Google proposed $147 million to Epic Games to launch Fortnite on the Play Store،
In recent years, Epic Games (the creator of Fortnite) has started a major saga of lawsuits with Apple, and not only. In 2020, the gaming company filed its first lawsuit against Google. This week, a second legal skirmish broke out, with Epic Games accusing Google of paying substantial sums to major developers, incentivizing them to keep their apps on the Play Store. According to judicial revelations reported by The edge, Google has confirmed that it has offered a $147 million deal to Epic Games to launch Fortnite on the Google Play Android Store. Purnima Kochikar, Google’s vice president of Play Partnerships, said the deal, approved and presented to Epic, was rejected by the gaming company.
The proposed agreement involved the gradual disbursement of funds over three years, concluding in 2021, as progressive support to the game’s publisher.
The underlying motive for this deal, as noted, was Google’s attempt to prevent a potential trend of popular apps bypassing the official Android store and, therefore, avoid Google’s in-app purchase fees.
Epic games against Google
Epic Games has expressed its displeasure with the 30% revenue cut imposed by Google (and Apple, for that matter) on Play Store transactions. This led Epic to take an unconventional route, releasing Fortnite for Android independently and offering the game’s download file directly on its website.
While Fortnite finally landed on the Google Play Store in April 2020, Epic persisted in distributing it independently, bypassing Google’s 30% cut on in-app purchases. Tension escalated in August 2020 when Epic allowed direct in-game currency purchases, which violated Google’s Play Store policies.
In response, Google removed Fortnite from the Play Store, prompting Epic Games to file an antitrust lawsuit against Google for alleged abuse of monopoly power. The case began last year and is still ongoing.
In the antitrust case, Epic Games claimed that Google reacted with anxiety to Epic’s initial decision, fearing a potential domino effect with other game developers. Internal documents presented to the court alluded to Google’s apprehension of a “risk of contagion” and revealed attempts to lure or acquire Epic to prevent such a scenario.
In the legal drama, the “contagion” documents took center stage this week as Lawrence Koh, Google Play’s former head of games business development, took the stand. They painted a picture of Google’s worrying scenario, predicting that within a few years of Epic’s move, almost all major game developers could leave the Play Store.
The forecast poses a financial nightmare for Google, with potential losses of up to billions of dollars in revenue. Documents presented to the court suggest a direct revenue loss of between $130 million and $250 million, with a wider downstream loss of up to $3.6 billion if the feared mass defection occurs.
In court, Google asserted its position with Purnima Kochikar, clarifying that Google’s concern was about potential losses of games on the Play Store and that there was no nefarious intent. “We just wanted developers to choose Play” said Kochikar.
Lawrence Koh confirmed in his testimony that the investment to secure games on the Play Store was considered profitable, especially considering the scenario in which developers could opt for an initial launch on Apple’s iOS.
Since its release in 2017, Fortnite has grown in popularity, boasting around 400 million registered users. Note that this count includes casual player registrations, and does not solely reflect the number of regular active Fortnite players.
