Has Unity repaired the damage done by its Runtime Fee plans?

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At the very end of last week, Unity finally revealed its revised plans for the controversial Runtime Fee, which originally intended to charge developers every time their games are installed past certain thresholds.

You can find the full details here, but the key points are that the fee no longer applies to Unity Personal users, while Unity Pro and Enterprise developers have the option to avoid the charge in exchange for a 2.5% revenue share based on self-reported revenues.

Unity also made changes to the Personal plan, removing the need for the Made With Unity splash screen in games and increasing the revenue cap from $100,000 per year to $200,000, after which developers are upgraded to a higher tier.

On the face of it, this seems to remove some issues so many developers were up in arms about over the past two weeks. But Will Lewis, co-founder and director of Garden Story publisher Rose City Games, says the updated plans "only offer the shortest term relief."

"They indirectly address developers' primary concerns surrounding trust, which leads to extremely important matters like the sustainability and viability of game studios that use the tool," he tells GamesIndustry.biz. "Unity's initial plan shows that it is out of touch with the games industry, and dialing back without making a real commitment to 'what they've learned' makes it difficult for people to decide whether Unity is a healthy business consideration in an already volatile industry."

Rose City Games was one of many studios that spoke out against the decision via social media, with its statement on X saying the company is considering moving to another engine. For now, with two unannounced projects still being developed with Unity, the studio feels it has no choice but to press on. Even though the team no longer faces the fee, Lewis observes that Unity's current plan is still "far too open to creating additional work for developers," such as self-reporting figures and any unforeseen integration work.

Programmer Zoë Hamilton observes: "By giving the revenue share as an option, and making the cost charged the lower of either the revenue share or runtime fee, it gets rid of the potential for a game to become financially ruinous for a dev or studio while also allowing for worst-case costings for a project to be projected when pitching for funding."

But, she adds, the Runtime Fee was not the only issue with Unity's original announcement, and its revised plans are still more complicated than they need to be.

"If they had simply announced a straight revenue share model two weeks ago that applied from the 2023 LTS release onwards, there would have been some grumbles about Unity costing more [but] by and large most devs and studios would have accepted it. Those of us who release games using Unreal are already familiar with how that model works. The current plan is still more complex than it has to be, and I do wonder how many developers will just report game revenue numbers instead of just engagement numbers or both."

Martijn van der Meulen, co-founder and development director of Snap Finger Click, describes the whole situation as a prime example of "anchoring bias," whereby a selling party (in this case Unity) offers an unrealistic deal, then responds to customer outrage with a deal that's "similarly controversial but suddenly looks tolerable [by comparison]."

"The ethics of sales techniques like this are debatable – especially as the Runtime Fee remains a controversial aspect," he says. "In my opinion, Unity hasn't done enough to make me feel like they won't change the rules around this again at some point in the future. The changes to the plans will still result in developers being more open to exploring alternative game engines for their project, especially now that the trust in Unity has been broken, so from that perspective I don't think their changes have addressed enough of the concerns."

"Developer trust that Unity is a safe and stable partner to use is broken. We're all asking ourselves is, what will they do next?"

Zoë Hamilton, programmer

He points to this week's news that the developer of popular racing game BallisticNG has cancelled the Switch port due to Unity's policy changes as a sign that "we're clearly not out of the woods yet."

Rob Hewson, CEO and creative director of Huey Games, says that most of the concerns for PC and console-focused developers seem to have now been addressed, but it's unclear how mobile developers will fare and it will take time for the entire Unity developer base to "absorb the implications."

"For example, if Microsoft is still expected to pay any relevant runtimes fees for Game Pass titles, will that be factored into Game Pass deals moving forward, or subtracted from revenue?" he says. "Another point one of our team members has raised is that this could push the industry even more towards microtransactions within games; if it is a choice between the lower of a rev share and the install fee, then the cynical thing to do is to milk each install for all that it is worth.

"It's difficult to objectively judge how we would have felt if they had announced this version of the policy initially – the first, botched announcement having anchored expectations so low. There's no doubt it was a substantial improvement, and it was successful in dampening the sense of outrage developers were feeling, but we are all still digesting it."

Before the dust has even settled, Unity has already become embroiled in another controversy with developers and its customers noticed the Terms of Service have been removed from the engine's GitHub repository.

Hamilton said this is reminiscent of an incident in late 2018, when Unity changed its terms of services in a way that suggested any developers using Improbable's SpatialOS were violating the engine's licence terms.

Unity later made a commitment that TOS changes would be "tied to a specific version of the editor runtime," she explains, with clauses to that effect added to the EULA. However, the Runtime Fee controversy has highlighted that these terms were removed in April 2023. Unity has claimed they were removed due to low views, but developers are skeptical.

"I think developer trust with Unity will be broken for a long time to come," says Hamilton. "Because we've been in this situation before, I honestly don't know if Unity can restore trust. If they can, it'll only happen over time."

Lewis adds that removing the Terms of Service is "unacceptable," adding that he does think "the trust is gone forever," referring back to our recent discussion with developers about the original Runtime Fee plans.

"The aftermath of this will only really become visible over the next one to two years, when new projects are being started"

Martijn van der Meulen, Snap Finger Click

"It's now clear to everyone, no matter how much of a superuser they are, that there is a disconnect between Unity and its community," he says. "It feels like decision-makers tried to pull one over on us instead of coming to a common understanding. Unity is 'negotiating' in the most damaging way possible; making a seemingly untested announcement, then relying on pushback to communicate is no way to treat a customer."

Hewson cites the phrase "trust takes years to build, seconds to break and forever to repair," adding: "No matter what they announced after the original uproar – even if they had rolled everything back to how it was before – trust would not have been fully restored."

The way to address this, he suggests, is to invest in tools, services and initiatives that show developers they are valued and appreciated."

"They also need to show they have learned all the hard lessons from this incident and ensure they are better at executing and communicating changes in future. No doubt that process is underway."

Van der Meulen adds: "Thousands of developers and publishers trusted Unity as being a core component of their game creation pipeline. The chain of trust that was in place with Unity has been broken, and no plans have been announced that restore this. The pricing model has been updated, which is a good step forward. However, not rolling out a plan of action to specifically restore trust will hurt their business going forward. In the end, Unity is a publicly traded company and the impact of this drama on their shares hasn't been particularly significant by the looks of it, so any serious plans to restore trust, such as replacing leadership, seem unlikely to happen."

Developers also have lingering concerns about the future, not only over whether Unity might change the conditions of using its engine again, but also on the effect this might have on funding.

"Will publishers, crowdfunding, and other funding sources see games made with Unity as too much of a risk in the long term?" Hamilton asks. "Will players even want to buy games made with Unity over this controversy, and the multitude of other controversies in Unity's recent past?"

These studios are keen to assert that frustrations are primarily aimed at Unity's management, with all expressing sympathy for the tech firm's staff.

"My thoughts and well wishes go out to Unity's staff in the midst of these announcements – none of them deserve any harassment or temper," says Lewis. "I hope everyone negatively impacted by the recent announcements can work together to push the industry harder to make itself more viable, sustainable, and enjoyable for veterans and newcomers."

Van der Meulen tells us that his studio is just a short distance from Unity's UK office in Brighton, and six of the latter's employees have approached Snap Finger Click about career opportunities, despite the developer not having any job openings.

"I'd imagine that for other Brighton-based studios these numbers might even be higher," he says. "Unity's pricing announcement hasn't just disrupted how the game industry perceives them, but also had an impact on their own internal talent. Unity has always played a major role in allowing more teams to create games, but I fully expect there to be a long and painful aftermath, which doesn't bode well for Unity's future. I hope to be proven wrong, but I don't feel optimistic about this situation."

Hamilton decries the senior management's handling of both the announcement and the backlash, as well as the "PR disaster of calling those of us who use Unity to create games 'confused'" about its intentions for the Runtime Fee. Hewson, meanwhile, observes that Unity's executives have been "strangely silent in the public domain."

"I don't know what is going on behind the scenes, but it doesn't seem like the ideal optics when you are trying to reassure and rebuild trust," he says. "People want to see management owning this."

"As an industry, we need Unity to get their act together... Developers need Unity and, as the last couple of weeks have shown, Unity needs developers"

Rob Hewson, Huey Games

Lewis adds: "Unity needs to reconnect with its community and core changes would be change in leadership, real commitments to change with advanced notice that provide existing users with stability, and notable improvements to the tool – but who knows if that patch will ever come?"

All that remains is to see whether this incident has a long-term impact on the engine providers. For all the talk of studios planning to abandon Unity in favour of alternatives, this is not a change that will come swifty.

"What Unity have done is bought themselves some time," Hamilton suggests. "Changing engines is never easy, it takes significant time to retrain and retool your pipelines in a new engine.

"The changes announced at the end of last week are enough to stop the immediate exodus to other engines, particularly for games that are in production. But longer term? Developer trust that Unity is a safe and stable partner to use is broken. One question I think we're all asking ourselves is, what will they do next? Will they pull another Darth Vader and further alter the deal? Or will they return focus to being a stable game engine provider?"

Van der Meulen adds: "The updated plan is tolerable enough to at least prevent many developers from switching their engines mid-development. The aftermath of this will only really become visible over the next one to two years, when new projects are being started and developers will compare what game engine gives them the best value. Moving to a different game engine has never been this interesting before: Unreal Engine has always been very competitive, and there's significant movement around Godot as well. Everyone benefits from exploring these alternatives."

Hewson agrees that "the jury is still out" on whether developers shift to other engines, but also added that Unity's troubles and its ongoing struggle for profitability have not been resolved either.

"It's worth remembering that Unity has nearly 8,000 employees – double the number of Epic, which also has Fortnite bringing in huge revenue," he concludes. "Unity need to move towards a profitable and sustainable future, and perhaps they can do that while giving up some of the colossal market share that they have acquired, but one would imagine that they can't afford many more slip-ups of this scale.

"As an industry we need Unity to get their act together. We can and should have a healthy debate about monopolies and the need for more competition in the engines market long-term – but in the here and now, developers need Unity and, as the last couple of weeks have shown, Unity needs developers. We all need to proceed with that reality in mind."

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