Microsoft announced that they have reduced the cut on sales of games to 12 percent, which almost 30 percent before. The new commission will be applied only for the games sold via Microsoft store on Windows 10. As Microsoft wants to compete with Valve’s Steam, this new move is likely to bring in more developers. Microsoft decision of giving this big chance for games on the Microsoft Store was a big sigh of relief for the developers to sell their innovative ideas of game. Earlier, Microsoft used to charge a commission of 30% to the developer, if they were willing to sale their games on Microsoft platform using Windows 10. The software company now has taken a decision to cut down their commission to 12 percent from 30 percent to the developers on the sale of their games.
The idea behind this decision is that Microsoft wants to attract more of the developers towards themselves to sell their games using Windows 10. Microsoft wants to increase the appeal of the Microsoft store to the developers of the games against the Steam. This new fee is only for the games on the PC, that would be bought from the Microsoft store. While Microsoft continues to keep its cut of 30% on the Xbox console games. A report by Statista suggested that, Steam might be the biggest competitor for Microsoft in terms of Games. Steam almost released about 10,263 games in the previous year of 2020. Steam has been giving a tough competition to Microsoft in terms of games. Microsoft therefore took the decision to cut the share to 12% from 30% to attract the developers and get back in business to give a tough competition to Steam.
Valve, which is a company that owns Steam has a different plan of revenue sharing which the developer felt much preferable and made them released their games on Steam platform. Steam has become an ultimate destination for playing, discussing, and creating games due to its best revenue sharing plan. Steam revenue plan is such that it would still charge a 30% cut to the developers and sales of their games on their store, but once the sales hit $10 Million and more, then the cut would be reduced to 25% which would be followed by just 20% commission for $50 Million sale on the Steam store. Microsoft strategy is totally different from the one Steam has.
Microsoft offers developers on sell of Epic games store a revenue split. This new strategy of Microsoft is expected to shake up the gaming platform business for Windows 10. Matt Booty, head of Xbox Game Studios at Microsoft said that for Microsoft game developers are at the heart of bringing great games to the players, and it is Microsoft duty to find them success on the platform. Matt said that no string attached and transparent clear revenue plan might help developers bring more games to the players and would get more commercial success to Microsoft too.
