Meta, also known as Facebook, is testing virtual sales and digital goods inside its new Metaverse platform called Horizon Worlds. And while this is an essential first step, we have bad news for developers. Meta’s fees will take nearly half of your profit from each sale.
In a recent Oculus blog post, the company said it’s testing virtual sales in Horizon Worlds, where players can buy digital goods, including NFTs, clothing, accessories, and more for the digital world. Then, in another creator monetization blog post, Meta expanded on the plan but didn’t explain fees or how much it’d take from each transaction.
Update, 4/14/22: After writing this post, and after the news got out regarding how much Meta will be charging developers, Apple has reportedly called them out for the hypocrisy and high fees the company plans to implement in the metaverse. As 9to5Mac reported, Apple said Facebook happily takes money from its creators and now seeks to charge them more than any other platform.
Unfortunately, Meta confirmed to both CNBC and Business Insider that it plans to take a 47.5% cut of each digital transaction. Ouch. To make matters worse, Meta recently criticized Apple and Google over its 30% cut on sales but is essentially doing the same thing.
Here’s the breakdown. Meta charges a hardware platform fee of 30% for any sale on Meta (Oculus) Quest VR systems, which is just as bad as Apple’s fee. But, then, the company has an additional 25% fee it’ll charge on the remaining balance (after the Quest fee) inside Metaverse platforms like Horizon Worlds.
“If a creator sells an item for $1.00, then the Meta Quest Store fee would be $0.30, and the Horizon Platform fee would be $0.17 (25% of the remainder), leaving $0.53 for the Creator before any applicable taxes,” a Meta spokesperson told Business Insider.
Basically, Meta will get nearly half of the transaction, and after taxes, developers aren’t seeing much of the $1.00 purchase inside Facebook’s digital world.
It’s worth mentioning that there is a silver lining here, sort of. Eventually, Meta plans to expand the Horizon Worlds metaverse to other platforms, like iOS, Android, and more. When that happens, those platforms will take whatever fee it has in place, and Meta will only collect the 25% Horizon Worlds fee.
So, technically, developers could earn more on sales when the metaverse reaches other platforms, but we’ll have to wait and see. Either way, developers will have to decide if those fees are worth testing and building for a new platform.