The Strategy Behind Epic Games Acquiring Bandcamp

Epic Games acquires Bandcamp strategy post on the Music 3.0 blog

As you may have already read, the music direct-to-fan platform Bandcamp has been acquired by Epic Games, the home of the hit game Fortnight. While on the surface there may seem much synergy between the two companies, there’s actually a lot of strategy going on behind the scenes that shows they’re more compatible than you might think. When you peel back the exterior coating of the transaction, it begins to make sense for both companies.

Looking At The Future

This deal is all about the Metaverse. It might not be the same one that Facebook/Meta is building, but it might be one that can be realized much quicker due to the virtual infrastructure that Epic has already built. With that in mind, think about the future possibilities for artists.

  • Let’s go virtual. Epic/Bandcamp can offer virtual events that artists can host, virtual music games built into Epic’s games that artists can participate in, and even virtual artists for those that are too shy to perform live. This also opens up an avenue for older artists that don’t have the youthful look that sells (at least as record labels see it) to actually have fruitful second careers online.
  • Direct to fan plus. While Bandcamp excelled at helping artists connect with their audiences, game developers have been the kings of the direct-to-fan model. It’s common for a gamer to buy virtual add-ons, pay to play different tiers and even pay to watch other gamers play. Some of this know-how can now be transferred to music artists as well that may lead to additional income streams.
  • There are some deep pockets available. Bandcamp has been successful but it can be viewed as a mature start-up. Epic has much deeper pockets than Bandcamp could ever have without a sizable round of investment and the restrictions that sometimes come with it. In other words, there are a lot of initiatives that Bandcamp can now undertake that it couldn’t before because of funding.
  • The tentacles of Tencent. One thing that no one is talking about is that Epic is 40% owned by the giant entertainment conglomerate Tencent. Tencent owns two Chinese music services, QQMusic and Joox, but also 10% of Spotify, 10% of Universal Music Group, and 1.6% of Warner Music Group. Does this directly affect Bandcamp artists? Not on the surface, but with those deep internal connections it makes all sorts of deals possible down the road.

While there’s still much to be worked out before the above points can be implemented (rights holder situations is a big one), the Epic Games – Bandcamp deal has far more potential than meets the eye. Think about it – if all this comes to pass, would you rather be with a record label or Bandcamp?

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