Tencent says app stores are “over-earning at the expense of app providers”
Games giant Tencent has said that app stores are “over-earning” at the expense of developers while pledging to launch fewer new games in the coming years.
The games giant, which owns Supercell, Riot, plus large chunks of Epic Games, Ubisoft and others, reported its Q124 financials earlier this week.
Tencent’s games earnings came to ~48.1bn RMB, or $6.7bn, in the three months ended March 31. 34.5bn RMB (~$4.8bn) of that total was from China, and 13.6bn RMB (~$1.9bn) was from international markets.
Speaking in a webcast afterwards, chief strategy officer James Mitchell was questioned about the 30% share of IAP revenue Apple and Google take through their app stores. He responded:
“We do believe that app stores are currently over-earning at the expense of app providers, including ourselves, both in China and even more so internationally. But for the purposes of our business plan, we assume that those revenue-sharing arrangements remain as they are today.”
Mitchell went on to outline the “challenging” climate for new game launches, noting that the company will be more conservative in terms of new launches as a result.
