In the wake of a controversial policy change by game engine developer Unity, dozens of small independent video game studios have announced they’ll abandon the engine and/or have called upon Unity to reverse course.
Unity Technologies, headquartered in San Francisco, might be best-known for its cross-platform game engine Unity. For over a decade, Unity has been a go-to toolset for video game production, particularly in the mobile and indie spaces.
Just this year, several of 2023’s highest-profile games were built in Unity, such as Oxenfree II, Dave the Diver, Sea of Stars, Arcadian Atlas, and Venba. For Pacific Northwest productions that we’ve covered on GeekWire, you can also include BattleTech and The Fall Part 2.
As widespread as it is in console/PC gaming, though, Unity is used virtually everywhere in the mobile space. If you’ve played a game on your phone or tablet in the last 10 years, such as Pokémon GO or Call of Duty Mobile, there’s a solid 80% chance it was made with Unity.
On Monday, Unity announced via its official blog that, as of Jan. 1, 2024, it would change the terms by which it licenses its engine. One element of those changes was the introduction of a new monthly “Runtime Fee,” which would be charged each time a qualifying game made with Unity is downloaded by an end user.
The threshold for incurring the Runtime Fee is determined by the version of Unity a developer is using. For example, users of the free Personal package would become eligible for the fee if a single project were to pass $200,000 in 12-month revenue and 200,000 lifetime installations. After that point, Unity would charge a developer a flat 20 cents per install. The installation figures would be detected by Unity Runtime, a separate program that gets installed alongside any game that was made with the Unity Engine.
This would’ve been controversial enough by itself. Unity usually makes money off of its engine by sharing revenue with companies who make successful products, but this changes the deal dramatically in Unity’s favor, using shaky metrics that aren’t readily accessible to companies outside of Unity itself.
Then developers subsequently noticed that Unity had quietly revised its terms of service to suggest that these changes could be applied retroactively, and that they would still apply to companies that signed a licensing contract with Unity before the Runtime Fee’s implementation on Jan. 1, 2024.
“Because revenue and profit aren’t taken into consideration with the per-install fee, there is a possibility that for smaller studios, the installation fees cost more than the total revenue of the game,” said Patrick Morgan, studio lead at Seattle’s Galvanic Games, in an email to GeekWire.
Galvanic recently attended the Penny Arcade Expo in Seattle to showcase its upcoming release, Wizard With A Gun, due out on Oct. 17. Wizard was built in Unity.
“Depending on the success of Wizard With A Gun, this could mean tens or hundreds of thousands of dollars in extra fees charged by Unity that we could not have predicted when we started [development],” Morgan said. “To say we’re mad would be an understatement… they’ve sprung this change to the Terms of Service on us a month before launch.”
Unity’s original announcement didn’t include any details about common, critical user cases, such as game demos, charity packages (i.e. Humble Bundles or the 2022 itch.io Bundle for Ukraine), giveaways, downloads from subscription services like Microsoft’s Xbox Game Pass, or even pirated copies of the game.
By charging a fee based on user installations, Unity would effectively penalize any user who, for whatever reason, deliberately makes their made-in-Unity game available for no cost. As an example, Vancouver, B.C.’s Over the Moon once offered its 2014 Unity game The Fall as one of the Epic Games Store’s weekly freebies.
Under Unity’s new licensing agreement, as Over the Moon pointed out via X (Twitter), suddenly being charged per installation for a game that was downloaded millions of times for free would result in a business-killing Runtime Fee.
In fact, by Unity’s terms as written, a user who installs, removes, and reinstalls a full Unity game that had reached the threshold for the Runtime Fee would result in the game’s original developer being charged twice for it. Theoretically, a bad actor could set up a server farm to automate that action, which could force a studio into bankruptcy by running up its Unity tab.
This all created a furious, growing backlash against Unity by development studios from all over the world. The changes drew sharp retorts on social media from multiple affected studios, including Pacific Northwest businesses like Innersloth (Among Us), Aggro Crab (Going Under, Another Crab’s Treasure), Mega Crit (Slay the Spire), and Rose City Games (The World Next Door, Floppy Knights).
Massive Monster, the creator of last year’s viral hit Cult of the Lamb and 2018’s The Adventure Pals, joked in a now-deleted tweet that it would outright delete Cult of the Lamb on Jan. 1 rather than pay Unity’s proposed fees.
In addition, campaigns have begun to boycott the Unity Unite conference in Amsterdam on Nov. 15, and multiple developers have announced they intend to stop using Unity, either immediately or in the future.
Unity later issued a FAQ that attempted to clarify the changes, such as stating that only full games’ initial installations are subject to the Runtime Fee. Developers can also enter into deals with Unity that would diminish or eliminate the fee, such as using Unity’s LevelPlay service. It also denied that the licensing change would be applied retroactively to games released before 2024.
“The Unity Runtime fee will not impact the majority of our developers,” Unity wrote in a Sept. 12 tweet. “The developers who will be impacted are generally those who have successful games and are generating revenue way above the thresholds we outlined in our blog.”
Unity’s attempts at damage control continued for most of the week, but the changes being offered at all have widely been seen as a breaking point for Unity’s user base.
“We believe wholeheartedly that the proper way to introduce big changes would be forward-looking, which allows developers to make an informed choice about whether to use the software for a project, knowing all the financial ramifications and implications,” Tyler Sigman told GeekWire.
Sigman is the co-founder and game design director at Red Hook Studios in Vancouver, B.C. Red Hook’s horror-themed RPG Darkest Dungeon II, built in Unity, left Steam Early Access in May.
“To change a fee model that applies to existing games is the equivalent of you leasing a car under certain terms, and then the leasing company sends you a letter informing you that you will now be charged money each time you start the car,” Sigman said.
Unity may yet walk back these changes, but in the short term, and to a massive degree, the damage has already been done.
“The implication here is huge, because nothing can prevent them from increasing the fees or changing them again,” Sigman said. “For Red Hook, the biggest issue is the uncertainty and trust breach that comes from knowing that the terms can be changed at any time. And we’re powerless, because we spent five years and millions of dollars developing a game that is built in Unity and there really is no practical option to change it to something else. What we can do about it is seriously reconsider what tech we would use on our next projects.”
“This whole fiasco feels like the writing’s on the wall,” Morgan said. “Features and bug fixes on the engine seem to have slowed after the last three rounds of Unity’s layoffs, and now they’re squeezing their existing customer base for extra revenue. We love working in Unity, but it’s hard to justify building a business on a platform that’s entering a death spiral.”
