclusive ? I don't really see a problem if they are doing timed exclusive but if it's to be fully exclusive that just feels iffy

    at the end of the day you're just shutting out the competition by being rich (which I suppose happens a lot in the real world heh)

      It tries to happen in the real world but things like Antitrust laws exist to stop it. Epic is basically competing through exclusivity because it can't compete through consumer experience and knows that buying up devs for the critical sales period of their game release is the best way to attract people to their store and hope they stay for the rest of the games.

      They put it under the banner of "changing the industry for the better" but all it's really doing is harming the smaller players (like GOG who have been in financial difficulty because they can't compete on both the consumer and developer front) or having little to no noticeable impact on their true target, Valve.

        I'm not sure antitrust works the way you think it is. If Epic bought exclusivity to ALL games, that would fall under Antitrust. If they priced the games so low that competitors weren't able to compete, that's Antitrust. But having exclusive games? That's fine. In real world terms, that the equivalent of Cadbury Caramilk coming back, but only at Woolies. Or coke being sold at MacDonald's on the condition that it isn't sold at KFC, or the latest Star Wars film only screening at cinemas that agree to give Disney 100% of profits for the first two weeks of business. It happens around us all the time, it's just we are more invested in the behind the scenes of video games and we notice more.

        Not saying you have to like Epic's methods, but they certainly aren't llegal.

          (I am not a lawyer and none of what I say is to be taken as legal advice disclaimer)
          Oh Epic isn't doing enough yet to trigger Antitrust laws for sure but the premise of buying up devs and games in an exclusionary manner is definitely under the banner of "Monopoly" which is one of the Antitrust no-no's. Epic gets an out though because a) they are timed exclusives and don't permanently shut out competition, and b) they are nowhere near in control of the market.

          In terms of comparisons to exclusive deals in stores, they have exceeded a reasonable expectation of exclusive agreements and will not let anyone onto their store that wants to sell somewhere else. It's the equivalent of EB Games having a distribution agreement with every publisher saying "You can sell through us but you cannot sell at any other store".

          Basically it's about volume and attitude and Epic has clearly indicated that they will continue to utilise exclusivity as a weapon in this supposed war on Valve.

        It happens in the real world. EB Games often gets exclusive rights to see Collector's Editions of games and charging a fortune for them. How is this different?

          That example is different because it's just some additional content, the games are still available from other stores.
          To be the same as Epic, EB would have to be the only one allowed to sell the game for year before others stores could.

          The closest stores like that can get is offering a midnight release.

            It happens all the time, though. Supermarkets sign exclusive deals with particular brands. Shops do it. It's really no different. You can go to any shop you want, but if you want brand X, it's exclusive to Shop Y.

              Yeah but I was really just pointing out the difference that Lich was requesting, I wasn't really arguing either way.
              Prob should've added that on a whole, physical distribution on a national level and digital distribution on an international level isn't really helping anyone's argument.

              For the sake of conversation though and at the risk of branching away even more from the main topic, a physical games retailer and a supermarket are subject to the same rules and laws, the difference is in how the products are viewed.
              Yes a supermarket can sell a brand of apples exclusively but it can't exclusively sell apples as a whole.
              In comparison individual games are viewed as the latter, there's a thousand brands of apples but there isn't a thousand brands of Witcher 3.

                I don't see how that tracks though. There are a thousand brands of jeans, but the company who made this particular brand of jeans only sells it here. The Witcher isn't a type of product, it's an individual product made by one manufacturer.

                Regardless, I'm not a huge fan of the epic store, but it's no worse than any of the others on balance and and pledging loyalty to This game selling billionaire over That game selling billionaire needs to have a think about their priorities.

            Epic Store games are still available to purchase at other retailers. Both in-store at the usual places and online at the Humble Store for example.

            The initial argument against Epic doesn't hold up anymore.

    Gamers aren't confused by the model but a lot of Kotaku writers seem confused about why some gamers are frustrated.

    As for if the model works I'm going withold judgement on that one.
    History shows it works in the short term but is damaging in the long term, though that's on competing platforms, not a singular platform over separate free launchers.
    For Epic specifically I don't think the model is sustainable in the long term but that's also a wait and see, a lot of variables.

      Its sustainable for Epic, because they get the money back. Its just an advance. Then they get their cut after that.

      Despite that, I dont think the model works long term anyway, because the developer is limiting their market at the most crucial time - the launch window. By default that means they arent selling to as big a market, which leaves sales behind.

      End of the day, its less profit in the long term, which put different pressures on the developers. They're trading short term stability for long term growth. By definition exclusivity makes something more limited, which means less sales. Even with digital products.

        You say they are limiting their market, but Borderlands 3 reportedly had 250,000 concurrents on PC at launch, twice the highest number of Borderlands 2. The market is already there. The only barrier the Epic exclusivity creates is the moral one, and that's only created by you.

          The markets definitely there. It's the MW2 debacle over again. People openly say they'll avoid it, boycott it etc.

          Then they toddle off and go play it. Same with this.

            That's because Kotaku reading commenters are the minority. Most people don't give a shit. They'll just buy the game from wherever it's on sale so they can play it. People fall into the trap of reading things here and on reddit and thinking that's what all gamers think, but when you look at the sales numbers that isn't the case.

            Borderlands was the first exception to the rule IMO. None of the other exclusives have done earth shatteringly well once variables are accounted for.

              the pc market has also doubled at the least since borderlands 2 was rleased, and even then borderlands 2 when it released was also the double the size of borderlands 1. no number of actual sales has been released and even the lastest report from 2k is forward speculation and also treats part of the 40million payed by epic for the exclusivity deal with take2 as part of the sales data

              Borderlands 1's launch peak on Steam was 68k; BL2's was 125k. BL3 hitting 250k seems entirely expected, and if anything a little low given that it's had more than twice as long to expand its following (BL2 to 3: 7yrs) as its predecessor (BL1 to 2: 3yrs), had at least one well-received spin-off to attract more players to the franchise (Tales), and the fact that in those seven years, a number of other looter-shooter games/franchises have popped up and attracted even more players to the genre.

            Sorry to burst your bubble but I refuse to buy games on the Epic store and I will not back down on that!

            The fact I'm not using my PC for gaming right now and therefore not buying games from any launcher prob has nothing to do with that.....
            Fight the powa!!

              Hey I'm not saying every single person in the world is on ES. But I am saying it's an incredible rarity that people genuinely aren't. The fact is, and it's been proven over, and over and over, that those who say and those who do, are unfortunately two very different categories of people. Kudos for having the courage of your convictions. One of the other guys here I've known a long time away from Kotaku, Cymelion, hasn't got Uplay and that's going on...well, since Uplay started? Credit to him for sticking to it too.

                I know I'm just teasing, I'm against Epics aggressive tactics but I'm not really in a position to test my convictions on that since I'm pretty much wading through a console backlog at the moment and they don't have anything I really want.

            MW2 debacle? I'm more upset by the current MW debacle, I'm sure my non-PS4 copy of the game won't be cheaper because its missing one of the main game modes I was looking forward to.

          Borderlands 3 is absolutely not an honest measuring stick... It was a sequel to a massively popular series, it already had a long established fan base in place.

          That'd be like Rockstar releasing a new GTA, or Bethesda a new Elder Scrolls/Fallout on the Epic Store and then Epic being like "Hey guys, see how not selling on Steam didn't hurt them? Proof!"

            But it is an honest measuring stick against Borderlands 2. I'd argue that both had a similar amount of hype going into release and we currently have twice as many people playing it as Borderlands 2. The market has adopted the launcher due to Fortnite and now we are seeing examples that the market has accepted buying games from that launcher. The argument that a game not being on Steam means less people will have access to it holds less and less water as time goes on.

              No, it's not.

              You'd have to act like a game having a bigger launch than a previous title in its series never happens... Or that hardware install bases (people with capable PCs in this case) never increase over time, resulting in more customers in general as time goes on.

              As @os42 mentions in their post, the numbers are not actually awe inspiring put into context... I'd be curious to see how many more we'd have seen playing on PC if it had gone live on Steam at the same time, hell even a few days later.

              Arguing that "There's no proof we murdered a portion of that developer's potential sales!" is awfully convenient when running around actively making sure no such proof can ever exist.

          Yes, I say they are limiting their market and I stand by that. That is not the same as saying there is no market, but that they left sales behind. Its an impossible number to state, but how many more concurrent players would they have had if they had sold on Steam as well?

          I am saying that it would have been higher than 250,000. Which means they wont have sold as many as they could have. Twice the number of Borderlands 2 simply means the market is bigger. And we know that.

          Theres a video floating about showing a timelapse of the biggest games on Steam, over about 10 years. You can clearly see a spike in users since PUBG came along and cracked the 1 million mark. There are more gamers than ever, I didnt say there wasnt.

          My career is as a business analyst (for the past 20 years in the ATO, what are your credentials?), and everything I know says they have left sales behind. Thats not twisting it into an anti-Epic belief, its saying that the industry will suffer. If they are leaving sales behind, they arent making as much money as they might have, and eventually that has to have an effect.

          Even if its just 50k sales Steam might have given, thats a big chunk of cash that negates any possible benefit the guarantee might have given. What business chooses to leave $3 million in sales behind?

          I actually dont have a problem with Borderlands being exclusive to EGS, I have a problem with exclusivity in general for the above reasons. It limits sales by default, which eventually has to have an impact somewhere. Maybe Gearbox, maybe not (probably not with them, B3 isnt a fair example). But at some point those sales left behind MUST have an impact.

          I'm playing Borderlands 3 on the PS4 by the way. Not for any moral reasons, but a) others I know that are playing are on that platform, and b) I prefer physical copies of games and the local stores were out of PC copies.

          Dont assume I make these statements out of some moral crusade, I'm not. Its easy to jump to the conclusion that I'm anti-Epic, simply because I make a negative statement about them. But I'm not, I'm voicing my professional opinion. They have their market, and if they were pushing only their products, or even Unreal based products (as Borderlands is) its really no different to Ubisoft, EA, Blizzard, etc.

          Its the buying of genuine third party rights that I disagree with, and at the moment, its only Epic buying them. If it was Steam, I'd argue against them as well for the same reasons - its bad for business.

            There's a point to be made that going exclusive would have given Epic a reason to help with the massive marketing push that Borderlands 3 has been given as it would have been mutually beneficial and how that would offset any potential customer loss from not being on Steam. But, considering your extensive experience as a business analyst, it's clear we aren't on the same level and a longer discussion with me would be a waste of your time.

              Just so you know, I'm arguing against your assumptions, not Borderlands specifically. Like where you assumed my initial comment was anti-Epic. Then laid out my reasoning for why I believe exclusives leaves sales behind.

              Exclusive by default means you're exposing your product to a smaller market. I'm not limiting that statement to one game, which is doing wonderfully well - 5 million sales in its first 5 days. As I said, I have no problem with Borderlands 3 being exclusive to EGS.

              If you think that one game is the one and only measure of success though, I have a wonderful bridge to sell you. Overlooks San Fransisco bay.

              What makes you think Epic helped with the marketing push by the way? I'd expect the publisher to do that, not the distributor. The online ads and print media would be from 2K Games, not Epic. Genuine question, I'd expect it to be 2K for pretty much all advertising outside of EGS.

              Epic wouldnt be pushing the Xbox or PS4 versions, would they? Nor would they fund adverts in PC gaming mags, like PC Powerplay. If you have info that shows Epic pushed beyond its own platform, it would be good info to share.

              As for its push inside EGS, thats a different discussion altogether. I think EGS has a few problems with discovery myself, but they arent unsolvable. Until they are though, they are a problem.

              B3 is a good example actually. Now the game is out, its slid quickly on the home page. Thats the first thing customers see when the load it up, and its 11th already, 11 days after release. Still high on the store page, but not the home page.

              Other recent releases are already 5 or more pages down on that store page, making them far less likely to be spotted by casual buyers. Unless you specifically go to buy Ancestors, you wont see it easily. And this is what I mean by sales being left behind. Outside the very early launch window, Epic isnt making it easy for games to sell. You either know about the game or you wont find it. If you know about it, you're far more likely to have bought it early on.

              Those are problems attached to exclusivity. Limited market, limited exposure, and rapid drop from public consciousness. Far faster than normal.

            My main point of contention for Borderlannd 3 is that they still haven't mentioned anything whether multiplayer would be compatible with copies from Steam 5 months down the line.

            They absolutely left sales on the table by going to Epic, but each sale is worth about 20-30% more to them, and they got an exclusivity fee on top. It might have been worth it for them, especially if they're not sure if anyone still cares about Borderlands and are expecting fewer sales long-term.

            (To respond to a reply below, Epic did a Fortnite/Borderlands cross-promotion, so I'm a little suspicious of your business analysis credentials at this point. This was trivial to check.)

              Yeah, I knew about the Fortnite cross promotion, but really? THATS the massive push they gave? I cant see that being a huge benefit. A benefit, sure, its always going to have an effect, but how big is impossible to say. My opinion is that its not as much as people think.

              My comment was based on traditional marketing, not what amounts to a PR stunt. Those gamers are already inside that ecosystem and would have been inundated with the existing advertising every time they loaded up Fortnite. They wouldnt have been exposed to something they werent already seeing. But, fair enough. It is something. It wasnt what I was referring to though.

              Regardless, it misses my point and its gotten way off track. I'm not aiming my argument to one game, I'm aiming it at exclusives themselves. Limiting your market limits your sales, thats been proven time after time. Any businessman that thinks otherwise is leaving profit behind.

            In addition to your statement. Given this is a cash advance means the dev will eventually be paying that back anyway. So apart from slightly less commission, I don't think the dev is better off over the long term by limiting their market.

            In general Epic's greedy actions don't really match their CEO statements on the matter. They are clearly in it for themselves. If they were indeed in it to help developers, why have many dev's openly rejected their offers, with Epic refusing to sell their games without an exclusive agreement. There has also been information circulating that Epic doesn't support third party key sales for their exclusive titles.

            I fail to see how limiting your market with third line forcing is any good for a developer or consumers period.

          My bad, was last 4 years they showed concurrent users. Same thing though. There are more gamers now. Which makes it hard to compare B2 to B3. Every sequel of a well known game is going to get a similar spike in sales.

          https://www.youtube.com/watch?v=3X46oWXucL4

            Hard to tell who exactly to reply to with this, but it's worth pointing out that while BL3 (2019) doubled BL2's (2012) launch player concurrency, Steam's peak player concurrency has roughly tripled in that same period. With only two games having peak concurrency above 1 million, and with other anticipated sequels and franchise releases performing better (the latest Resident Evil release almost quadrupled its predecessor, Risk of Rain 2 got 14x its predecessor, Mortal Kombat 11 more than doubled MKX, AC Odyssey quadrupled AC3's 2012 performance) this seems to suggest that Borderlands 3 on EGS has performed worse than the average.

    My issue with the Epic exclusives are
    a) Epic is buying the exclusives late in the games development, not in partnering from early development/commisioning like a Sony, Xbox or Nintendo deal.
    b) These developers have broken early commitments to Steam releases especially for crowd funded titles and preorders already recieved
    c) The "exclusive" is NOT exclusive... its "excluding" only Steam. Amd recently gotten to the point they refusing developers who wint withdraw from Steam. This is anri competitive and anti consumer.
    d) There is no regional pricing or faircurrency exchange, Australia tax is oppressive. Borderlands 3 was cheaper in JBHIFI than on Epic... $14 US dollars cheaper for a box set. Thats dodgy pricing for an electronic storefront claming to be cheaper... but is more expensive outside the USA.

      a) I'm upset by recent Modern Warfare announcements, as I was never told I would only receive a portion of a game when preordering because I'm not Sony. Pretty sure Sony didn't partner in early development to get Survival Mode exclusivity.

      c) Where else can you get Control for PC? Its not simply excluding Steam. You can't buy Control on GoG, Battle.net, Uplay or Origin. Buying from any other retail gives you an Epic product, much like getting Steam keys from retailers in the past.

      d) You get used to it and has nothing to do with Epic. Borderlands 3 was cheaper in any brick and mortar store in the country than it was buying digital on any platform. Its been like this for a decade. Comparing US region prices to AUs, again, regardless of platform.. you should look around a bit more. You'll be hard pressed to find a game on Steam or any platform (especially one made by Warner Bros or Bethesda) thats has the Aus equivalent of US$ pricing. Has nothing at all to do with Epic.

    And now while my internet is down I can't play Borderlands offline because the EGS won't let me use their stupid launcher offline.
    I didn't give a fuck up until I realised how shitty the launcher actually is.

    So at what point does Epic actually use some of that money they are throwing around to improve the store? It has been up a while now with little to no noticeable improvement.

      They introduced localised release windows and preloading infrastructure with BL3, so... Two weeks ago, I guess?

      I'm not going to pretend the store isn't a long way behind the competition, but developing these things takes time. I guarantee they're spending money on it right now because user experience is what's going to keep people on the store once the buying spree is over.

        I'm not going to pretend the store isn't a long way behind the competition, but developing these things takes time.

        That statement's a little misleading (but I'm not saying you're trying to mislead anyone) and I want to speak from my own experience on that. Developing a digital store doesn't take much time at all. Solving the problems that a digital store faces is what takes time, but those problems have mostly been solved already.

        This is also why the comparisons we see around the place about how long Valve had to develop Steam vs how long Epic has had to develop EGS are mostly invalid. Once a problem has been solved, others can reference that solution to rapidly integrate it into their own product. The first fully 3D game engine took ages to solve, but all 3D engines made since then have used the original solution to rapidly get up to speed so the real work would be spent improving on it. It's all standing on the shoulders of predecessors, nobody reinvents the wheel unless it's educational, or is necessary to create a fundamentally different solution.

        It's difficult to conclusively say why Epic is taking so long to build a decent digital store, but I can see one of two likelihoods: either they're trying to reinvent the wheel, so they're spending a lot of developer time re-solving problems that have already been solved; or they don't care enough to invest the developer time necessary to close out those problems with existing solution knowledge. The third possibility - that they're creating a fundamentally different solution to everything else that exists today - is just not supported by what we can see of their work so far.

          I think they have a timeline and the team has been budgeted accordingly. They know roughly when the buying spree and the fortnite cash train id going to run out of steam and as long as they have a fully functioning store before then, they're cool.
          So the people who have the job of building the store are doing the best they can with what they have, but they certainly don't have the money and manpower of Epic as a whole behind them.
          They're also showing that they are fixing things as the become problems, which is... sub-optimal. But it means a smaller group can prioritise. There was a massive release and people were demanding preloading and staggered release times, so they got it done in like a week.

          Even a filtering or decent search system would be something. They arent hard, they're basic SQL queries referring their catalog. Go to the EGS store right now (not their home page, cant do it from there) and search for rpg. Just that.

          You get 10 matches, which seems to be their return limit. 3 (Cyberpunk, Vampyr Bloodlines 2, Outer Worlds) are pre-purchase. 2 (Spellbreak, Phantom Brigade) are Coming Soon so also pre release - thats half the list already made of games you cant play. Others are 5 (Transistor) or 10 years old (Torchlight).

          Dauntless is there for free if you want. Thats 8 of the 10 listed that are either old, not out yet, or free. Outward, and Operencia were the 2 games that were actually out, recent, and cost something. Vampyr appeared a couple of times. ARPG's get included along the way

          Once you click through to one of them, you have to restart the whole search process if you want to look at a different game. No "back to results", but back to the store and a fresh search. These arent problems that should need solving. Nor development time. Its basic database querying with 3 lines of code if they want something basic.

          SELECT *
          FROM catalog
          WHERE genre = "rpg";

          Its basic work, and easily built into a GUI to help the customer. Very small bit of work would make it a lot friendlier. Check box to exclude games not released, an extra ORDER BY line to put them in some sort of order (price, release date, etc), or extra filters (price, publisher, etc) and it stops the complaints, at least for now.

          These are things that should have been there on day 1, not discussed a year later.

      None, cause everyone they hire gets put onto Fortnite. Cause that's is the only metric they care about and with Fortnite losing ground to Minecraft in viewers and player bases they seemed to be pumping out more content ingame in response to keep the "memes" and "plays" alive that have to be coming from some increase in staff/resources.

      The changes pokedad mentioned... were rumored to not been built by Epic Games, but by Borderlands own team so they can get the release infrastructure they needed.

        If that turns out to be true it would be a PR nightmare for Epic.

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