The New York Times International - 29.08.2019

8 | T HURSDAY, AUGUST 29, 2019 THE NEW YORK TIMES INTERNATIONAL EDITION

business

Epic Games found blockbuster success
with the video game Fortnite: Battle Ro-
yale, a fantasy test of endurance and
survival that has captivated millions of
players. The game has brought in an es-
timated $4 billion since it was released
in September 2017.
Now, Epic is using its windfall to back
its next venture: controlling the way
people buy video games.
Like books, movies and music, the
video game industry has been shaken
up by the internet. Sales at traditional
brick-and-mortar stores have plum-
meted as more consumers have down-
loaded their games, and retailers like
GameStop have struggled to adapt as
customers have switched their buying
habits.
Revenue from PC games is expected
to rise 4 percent this year to $35.7 billion,
from 2018, according to Newzoo, a mar-
ket research firm. This growth offers a
lucrative opportunity for digital stores.
Epic’s entry into the market, called
the Epic Games Store, opened in De-
cember. To bolster its service, Epic has
been courting game developers by com-
mitting a larger share of revenue. It of-
fers exclusive access to hot sequels and
lower prices to lure players. And it has
big backers, including the Chinese tech
giant Tencent.
But the biggest challenge facing Epic
is the decade-long dominance of Steam,
the primary destination for people buy-
ing computer games online.
A majority of game developers who
used Steam said it accounted for at least
75 percent of their revenue from sales of
computer games, according to a survey
released this year. Those sales generate
crucial revenue for Steam’s owner, the
game maker Valve Corporation. Steam
was created in 2003 to sell Valve games,
but its offerings were broadened to in-
clude third-party games. When a game
is sold on Steam, Valve typically keeps
30 percent of all revenue the game gen-
erates.
“Stores extract an enormous portion
of game industry profits and are ripe for
disruption,” said Tim Sweeney, the chief
executive of Epic.
Valve did not respond to requests for
comment.
Becoming a platform provider is a
dream for many large gaming compa-
nies because it offers financial security,
said Serkan Toto, the chief executive of
Kantan Games, a consultant for invest-
ors and developers.
“The goal is to build a long-term and
presumably stable business with recur-
ring revenue,” he said in an email, “in-
stead of living under the pressure of con-
stantly delivering hits and misses in the
content business.”
Steam has faced other rivals, includ-
ing stores from game developers like
Blizzard Entertainment, Electronic Arts
and Ubisoft, who can collect 100 percent
of revenue when selling their own

games on their own storefronts. Despite rising competition and complaints from small-game developers over revenue- sharing deals, Steam has managed to stay on top because of its powerful influ- ence.

But Epic has some advantages. Its piles of cash, emphasis on community building and access to the Chinese market give it a chance to successfully challenge Steam, said Joost van Dreunen, the managing director of SuperData Re-

search, a Nielsen company. It estimates that Fortnite: Battle Royale has generated at least $3.9 billion in revenue. “They’re going to be this social platform where there are going to be cool games but you are also going to be hang- ing out with your friends,” Mr. van Dre- unen said. “It panders to a very different audience segment. Most likely Epic will be the more mainstream version of Steam.” Toppling Steam will not be easy. Changing the habits of entrenched users can be difficult, and even companies with large audiences have struggled in

the digital distribution space. Twitch, the streaming service owned by Ama- zon, and Discord, the chat program used by many gamers, recently shuttered their public storefronts. But there has been growing frustra- tion within the industry about what some call a glut of games on Steam — it offers more than 30,000, while the Epic Games Store has curated fewer than 100 — and an antiquated revenue-sharing model that benefits Valve. Epic is already off to a strong start. It has greater access to China’s lucrative market, with more than 300 million computer gamers, through its investor Ten- cent. That company paid $330 million for 40 percent of Epic in June 2012, years before Fortnite became a global phe- nomenon, in a deal that valued the company at about $800 million. To court developers, it has promised to keep only 12 percent of game revenue, less than half of what Steam keeps. And it waives the 5 percent royalty fees for games built using its Unreal Engine, a suite of design tools used by developers. Many publishers and developers of computer games are eager to do business on the new platform. For years, Ubisoft released blockbuster titles like Assassin’s Creed and

Splinter Cell on Steam. But it decided not to sell the sequel to its hit game Tom Clancy’s The Division on the platform because Valve would not modify its revenue-sharing model, said Chris Early, Ubisoft’s vice president for partner- ships and revenue. The game is for sale on the Epic Games Store and Uplay, Ubisoft’s store. The move was part of a broader business discussion at Ubisoft about releas- ing titles on Steam, Mr. Early said. “It’s unrealistic, the current business model that they have,” he said. “It doesn’t re- flect where the world is today in terms of game distribution.” Other developers declined to discuss contractual details of their exclusive deals with Epic, citing nondisclosure agreements, but they said money was a factor in their decision-making. To draw players, Epic is offering lower prices and exclusive release win- dows. With the money flowing from Fortnite, Epic has been able to pay sev-

eral developers for exclusive distribution rights on the Epic Games Store. Ti- tles like Metro: Exodus and Border- lands 3 will not be found on Steam for at least six months after their release. Epic said in March that its store had 85 million accounts, although it was un- clear whether they were used to pur- chase games. Anyone who plays Fort- nite on a computer must log in through the Epic Games Store. By comparison, Valve has said that 90 million people vis- ited Steam monthly in 2018. Some users saw promise in the competition. When digital distribution was nascent, many players resented using Steam, said Ryann Berg, 41, a resident of Salt Lake City who has been playing computer games since the late 1980s. But the cost savings for developers fu- eled a surge of high-quality independent games, he said, adding that by giving creators a larger portion of their sales, the Epic Games Store can help fund sim- ilar innovation. “It is an inconvenience for the gamers, but it has great potential to be a great payoff for the consumers if they remain patient,” he said. Developers who have signed deals with Epic say that competition is good for the industry. After other platforms set a new standard for digital game re- funds, Steam followed suit. “What’s a Sony without a Microsoft and a Nintendo?” said Greg Kasavin, the creative director of Supergiant Games, which put early access to its dungeon crawler Hades exclusively on the Epic Games Store for a year. Tommy Refenes, the co-creator of Su- per Meat Boy, an independent game no- table for its high level of difficulty, said there should be a better model for buying and selling games. “The only way we’ll get it is if companies with tons of money are innovating and trying to outdo each other,” he said.

The Fortnite World Cup last month in New York. The video game Fortnite: Battle Royale has generated an estimated $4 billion for its owner, Epic Games.

BRIAN FINKE FOR THE NEW YORK TIMES

Epic wants to change

the way people buy games.

But it has stiff competition.

BY JASON M. BAILEY

Digital game marketplaces are “ripe for disruption,” said Tim Sweeney, the chief executive of Epic, which opened the Epic Games Store in December.

TRAVIS DOVE FOR THE NEW YORK TIMES

Classic video game titles at the headquar- ters of Epic in Cary, N.C.

TRAVIS DOVE FOR THE NEW YORK TIMES

Epic Games has access to China’s lucrative market, with more than 300 million game players, through its investor Tencent.

Maker of Fortnite sets up shop online

As a stand-up comic, Aparna Nancherla
is a master deadpan artist. Onstage she
plays the role of the shrugging neurotic,
dryly poking fun at her own shortcom-
ings, surreal ideas and life’s grim ab-
surdity.
In the past three years, she’s also par-
layed her comedic talent into a lively
acting and writing career, appearing in
comedies on HBO and Comedy Central
(“Crashing,” “Corporate”), voicing ani-
mated characters on Netflix (“Bojack
Horseman,” “Boss Baby”) and record-
ing her own comedy album (“Just
Putting It Out There”), in addition to
touring the country as a stand-up.
Ms. Nancherla, 37, is currently writ-
ing — or, as you’ll see below, sometimes
not writing — a book for Viking Press, in
the form of a collection of essays on im-
postor syndrome.

Tuesday

9:42 a.m.I wake up with a crick in my
neck. My boyfriend and I officially
moved in together in Brooklyn last
weekend, and our new apartment does-
n’t have a bed yet, so I’ve been sleeping
on the sofa while he sleeps at his old
place. It’s a millennial would-you-
rather: I have all our stuff, but no inter-
net; he has internet, but no stuff —
which would you choose?
10:12 a.m.I go to the gym. Exercise
helps keep my mind right, is a phrase I
learned from a YouTube workout video.
This is especially true on days when I
perform — I get keyed up the entire day
of a show.
11:40 a.m.I get a tour of my new writing
center, where I plan to work on my book.
Writing centers are co-working spaces
just for writers — basically a quiet area
with Wi-Fi and a printer that you can
rent for long-term projects. Crucially, it
also has a kitchen and a place where I

can eat my meals. This is what I retain from the tour. 1 p.m.I am supposed to work on the book, but instead I answer emails. Did you know email always takes way long- er than you think? TRUE. 6:45 p.m. Before my stand-up show tonight, I meet up with my boyfriend at a nearby noodle place that he’s been rav- ing about. Mostly I think about my set tonight. I use the Japanese toilet in the restaurant, which has a bidet setting. I consider talking about it onstage. 8:10 p.m.The show is in the back of a Williamsburg bar, in the distillery-slash- storage area. (Comedy is so glam- orous!) It’s very humid. The audience is sweaty, the comics are sweatier, and there’s hot dogs. I honestly can’t focus on the words during my set because I feel too sweaty, but I do talk about the mysteries of the Japanese toilet and the audience seems receptive. 11:20 p.m. I get home and get an urge to actually write some stand-up ideas! In- spiration is like the urge to pee: If you don’t attend to it, you will regret it. I write about going to Bed Bath & Beyond, as well as some errant material about dogs. 2:25 a.m. My mind won’t settle down after comedy shows. I hope to fall asleep by 3.

Wednesday

11 :20 a.m.I find a spot on the floor with adjacent back support to meditate, which I try to do twice a day. It sounds profound, but you could also describe it as me sitting quietly with anxiety. The cable guy is supposed to arrive any minute to hook up our internet. I wonder if the cable guy will arrive while I’m meditating. I dare him to arrive. 11:50 a.m.The cable guy is still not here. I could work on writing the book, but I feel like as soon as I start writing, he’ll come and then what was even the point. 12:55 p.m.The cable guy is here! 3:15 p.m.I have to go to Manhattan to record voice-overs for a Netflix animated show, but I realize I haven’t had anything to eat or drink all day and am

almost delirious. I go to a brunch place and order a coffee, a giant meal and a smoothie. 5 p.m.The nice thing about voice-overs is you can record remotely. Here in this little New York studio it’s just me and a sound engineer, and the director in L.A. connects via video conference. For this show (“Boss Baby”) I play a kooky baby who lives in the vents of a factory. 7:35 p.m. I leave for a comedy show in Park Slope. I am having weird show anxiety again: increased heart rate, up- set stomach, heavy breathing. 8:25 p.m.The show is hosted by two co- medians I’ve never met before. These days, people reach out to me to do spots, a real privilege. (When you start comedy, you have to reach out to people and go to open mics.)

Thursday

11 a.m. I meet my friend Ashley Brooke Roberts for breakfast. She’s also a co- median, so we talk about that and how social media is warping our brains. Is the solution to get off it? But then how do we stay relevant? I try to limit my coffee to one shot of espresso rather than two, to limit my anxiety. 1:40 p.m. I figure if I get to the gym quickly, I can squeeze in some book- writing time. But then I get sidetracked with bills and then recording takes for a voice-over audition for a new animated show. Voice-over auditions are nice because you can record them by yourself on your phone. You can even record voice-overs in the bathroom! Which is what I finally do because cars keep honking outside my window. (New Yawk City!!) 4 p.m.I realize I probably will not write today. Besides that weird jag the other night, perhaps this whole week is going to be a writing non-starter. I know a book takes a lot of hours of trying to write vs. actually producing. And for me, a lot of ideas and inspiration come out of moments when I’m not trying to be creative — talking to a friend, on my way to something else, moments. 9:20 p.m. I used to watch things and

live-tweet them, and I haven’t done it in a while. So when my boyfriend and I get our projector working to watch the Democratic debates, I decide to live- tweet them, mostly just as a mental exercise to try and write funny little quips. It’s not writing a book, but it’s something.

Friday

11 :40 a.m. Gym. As I use the elliptical, I wonder about all the substances I put in my body; I picture my GI tract as a Wall Street trading floor with various liquids

and solids yelling into phones, making demands of the rest of my sorry organs. 12:45 p.m. Race back to my apartment to shower and pack for the Solid Sound Festival in North Adams, Mass., tomor- ro w. 2:20 p.m.As a self-employed “creative,” I feel like I’m supposed to be good at working in transit. “Stand-up?” “I’ll write on the bus.” “The commissioned essay?” “I’ll whip something up on the train.” “My taxes?” “I’ll do them on the redeye.” Guess what? It never happens. On this train I make a set list for tomor- row, read parts of a book andplay sev- eral games of Candy Crush. Don’t worry,

I’ve berated myself thoroughly without your judgment, thanks.

Saturday

9:30 a.m. Music festivals make me nervous. I figure people are there to see music, not comedy, and that kicks off the roll call of negative thoughts: What if they hate me? What if I have to walk around a bunch of people I just bombed in front of? Why does it matter? Why do I matter? Why does my ego get in the way of just existing? And so on. 10:35 a.m. Sound check. Thankfully, the comedy venue is indoors and apart from the music stage; it’s got an art museum vibe. I meet John Hodgman, who organ- izes the comedy show portion of the festival, as well as the other producers. It’s low-key in the green room. But my nerves are like, “At ease? [Expletive] you! This is our time to shine.” 12 p.m. To try to calm my nerves I listen to an old set — it reminds my brain that I’ve done this before. 2 p.m.John Hodgman hosts the after- noon segment with Jean Grae, a comic and hip-hop artist from Brooklyn. They do a live version of his podcast, Judge John Hodgman, where he arbitrates is- sues people are having (e.g. one man is concerned about his girlfriend putting her drinking glass on top of the toilet). 3 p.m. I go on. I start with some vague festival-themed stuff, which works — and then doesn’t. Thankfully the rest of my set chugs along. I skip the bidet and other new stuff until it’s more polished. 3:30 p.m.All done! The set went fine. With bigger crowds, the pacing is slower; it feels good to let the punch lines breathe. The crowd was warm and more attentive than I expected. After the show ends, John Hodgman kindly in- vites the artists to dinner at a nearby restaurant. It is fancy and delicious and boyfriends are invited. After a show you’re on an adrenaline high. It takes a few hours to really come down from the rush.

Even sitting quietly is done with anxiety

Like a Boss

BY BURT HELM

“Music festivals make me nervous,” Aparna Nancherla said. “I figure people are there to see music, not comedy, and that kicks off the roll call of negative thoughts.”

CELESTE SLOMAN FOR THE NEW YORK TIMES

Interviews are conducted by email, text and phone, then condensed and edited.

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The New York Times International - 29.08.2019

Maker of Fortnite sets up shop online

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