Epic explains how it spends millions of dollars on free games

Epic Games is once again going to give away free PC games every week of the year through the Epic Games Store, the company announced on Thursday. But how does Epic choose which games to give away? The company tells us it’s about timing — and picking some big names.

Since the Epic Games Store’s launch in late 2018, Epic has spent millions of dollars to give away games as a way to hook new users and bolster its nascent game store. (Originally, it gave away a free game every two weeks before upping that to every week in June 2019.) Epic’s goal is to have one “tentpole” game every month, Steve Allison, VP and general manager of the Epic Games Store, said in an interview with The Verge. “Those become really big weeks,” he said. For the weeks with smaller games, Epic tries to highlight hidden gems, teams the company respects, or a developer that may have an upcoming release.

Looking at Rock Paper Shotgun’s compilation of all of the free games that have appeared on the store, that generally tracks with what’s actually happened. I’d argue 2023 has so far been a little light on major free games — we haven’t seen anything quite on the level of a Grand Theft Auto V or Sid Meier’s Civilization VI just yet — and Allison declined to share any details of specific games to look forward to.

The free games can be really beneficial for developers. “The smallest free games on any given week get between six and a half and 7 million claims,” Allison said. The bigger ones? Twenty to 25 million claims, according to Allison. Developers don’t just get new free players, by the way; in our interview, CEO Tim Sweeney said that developers see sales increases on both the Epic Games Store and on Steam, Valve’s competing PC game store. Sweeney also pointed out that the free games can be a good deal for players in developing countries where gaming may be more expensive, meaning that they help expand the global reach of some titles. And since developers get a flat fee from Epic so that Epic can offer their game for free, they make some money no matter what.

Epic isn’t being entirely altruistic, of course. The company spends a lot of money to be able to give games away for free, and it certainly wants to offer good ones that keep people playing on its platform instead of others like Steam. And if Epic can attract players with free games from notable developers, those same players might also try out some of Epic’s big free-to-play multiplayer games like Fortnite or Rocket League, keeping them in Epic’s universe — and, again, off Steam. 

The company is sharing the news about its free games program as part of its annual year in review for the store. The platform appears to be growing; Epic says daily active users peaked at 34.3 million in 2022, up from 31.1 million in 2021, while monthly active users hit 68 million, up from 62 million in 2021.

However, the store didn’t bring in quite as much money as it did in 2021. While Epic says that spending on third-party applications totaled $355 million, up 18 percent year over year, when the company included its own games, spending was down 2 percent year over year, at $820 million.

Sweeney attributed that drop primarily to Fortnite. “The funny thing that’s happened post-pandemic is that Fortnite monthly active users have held up, but playtime, hours played, and spending has gone down,” Sweeney said. I’m interested to see if that changes this year, especially with a promising-looking new season launching soon.

On Thursday, Epic additionally shared details about the wide launch of self-service publishing tools for Epic Games Store developers, which are now available following a long closed beta. The company is also planning to add support for subscription services from third-party publishers, meaning the Epic Games Store could offer programs like EA Play, Ubisoft Plus, and “hopefully PC Game Pass,” according to Allison. He even mentioned that the store could offer the Unity development engine, which competes directly with Epic’s own Unreal Engine.