Much has been said about Fortnite’s revenue, users, business model, origin and availability. But these narratives are overhyped. What matters most is instead how these achievements will enable Epic Games and Fortnite to create something truly revolutionary.

In 2018, there was a lot to read about Fortnite, and even more to learn from it. And to point, “the game” is indeed the future of entertainment (as well as the greatest threat to today’s media giants). But probably not in the way you think. Fortnite’s real opportunity is much bigger and more significant than the ways the game is notable today. In fact, most of the existing narratives around Fortnite success are overhyped – even if they’re critical to its long-term evolution.

There’s a lot to unpack, so I’ll start by deconstructing the hype before moving into what Fortnite is building towards and why Epic Games is uniquely positioned to realize this potential.

Hype #1: Revenue

To start, consider one of Fortnite’s signature achievements to date: its extraordinary revenue generation. In May 2018 (i.e. when the registered userbase was 38% smaller than today), SuperData estimated Fortnite was pulling in $318MM per month. To put this in perspective, The Avengers: Infinity War (the highest grossing film of 2018) did $2.1B in lifetime revenue at global box office, Candy Crush (which, unlike Fortnite, is available in China) peaked at around $150MM per month, and the biggest opening in gaming history, Grand Theft Auto: V, saw $1B in sales in its first five days (notably, the game was sold via the upfront/one-time payment model). No game has ever pulled in Fortnite’s sales figures, let alone month after month.

Except that last point isn’t true. Games generating billions of dollars per year have been around for a decade – it’s just that few of them have been big in the West. 2012’s Puzzle Dragon and 2013’s Monster Strike each grossed more than $7B to date, with League of Legends not far behind. 2016’s Honor of Kings (AKA Arena of Valor) is approaching $5B in gross revenue (update: the title pulled in $1B in China in February 2018 alone). Fate/Grand Order is at more than $2B (and was developed by DelightWorks, which is 100% owned by a single individual Akihito Shoji), and in 2018 – the year of Fortnite and PUBG – Fate/Grand Order was the year’s most tweeted about game. Disney’s Tsum Tsum, a mobile title based on a Disney line of plushies, has grossed more than $1.5B. And notably, most of these games generated almost all of this revenue from just two markets: Japan and China (though to be fair, Fortnite is yet to launch in China). Still, there have been some record-breaking titles that, like Fortnite, were also hits in the West. Pokémon Go, for example, has grossed more than $2B to date, while Candy Crush Saga is at more than $5B.

Hype #2: Business Model

Fortnite’s most startling achievement in the eyes of the media business has been its ability to pull in such revenues…without requiring users to pay a dime. A Fortnite player need not pay to download, play the game, access any of its features, advance or to help them win. All revenue comes from the sale of purely cosmetic items such as an avatar/costume, or a “Battle Pass” that helps users participate and track their progress in optional challenges that neither advance the game nor advantage competitive play in any way (to all the parents out there, just know that every dollar spent on Fortnite is both optional and unnecessary).

But, again, lucrative “free-to-play” games have been around for more than a decade. In fact, it turns out the most effective way to generate billions of dollars is to not require a player spend a single one (all of the aforementioned billion-dollar titles are also free-to-play). Though spending money does help players in some of these games (e.g. via extra lives in Candy Crush), they just as often provide no competitive advantage or aid whatsoever (e.g. Counter-Strike: Global Offensive).

And notably, Fortnite is a far more expensive game to develop and operate – and generates materially less revenue from far more total players – than some of its free-to-play peers, such as Honor of Kings or Fate/Grand Order. Fortnite’s top and bottomlines are certainly enviable, but they’re far from without precedent – or even the best examples of the category’s potential.

Hype #3: Cross-Platform Availability

Another popular Fortnite narrative focuses on the game’s cross-platform availability and functionality. The identical (i.e. complete or full) version of the game is available across not just all major consoles, but mobile devices too. As a result, just about anyone anywhere can play Fortnite and with almost any device. In addition, every Fortnite player – no matter the device – can play one another. This ubiquitous cross-integration is rarely seen in the game industry. In fact, it was only made possible through the game’s extraordinary success, which forced Sony to abandon more than a decade of online isolationism and allow cross-play with Xbox, PC and others (and not just for Fortnite).

At the same time, Fortnite’s achievements here represent mostly iterative contributions to existing trends. Games have been selectively cross-platform for years, and Fortnite is far from the first game to be available across multiple platforms with identical functionality. What’s unique is that Fortnite’s popularity forced the entire industry to support cross-play and extended availability, not just across all mobile devices, or across all console/PC hardware, but across both – without any compromises in functionality.

That said, these same achievements actually undermine the significance of Fortnite’s topline revenue. Each of the other aforementioned billion-dollar titles achieved their sales through only one platform: mobile (or PC in the case of League of Legends). Fortnite has hit its records using a combination of many platforms: mobile, and PC, and PS4, and Xbox, and Switch, etc.

Hype #4: Popularity

The fourth major thread is Fortnite’s obsessive popularity. In November 2018, the game crossed 200MM registered accounts (though active users are unknown), up from 125MM five months earlier. To this end, Fortnite likely represents the largest persistent media event in human history. As of today, the game has likely had more than six consecutive months with at least one million concurrent active users – all of whom are participating in a largely shared and consistent experience that spanned multiple “seasons”, storylines, and events (contrast this to Candy Crush, in which gameplay is isolated and unique to the player). To point, season six’s live finale, which took place on November 4, 2018 at precisely 1:00p.m. Eastern Time and involved the explosion of a metaphysical cube that began to emerge in season four, saw 5MM+ active players watching live and close to 4MM other passive or non-player viewers watching via Twitch and YouTube.

 These achievements are significant. And unprecedented. But they’re not entirely unexpected. Esports as a category has been ascendant for years – with Twitch regularly ranking among the top 30 TV channels in the United States in terms of hours watched. The notion that gaming’s newest obsession is able to amass millions of concurrent viewers around events several weeks in the making shouldn’t be a surprise. As a single case study, consider Ninja, Twitch’s top streaming personality. He alone streams close to seven hours per day with an average of 50,000 viewers per minute in December, a peak of 600,000 and more than 10MM unique viewers.

Hype #5: Origin Story

Fortnite’s most indulged press narrative, meanwhile, has to do with how it was created and by whom. While Fortnite’s creator, Epic Games, has a history of developing and publishing games, game creation is more of an R&D and marketing investment behind the company’s core business: licensing its Unreal game engine to third parties. It’s therefore surprising, the story goes, that such a monocultural hit came from Epic. Yet, Epic has developed several hit games before – including the Gears of War franchise, which has sold nearly 30MM copies, grossed more than $1B to date, won numerous “Game of the Year” awards, and is being adapted into a feature film by Universal.

Another popular narrative concerns Fortnite’s evolution. The original version of the game, which was released in July 2017 and has been since renamed Fortnite: Save the World, wasn’t particularly successful. The game didn’t really take off until a battle royale mode was released in the game three months later (one clearly modeled on PlayerUnknown’s Battlegrounds, which first popularized the Battle Royale format). As the original Save the World mode spent seven years in development only to sputter on release, Fortniteis often characterized as an accidental success.

Were this the case, Fortnite would be far from the first example of accidental success in entertainment. Fifty Shades of Grey, for one, began as Twilight fan fiction. Author EL James had neither a plan nor a desire to publish the title professionally (it has since outsold Harry Potter on Amazon in the UK). At the same time, it feels unfair to characterize Fortnite: Battle Royale as stumbled upon good luck. As an engine provider, Epic’s job is to understand and optimize for emerging genres and game dynamics. Furthermore, Fortnite was always designed for flexibility. While Epic wanted to preserve the live-or-die urgency of shooters such as Counter-Strike or Call of Duty, it also wanted to unite and underpin this sensibility with the sandbox nature of Minecraft. Accordingly, a pivot was natural to the game (indeed, the speed with which Battle Royale launched suggests the mode was in development well before Save the World had even launched).

Taking Stock

Fortnite is a groundbreaking game, even if its individual contributions are only iteratively significant. A testament to the game’s success was Epic’s ability to use Fortnite to launch its own game distribution platform (the Epic Store) in December 2018. But even this falls short of breaking new ground. Valve successfully spun Counter-Strike into a digital store (Steam) in 2003 (the same year the iTunes Store launched) and has since generated more than $20B (with more than $4.5B now generated each year), yet this story is too old to generate much press attention today.

At the same time, Fortnite’s achievements are collectively significant – especially when matched with Epic’s broader assets and ambitions. And it might foretell the future of not just Fortnite and video gaming, but of entertainment at large.

Fortnite and the Challenges of Longevity

If Fortnite is to play an important role in Epic’s future (let alone that of media overall), it’s important to address its primarily challenge and most common criticism: its popularity can’t and won’t last.

It’s easy to overemphasize the importance, significance and durability of any game – especially when they become part of the monoculture. To point, the most enduring names in gaming haven’t really endured in the traditional sense. Instead, they’re constantly being re-interpreted and re-deployed in new gaming genres and formats in order to remain relevant.

Consider Warcraft, for example. The game started (and is still played) as a Real-time Strategy game(“RTS”), which was the dominant online gaming genre from the late 1990s until the early 2000s. However, it subsequently evolved into a much larger Massively Multiplayer Online game (“MMO” or “MMORPG”) as World of Warcraft, which led the late 2000s. Warcraft III, the franchise’s third RTS title, meanwhile, went on to spawn the Multiplayer Online Battle Arena (“MOBA”) genre (most famously led by League of Legends), with Warcraft’s IP being deployed in the MOBA title Heroes of the Storm. And since 2014, Warcraft has been adapted to a secondary gaming category, the collectable card game genre (e.g. an online Magic: The Gathering) in Hearthstone. This process bears little in common with the traditional Hollywood definition of franchise reinvention, where a given IP (such as James Bond) sees only stylistic and narrative evolution/changes over time.

Naturally, the emergence of new genres (most recently, battle royale) means that the most popular games tend to change every five years or so. It wasn’t that long ago that Candy Crush and then League of Legends were the talk of the digital media business, and now both titles have been eclipsed by Fortnite (though they both remain roughly as popular as ever). Still, Warcraft has shown that IP gives a hit game the opportunity to continually sustain itself (and sector domination) through reinvention. But crucially, this advantage isn’t definitive. The MOBA genre, for example, was created after a gamer modified Warcraft III’s code to create a new title dubbed Defense of the Ancients. However, Warcraft’s MOBA, Heroes of the Storm, is a distant third in the genre behind Riot’s League of Legends and Valve’s Dota 2 (which was created after the company hired Defense of the Ancient’s creator).

Accordingly, it’s important to emphasize how story, or even IP, really, doesn’t exist in Fortnite. While there are narrative seasons which culminate in beautiful moments that are hotly anticipated and watched live by millions, these events mostly surround new features or changes to the game’s map. There are no characters, barely any objectives that don’t reset after 20 odd minutes of play, and no real explanation for what’s happening or why.

As a result, many believe that Fortnite’s popularity simply can’t endure; that however popular, it will inevitably fall to the next hot gaming category and have no story/character IP through which to pivot. But this read is too narrow.

(Also note that while many believe Fortnite is already on the decline, this appears to stem mostly from reduced press attention. In December 2018, for example, Fortnite had its best-ever month on iOS, with revenue growing 83% month-over-month and 16% over its prior peak in July). [Update: On 16 February 2019, 12 days after the release of Apex Legends, Epic announced that Fortnite had hit a new peak for non-event concurrent players, with 7.6MM. This was only 8% below Fortnite’s season six finale event in November 2018.] Contributor: Matthew Ball