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Comment by yifanl | Hacker News Reader

Because games is simply not a particularly profitable industry. There's a reason why Valve moved on from making games to being a digital landlord.

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Games with micro transactions are one of the most profitable things that you can do today and fortnight being fortnight. There are tiny mobile companies being sold for billions and making massive profits with predatory mtx transactions. Gatcha games are doing extremely well, and fortnight is no exception.

Valve is making a killing over CS gambling and MTX as well, so not a good example. Steam is obviously making more but even CS itself would have made Valve a very successful and profitable company. Pretty much all of these build on predatory practices though.

If we are talking about games without MTX, yes that’s a very rough business.

Fortnite alone is estimated to produce more than five billion USD in annual revenue every year since 2018

Every year the licensing fees add up as they add more collaborations, while revenue is not rising to match.

They didn't need to do any of that by the way.

They're also paying out hundreds of millions to map "creators", the majority of which are pumping out low effort game modes like Steal The Brainrot. I can't help but feel this isn't helping their situation at all. Then again, Steal The Brainrot often surpasses the actual Fortnite game modes in player count, so maybe it is worth it. It doesn't seem like a sign of good health for Fortnite overall, though.

I'm gonna need someone smarter than me to show me the numbers on that. Fornite by itself is insanely profitable.

A game can be massively popular but many many games fail to hit the mark. Many do not see success and many do not even ship.

Ok, but Fortnite is a massively popular success, even as its popularity slips. Fortnite's run so far could have sustained Epic for years, even without other revenue they get from things like Unreal Engine. Games as a whole may be a risky venture, but we're talking about Epic here; the mystery is not how to succeed in games, but how a company that had an earth-shattering run of success in games is now in such a position.

Just because it's popular, doesn't mean it's financially successful. Take a look at YouTube. They lost money hand over fist for decades.

That's like saying playing baseball must be profitable because of how much money A-Rod made. The returns are skewed.

https://www.matthewball.co/all/presentation-the-state-of-vid...

You need an email address to access it but it’s good, if bleak, reading.

It absolutely is a profitable industry, maybe not as profitable as todays greedy shareholders would like it to be. Just look at the CD Projekt that releases 1 game per 10 years and still makes a fortune through Netflix colabs and selling merch.

It is full of street performers, some manage to strike a deal with a label, and tour the world once.

Afterwards depends on how they manage to keep surfing the success wave.

Basically.

Fortnite is exactly the guy who tour the world once and twice and thrice.

Indeed, pity are all the others that haven't.

I agree with your sentiment, but I also don't know if CD Projekt is a great example because its not their original IP. I am sure the games saw a boast in sales from awareness given by the TV show. But I am assuming Andrzej Sapkowski is probably the one who gets most of the money from licensing from Netflix. Although I will say, I don't 100% know all the details for the Netflix deals. And due to lawsuits and what not, exactly what Andrzej has the ability to sell rights to isn't very easy to find out with quick searches.

Edit: Ah, maybe CD Projekt does own the rights completely? They may have bought the right completely from Andrzej? So Andrzej may not have been the primary party selling the rights? Or maybe not? Andrzej may have retained film/tv rights and not sold those to CD Projekt.

It's the leading entertainment industry, beating tv/film/music. If you can't find profit there then you're not doing your job.

If you think Epic Games is unique in doing layoffs this year, I don't think you're paying particularly close attention to the games industry.

Did I say that? I'm just attacking your thesis that games aren't profitable.

Discretionary spending is the first victim in a recession.

Is it games overall or specific genres? I always regard games that have stores and strong at UA as something else.

It’s a power law distribution.

Games are an obscenely, absurdly profitable industry. Particularly the successful ones.

Lottery is obscenely, absurdly profitable employment. Particularly for the ones who win it.

The person I was replying to is asserting that the winners of the metaphorical lottery are not in profitable employment, so you aren't making the point you think you're making.

Well, you goto be good nowadays, you compete against the whole worlds dreamy eyed teeangers wanting to make "their"game. A wellfunded, pig-trough-slop-mill ala hollywood can not compete against that when it comes to fun, art and experiences. They fled into gambling, but gamers actively ostracize lootboxers nowadays.

> gamers actively ostracize lootboxers nowadays.

Gamers love, love, love lootboxes. Can't get enough of them. There are many lootbox games with 10-100s of millions of players. The Reddit/HN vocal minority who hate lootboxes (myself included) probably represent <5%, if that.

Given the love of Valve I’d bet Reddit/HN love lootboxes too, seeing Dota/TF2/CS all implemented them.

Steam works on the top 2 most played games on Steam right now.

Citation needed.

Look at NVidia's stock price during the period when they announced a pivot away from gaming.

Nvidia doesn't make games, this is one of the worst takes I've ever seen on this site.

They made products that were effectively only targeted at the gaming audience, and when they pivoted, they were rewarded substantially, as the wider market recognizes how small the niche they used to be in was compared to where they are now.

You have literally no fucking clue what you're talking about. The games industry is ~200 billion dollars per year. Film is 30, music is 60. Not only are games the largest entertainment sector, nothing else is even close.

A hardware company pivoting to the AI bubble has literally nothing to do with the profitability of software.

Because of basic economics. The opportunity size of AI for NVidia is unlike anything we have ever seen. Of course they pivoted.

This is the worst take I've seen in a while on HN. Nvidia doesn't make games, and for its case, they can either sell the same die as a gaming GPU for $2,000, or as a server GPU for >$30,000, the math is simple and obvious, which is why the stock jumps.

Epic doesn't have anything else besides the gaming market. And the gaming market is huge, it's more than music and movies combined, so please just stop spilling bullshit.

Is the gaming market huge or is it 1/15th as valuable as an alternative for investors? Even if the answer is both, what's the net effect of this?

Right now even Valve realizes that Steam will literally run out of steam. This is why they have been trying to become more like Nintendo and selling their own hardware (with varying success) .

Valve wants a boat that is independent of microsoft. Not to go down with that Tit.A.I.nic seems like a smart move.

Exactly, and they've not been quiet about it. It's why Steam works on Mac and Linux and they work so hard on being independent of all of those.

And Arm is next.

Hardly when their business depends on running Windows games on top of Proton.

Independence of paying Windows licenses or Microsoft store taxes, sure.

Because of Oracle v Google, supporting applications running in the Win32 userspace isn't necessarily leaving yourself open to threats of Microsoft meddling.

There's tons and tons of older software that people still want to run that might never be ported to Linux. And that's fine, because there's no problem with building compatibility layers to make it work. Microsoft can't do anything about that.

Sure, if the goal is like doing retrogaming with Windows games as if it was WinUAE.

I believe they have proved that very few games are actually Windows games. The few remaining are mostly those which require Windows kernel drivers to run or connect to online services.

Really, where are those Linux builds?

The point is that Proton puts them in a win win position. If Windows stays popular, they're fine. If Windows tanks, they're fine.

If Windows tanks their fountain runs dry.

What is the scenario where windows becomes so unpopular, computer games stop being made entirely instead of another OS filling that gap?

The doom that is repeated all the time on Linux forums, or even here.

The industry will adapt quickly, especially the part that's using multiplatform mainstream engines like UE/Unity.

Lots of new/recent native MacOS releases nowadays: https://store.steampowered.com/macos

The same that support Linux and yet Valve has to come up with Proton.

Developers chase the user base. If and when the users choose Linux developers will target Linux.

Proton as a project let's valve hedge on the heir apparent OS without upfront developer cost. If the Linux player base grows, developers will follow and valve is poised to remain dominant.

Hmm, citation needed on that one imo. Consensus is that their hardware strategy is in service of selling more games. Hardware revenues for Steam Deck are proportionally tiny; Frame and Machine aren’t going to meaningfully change that.

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