Epic Games recently laid off over 1,000 employees as Fortnite faces a significant engagement downturn, a shift that industry analyst Joost van Dreunen identifies as a symptom of the broader erosion of American cultural dominance in the video game sector.
The End of an Era for American Gaming
NYU professor and researcher Joost van Dreunen suggests that the current struggles at Epic Games are not isolated incidents but part of a larger, systemic collapse. “It’s in the nature of empires to destroy themselves,” van Dreunen notes, arguing that the fading cultural relevance of Fortnite serves as a bellwether for the diminishing influence of US-based interactive entertainment on the global stage.
Economic Headwinds and Policy Hurdles
American developers are currently navigating a complex landscape of strategic and economic challenges. While post-pandemic demand for games has cooled, the cost of entry for consumers continues to climb. Furthermore, van Dreunen points to specific US policy issues, such as expensive H-1B visa fees—costing upwards of $100,000—which discourage talent retention and decrease domestic competitiveness, ultimately causing the US to miss out on significant tax revenue.
Data supports this trend: in 2025, publicly traded game companies in Europe and Asia have significantly outperformed their American counterparts, with growth rates of 60% and 26% respectively, compared to just 18% in the US.
The Rising Power of Platform Gatekeepers
A critical factor in this shift is the disproportionate power held by platform owners. Over the last decade, revenue for app stores, console marketplaces, and digital storefronts surged by 191%, jumping from $14 billion to $41 billion. In contrast, game publishers saw a more modest growth of 98%. Effectively, gatekeepers are capturing value at nearly double the rate of the creators themselves.
Epic’s high-profile legal battles against Apple and Google highlight these systemic tensions. Despite securing certain concessions, the cost of these legal fights has been immense. Before its removal from the iOS App Store, Fortnite generated between $1 million and $2 million daily. Over the five years since its removal, that represents roughly $2 billion in lost net revenue for Epic Games.
The Inevitability of Live-Service Decline
Beyond external economic pressures, the decline of a juggernaut like Fortnite may be an inevitability of the live-service business model. The industry demands perpetual growth, a metric that is mathematically unsustainable in the long term. As the pool of new players dries up and veteran users move on, even the most successful live-service titles face a natural ceiling.
Fortnite once sparked a gold rush in the industry, yet the current market is littered with the failures of those who tried to replicate its success. While the American live-service empire may be showing the first signs of structural collapse, the global industry continues to struggle against the persistent force of market entropy.
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