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How Does Minecraft Make Money (Business and Revenue Model)

The Minecraft business model

How Does Minecraft Make Money?
Here’s what you should know:
  • What is Minecraft, and how does Minecraft work?
  • How does Minecraft make money?
  • Sale of Minecoins (Minecraft’s in-game currency)
  • Video Game Sales
  • Minecraft Realms (Subscription Revenue)
  • Minecraft Marketplace Creator Fees
  • Selling Merchandise
  • Minecraft’s profit and revenue
  • What is the Minecraft business and revenue model?
  • Minecraft’s funding and valuation

How does Minecraft make money? Here is a full, in depth, breakdown of their five (5) revenue streams and the different products and services they offer, as well as the Minecraft business model, their year over year revenue, and how Minecraft works.

What is Minecraft, and how does Minecraft work?

Minecraft is a sandbox type video game that allows players to freely do what they want and get creative in game.

Created and released in 2009 by Markus Persson, founder of Mojang Studios. Minecraft was later acquired by Microsoft in September 2014 for $2.5 billion.

Since that time, Minecraft has sold over 238 million copies and accumulated more than 141 million monthly active players worldwide, making it one of the top selling video games of all time.

How Minecraft works is: To play Minecraft, players must first purchase the game through their gaming platform of choice (Console, PC, Mobile, or another device).

Once purchased, players can freely do whatever Minecraft offers to them such as purchasing marketplace add ons, playing with friends, creating worlds, and more.

Some of Minecraft’s competitors include Fortnite, Roblox, Candy Crush, Pokémon GO, and other popular video games.

Minecraft App in Apple App Store | Minecraft Business Model | How Does Minecraft Make Money? | How Does Minecraft Work?
Source: Apple App Store | Minecraft

How does Minecraft make money?

Since its founding, Minecraft has sold over 238 million copies and accumulated more than 141 million monthly active players worldwide.

So how does Minecraft make money off of all those sold copies and active players?

Below is a breakdown of how much money Minecraft makes and its revenue model. Including all revenue streams and how much they charge for their services.

Here are the 5 ways of how Minecraft makes money (in 2022):

Minecraft has a revenue model that makes money in five (5) ways – the sale of Minecoins (Minecraft’s in game currency), video game sales, subscription revenue, Minecraft Marketplace creator fees, and selling merchandise.

#1. Sale of Minecoins (Minecraft’s in-game currency)

Minecraft makes money through the sale of Minecoins on the Minecraft platform.

What are Minecoins? Minecoins are Minecraft’s in-game currency that allows users to purchase and use this currency to buy things like Skins, Texture Packs, Worlds, and more from the Minecraft Marketplace.

Minecoins can be purchased in game, through Microsoft, or at partnering retailers. You can see how much Minecoins cost below.

Minecoins Price:

  • $1.99 to $49.99 depending on the quantity of Minecoins purchased
Minecoins Price | Minecraft Business Model | How Does Minecraft Make Money? | How Does Minecraft Work?
Source: Nintendo

#2. Video Game Sales

Minecraft makes a bulk of its money through traditional sales of its video game. Which is compatible with and sells on all consoles, PCs, mobile apps, Oculus, and Fire Devices.

As noted above, Minecraft has sold over 238 million copies all time to date. Each sale ranging in price, which you can see below.

How much does Minecraft cost?

  • $6.99 to $29.99 depending on which video game console it is

Note: Minecraft makes money from this like a traditional video game sale.

#3. Minecraft Realms (Subscription Revenue)

Minecraft also has a multiplayer upgrade that players can pay extra money for if they want to play with numerous friends at the same time in game, using Minecraft Realms.

These realm servers have two (2) separate versions: Bedrock Edition and Java Edition. Both of which allow players to play with 2 to 10 friends depending on the version. With cost differences that range depending on the plan, which you can see below.

How much does a Minecraft Realm cost?

  • Bedrock Edition: $3.99 to $7.99 per month
  • Java Edition: $7.99 per month; or $9.99 to $47.99 one time purchase depending on the plan
How much does a Minecraft Realm cost? | Minecraft Business Model | How Does Minecraft Make Money? | How Does Minecraft Work?
Source: Minecraft

#4. Minecraft Marketplace Creator Fees

Another way Minecraft makes money is by getting a piece of every sale made on its Minecraft Marketplace.

The way it works is; once a creator applies for and is accepted into the Minecraft Partner Program, they enter into a partnership with Microsoft. From there, they can then create and sell skins, textures, and world designs on the Minecraft Marketplace. Every sale (paid for in Minecoins) is then profit split between Microsoft and the creators.

Per reports, Microsoft takes between a 30% to 50% cut of every sale made on the Minecraft Marketplace, leaving the creators and mod makers with the rest.

#5. Selling Merchandise

Minecraft also sells its own merchandise through its online store Minecraft Shop. Where they sell branded Minecraft toys, collectibles, apparel, and more that range in price from $3.99 to $101.40.

Selling Merchandise
Source: Minecraft

Minecraft’s profit and revenue

In 2020, Microsoft reported Minecraft generated $415 million in revenue. As for 2021, Microsoft has not released or reported any official reports regarding the games’ earnings.

Note: Because the Microsoft Corporation, parent company of Minecraft, is a publicly traded company, under the Securities Exchange Act of 1934, they must file continuous financial filings with the U.S. Securities and Exchange Commission (SEC). You can find all of Microsoft’s publicly released financial reports, including annual reports, through Microsoft’s investor section on their website.

What is the Minecraft business and revenue model?

Minecraft makes money through a few revenue models that they combine within their company, they are:

  • Gaming as a Service (GaaS) business model
  • Transaction based revenue model
  • Subscription based business model
  • Licensing business model
  • B2B2C (partnerships) business model

Minecraft’s funding and valuation

Minecraft was acquired by Microsoft in September 2014 for $2.5 billion.