Could the party be over? Fortnite’s revenue is down by 52 percent
By looking at more than 375,000 transactions, an analyst company determined that the battle royale genre has fallen hard in terms of consumer spending, down from a major peak last year, with major titles like Fortnite being hit very hard. Speaking of the king of the hill in the genre, spending dropped significantly from Q2 2018 to Q2 2019, as reported by data analyst Edison Tech. These kinds of drops are inevitable, especially considering the crowded nature of the whole battle royale genre and how fast players are moving onto other games. But in the case of Fortnite, it seems a bit more complex than that.
The battle royale genre exploded in 2017, growing throughout 2018 and well into 2019 to become a force to be reckoned with in the video game industry. Edison Tech posits that tons of this growth was temporary, given that in-game purchases increased on an average of 110 per cent per month from November 2017 through May 2018, with a sudden spike in December 2018, and now it seems as though the party is over for Epic in particular. Of course, there’s still huge money flowing through Fortnite, with an estimated 83% of all transactions being for V-Bucks. And by looking at their nearest major competitors, microtransactions for premium currency make up the bulk of spending, like Apex Legends where Apex Coins account for 96%. The one exception being PUBG, where the majority of spending is on the game itself.
According to their report:
Spending on online games over the last two years has shown peaks and valleys for even the most popular games. Spending on Fortnite, for example, had risen an average of 110% per month from November 2017 through May 2018, but has been in general decline ever since. However, they had their best month in December 2018, with 20% more revenue during the holiday season than their previous high in July 2018.
One interesting detail that the analysis revealed was a projection for the portion of the playerbase that spent money in one of the four games analysed. The company looked at data from June 2019 and July 2019 to make the determination, revealing that Apex Legends had the highest rate of users who made repeat purchases at 62%. Fortnite had a rate of 49%, whereas Black Ops 4 and PUBG were relatively even with one another at 40% and 38% respectively.
AS to what led to this drop, it’s very hard to point to one specific cause, as economic segments tend to be very fickle and prone to boom and bust cycles dependent on a wide array of factors. The growth of the economy in a major country like the US or China can lead to a boom for entertainment, and thus more game spending, as people have more excess cash on hand. However decisions within the industry can also a knock-on effect, and it’s not always positive. The overall trend of perception in the games industry turning against loot boxes certainly didn’t help. It’s also probably not a good thing that lawsuits are even being filed over addictive mechanics.
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