Although Fortnite seems firmly entrenched as a socioeconomic “phenomenon” in the world of gaming, many are those who are trying to dislodge it.
Fortnite, developed by EPIC Games (a company headquartered in Cary, North Carolina), was initially announced in 2011. Although it seemed to have reaped instant success, it received a considerable boost after the game evolved to adopt a battle royale mode. It’s a variation of all against all with 100 players, in which only one is consecrated the winner. It is generally agreed that the new Fortnite was born with this version in the fall of 2017.
Some of the sector’s main players, which were caught off guard by the amazingly successful battle royale developed by EPIC, have since announced their own similar initiatives. Although Fortnite was preceded by games such as H1Z1 and PlayerUnknown’s Battleground, the title of the most serious challenger today goes to Apex Legends, a game developed by Electronic Arts and launched on February 4, 2019, almost two years after Fortnite.
Apex Legends is a more “realistic” variation of the battle royale type of game system proposed by Fortnite. The latter is more colourful and actually made its entry on the market very discretely. Indeed, no one was expecting it. Whereas the game’s developers usually prepared their communities months in advance, Apex Legends resorted to this original distribution strategy and unveiled the game to the market the same day. Nevertheless, this strategy allowed the game to reap immediate success following its launch: 25 million players after one week, 50 million after one month. By comparison, Fortnite, which is today played by more than 200 million gamers, required six months following its release to reach the level of 50 million players.
The free economy
Like Fortnite, Apex Legends is different from traditional game franchises in that it is a high-end console/PC game that is distributed free of charge to players (free-to-play or F2P). Revenue is basically generated from a small fraction of players who are willing to pay, in the form of microtransactions, to purchase “legends” (the game’s characters), subscribe to “seasons” of the game, purchase artefacts or an ‘Apex Pack’, i.e., a loot box that gives the player different randomly selected game elements.
Consequently, contrarily to traditional console/PC games, the success of games the likes of Apex Legends and Fortnite depends on mechanisms that very closely resemble thinking borrowed from e-commerce. To the extent that the game is free, the revenue that it generates depends on the willingness of a small proportion of players to pay either to advance in the game or personalize their experience of the game. That is what is meant by “conversion” from free pay to pay to play.
In many cases, especially on mobile, game editors go so far as to pay to attract players to their universes, for example by posting targeted ads on Facebook or Google. The more numerous these players are—if the percentage of “converts” is fixed—the higher the revenue generated from them.
So, what is most important to track is no longer the total number of players having played the game—seeing as it is free to play!—but rather the number of players who come back day after day or month after month.
Basically, a player needs to spend more while playing the game than what it cost to “acquire” said player.
In this respect, it is estimated that, of the 200 million players having downloaded Fortnite, about 78 million actively play the game on a monthly basis.
A constant effort
However, such a system obliges developers to constantly provide the most highly engaged players (and, therefore, often the most profitable) with new features, new experiences and new maps. To the extent that these players play on a regular basis, the novelty factor is intrinsically linked to the revenue the game generates.
It’s the error that EA made when it launched Apex Legends in February 2019. A month later, EA announced its first “season” of the game seeing as nothing new was presented during the three months that followed. The total number of players consequently increased from 50 million to 70 million during the five months that followed the launch of the season, whereas the number of active players fell sharply. In terms of the number of users who viewed Apex Legends matches (a common practice on the Twitch streaming platform and a rather accurate indication of how the number of players evolved), it’s more than 75% of all users who stopped playing the game two months after it was launched.
As for EA, it learned its lesson. Today, the game programs “events” starting with its “Legendary Hunt” challenge held mid-June 2019 to give its experienced players a chance to win a variety of prizes. Two weeks later, the game inaugurated its second season. Then, one month later, the “Iron Crown” event was followed by the “Voidwalker” event in September. Season 3 began immediately in October with the “Fight or Fright” event.
The ‘Battle Pass’ evolves from season to season both in terms of the items available and the interfaces. Also, the rewards offered by the game become more interesting for the players. Now that the game seems to be on a more stable footing, EA appears to have found its own “goose that lays the golden egg”. During the third quarter of 2019, the company announced that it was expecting to generate 300 to 400 million US dollars in recurring revenue per year from this single franchise.
Following Fortnite, the example of Apex Legends demonstrates how video gaming is converging toward other modes of distribution, access and monetization. These modes evoke either e-commerce or the profound transformations that creative industries such as music, film and television are undergoing. At the dawn of the technological transformations that may lead to AAA games being available in streaming format, the promise of free high-quality games is also disruptive for the industry.