PC Unity planning on charging developers *by individual installation* in the near future.

[Fanatical_Meat]

Did the game dev explain what he heard from a lawyer? Or is he well educated in law? Just asking, just because he is a dev and posts on youtube, it doesn't make his "facts" any more accurate than what everyone here is knowing or not knowing.

Especially the retroactive thing is something that should not be possible in normal circumstances. So before we have hard evidence of it actually being true you should use occams razor and except the normal way of things, not the sensational way.

If Unity has been losing money with their current pay model then they need to do something about it. If your grocery store raises prices it isn't because he is a money grabbing monster but he may need to because he may have more costs as well. And you always need to compare prices to similar offers. Is unreal engine really cheaper or more bang for the buck even after such a raise?

The problematic thing about this is ONLY that they seem to be looking for a new pricing mechanism instead of simply raising prices and the mechanism they showed is very suspect in quite a few ways. I can only guess they think their current pricing model does not fit the actual usage pattern, so some developers are charged right or already too much, and others can use the engine successfully without having to pay as much. 

Companies, particularly large companies want recurring revenue far more than one time revenue. Pricing as originally proposed allow them to become Qualcomm a company that holds multiple important patents that relate to networking and mobile devices. As of more than a decade ago they stopped doing anything meaningful and now live quite well off their recurring revenue. This is the goal.

 

[meganoth]

Companies, particularly large companies want recurring revenue far more than one time revenue. Pricing as originally proposed allow them to become Qualcomm a company that holds multiple important patents that relate to networking and mobile devices. As of more than a decade ago they stopped doing anything meaningful and now live quite well off their recurring revenue. This is the goal.

Yes, "owning" some market section is practically the goal of most companies. And the patent system is one way to achieve that goal as it works by giving out monopolies.

But unless you have a monopoly on something really "unavoidable" you have a hard time just sitting there like a spider and waiting for the money rolling in.

Unity can hope to benefit from the long tail of sales of games already published (if their contracts with developers provide for this option), but if they want too much those developers can as a final option remove those games from the market.

Unless Unity finally settles on something reasonable for their customers, their customers will in one way or another cease to be their customers. I am sure Unity came out with this plan months before the actual start so they could feel the waters. We as outsiders to this have a hard time judging whether the 20 cent are irrelevant, reasonable or preposterous to most developers.

 

[4sheetzngeegles]

This conversation is interesting, and has gotten me to go read more of the
back story leading up to now. Loop the loop roller coaster.

It has brought another question to mind if implemented. RE: ALPHA If Unity
does use it's runtime as a gauge. Would it apply differently depending upon
the stage of production. What I mean is, an alpha game such as 7dtd, has had
many versions and sub versions as they have progressed, toward their end goal.
Each time a new iteration is released, a new download is performed.

Would this not mean other than the future potential revenue, but also that any
game dev must complete their game in a single pass, bugs and all. No, alpha or
beta test.

That in turn could lead to lower quality and quantity of releases from indie co.
Redistributing, or monopolizing, the gaming industry for AAA production or already
established companies. Just as the analogy of grocery stores and pricing that meganoth
touched on. If that same store is the only one around, then it becomes a monopoly
regarding supply and demand.

Basically if this plan sets a precedent would it not go against this.

Regulatory measures to ensuring free and fair economic competition for markets while
addressing monopolies, cartel agreements and other factors which might impact the growth
and diversification of the economy.

 

[DanLW]

Here is the video without the commentary interrupting it:

 

[warmer]

It would depend on the popularity of the game in question.
as a singular purchaser, .2 or 20 cents is inconsequential.

A game that has sold 10,000 copies if each player installed
it only 1 extra time. that is a 4,000 dollar check.

The more popular a game is the higher the instant return.

7DTD has sold 16,000,000 copies. If each person installed it
1 extra time, then that is $3,200,000.00 "million" dollars
instant payout.

As an example: i took "4" samples to get a  numeric.
Among Us 600,000,000 downloads be generous and say 30 percent
is a secondary install. thats 180,000,000

This is just if a Single extra copy is installed. Its basically
unregulated numeric s.

Among Us: 180,000,000      *.2    = 36,000,000‬

7DTD: 16,000,000                *.2    = 3,200,000‬

ape out: approx 200,000     *.2    = 40,000

Rust: 12,400,000                   *.2    = 2,480,000‬

$41,720,000‬ instant back revenue owed by these game devs.

There are 38 other games. It adds up to, a poor business model
on Unity's part. To compensate, it is to be passed off on the game
developers.

An easier way to look at it is; If you didn't think ahead, got a
woman pregnant, and then expected me to pay the child support  just
because i live in the same building.

I hope it all works out

I understand your math, but when the software is 100x the cost of the "fee" so what is the issue? 1% is nothing. I pay Bandcamp and Tapalti and PayPal 15% on my music sales because they make it possible to sell anywhere in the world

If someone wants to keep 100% of their earnings, they make their own engine and sell directly from their website on servers they host.

The arguments I am hearing is the makers that facilitated the possibility of you earning millions doesn't deserve 1% and that is just crazy talk.

 

[Riamus]

I understand your math, but when the software is 100x the cost of the "fee" so what is the issue? 1% is nothing. I pay Bandcamp and Tapalti and PayPal 15% on my music sales because they make it possible to sell anywhere in the world

If someone wants to keep 100% of their earnings, they make their own engine and sell directly from their website on servers they host.

The arguments I am hearing is the makers that facilitated the possibility of you earning millions doesn't deserve 1% and that is just crazy talk.

It isn't that 1% or whatever is too much.  It is that the way they want to charge isn't good.  Based on that video, unreal charges 5% after a threshold is reached and no one is complaining about such a model.  However, unity is doing it in a bad way.  First, they can't accurately track install numbers that don't include reinstalls and just say they estimate (guess) and provide no proof they can do so accurately.  So they can basically charge anything they want.  Second, the percent the devs have to pay scales based on game pricing so a game priced lower will pay a higher percent, which is backwards even if they wanted to charge differently based on game price.  Third, this makes it so that making games free downloads such as through Epic Games or giveaways on Steam and GOG would be a very bad (costly) idea and so you will see fewer devs doing so if they use unity.  Fourth, this could be a very expensive January for devs as any game that has already reached the install threshold and the revenue for the past year is over the threshold for that would have to start paying a significant amount of money that they have not budgeted for.  And, last, as I mentioned before, many devs have low actual income already after paying all existing costs, so having to come up with more money out of nowhere and little choice to avoid it (most can't just switch to something else unless they just started development) will mean some developers will go bankrupt.

So, it isn't that 1% or whatever is bad but that the way they are doing it is bad.  A straight price increase or something similar to unreal would not have created the uproar.  When you trap the developers into suddenly needing to pay a lot more money without more than a few months warning when most have no way to avoid it, then that is bad business.

 

[warmer]

It isn't that 1% or whatever is too much.  It is that the way they want to charge isn't good.  Based on that video, unreal charges 5% after a threshold is reached and no one is complaining about such a model.  However, unity is doing it in a bad way.  First, they can't accurately track install numbers that don't include reinstalls and just say they estimate (guess) and provide no proof they can do so accurately.  So they can basically charge anything they want.  Second, the percent the devs have to pay scales based on game pricing so a game priced lower will pay a higher percent, which is backwards even if they wanted to charge differently based on game price.  Third, this makes it so that making games free downloads such as through Epic Games or giveaways on Steam and GOG would be a very bad (costly) idea and so you will see fewer devs doing so if they use unity.  Fourth, this could be a very expensive January for devs as any game that has already reached the install threshold and the revenue for the past year is over the threshold for that would have to start paying a significant amount of money that they have not budgeted for.  And, last, as I mentioned before, many devs have low actual income already after paying all existing costs, so having to come up with more money out of nowhere and little choice to avoid it (most can't just switch to something else unless they just started development) will mean some developers will go bankrupt.

So, it isn't that 1% or whatever is bad but that the way they are doing it is bad.  A straight price increase or something similar to unreal would not have created the uproar.  When you trap the developers into suddenly needing to pay a lot more money without more than a few months warning when most have no way to avoid it, then that is bad business.

Until you know how they are tracking we are all making a bunch of noise. Not one of us has a real picture on how this works. The best thing to do in this situation is to NOT blow things out of proportion, but there are lots of people making a ton of assumptions.

I am coming from the perspective things get tracked correctly, whereas everyone else is "assuming" things are going to be shady.

 

[Riamus]

Until you know how they are tracking we are all making a bunch of noise. Not one of us has a real picture on how this works. The best thing to do in this situation is to NOT blow things out of proportion, but there are lots of people making a ton of assumptions.

I am coming from the perspective things get tracked correctly, whereas everyone else is "assuming" things are going to be shady.

And how would they legally track this accurately?  They can get sales data legally but not install data.  At least in the US and, I believe EU.  I don't know about the rest of the world.

Also, this is direct from the unity website:

We leverage our own proprietary data model and will provide estimates of the number of times the runtime is distributed for a given project – this estimate will cover an invoice for all platforms.

So it is estimated and not actually tracked.

 

[DanLW]

The Hoeg Law video I posted earlier is very informative, and worth the watch.

Key takeaways:

The model seems to be pushing developers to purchase Pro ($3k/yr/seat) and Enterprise ($5k/yr/seat) pricing.  So if a developer has 10 devs, it would be $30k/yr for pro licensing.

No indication on how Gamepass installs work.  Likely, MS will pass it on to gamers or possibly developers as a "sales tax".

How do they track pirated installs?

The install tracking is "black box" algorithms.  This is new to the industry as there is no way to audit or prove accuracy other than "trust me".

The new agreement constitutes a breach of trust which is not necessarily illegal, but is unethical.  The old agreement allowed developers to stick to old Unity versions of they did not like the new agreement.  That clause has been dropped.  Not illegal, but shady.

Ambiguity exists between the various agreements and amendments.  If a developer disagrees can they stick to old versions, or do they have to stop using ANY version of Unity?

Possible legal recourse for developers exists in the concept of "promissory estoppel".  This goes outside the terms of the agreement and asks the court to provide relief on ethical grounds.  This can go either way.  Basically, contracts are not necessarily binding if they are egregious.  For example, if you sign a contract that says somebody can cut off your arm if you breach the contract, you could take it to court and a judge would almost certainly declare it null and void.

 

[4sheetzngeegles]

Riamus stated exactly what I was asking. I understand the
need and drive for profit in business. The diversification
is a smart thought, the industry "phones" is the hot sales
media medium at this time.

It may be thought of as a knee jerk reaction to the recent
past losses. But, the CEO's history is directly influencing
the fast paced acquisition.

Unity is a company, and a company only survives from profit, and
support. All of this I understand. But as Riamus pointed out.
The manner is not economically feasible for many that elected
the previous plan.

If you received a grant, for Master of studies in Science, were
beginning your third year of eight. Then the company that gave you
the grant decided to convert it to a loan and wanted immediate
interest payments for the past 3 years, in one lump sum.

Would the average reaction be: Pfft, Ok i got this.
Or How the #$%$% do I do this, I'm still a student. Now if you were one
of the fortuitous ones that have support from home, or were hired to a well
paying position, through nepotism. Its all good, but the majority or
not so fortunate.

And yes I know that is not how a grant is posted. It's a loose example
of a contractual agreement, where one party enters into it because
it allows them to progress, and this is what was offered.

The only other time I've seen this done is by Loan sharks, and Dealers.
You lure the clientele in,wait until they are entrenched/dependent, with few

other choices, then call in the newly created balance.

I'm mostly paying attention to the progress and outcome, because I'm hoping,
as an entrepreneur, this type of model does not become the norm.

 

[YourMirror]

Well the backlash is real:

Game devs with 3.5B installs say they will boycott Unity ads until its price increase is reversed | VentureBeat

 

[FramFramson]

Not posting a link as its easily searchable, but apparently today: "Unity was forced to close its offices in San Francisco and Austin on Thursday due to what it called a credible death threat"

Anyway, just interesting. Seems a but much coming out of the gate. 

In an added twist the the death threats (which ended up closing two offices in total), came from a Unity employee.

Brothers morale is high!

 

[dsZombiex]

...

If Unity has been losing money with their current pay model then they need to do something about it. ...

For all the data I could find, I didn't see a single quarter where Unity Software Inc didn't lose money. As I said in my post earlier with the link to net income charts, last year they were down almost 1 billion net income. They have good revenue but they always come out negative net income due to expenses. This has been the case for years. Now I'm guessing their debt is becoming too expensive to service and investors are becoming unwilling to pour more money into this money burning machine.

Last 12 months:

 

[DanLW]

For all the data I could find, I didn't see a single quarter where Unity Software Inc didn't lose money. As I said in my post earlier with the link to net income charts, last year they were down almost 1 billion net income. They have good revenue but they always come out negative net income due to expenses. This has been the case for years. Now I'm guessing their debt is becoming too expensive to service and investors are becoming unwilling to pour more money into this money burning machine.

Last 12 months:

View attachment 29139

That gives some perspective.  On the one hand, this move is something they hope can erase almost a billion dollars of negative cash flow.  So in that sense, this could collectively cost developers a billion per year.

But Unity can't keep operating with these sort of losses, so they have to do something to keep the lights on.  If they go under, the software gets sold and the new owners may stop giving it away for free.

 

[FramFramson]

For all the data I could find, I didn't see a single quarter where Unity Software Inc didn't lose money. As I said in my post earlier with the link to net income charts, last year they were down almost 1 billion net income. They have good revenue but they always come out negative net income due to expenses. This has been the case for years. Now I'm guessing their debt is becoming too expensive to service and investors are becoming unwilling to pour more money into this money burning machine.

Last 12 months:

View attachment 29139

Notice their Revenue and Profit are within industry standards, and yet they're losing near a billion every year - everyone should start asking where in the hell that two billion is going every year.

 

[Krougal]

The big issue for us as consumers is that reinstalls don't make the company any money.

They only make money off the purchase.

So now if they are going to be charged for the reinstallation, they are either going to find a way to pass those costs along to us or just make it more difficult for us to reinstall (like not maintaining free easy downloads).

Also since the GOG installer is self-contained and supposedly free of DRM (one of their main marketing points) I just don't see how they are going to start tracking that without doing some dirty stuff.

 

[t3hp0larbear]

I've been watching this unfold, and my latest take on the situation is that us as end users analyzing the potential costs devs will incur or trying to determine who exactly is going to be affected by this is missing the forest for the trees. The bottom line is that Unity Technologies is attempting to do something that is questionably legal at best by rug-pulling literally their entire client base and suddenly deciding to charge for things that were not agreed upon or considered by either party when contracts were signed. Even if the fees themselves aren't retroactive, this still affects any Unity-based product back to whenever they started integrating the telemetry into the runtime. This is absolutely not kosher and frankly I won't be surprised if Unity gets sued into the ground for pulling this.

I still wonder how TFP will be handling this situation, if Unity doesn't walk back this dumpster fire of a decision. 7 Days has already been in alpha for years and has been getting closer and closer in recent years to looking like a finished title, there is no jumping to a different engine at this point.

 

[dsZombiex]

Notice their Revenue and Profit are within industry standards, and yet they're losing near a billion every year - everyone should start asking where in the hell that two billion is going every year.

Expenses. They're a horribly bloated company. For example if we look at Epic Games, they have around ~2200 employees (2022 est). Unity Software Inc however has roughly ~7700 employees (2022 est).

 

[dsZombiex]

... rug-pulling literally their entire client base and suddenly deciding to charge for things that were not agreed upon or considered by either party when contracts were signed. Even if the fees themselves aren't retroactive, this still affects any Unity-based product back to whenever they started integrating the telemetry into the runtime...

Because they're gonna go bankrupt. Not that this is going to help... But it's something to think about. How will Unity devs handle it when Unity goes down and they can't get support anymore?

 

[FramFramson]

Expenses. They're a horribly bloated company. For example if we look at Epic Games, they have around ~2200 employees (2022 est). Unity Software Inc however has roughly ~7700 employees (2022 est).

Yes, so what does having that many employees do. That's an insane number of employees for an engine developer. WTF