Microsoft just cut their cut of profit for the sale of games on the Microsoft Store to 12%. This puts their profit margin down to match that of the Epic Games Store, and well below that of biggest PC game sales store in the world: Steam. Valve’s Steam platform currently takes a baseline 30%, with a sliding scale to 25 and 20% for games that are most massively successful.
To be clear, here, this change isn’t necessarily going to affect the amount of cash a gamer will pay for a game. It COULD affect the price a gamer pays IF a developer sees the lower profit margin for Microsoft as a sign that they can lower the price of their games in the first place. But for now, it only means that developers (and publishers, etc) will get more of the money when a game is sold with the Microsoft Store.
It’s also important to note that Microsoft has not made the same change for their store on the Xbox, for all Xbox consoles. The terms for PC game developers listing with the Microsoft Store start on August 1, 2021. At that point, the developer share of Microsoft Store PC games sales revenue will move from 70% up to 88%.
Microsoft described this change as a “clear, no-strings-attached revenue share” in their LinkedIn article today written by Sarah Bond, Microsoft’s CVP, Head of Game Creator Experience & Ecosystem.
This changing of the standard profit margin percentage is very likely due in part – at least in part – to the Epic Games Store. Epic Games and their crusade against overzealous profit sharing seems to be changing the way the industry handles developers, games, and the way in which they profit from being the store in which said games are housed.
Microsoft also noted that their Xbox Game Pass for PC system has shown some measure of success with expanding the amount of time a user spends playing games and expands the number of different sorts of games a gamer plays by a significant amount. Bond cited a “recent survey” in which they found “more than 90% of [Xbox Game Pass for PC] members said they played a game that they would not have tried without Game Pass.”