Epic Games

Epic Games is an American video game developer, publisher, and technology company headquartered in Cary, North Carolina. Founded in 1991 by Tim Sweeney, the company built its early reputation on the Unreal game engine before Fortnite turned them into one of the most valuable private companies in the world. They operate the Epic Games Store, publish third-party titles through Epic Games Publishing, and license Unreal Engine to studios across the industry. Tencent holds a roughly 40 percent stake in the company following a 2012 investment.

Epic Games Origin Story: From ZZT to Unreal

The Early Days

Tim Sweeney founded the company as Potomac Computer Systems in 1991, operating out of his parents’ garage in Maryland. Their first product was ZZT, a shareware game that also functioned as a simple game creation tool, letting players build their own levels. The company renamed itself Epic MegaGames and eventually just Epic Games. Sweeney’s obsession with graphics technology defined the company’s direction from the beginning.

Unreal and the Engine Business

Unreal released in 1998 and was as much a showcase for the engine as it was a game. Epic began licensing the Unreal Engine to other developers and the licensing business became a significant revenue stream alongside their own game development. The engine became foundational to the industry, used in hundreds of games across multiple generations. Unreal Engine 5, released in 2022, is currently the most widely licensed game engine in the world.

Epic Games Key Games and Products

Unreal Tournament Series (1999 to 2007)

Epic developed several Unreal Tournament games, fast-paced arena shooters that were competitive multiplayer staples of the early 2000s. Unreal Tournament 2004 in particular is remembered as one of the best multiplayer shooters of its era.

Gears of War Series (2006 to 2013)

Gears of War launched on Xbox 360 in 2006 and was one of the defining games of that console generation. Epic developed the first three mainline Gears games before selling the IP to Microsoft in 2014, much like Bungie did with Halo. The cover-based shooter mechanics and co-op design influenced a generation of action games. People Can Fly co-developed Gears of War: Judgment in 2013, the last Epic-developed entry in the series.

Fortnite (2017)

Fortnite launched in 2017 as a cooperative survival game before the Battle Royale mode was added later that year and became a global phenomenon. The game generated over a billion dollars a month at its peak and turned Epic into one of the most financially powerful companies in gaming. It remains one of the most played games in the world and is updated continuously with new seasons and crossover content.

Epic Games Store (2018)

Epic launched the Epic Games Store in December 2018 as a competitor to Steam, offering developers an 88 percent revenue share compared to Steam’s 70 percent. The store gained users quickly by offering free games on a regular rotation, a practice that continues. It has been a significant part of Epic’s strategy to reduce Steam’s dominance in PC game distribution, with mixed results in terms of developer and consumer adoption.

The Apple Lawsuit and What It Meant

In August 2020 Epic deliberately triggered a legal fight with Apple by implementing a direct payment system in Fortnite on iOS, bypassing Apple’s 30 percent cut. Apple removed Fortnite from the App Store. Epic sued. The case went to trial and the ruling was largely in Apple’s favor though it required Apple to allow developers to link to external payment methods. The case was significant for the broader conversation about platform fees and developer rights across the games industry.

Where Epic Is Now

Epic laid off around 870 employees in September 2023, roughly 16 percent of their workforce, citing Fortnite revenue declining from its peak. They sold their music platform Bandcamp and their events company SuperAwesome as part of restructuring. Unreal Engine continues to grow and Fortnite remains one of the largest games in the world. Tim Sweeney continues to be one of the most outspoken figures in the industry on topics ranging from platform fees to open metaverse standards.