In the latest blog post, discoverability guru Simon Carless discusses how developers or publishers’ net revenue compares to what gamers actually spend on the game.
The TL;DR version of the post is that if you title has grossed $1 million on Steam, you will actually only see just over $500,000.
Here’s a list of deductions happening to the gross revenue on its way to the developer’s pockets.
- VAT & Sales Tax Payments. Many countries demand that Steam pays them a sales tax typically between 10% and 20%.
- Steam’s revenue share. Steam takes another 30% from your gross revenue.
- Then, there are company taxes (20% in the UK, for example) and, importantly for all non-US devs, exchange rate costs.
Moreover, Steam’s refund policy might further reduce your earnings. Looking at titles publihsed by No More Robots, Carless found that “average monthly refund rate by unit across the portfolio ranged between 5% and 8%.” Commenting on the refund rate, Carless hightlighst the following considerations:
- In some countries, the refund rate is intrinsically lower or higher. China, for instance, tend to have a higher Steam refund rate.
- Making a good game and especially making a good first impression is a good way to keep refunds to a minimum.
- Niche games tend to have loyal fan communities that are less likely refund.
Roughly speaking, the net revenue is around 55% of what your game grossed. In confirmation of Carless’ calculations, Eastshade developer Danny Weinbaum said that “across all platforms we have grossed about $2M since launch. That translates to about 1.1M post-platform net.”