On September 12, Unity Technologies made an announcement regarding changes to its business model, causing a wave of frustration, fear, and confusion among game developers on social media.
The company introduced a new monetization plan in a blog post, which includes the implementation of a Runtime Fee. According to Unity, this fee is determined by the number of times a game built with the Unity engine is installed. Under the new plan, games developed using the lower-cost option will only face charges once they exceed $200,000 in revenue in a year and 200,000 lifetime installations. On the other hand, Unity Pro and Unity Enterprise accounts will only be charged once they generate more than $1 million in revenue in a year and have more than 1 million lifetime installations.
Once developers exceed the specified limits on their Unity engine plans, those on lower-tier plans will be required to pay the company $0.20 per game installation, while those on higher-tier plans will pay anywhere from $0.01 to $0.15 per installation. This new policy is scheduled to take effect on January 1, 2024, and will have significant implications for numerous popular games, including Among Us, Genshin Impact, Cuphead, Hollow Knight, Firewatch, Outer Wilds, Cult of the Lamb, Pokemon Go, and many others.
However, it didn't take developers long to realize that Unity's new business model would result in exorbitant fees. This was particularly alarming considering that the Runtime Fee would apply retroactively, meaning that every studio with a Unity-based game that had surpassed the threshold in the past would be required to pay the Runtime fees. In addition, developers expressed confusion about how Unity would calculate these fees, the implications for charity bundles and demos, the potential impact on games under contract with distribution services like Xbox Game Pass or Apple Arcade, the influence of piracy on installation numbers, the possibility of bad faith actors abusing installations to harm studios financially, and various other pressing concerns. Unity provided vague and brief responses to these inquiries.
"We utilize our exclusive data model, therefore we won't delve into excessive specifics. Nevertheless, we firmly believe that it provides a precise assessment of the frequency with which the runtime is distributed for a specific project," stated a representative from Unity in response to an inquiry about installation tracking.
Rami Ismail, a prominent independent game developer and recognized industry advocate, is one of the most outspoken critics of X (previously known as Twitter). Ismail promptly analyzed all the potential ways in which Unity—and dubious consumers—could exploit these new charges.
"If you happen to anger your user base as a Unity development studio, you'll be in for a tough ride," Rami commented. "Rather than risking a negative impact on your Metacritic score through a coordinated review campaign, users now have the power to financially ruin you by organizing a mass installation campaign."
In response to inquiries about "installation-bombing," Unity stated, "We already have effective fraud detection measures in place within our Ads technology that addresses similar issues, so we will build upon that expertise. We understand that users may have concerns about this and we will establish a process for them to report their concerns to our fraud compliance team."
Marcus Clarke, an independent game developer currently working on the highly anticipated game Overmorrow and a member of the LBGTQ+ community, expressed his utmost concern regarding this particular development.
"By implementing this change, it creates a potential avenue for marginalized communities to be specifically singled out and attacked in a manner that was not previously feasible. Unfortunately, we have witnessed instances where minority developers have had their games bombarded with negative reviews simply because they address important societal issues," Clarke shared with Our Website. "I am now genuinely afraid that expressing any support or showcasing the achievements of LGBTQ+ individuals and other marginalized communities could make me vulnerable to targeted 'install attacks'. Needless to say, this is not a factor I would prefer to take into consideration when selecting a development engine for my projects."
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Around 6 PM PT on September 12, Unity executive Marc Whitten contacted Axios reporter Stephen Totilo to provide an update regarding some of the company's more controversial terms. Whitten informed Totilo that, following their reassessment, the company decided that only the initial installation of a game would incur a fee. This measure aims to address the issue of "install-bombing" mentioned by Ismail and Clarke. However, it's important to highlight that installing games on different platforms will still result in additional fees. Consequently, if a player downloads a title on Xbox, PC, and Steam Deck, for instance, they would be charged for three installations.
Whitten also mentioned that most demos would be exempt from fees, unless they are included in a download that comprises the full game, such as titles in early access. Additionally, charitable bundles can be self-reported to avoid charges. However, Whitten did not provide any explanation of how this data would be gathered or monitored.
Unity also addressed the assumption that studios engaged in contracts with larger distribution services, such as Microsoft's Xbox Game Pass, would have to bear the burden of paying the considerably high installation fees incurred through that service. However, Whitten clarified that studios would not be held responsible for these fees as distributors would be the ones accountable for their payment. To illustrate this, he referred to the partnership between developer Aggro Crab and Xbox Game Pass as an example.
Earlier that day, I had a conversation with Nick Kaman, the studio head and art director at Aggro Crab, regarding this very situation. Kaman, who is currently working on the game "Another Crab's Treasure" scheduled for release on Game Pass next year, promptly emphasized the adverse impact it could have on game studios. He questioned why a distributor would select to distribute a game if they knew they would ultimately be required to cover the installation fees.
"Microsoft may choose to compensate for Unity's decision, but it doesn't seem like their responsibility. Both Xbox and ourselves are satisfied with the terms of our Game Pass agreement," stated Kaman. "Services like Game Pass are not the issue here, as Microsoft, the developer, and the consumer all benefit from it. The new Unity fee fails to consider this valid business model. Additionally, if publishers, investors, or distributors offer to bear this fee, it may discourage them from funding Unity games in the first place."
Several developers have completely lost trust in Unity, including Brandon Sheffield, the creative director of Necrosoft Games. Sheffield's team is currently using Unity for their upcoming game Demonschool. He expressed his frustrations with the company and its ill-conceived plans in an opinion piece on his website, Insert Credit. Sheffield then contacted Our Website to further discuss these matters.
"We have been working on a game for four years. During this time, Unity's pricing scheme has changed twice. They have discontinued the subscription tier we were paying for and forced us to upgrade to a higher one. Additionally, they have demonstrated their ability and willingness to make significant changes to financial agreements without any input or options from us. Given these circumstances, Unity cannot be relied upon, and it is advisable to avoid using their product."
Sheffield also voiced doubts about Unity's previous assertion that installation fees would not apply to charity bundles. He explained that "there is no way for them to determine which installations originate from charity bundles. There is no mechanism for that, only for platform origin."
Developers are consistently frustrated by the lack of data and the mysterious methods behind its collection. This frustration ultimately extends to a broader grievance against Unity: the company simply doesn't comprehend the inner workings of game studios.
"Unity's recent pricing model demonstrates a clear lack of understanding or interest in how many of its users' business models function," expressed Julian Wilton, creative director at Massive Monster, in an interview with Our Website. "There is greater complexity involved than simply selling a game to consumers, such as utilizing demos for marketing, negotiating deals with storefronts, and selling bundles of keys. Additionally, those targeting a lower price point or implementing a free model for their game will face significant challenges and obstacles in terms of scalability."
The developer of The Cult of the Lamb explained that installations do not always lead to revenue and that platforms often take a long time to pay out. If fees are charged before receiving payment, it could create uncertainty in cash flow for developers. In the volatile gaming industry, this cash flow insecurity could potentially halt production or even shut down smaller or mid-sized studios. Massive Monster joined the conversation by urging fans to buy Cult of the Lamb before it is deleted on January 1. Aggro Crab's Nick Kaman believes that statements like these will help Unity understand the impact of its new policies.
Aggro Crab, along with numerous other studios, expressed concerns about the new business model, stating that it may hinder their use of Unity for future projects. Kaman, speaking to Our Website, emphasized the importance of other studios joining in and shedding light on how this decision impacts their individual circumstances. According to Kaman, the involvement of credible sources like game studios and articles is crucial in raising awareness, given that much of this information may be initially unclear to the general gaming audience.
Following this, InnerSloth, the studio responsible for the immensely popular Among Us, has also released a statement. In their statement, the studio expressed their concerns by saying, "If this proposal is implemented, we would have to postpone content and features that our players truly want in order to relocate our game to another platform (which other developers are also considering). However, many developers may not have the resources or time to do the same. Put an end to it."
Nevertheless, opposition towards Unity does not end with these statements. Xalavier Nelson Jr., the head of Strange Scaffold, recently revealed that a "significant group of developers" is currently exploring the possibility of pursuing a class-action lawsuit against Unity. When I contacted Nelson for more information, he shared that although the details are being kept confidential, he can confirm that substantial discussions are taking place among some of the most influential developers utilizing the engine.
Reportedly, Unity Technologies is experiencing internal division. An employee, who has since deleted their post on X, mentioned that there was extensive internal communication about how poorly this would be received. They emphasized the importance of simplicity and provided a detailed FAQ addressing all possible scenarios. We will continue to provide updates on this matter on our website as more information becomes available.
