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Epic Games’ $1.8bn funding round will help it expand beyond the gaming sector, says GlobalData

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“While Epic Games’ strong position is largely due to its role in developing the massively popular Fortnite, its success is attributable to the pure power of its gaming platform – indeed on which Fortnite is built – Unreal Engine. This platform demonstrates the company’s capabilities in computer graphics, 3D technologies, cross-platform offerings, augmented reality (AR) and virtual reality (VR), and its power and flexibility are garnering the company’s success and will allow it to reach beyond the gaming sector to film-making, architecture and medical systems.

“It is expected that the company will use this latest funding round to expand the Unreal platform, as well as give the Epic Gamestore and support customer retention strategies a boost. The influx of cash will help Epic cement its leadership position in themes such as game development, esports, social media, ecommerce and mobile gaming. It currently ranks second in GlobalData’s gaming software thematic sector scorecard, preceded only by Tencent (which itself owns 40% stake in Epic Games), and ahead of Valve and Microsoft. Epic is also likely to use the money to develop new monetization strategies for its free offerings, including games and the Unreal Engine platform.

“Furthermore, the company should use its relationship with Sony, which owns a 1.4% stake in Epic, to expand the use of the Unreal Engine among content developers, both in the gaming and film sectors.

“The Unreal Engine’s strong AR and VR capabilities will also help Epic expand its operations in industries such as medical and automotive, which are increasingly experimenting with both AR and VR. The company holds a score of four out of five in the AR and VR theme in the gaming software sector scorecard, which indicates that it is well positioned to benefit from the growing demand from enterprises for immersive content.”