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Unreal is completely free for up to $1 million in revenue. And at that point, the 5% royalty is very much a happy problem.
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Lifetime royalty fee on any related worldwide gross revenue is a happy problem?
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The question is about counterfactuals

If unreal cost money up front, would this have been built? No.

Unreal is saying: hey, we contributed to 1/20th of your success, because you could not have done this without us.

Thus, in the event that you're extremely successful, yes, you'll owe unreal a million dollars. But that's only because you made 20mm and keep 19mm for yourself.

That's an incredible bargain.

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Shiny, that's why I thought you might've felt it fair, but couldn't have put it this well.
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Surely better than this engineer having to pay $100k upfront which would likely mean he never made the game at all. 5% over a million seems pretty reasonable to me. I guess it'd be an issue if profit margins were thin, but that wouldn't be the case here.
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Sure as long as we acknowledge that this isn't really free it's just deferred payment
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But it is free up to $1mm in revenue. Anyone can go and download the engine and use it as much as they want free. It is really smart and honestly $1mm is a generous entry point to capture a royalty for everyone involved.
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They could have just sold the engine, even a subscription is better than royalties. If my game sells more it doesn't cost Epic any more money.
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You misunderstand the business model.

Unreal is like venture capital or a book advance (or the equivalent in music record deal)

Can you self publish? Sure, of course, have fun. But if you want the support and infrastructure of a company that understands the business of books, you take a deal and it is just like this: if a bunch of authors get book advances, that is generous to the ones who are unsuccessful, and they can only do that _because they capture the upside of those that are successful_.

Without that, you don't get advances for anyone.

So the point I'm making here: unreal provides variance reduction for all game publishers and yes that disproportionately benefits the ones who make under a million. But they're the ones who need the help!

And in exchange, if you're one of the lucky few, you pay a shockingly reasonable 5% in perpetuity.

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I know you’re trolling but come on. The entry price for what you are suggesting would never be obtainable for folks like this kid. You can absolutely negotiate pricing if you are a big enough studio but for hobbyist they let you use it for a royalty. It’s great because it opens it up for everyone. If they charged a fixed fee it would have to be at a very high price.
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Not deferred payment for most devs as they do not reach the 1 million revenue
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For "the best train sim ever made" they probably reach it.
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Sure, and then he can afford it, because he's making over $1M/year revenue on this sim, and taking a very reasonable 5% off the top of that. So it blunts the profits a bit at that point, but it hardly seems like such a terrible thing at that point.
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To be able to use this tech in the first place? I have no glue about business problems but this sounds far better then the 30% rip off by apple and Google app stores....
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I mean, he's still going to be paying 30% to Steam.
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> 30% rip off by apple and Google app stores

Sounds like a happy problem to me;)

By the way you don't only have to file a report for Epic whenever you release a game using UE, you also have to report them your yearly sales and calculate what income is "directly attributable to UE" for that game. For an ordinary small person, for whom you imply lifetime 5% off gross worldwide revenue is a "happy problem", this is way more involved (and prone to legal liability) compared to app stores. You will probably have to hire people well before the million mark to make sure numbers are OK and you don't accidentally owe Epic $$$$$.

I know which model I would choose. Probably the one where I raise prices by 30% and don't have to deal with anything else.

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At the point where you have 1 million in revenue you for sure have an accountant even just to do your yearly business taxes. So reporting to Epic just becomes an extra hour of work to make the report.
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Or not. I depends on the country and its tax system.
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What is this insane argument. Now you are telling me it’s a burden of paperwork because reporting your revenue gets complicated?
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I'm saying it's not a "happy problem":)
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There is this high correlation with low quality comments and smiley faces, that and when people like to insult others and put a little winky face at the end.

You are simply making up nonsense. It is not a lot of work as most likely sales are being driven through a handful of platforms. Reporting is simple and no different than doing your taxes. It is very much a happy problem. Similar to having to pay more taxes. There is more burden but you are making more money.

Your argument is insane because Indonesia average income in USD on the high side is around $300. If you make $1mm USD, having to do some extra paperwork and pay $50k per $1mm of revenue is an awesome problem to have.

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You're calling my argument insane, you're saying my comment is low quality, and imply I'm the one insulting. What is my argument then, in your opinion?
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If that’s all you have to respond then you sir are the one with no argument. I have listed my points multiple times. All you keep saying is “they could offer it at a fixed price”. Well that price would be well above any hobbyist. It is kind of an insane argument. They have had fixed pricing before without royalty and usually that price is north of $1mm. Free + 5% is pretty amazing. There is enough competition in this space that you could always go elsewhere.
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If you are a fan of royalty based business models, you can be that. What are you so upset about?
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Classic now the “what are you upset about”. Sorry not upset here just love to push back on ridiculous people. Businesses are free to operate however they choose. There are other options in the market outside of unreal ( though they definitely have some of the best tech). 5% is incredibly cheap for small shops. Larger studios will negotiate better rates or potentially a fixed fee. You have still yet to support your argument.
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Yeah, you also get updates to the engine, Steam's share is bigger, and you still keep everything else.

I would be okay with getting 75% of everything earned over $1M.

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> you also get updates to the engine

They could sell the engine and sell new versions separately as one time purchase.

> I would be okay with getting 75% of everything

I'd be okay getting 70% from the start. That's not what it's about.

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If you get a million dollars in revenue as a solo dev, it's pretty much just winning the lottery. You've already spent all the working hours to make the game, so it's pretty much all profit at that point. What costs do you even have?

It's a free choice to use the engine, you can use another engine or make your own if 5% is too much for you.

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> If you get a million dollars in revenue as a solo dev, it's pretty much just winning the lottery

You know it's not 1 mil per year, it's 1 mil over your lifetime

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The vast, vast majority of indie game devs will not see $1m in revenue in multiple lifetimes.
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Should unreal give away their work for free? What is your argument. They don’t take a single royalty until $1mm and 5% is not a wild number considering it’s making use of the engine.

Heck steam takes 30% which is much more egregious but factoring in costs of running steam, payment processing and the free marketing its almost always worth it.

Share a counter argument to how it should be please.

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There's many ways that are better than royalties. Just sell the engine as a one time purchasec have a non-profit foundation where sponsors fund development, etc.
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If they sold it as a one time purchase this kid would have never been able to use Unreal.
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If Adobe sold their suite as one time purchase many creatives who can just afford a monthly subscription couldn't use it. Does it make it a great business model.
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Sorry I don’t know what you are trying to say?
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What are you trying to say? You can't even get the name of the company right. "unreal" won't give their work away for free. UE is a product, Epic is the company that develops UE.
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Sorry I still could not understand your point about Adobe. Instead of getting defensive and attempting to deflect “what’s unreal?” in the context of unreal engine you should try to defend your position.

Edit: NM you are a new account. Shadow banned on my end. Enjoy!

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That is fair for something that makes the game possible in the first place.
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Can’t tell if you mean it (that it’s fair) or you would’ve preferred a different pricing structure?
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It was sarcasm to remind this is a commercial product.
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I mean, if he makes a boatload of money then it's fine if a fraction of it goes to the engine. When his immediate needs are met, he can choose to either stay with unreal or move to an alternative later on without cost pressures.
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Unreal devs have bills to pay as well.

We already know what happens in Nebraska.

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To those asking about the reference to Nebraska, I'm pretty sure it's a reference to XKCD 2347 "Dependency": https://xkcd.com/2347/
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Yep, and then we always get those regular posts "project XYZ is no longer", yeah people not paying.

Unreal is free to the extent it contributes to bringing even more people into the ecosystem, eventually becoming paying customers, Epic doesn't make it available out of their kindness, rather also taking into account there are other competing alternatives.

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It's important to keep development going but commercial projects is not the only way. Godot Foundation exists and there are plenty of others in open-source space.

A nonprofit means actual reports about how money is used, and it's not as if commercial projects are somehow better because they don't fold or get sold or canceled.

And even between commercial ways, charging royalties is one of the worst. It doesn't cost Epic extra if my game starts making more money. Just make the engine a one-time purchase (per version, so you get to keep sales going) and everyone will be much happier. Sell additional services which actually do cost you money to keep up (multiplayer hosting).

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I love Godot but it's not a particularly brilliant example of what you are trying to say. Many games made with Godot generate more profit than the entire budget of the engine itself.

The engine itself is far from cutting edge and missing several features that are now quite common elsewhere, like texture streaming, bindless textures, etc. The speed of development isn't blazing fast either (see the implementation of the traits system). Devs are excellent at what they do but one could wonder how much faster and further it could go with more fundings.

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Nothing against Godot, it's a great project, but looking at the wikipedia list of notable games using the engine, there's a single one I have heard of. Meanwhile about 28% of the market share of all video games is using Unreal. So I don't really see the need to make "everyone much happier" honestly.

> Sell additional services which actually do cost you money to keep up

After a game has been released a solo dev often has very little work to do, since they've already invested all of the development time ahead of release. So, by this logic they shouldn't really be allowed to charge anything for the game, except to cover potential work on updates.

Perhaps game projects don't need to operate like nonprofits, but then why do game engine projects?

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There are notable games missing from that list. Unrailed 2, for example, which is, in my opinion, one of the best games ever created. I am not even a avid gamer and I recognize several games from that list.
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Cruelty Squad was developed in Godot which means most dev's are just weak /s
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I just think of Steve Ballmer's ad for Windows 1.0 (1986)

"Order today! PO box 286 DOS... Except in Nebraska!"

https://youtu.be/sforhbLiwLA

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Curious. Why wasnt it available in Nebraska? :-)
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I doubt Epic struggles for money. By the way what happens in Nebraska?
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It is also not a charity, it is a business.

xkcd has the answer.

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Well then exactly what I was saying. This is a business & it's a commercial product, not a freebie. This is why I see many people look at UE but go with Godot. It's nice when you don't have to notify a megacorp about every game you release & then follow up with yearly revenue reports.
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What happens in Nebraska?!?
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xkcd has the answer.
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