How Fortnite Makes Money
Fornite is Free to Play, but here’s how it’s on pace to make $3.5 Billion Annually. For those who don’t know, it’s a mega-popular video game with millions of addicted players. However, it is unlike any other popular online games like Call of Duty or PUBG. You can download Fortnite for free and you’re ready to go. A recent estimate by data research firms super data estimates that the game pulled in $296 Million in revenue in April. Multiply that by 12 and you’re looking at an estimated $3.5 Billion in annual revenue.
So how is this game making money?
People are shelling out real cash on V bucks which is fortnight’s in-game currency. V bucks let you buy cosmetic items for your in-game character. It will also let you buy the Battle Pass which is a way to unlock in-game rewards. The gaming studio behind Fornite also raked in money by letting players buy early access to the main version of the game known as “Save the World” mode. But the most popular game mode is Battle Royale which pits a hundred players against each other until one person survives. The main tip is survival, you don’t want to go in trying to kill everything that you see. Avoidance is key, even at the high level of gameplay. A lot of players will avoid each other just so that they can get that number one win.
While the in-game currency doesn’t affect gameplay, that hasn’t stopped players from spending hundreds of millions of real dollars each month to spruce up their characters. So far it’s been a successful model for Epic Games as the V bucks model hasn’t drawn the same kind of scrutiny as EA did when they released Star Wars Battlefront 2. That highly anticipated game faced an avalanche of criticism. Due to the fact that it not only required players to buy the game but it also incorporated expensive in-game purchases as one wing to unlock popular characters such as Darth Vader. It was a PR black eye for EA and its stocks took a hit amid the controversy, though it has since recovered those losses.
The EA example sheds light on how fortnite’s free to play tactic combined with later purchases that don’t affect gameplay has helped the game reach of frenzy status. The freemium style of video games has been around for a decade, where the game itself is free. Some games are pay to win which people don’t like, on the other hand, games like Dota 2 have been around forever making a ton of money on cosmetics.
The game has also attracted a wide base featuring many younger gamers, who are drawn to the cartoony aesthetic of the game. As opposed to a similar game Player Unknown Battlegrounds, which has a grittier real-world feel. Back in the start of this year, Epic Games revealed that the game had 45 million active users worldwide.
At one point concerns about Fortnite’s rapid growth actually wiped out $6 Billion of Activision Blizzard’s market value. It seems Fortnite will cannibalize the company’s profits and apparently Activision is listening. To compete with Fortnite they recently announced a new Battle Royale mode in their popular Call of Duty Black Ops 4.
So will Fortnite continue to be a cash cow for Epic Games?
The answer is, yes for sure. It seems very likely that Fortnite is going to be a successful game for a long time. People are always going to want that new cool costume. Almost all the kids in the world are either watching or playing Fortnite right now and that’s not going away. People under the age of 20 know their favorite Fornite streamer more than they know their favorite baseball player.
The numbers keep piling up, Epic Games recently announced that it will provide a $100 Million to fund eSports prize pools. That might have raised the bar of eSports in the world in terms of prize money by a huge surplus. Overall, people have been pretty happy with Epic Games and seem to really enjoy the game.