Unreal doesn't take royalties from the first 1.000.000 $. I think they have a great business model, you don't have to pay until you succeed. Remember if you're not paying, you're the product.
As I know, Unreal charges 5% after you made $1,000, 000 and if last 3 months the revenue from the game is above $40,000. Unity will charge around $2,000 after $200 000 (made from all games) for Pro plan per seat and 2.5% if you have over 1,000,000 installs and $1,000,000 profit if last 12 months your revenue from a single game is above $1,000,000. Both don't charge the first $1,000,000. So, Unreal plan charge more the extra profitable games than Unity, but is better for these who earn between $200,000 and $1,040,000, but Unity plan is better for games with bigger success. For about 92% of developers, who earn less than $200,000 from their games and don't pay anything, the engine's plans doesn't matter.
@@flamart9703 Unreal also has one huge advantage Unity doesn't have, it's owned by Epic Games, who happens to have their own online digital game marketplace. If you host an Unreal game on the Epic Games store, Unreal's parent company makes a huge cash advance, which is the equivalent of paying for Unreal Engine well before that first million. It's so good, that Unreal doesn't charge you for revenue made on the Epic Games store. (Keep in mind, Epic Games may not actually be making money, rather it's an incentive to grow their online store presence.)
With game engines it's also in their interest to keep them free for people just starting out and learning, because they want to be THE industry standard and the easiest way to get there is to be used by as many people as possible. Sure Godot might take over eventually, but it took years for Blender to be considered on par. So learning Godot is good but knowing c++ and unreal is a good skill to have specially if you decide making it as an indie isn't your thing and you are looking for a job at a bigger dev studio.
Unity is better, Unreal 1m cap is lifetime, Unity's is annual. For example, if a game making small amount of money every year for 10 years, as long as the annual revenue doesn't exceed 1m, Unity is free forever, but Unreal will always take 5% forever
Unreal takes 5% only of what you make after your first million. If you make 1.000.100$, you pay them 5$. I'd say it's more than enough for an indie who gets access for free to one of the best engines in the world. If you consider how much it would cost you to develop such an engine, you'll probably change your mind over those 5% even if they are gross.
@@Conradical In my EU country we even don't use commas or dots to separate thousands, but just leave a space between every 3 digits, and decimal comma if needs - 1 000 000,01.
Honestly, we should be going after publishers and especially storefronts before engines. I think game engines deserve a significant cut of things considering they handle a majority of the game code. A lot of work goes into making a game, but far more goes into developing all the systems a game relies on. There's a tons of games that even a god tier programmer could not make on their own without an engine, simply because no one has the time and resources to develop all the features of a game engine like unreal or even unity! Now I realize that open-source engines exist, and I'm grateful that they don't charge, but if they did I think they would certainly deserve it. Meanwhile publishers do... some stuff I suppose? Somehow I doubt they deserve as much as they ask. But storefronts do pretty much nothing other than list your game. And somehow the engine, the thing that enabled your game to exist, takes far less.
Now I definitely believe things should be pro-consumer, but I really think we should be focusing on publishers and especially storefronts. They're the ones taking such a significant chunk out of things for like no reason. Engines are actually crucial for the most part.
I totally agree with your general sentiment! Engines are definitely worth the money, my point was moreso that the pricing *model* should be better, like the per seats model that Unity has outside of the percentage fee. Id rather just pay more per seat than deal with messy percentages. Regarding publishers, there are sooo many bad/valueless ones, but I think they're healthy to have in the industry especially if they provide funding as they can help make games better in that direct way (everything else equal). Regarding storefronts, they definitely pull their weight but 30% is insane. I wish there was true competition to push that down (as I mentioned in the end of the video!)
@@Conradical Seat model would work if people actually paid for it, studios with a dozen devs paying for 1 pro seat is pretty common from what I've seen. There's a lot of ways to skip paying and sometimes it's not even maliciously done
do take it with a grain of salt, as the example he shows in the video is constructed to favor the point he wants to make. (still at least somewhat applies for Unreal, but not for Unity, as in the vast majority of cases you won't actually pay anywhere near that 2.5%)
I assume Godot doesn't really apply since it is open-source and the only problem is console support which would require a third-party or other solution.
Yep exactly! And even with consoles you could theoretically do it yourself with enough expertise. I think Godot has a good chance of being in a Blender-like position, and I really hope it happens. Will be great for everyone to have that option, and will pressure non open source engines to improve themselves
I really don't see the problem. It's pretty transparent and easy to understand and mostly impacts bigger studios who can make the calculations. I mean if your game makes 2 million: 30% steam, 2,5% Epic Games.. And for all the tools they provide it's veeeery hard to complain. Or you could also sell on the Epic Games store for 12% where also the fee for Unreal Engine would go away. Personally I prefer this percentage cuts a lot over the subscription models/ flat prices because they make more sense: Indies can start out free and don't have to worry about paying a subscription and bigger studios can not just get away with paying nearly nothing in comparison to what they make.
Epic games isn't lying to you, they explicitly state it is 5% of the gross revenue, their website and eula also makes clear what exceptions there are among other things.
Yeah I changed the thumbnail wording be be better representative of what I was trying to say - wasn't saying they were lying per se, just noticed that a lot of people were making example calculations off of net revenue instead of gross revenue, and this video was meant to explain what they actually take from.
@@Conradical Sorry but you're making a worse thumbnail, if you go to unreal website and check the license part it mention gross value, eslewhere it clearly states that if your game (not the creator) earns over 1 million. You're creating a deception where clearly none exists, atleast with Unreal Engine. Also you accounted for a publisher, but publishers do not just advertise, they do also various things such as paying royalties and funding development... The creator of Epic Games also made a chart explicitly detailing how steam with an unreal game (that is succesful) need to pay 35% combined to just steam and unreal to show why publishing on his own epic store is better (less store fees and no royalty for using unreal engine).
I mean, it's not a business model. The goal of Godot's team is to build up the engine and community. W4 exists of course, but that's a business to support developers with the process of porting to consoles.
that publisher percentage is pretty suspect if your getting a publisher with that number i would assume they gave you an advance of some kind and if they did that prob means you have experience and cache but still 40%!?!!?? the engine is vital not the publisher if I was to make one cut and risk it that's who I would cut.
I don't think, Unreal Unity can reduce their price anymore. Developing Engines are so very expensive nowadays, they actually don't make money, Their companies make money by monopolizing the service around the engines. Unity has Unity Ads and their online services. So is Unreal, Epic store fills the cost of their engine development.
@@Conradical Yeah, I put that in *right* before you mentioned it lol. I'd love a video on that too, I think far too many people discount how much that 30% is when your math here showed how bad as little as 2.5% was (and I'd argue engines should get more of the pie than Steam does, and the engines are already pretty $$$). Not to say Steam doesn't do a lot for you, but I wish they had a tiered system where developers opted in to more % for more features (base 15% for storefront, discussions, achievements and trading cards. +% for Multiplayer and/or Cloud saves, etc).
Yeah I completely agree that 30% is insane, maybe the topic of another video :) That 30% is very visible though, so it catches people less off-guard. The thing with the engine fees is that they take them after you've received your revenue, so it's easier to be surprised/not fully understand how it works... And then you're given a bill that's actually ~14% of the money you've actually received so I can imagine that being a shock if you're not ready for it. I like that idea with Steam! Never thought of a tiered system, might also work for other parts of the industry like engines!
It's not as bad as you think. They don't take 30% in practice. Getting a key for your game is free and selling it on third party marketplaces like Humble or Itch can reduce that fee to 0. You also make money off every item or trading card sale.
@@sp.n7401 until you consider that Humble Bundle takes a 25% fee and Itch takes a 10% (by default) fee. I consider Steam taking a 30% cut to actually be one of the more reasonable ones, as getting your game on the platform is a huge deal due to the sheer volume of users, hence why for example signing an exclusivity deal with Epic would be a terrible idea for the success of your game.
Depends on what indie means to you! Most people in the industry go by a budget range as the definition of indie so thats what I've gone by! Even if you disagree and call such debd A or AA, they're still the smaller devs so I believe the point stands :)
To me it's funny seeing all the unity hate from non game developers and the insane outrage, while they kiss steam feet. Truth is consumers don't actually care, otherwise they would be mad about a 30% fee. Don't get me wrong, steam is amazing but they can do what they do because they became basically a monopoly.
Yeah I 100% agree and touch upon this near the end of the video. I think the reason people focus on engines is because there's actual true competition in that space unlike storefronts, so they're more likely to change.
@@Conradical I think because an engine directly effects the product itself, while steam doesn't. So for a consumer when they see engines being bad, they automatically think less/worse games and they get pissed. It's very selfish at the core sadly of why these things happen :( Thanks for making this video, lot of devs don't even understand what you explained. For example outside of the US, you pay at least 10% royalties ON TOP of the 30%... and that 10% can actually go up to 30% in some countries... Very demorializing for some developers.
You want good tools, they need to be paid for. Taking a cut of the revenue is a fair and transparent way to charge for that. You give an example where the developers failed to make enough money to pay for the charge, but it would have cost them far more to make the game without using an engine like Unreal or Unity, so they'd have been even more in the red without these generously priced tools.
Well what I'm criticizing is not so much that you have to pay, I'm more than happy to pay even more than what I already am - rather I'm pointing out how messy and tacked bn the percentage payment model feels, as I explained near the end of the video.
No disrespect everyone, but I think when we watch videos, we have to stay and watch the whole video rather than just looking at the thumbnail and already making a reply based upon that. Clarification is in the video.
Its unfortunate then that the video is largely misinformation this time around. If I bought a $100 book and resold it for $110 on ebay and ebay charged me 2% of whatever revenue I made. I'd pay ebay $2.20 cents for that sale. But if I randomly wanted to be dishonest about the charging process, I could claim ebay had taken 22% of my profits and that ebay was overcharging for doing so. But...that's not reality at all. It's a method of number fudging called cooking the books...and people do it such as to make intentional accounting errors for things like tax right offs or just...scams. Essentially, Unity and Unreal are taking an objective amount of money...not a "hidden amount" as false informed in this video. If a game is unprofitable because of these fees they knew exactly how many copies they needed to sell in order to be profitable on the store front they sold tonamd based on the engine they made the game in. Them failing to be profitable isn't suddenly the engines fault at all. Its them poorly managing their expenses and mismanaging how to release their game, or simply, not selling enough. If after 30%steam fee, 5% Unreal fee, and x unknown publisher fee, you can't turn a profit off of, the remaining 50% or so net revenue with projected sales then...you should not develope the game...period. That's called mismanagement of funds. And...that's on the devs, not the people who made their prices explicit in the beginning.
Said this in the other comment reply but i thought I'd reiterate. The reason for why I made this is that most people thought the %s that these engines take was from the money that you made as a developer, instead of gross. Hence why I say that the engines take 7%/14% of net, because that is the portion you have to pay relative to how much has actually been received by you. Never said that the 5% reduction wasn't from gross, on the contrary, this video aims to educate those that thought it was from the net (which as explained in the video could lead to fraud) and explains how it's actually from the gross and why that results in devs paying more than one would expect.
Yeah, well the example shown in the video isn't really realistic either, as the fee taken by Unity is based on the volume of games sold, which wasn't taken into consideration in the calculations. Assuming the 2.5% when in many cases you won't even reach it is misleading.
I think you aren't making sense. Gross revenue deductions are still...taking off the top. 1000 × 5% = 50 dollars. 1000 x 2.5% = 25 dollars. Both are...exact. The don't suddenly become larger percentages of revenue being taken off because you randomly decided these were deductions of Net Revenue instead, when...objectively the were not. So...when calculating Net revenue, you don't randomly act like that 5% isn't a deduction from gross...cause that's called cooking the books and its illegal. Objectively, the 5% comes from gross revenue, not net revenue, or... it would be a smaller amount. 360 x 5%. Its not... somehow taking a larger percentage just because other deductions exist, or because you want to consider it a deduction of net revenue... Do this kind of mental gymnastics on your taxes and you'll be audited. The game engines are taking an exact amount from gross revenue, and most people know this...and price the game accordingly, consider profit margins accordingly, and sales projections...accordingly. If this is a "hidden fee" to anyone... they really weren't paying attention to begin with.
Completely agree with you, and the math you used as an example is effectively the same as the one I used in the video. The reason for why I made this is that most people thought the %s that these engines take was from the money that you made as a developer, instead of gross. Hence why I say that the engines take 7%/14% of net, because that is the portion you have to pay relative to how much has actually been received by you. Never said that the 5% reduction wasn't from gross, on the contrary, this video aims to educate those that thought it was from the net and explains how it's actually from the gross and why that results in devs paying more than one would expect.
@@Conradical That's the lie I just explained. It's not "more than you expect". This 7% and 14% figure is fictional, and arbitrary defined upon an undefined variable, the amount of copies sold, where as the 5% can be added directly on a per copy above 1 million dollars basis, meaning the value is predictable and consistent. The way you intentionally presented the information is directly deceptive and is making matters worse not better. Your presentation of information is equivalent to misinformation or misdirection. That's the point. The amount calculated for this be included in the deductions that vauge 36% you mentioned...not sperated out. Where and when you apply a percentage charge is not benign...its paramount. It applies to the gross...exclusively. Acting as if its a percentage of the net is...a fabrication. You could do the same with steams 30% charge and make that charge "seem" like it's some 40+ by applying it to the net, but that's deceptive misuse of information. That's my point. This video...is misinformation if you present this as if the math is a larger percentage or even an unannounced dealbreaker that could make or break a studio, when they should know the fees structure before making the game, not after they "thought" they had a profit. That's almost a red herring of a fallacy.
Again, I don't think we disagree we're just missing each other on specific wording. As I mentioned in the video, the definition of gross and net revenue really depends a lot on who you are - distributor, publisher, or developer. The 36% figure was explained, so I don't agree with the fact that it was vague. And just to clarify, this video is a direct response to me seeing people make example calculations based off of received revenue, instead of what engines actually take from. This video's aim is to educate those people so that they know what Unity/Unreal actually take their percentage from. Doesn't matter whether you call that gross, net, or net after deductions, or whatever definition (because net revenue doesn't have a set definition, it depends on the context of who you are in the business), what matters is the actual details of where the engines take from. The examples I gave in the video are all factual, if you make $X, your received revenue is very possibly 36% (or sometimes lower). I'm not saying that Unity/Unreal *actually* take 7%/14% of net revenue, and that's how they make their calculations to see what they charge - I'm saying that they make the calculation based on the gross revenue and in an average situation, that fee just happens to be 7%/14% of your received revenue. I understand that the thumbnail having the word "lie" has been misleading to some in the comments, so I've changed the wording to adhere better to the point I'm trying to make, thanks for the feedback :)
@@Conradical And again...for the last time... The way you present information is the problem directly. The word lie, the needless usage of other percentages that are purely arbitrary, the yes vauge "publisher" percentage, which many games don't even have or need a publisher and you confabulat between this being upawards of 50% and the random 36% you conjured. The amount of things you made unclear needlessly, outweigh any clarifications you offered. Utilize definitive terminology, gross, profit, and objective numbers. By sensationalizing the concept of people paying more than they expect, you've created a false narrative...that doesn't align with reality. At the end of the day, people who couldn't understand the definition of gross revenue, which is a definition that is set, and a pervasive term in economics, would not be better educated after watching what you made to "educate them". Your normal videos are equality, this one was not. If you can't understand why we disagree, then perhaps you are not the right person to edify others on this matter, as made evident here and in the video. There really isn't anything to defend. I'm sorry you worked hard on the video, but ultimately its sensationalism, not education. The means by which you are attempting to share the truth is intentionally done to further mystify and obscure it for the sake of "bad company bad police" narratives. Which gets views, but it doesn't actually help people. Edit: And the edited thumbnail and current title are...again, just sensationalism. By presenting the false narrative there is some deceptive thing happening, you imply a narrative that's simply false. There is no hidden fee. The fee is not unexpected or more than what is reasonable, nor is it more than what many do expect who know basic terms like gross revenue and ....mathematics. Statistics 101- The means by which you present information is indicative of how much of the truth you intend the reciever to gain from it. Your numbers aren't wrong. I never said they were, but this is intentionally made to make the matter seem insidious... when its objectively just...5% of gross revenue after 1 million. The other numbers you threw in, where arbitrary calculations for a specific situation ...that don't actually mean...anything... other than what statisticians frequently utilize..."the truth made too look like apart of our story". In otherwords... numbers that only serve to emotional distort viewer perception...but are...equivalent in ever other way to the 5% that was already explict. And you proceed to order the deductions to make it look like...that 5% broke this fictional hypothetical company...while deliberately ignoring that in that same scenario, they had a publisher who likely fronted some of the bill...and thus what they deducted for services...like created that million dollar funding in the first place. So is it realistically not profitable when the funding for a million dollar indie game was funded in part by publisher who then...got paid anyway? Like... You just wanted to fudge a scenario that contributed to your story and worse, completely ignored the 30% coming off steam. Cause oh yeah that 5%...that was the last straw. Again. Sensationalism. Twisting facts to make stories that help you...is the definition of misdirective deception. That's the sum of it.
I agree, "lie" wasn't the right word to use, I've adjusted the thumbnail to make it more representative of the point I was trying to make. I think where we disagree at is that there is simply 1 definition of gross revenue, or just 1 definition of net revenue. It seems that you believe that there is 1 definitive definition, where I believe there are multiple, depending on who you are in the supply chain. If you're a developer, net revenue might actually mean "money received - money spent on the game", instead of just "money received". That's not the definition I used in the video, because clearly it has no bearing on the topic. Also, if someone were to believe that the % is of the money the game grossed instead of what the developer grossed, is it not true that the fee is higher than what one would expect? I don't think that's sensationalizing, it's factual (although the thumbnail definitely used some misleading wording, and that has now been fixed so I appreciated the feedback). Could the video have been clearer? 100%, and I really appreciated your feedback and if I ever make a similar video in the future I'll make sure to explain certain things with more detail, but I think the video still has achieved to do what I set out to do since other viewers have commented both here and on other socials that it clarified the exact misconception I was trying to dispel.
Don't disagree! Just made the video to help some that thought the percentage splits were taken from net instead of the actual gross! I think we can agree that both engine pricing models are messy and that storefronts take far too big of a share!
It's not for nothing though. Getting your game on Steam is crucial to actually getting people to buy it. If your game isn't on Steam, many people will probably never even hear of it, and if it's on Epic will outright refuse to buy it.
Unreal doesn't take royalties from the first 1.000.000 $. I think they have a great business model, you don't have to pay until you succeed. Remember if you're not paying, you're the product.
I touch on that in the video! While true, there are situations where they still make money before you profit so it's a very imperfect system
As I know, Unreal charges 5% after you made $1,000, 000 and if last 3 months the revenue from the game is above $40,000. Unity will charge around $2,000 after $200 000 (made from all games) for Pro plan per seat and 2.5% if you have over 1,000,000 installs and $1,000,000 profit if last 12 months your revenue from a single game is above $1,000,000. Both don't charge the first $1,000,000. So, Unreal plan charge more the extra profitable games than Unity, but is better for these who earn between $200,000 and $1,040,000, but Unity plan is better for games with bigger success. For about 92% of developers, who earn less than $200,000 from their games and don't pay anything, the engine's plans doesn't matter.
@@flamart9703 Unreal also has one huge advantage Unity doesn't have, it's owned by Epic Games, who happens to have their own online digital game marketplace. If you host an Unreal game on the Epic Games store, Unreal's parent company makes a huge cash advance, which is the equivalent of paying for Unreal Engine well before that first million. It's so good, that Unreal doesn't charge you for revenue made on the Epic Games store. (Keep in mind, Epic Games may not actually be making money, rather it's an incentive to grow their online store presence.)
With game engines it's also in their interest to keep them free for people just starting out and learning, because they want to be THE industry standard and the easiest way to get there is to be used by as many people as possible. Sure Godot might take over eventually, but it took years for Blender to be considered on par. So learning Godot is good but knowing c++ and unreal is a good skill to have specially if you decide making it as an indie isn't your thing and you are looking for a job at a bigger dev studio.
Unity is better, Unreal 1m cap is lifetime, Unity's is annual.
For example, if a game making small amount of money every year for 10 years, as long as the annual revenue doesn't exceed 1m, Unity is free forever, but Unreal will always take 5% forever
Great video, thanks for sharing!
Glad it was helpful :)
Unreal takes 5% only of what you make after your first million. If you make 1.000.100$, you pay them 5$. I'd say it's more than enough for an indie who gets access for free to one of the best engines in the world. If you consider how much it would cost you to develop such an engine, you'll probably change your mind over those 5% even if they are gross.
I touch on this in the second half of the video!
My point is not so much about paying for the engine, it's about how the payment system works.
@@enriquebp6070 one million one hundred dollars, I've added dots for readability. They should teach you how to read numbers in school, mate.
In many places in Europe we use "." as the thousands separator and "," as the decimal separator, so the opposite of what you may be used to :)
@@Conradical In my EU country we even don't use commas or dots to separate thousands, but just leave a space between every 3 digits, and decimal comma if needs - 1 000 000,01.
@@tgsnicholas8817someone crying
Honestly, we should be going after publishers and especially storefronts before engines. I think game engines deserve a significant cut of things considering they handle a majority of the game code. A lot of work goes into making a game, but far more goes into developing all the systems a game relies on. There's a tons of games that even a god tier programmer could not make on their own without an engine, simply because no one has the time and resources to develop all the features of a game engine like unreal or even unity! Now I realize that open-source engines exist, and I'm grateful that they don't charge, but if they did I think they would certainly deserve it.
Meanwhile publishers do... some stuff I suppose? Somehow I doubt they deserve as much as they ask. But storefronts do pretty much nothing other than list your game. And somehow the engine, the thing that enabled your game to exist, takes far less.
Now I definitely believe things should be pro-consumer, but I really think we should be focusing on publishers and especially storefronts. They're the ones taking such a significant chunk out of things for like no reason. Engines are actually crucial for the most part.
I totally agree with your general sentiment! Engines are definitely worth the money, my point was moreso that the pricing *model* should be better, like the per seats model that Unity has outside of the percentage fee. Id rather just pay more per seat than deal with messy percentages.
Regarding publishers, there are sooo many bad/valueless ones, but I think they're healthy to have in the industry especially if they provide funding as they can help make games better in that direct way (everything else equal).
Regarding storefronts, they definitely pull their weight but 30% is insane. I wish there was true competition to push that down (as I mentioned in the end of the video!)
@@Conradical Seat model would work if people actually paid for it, studios with a dozen devs paying for 1 pro seat is pretty common from what I've seen. There's a lot of ways to skip paying and sometimes it's not even maliciously done
As some degenerate gamer would say: “Leave alone the multimillion dollar company.”
How dare someone think critically about who we give money to 😡
Damn, I never thought about it 😮 many thanks for this video, it’s clear now 😊
Glad it was helpful :)
do take it with a grain of salt, as the example he shows in the video is constructed to favor the point he wants to make. (still at least somewhat applies for Unreal, but not for Unity, as in the vast majority of cases you won't actually pay anywhere near that 2.5%)
@@Hietakissa sure but still it's good to know, until now I was building game without keeping these in mind while predicting revenue. That's all 😀👍
Thank you for the video.
Glad it was helpful :)
Great explanation!
I assume Godot doesn't really apply since it is open-source and the only problem is console support which would require a third-party or other solution.
Yep exactly! And even with consoles you could theoretically do it yourself with enough expertise.
I think Godot has a good chance of being in a Blender-like position, and I really hope it happens. Will be great for everyone to have that option, and will pressure non open source engines to improve themselves
I really don't see the problem. It's pretty transparent and easy to understand and mostly impacts bigger studios who can make the calculations.
I mean if your game makes 2 million: 30% steam, 2,5% Epic Games.. And for all the tools they provide it's veeeery hard to complain.
Or you could also sell on the Epic Games store for 12% where also the fee for Unreal Engine would go away.
Personally I prefer this percentage cuts a lot over the subscription models/ flat prices because they make more sense: Indies can start out free and don't have to worry about paying a subscription and bigger studios can not just get away with paying nearly nothing in comparison to what they make.
so happy I use godot
Yeah it sounds awesome, so many pros of using open source!
Do you reckon Godot has a bright future?
@@GodotNoContext my eyes hurt thinking about its future
Epic games isn't lying to you, they explicitly state it is 5% of the gross revenue, their website and eula also makes clear what exceptions there are among other things.
Yeah I changed the thumbnail wording be be better representative of what I was trying to say - wasn't saying they were lying per se, just noticed that a lot of people were making example calculations off of net revenue instead of gross revenue, and this video was meant to explain what they actually take from.
@@Conradical
Sorry but you're making a worse thumbnail, if you go to unreal website and check the license part it mention gross value, eslewhere it clearly states that if your game (not the creator) earns over 1 million. You're creating a deception where clearly none exists, atleast with Unreal Engine.
Also you accounted for a publisher, but publishers do not just advertise, they do also various things such as paying royalties and funding development... The creator of Epic Games also made a chart explicitly detailing how steam with an unreal game (that is succesful) need to pay 35% combined to just steam and unreal to show why publishing on his own epic store is better (less store fees and no royalty for using unreal engine).
godot is the blender of game engines so Im betting on it, the open source business model in the long run beats the competition
I'm hoping for that too, the community has been growing so fast so it has a great chance!
I mean, it's not a business model. The goal of Godot's team is to build up the engine and community. W4 exists of course, but that's a business to support developers with the process of porting to consoles.
that publisher percentage is pretty suspect if your getting a publisher with that number i would assume they gave you an advance of some kind and if they did that prob means you have experience and cache but still 40%!?!!?? the engine is vital not the publisher if I was to make one cut and risk it that's who I would cut.
I don't think, Unreal Unity can reduce their price anymore.
Developing Engines are so very expensive nowadays, they actually don't make money,
Their companies make money by monopolizing the service around the engines. Unity has Unity Ads and their online services. So is Unreal, Epic store fills the cost of their engine development.
Sounds more like the problem is the 30% Steam takes in my opinion
I mention that too at the end of the video! This one was more focused on the misunderstanding with the percentages that I've seen around
@@Conradical Yeah, I put that in *right* before you mentioned it lol. I'd love a video on that too, I think far too many people discount how much that 30% is when your math here showed how bad as little as 2.5% was (and I'd argue engines should get more of the pie than Steam does, and the engines are already pretty $$$). Not to say Steam doesn't do a lot for you, but I wish they had a tiered system where developers opted in to more % for more features (base 15% for storefront, discussions, achievements and trading cards. +% for Multiplayer and/or Cloud saves, etc).
Yeah I completely agree that 30% is insane, maybe the topic of another video :) That 30% is very visible though, so it catches people less off-guard. The thing with the engine fees is that they take them after you've received your revenue, so it's easier to be surprised/not fully understand how it works... And then you're given a bill that's actually ~14% of the money you've actually received so I can imagine that being a shock if you're not ready for it.
I like that idea with Steam! Never thought of a tiered system, might also work for other parts of the industry like engines!
It's not as bad as you think. They don't take 30% in practice. Getting a key for your game is free and selling it on third party marketplaces like Humble or Itch can reduce that fee to 0. You also make money off every item or trading card sale.
@@sp.n7401 until you consider that Humble Bundle takes a 25% fee and Itch takes a 10% (by default) fee. I consider Steam taking a 30% cut to actually be one of the more reasonable ones, as getting your game on the platform is a huge deal due to the sheer volume of users, hence why for example signing an exclusivity deal with Epic would be a terrible idea for the success of your game.
Indie developers by definition don't have a publishers...
Depends on what indie means to you! Most people in the industry go by a budget range as the definition of indie so thats what I've gone by!
Even if you disagree and call such debd A or AA, they're still the smaller devs so I believe the point stands :)
tkm conrad videaso
Gracias :)
Just use an open source engine like godot
Yep, I touch on that at the end of the video!
even godot is not safe
To me it's funny seeing all the unity hate from non game developers and the insane outrage, while they kiss steam feet. Truth is consumers don't actually care, otherwise they would be mad about a 30% fee. Don't get me wrong, steam is amazing but they can do what they do because they became basically a monopoly.
Yeah I 100% agree and touch upon this near the end of the video.
I think the reason people focus on engines is because there's actual true competition in that space unlike storefronts, so they're more likely to change.
@@Conradical I think because an engine directly effects the product itself, while steam doesn't. So for a consumer when they see engines being bad, they automatically think less/worse games and they get pissed. It's very selfish at the core sadly of why these things happen :( Thanks for making this video, lot of devs don't even understand what you explained. For example outside of the US, you pay at least 10% royalties ON TOP of the 30%... and that 10% can actually go up to 30% in some countries... Very demorializing for some developers.
Bad explained. More confusing than the official terms.
What did you have trouble understanding? Maybe I could help by clarifying any questions, and it'll help me in improving my future videos!
You want good tools, they need to be paid for. Taking a cut of the revenue is a fair and transparent way to charge for that. You give an example where the developers failed to make enough money to pay for the charge, but it would have cost them far more to make the game without using an engine like Unreal or Unity, so they'd have been even more in the red without these generously priced tools.
Well what I'm criticizing is not so much that you have to pay, I'm more than happy to pay even more than what I already am - rather I'm pointing out how messy and tacked bn the percentage payment model feels, as I explained near the end of the video.
No disrespect everyone, but I think when we watch videos, we have to stay and watch the whole video rather than just looking at the thumbnail and already making a reply based upon that. Clarification is in the video.
😅
Yeah, people tend to do that a lot.😅
Its unfortunate then that the video is largely misinformation this time around.
If I bought a $100 book and resold it for $110 on ebay and ebay charged me 2% of whatever revenue I made.
I'd pay ebay $2.20 cents for that sale.
But if I randomly wanted to be dishonest about the charging process, I could claim ebay had taken 22% of my profits and that ebay was overcharging for doing so.
But...that's not reality at all.
It's a method of number fudging called cooking the books...and people do it such as to make intentional accounting errors for things like tax right offs or just...scams.
Essentially, Unity and Unreal are taking an objective amount of money...not a "hidden amount" as false informed in this video.
If a game is unprofitable because of these fees they knew exactly how many copies they needed to sell in order to be profitable on the store front they sold tonamd based on the engine they made the game in.
Them failing to be profitable isn't suddenly the engines fault at all.
Its them poorly managing their expenses and mismanaging how to release their game, or simply, not selling enough.
If after 30%steam fee, 5% Unreal fee, and x unknown publisher fee, you can't turn a profit off of, the remaining 50% or so net revenue with projected sales then...you should not develope the game...period.
That's called mismanagement of funds. And...that's on the devs, not the people who made their prices explicit in the beginning.
Said this in the other comment reply but i thought I'd reiterate. The reason for why I made this is that most people thought the %s that these engines take was from the money that you made as a developer, instead of gross. Hence why I say that the engines take 7%/14% of net, because that is the portion you have to pay relative to how much has actually been received by you.
Never said that the 5% reduction wasn't from gross, on the contrary, this video aims to educate those that thought it was from the net (which as explained in the video could lead to fraud) and explains how it's actually from the gross and why that results in devs paying more than one would expect.
Yeah, well the example shown in the video isn't really realistic either, as the fee taken by Unity is based on the volume of games sold, which wasn't taken into consideration in the calculations. Assuming the 2.5% when in many cases you won't even reach it is misleading.
misleading thumbnail
Changed it not too long ago, might've not changed yet but it should now be more representative of the video :)
I think you aren't making sense.
Gross revenue deductions are still...taking off the top.
1000 × 5% = 50 dollars.
1000 x 2.5% = 25 dollars.
Both are...exact.
The don't suddenly become larger percentages of revenue being taken off because you randomly decided these were deductions of Net Revenue instead, when...objectively the were not.
So...when calculating Net revenue, you don't randomly act like that 5% isn't a deduction from gross...cause that's called cooking the books and its illegal.
Objectively, the 5% comes from gross revenue, not net revenue, or... it would be a smaller amount. 360 x 5%.
Its not... somehow taking a larger percentage just because other deductions exist, or because you want to consider it a deduction of net revenue...
Do this kind of mental gymnastics on your taxes and you'll be audited.
The game engines are taking an exact amount from gross revenue, and most people know this...and price the game accordingly, consider profit margins accordingly, and sales projections...accordingly.
If this is a "hidden fee" to anyone... they really weren't paying attention to begin with.
Completely agree with you, and the math you used as an example is effectively the same as the one I used in the video. The reason for why I made this is that most people thought the %s that these engines take was from the money that you made as a developer, instead of gross. Hence why I say that the engines take 7%/14% of net, because that is the portion you have to pay relative to how much has actually been received by you.
Never said that the 5% reduction wasn't from gross, on the contrary, this video aims to educate those that thought it was from the net and explains how it's actually from the gross and why that results in devs paying more than one would expect.
@@Conradical That's the lie I just explained.
It's not "more than you expect".
This 7% and 14% figure is fictional, and arbitrary defined upon an undefined variable, the amount of copies sold, where as the 5% can be added directly on a per copy above 1 million dollars basis, meaning the value is predictable and consistent.
The way you intentionally presented the information is directly deceptive and is making matters worse not better.
Your presentation of information is equivalent to misinformation or misdirection. That's the point.
The amount calculated for this be included in the deductions that vauge 36% you mentioned...not sperated out. Where and when you apply a percentage charge is not benign...its paramount.
It applies to the gross...exclusively. Acting as if its a percentage of the net is...a fabrication.
You could do the same with steams 30% charge and make that charge "seem" like it's some 40+ by applying it to the net, but that's deceptive misuse of information.
That's my point. This video...is misinformation if you present this as if the math is a larger percentage or even an unannounced dealbreaker that could make or break a studio, when they should know the fees structure before making the game, not after they "thought" they had a profit.
That's almost a red herring of a fallacy.
Again, I don't think we disagree we're just missing each other on specific wording. As I mentioned in the video, the definition of gross and net revenue really depends a lot on who you are - distributor, publisher, or developer. The 36% figure was explained, so I don't agree with the fact that it was vague.
And just to clarify, this video is a direct response to me seeing people make example calculations based off of received revenue, instead of what engines actually take from. This video's aim is to educate those people so that they know what Unity/Unreal actually take their percentage from. Doesn't matter whether you call that gross, net, or net after deductions, or whatever definition (because net revenue doesn't have a set definition, it depends on the context of who you are in the business), what matters is the actual details of where the engines take from.
The examples I gave in the video are all factual, if you make $X, your received revenue is very possibly 36% (or sometimes lower). I'm not saying that Unity/Unreal *actually* take 7%/14% of net revenue, and that's how they make their calculations to see what they charge - I'm saying that they make the calculation based on the gross revenue and in an average situation, that fee just happens to be 7%/14% of your received revenue.
I understand that the thumbnail having the word "lie" has been misleading to some in the comments, so I've changed the wording to adhere better to the point I'm trying to make, thanks for the feedback :)
@@Conradical And again...for the last time...
The way you present information is the problem directly.
The word lie, the needless usage of other percentages that are purely arbitrary, the yes vauge "publisher" percentage, which many games don't even have or need a publisher and you confabulat between this being upawards of 50% and the random 36% you conjured. The amount of things you made unclear needlessly, outweigh any clarifications you offered. Utilize definitive terminology, gross, profit, and objective numbers. By sensationalizing the concept of people paying more than they expect, you've created a false narrative...that doesn't align with reality. At the end of the day, people who couldn't understand the definition of gross revenue, which is a definition that is set, and a pervasive term in economics, would not be better educated after watching what you made to "educate them". Your normal videos are equality, this one was not. If you can't understand why we disagree, then perhaps you are not the right person to edify others on this matter, as made evident here and in the video.
There really isn't anything to defend. I'm sorry you worked hard on the video, but ultimately its sensationalism, not education. The means by which you are attempting to share the truth is intentionally done to further mystify and obscure it for the sake of "bad company bad police" narratives.
Which gets views, but it doesn't actually help people.
Edit: And the edited thumbnail and current title are...again, just sensationalism. By presenting the false narrative there is some deceptive thing happening, you imply a narrative that's simply false.
There is no hidden fee.
The fee is not unexpected or more than what is reasonable, nor is it more than what many do expect who know basic terms like gross revenue and ....mathematics.
Statistics 101-
The means by which you present information is indicative of how much of the truth you intend the reciever to gain from it.
Your numbers aren't wrong. I never said they were, but this is intentionally made to make the matter seem insidious... when its objectively just...5% of gross revenue after 1 million. The other numbers you threw in, where arbitrary calculations for a specific situation ...that don't actually mean...anything... other than what statisticians frequently utilize..."the truth made too look like apart of our story". In otherwords... numbers that only serve to emotional distort viewer perception...but are...equivalent in ever other way to the 5% that was already explict.
And you proceed to order the deductions to make it look like...that 5% broke this fictional hypothetical company...while deliberately ignoring that in that same scenario, they had a publisher who likely fronted some of the bill...and thus what they deducted for services...like created that million dollar funding in the first place. So is it realistically not profitable when the funding for a million dollar indie game was funded in part by publisher who then...got paid anyway? Like...
You just wanted to fudge a scenario that contributed to your story and worse, completely ignored the 30% coming off steam.
Cause oh yeah that 5%...that was the last straw.
Again. Sensationalism.
Twisting facts to make stories that help you...is the definition of misdirective deception.
That's the sum of it.
I agree, "lie" wasn't the right word to use, I've adjusted the thumbnail to make it more representative of the point I was trying to make.
I think where we disagree at is that there is simply 1 definition of gross revenue, or just 1 definition of net revenue. It seems that you believe that there is 1 definitive definition, where I believe there are multiple, depending on who you are in the supply chain. If you're a developer, net revenue might actually mean "money received - money spent on the game", instead of just "money received". That's not the definition I used in the video, because clearly it has no bearing on the topic. Also, if someone were to believe that the % is of the money the game grossed instead of what the developer grossed, is it not true that the fee is higher than what one would expect? I don't think that's sensationalizing, it's factual (although the thumbnail definitely used some misleading wording, and that has now been fixed so I appreciated the feedback).
Could the video have been clearer? 100%, and I really appreciated your feedback and if I ever make a similar video in the future I'll make sure to explain certain things with more detail, but I think the video still has achieved to do what I set out to do since other viewers have commented both here and on other socials that it clarified the exact misconception I was trying to dispel.
Real criminals here aren't game engines because they provide actual value, real criminals are store fronts that take 30% of your revenue for nothing.
Don't disagree! Just made the video to help some that thought the percentage splits were taken from net instead of the actual gross!
I think we can agree that both engine pricing models are messy and that storefronts take far too big of a share!
It's not for nothing though. Getting your game on Steam is crucial to actually getting people to buy it. If your game isn't on Steam, many people will probably never even hear of it, and if it's on Epic will outright refuse to buy it.
@@Hietakissa which is the whole point of my argument, steam has monopoly and takes 30% of your revenue for nothing
30% is completely ridiculous. I wonder how it compares to other game marketplaces, like the switch store
@@bbrainstormer2036 No one knows how much Switch store takes because it's under NDA and Nintendo is serious about their lawsuits