Overview
Recently, there has been a lot of turmoil with Unity developers around the newly introduced Runtime fees for developers using the Unity platform. At Slidefactory, we were curious how those costs would affect us as a business when we use Unity for projects here such as McFarlane Digital, Broom Magic Mayhem, and Motusi. So, we decided to do a Unity vs Unreal cost analysis before spending many hours changing our pipeline and learning a completely new game engine. Whether or not you’re a fan of Unity and its recent decisions, we hope this article will help inform you about how you might be affected by these changes moving forward.
Who doesn’t pay anything?
First, let’s start with a comparison of when you DO NOT need to pay fees to these different game engines.
Unreal
- Before you make $1,000,000 lifetime revenue from your Unreal game/product you owe nothing.
Unity
- You are using Unity Personal and your personal revenue that comes from Unity, or your total business revenue is < $200,000 in the last 12 months.
Subscriptions
Next, there are subscription costs to take into account using both Unreal and Unity.
Unreal Enterprise
This subscription is only for non game professionals and requires terms discussions with Unreal, so we’ll leave it out of our future calculations.
- $1,500 per seat per year. So, 3 seats for 3 years would be $1,500 * 3 seats = $4,500 * 3 years = $13,500
Unity
Passed $200,000 in revenue, you are required to upgrade to a paid Unity subscription license. It’s worth noting, Unity does not let you mix and match plans, if you’re working on a project, everyone would need to pay for the same subscription per seat. It’s unclear from the FAQs how this works with Freelancers/Contractors, but the FAQs seem to say that you must invite Freelancers to your Organization and then pay for their license to help you build your product, even if they would qualify for Unity Personal, and you pay for Unity Pro. We’re trying to nail this down with a Unity rep and will make an update if we get a clear answer. Going forward we’ll use Unity Pro for our calculations.
- Pro – $2,040 per year per seat
- Industry – $4,950 per year per seat
- Enterprise – Requires consultation with Unity.
Unity vs Unreal Cost
The newest piece of Unity’s pricing model and the one causing the most tension with developers is the introduction of Unity’s runtime fees. It’s a bit complicated, so let’s see how it breaks down:
Unreal
- After your first $1,000,000 gross revenue from your product, you owe 5% from any additional revenue you make.
Unity
- After your first $1,000,000 in gross revenue AND your first 1,000,000 initial engagements (unique sales/installs), there is a pricing tier list to determine how much you owe:
- Next 100,000 engagements = $0.15 each for Pro and $0.125 each for Enterprise
- Following 400,000 engagements = $0.075 each for Pro and $0.06 each for Enterprise
- Following 500,000 engagements = $0.03 each for Pro and $0.02 each for Enterprise
- All remaining engagements = $0.02 each for Pro and $0.01 each for Enterprise
- The runtime fee is capped at 2.5% of your gross monthly revenue.
- This fee only applies to Unity 2023 LTS and beyond.
Cost Analysis Example Scenarios
Here, we’ll do some comparisons between different Unity vs Unreal cost scenarios to compare the two. We’ll assume for this example, that we’re using Unity Pro (paid subscription) with version 2023 LTS or greater. (Remember, if you make more than $200,000 in revenue as a business or an individual using Unity for that income, you need Unity Pro).
Scenario 1 – Low revenue, Low engagement
- Gross Revenue: $500,000
- Engagements: 500,000
- Seats/Timeline: 3 Seats, 2 years of development
Unreal Engine Cost
- Royalty-free threshold: $1,000,000
- Royalty: 5% on gross revenue above $1,000,000
- Since the revenue is $500,000, it falls under the royalty-free threshold, so: Unreal Engine Royalty = $0
Unity Pro Cost
- Runtime Fees
- The first 1,000,000 engagements are free.
- Since there are only 500,000 engagements, no runtime fees apply.
- Total Runtime Fees = $0
- Subscription Costs
- $2,040/year/seat for Unity Pro. For a team of 3 over 2 years, the cost is $12,240.
- Total Unity Pro Cost = Runtime Fees + Subscription Cost, $0 + $12,240 = $12,240
Cost Summary
- Unreal Engine: $0 (due to the revenue being below $1,000,000 royalty threshold)
- Unity Pro: $12,240 (solely for the subscription fees)
Scenario 2 – High revenue, High engagement
Gross Revenue Calculation
- Price per game: $10
- Number of engagements: 2,500,000
- Gross Revenue = $10 × 2,500,000 = $25,000,000
Unreal Engine Cost
- Royalty-free threshold: $1,000,000
- Royalty: 5% on gross revenue above $1,000,000
- Royalty = 5% of ($25,000,000 – $1,000,000) Royalty = 5% of $24,000,000 = $1,200,000
Unity Pro Cost
- Runtime Fees:
- First 1,000,000 engagements are free.
- Next 100,000 engagements = $0.15 each = $15,000
- Next 400,000 engagements = $0.075 each = $30,000
- Next 500,000 engagements = $0.03 each = $15,000
- Remaining 500,000 engagements = $0.02 each = $10,000
- Total Runtime Fees = $70,000. However, the fees are capped at 2.5% of gross revenue after the first $1,000,000. Cap = 2.5% of $24,000,000 = $600,000. The actual runtime fees would be the lesser of $70,000 and $600,000. So for our calculation, the runtime fees would be $70,000
- Subscription Costs:
- Unity Pro subscription = $2,040/year/seat. Number of seats = 3. Development time = 2 years. Subscription Cost = $2,040 × 3 × 2 = $12,240
- Total Unity Pro Cost = Runtime Fees + Subscription Cost = $70,000 + $12,240 = $82,240
Cost Summary
- Unreal Engine: $1,200,000
- Unity Pro: $82,240
Scenario 3 – Low Revenue, Very high engagement
This scenario assumes that the game price is very low, but gets a lot of engagement.
- Revenue: $2,000,000
- Engagements: 25,000,000
Unreal Engine Cost
- Royalty-free threshold: $1,000,000
- Royalty: 5% on gross revenue above $1,000,000
- Royalty = 5% of ($2,000,000 – $1,000,000) Royalty = 5% of $1,000,000 = $50,000
Unity Pro Cost
- Runtime Fees:
- First 1,000,000 engagements are free.
- Next 100,000 engagements = $0.15 each = $15,000
- Next 400,000 engagements = $0.075 each = $30,000
- Next 500,000 engagements = $0.03 each = $15,000
- Remaining 23,000,000 engagements = $0.02 each = $460,000
- Total Runtime Fees = $520,000. However, the fees are capped at 2.5% of gross revenue after the first $1,000,000. Cap = 2.5% of $1,000,000 = $25,000. The actual runtime fees would be the lesser of $25,000 and $520,000. So for our calculation, the runtime fees would be $25,000
- Subscription Costs:
- Unity Pro subscription = $2,040/year/seat. Number of seats = 3. Development time = 2 years. Subscription Cost = $2,040 × 3 × 2 = $12,240
- Total Unity Pro Cost = Runtime Fees + Subscription Cost = $25,000 + $12,240 = $37,240
Cost Summary
- Unreal Engine: $50,000
- Unity Pro: $37,240
Unity vs Unreal Cost Conclusion
In conclusion, we hope this cost analysis helped give you a basic idea of the upcoming costs of using Unity 2023 LTS compared to Unreal engine. Most of the time, because Unity caps their fees at 2.5% of gross revenue, it will almost always be lower than Unreal, sometimes substantially so, unless you are between $200,000 and 1,000,000 in gross revenue, where Unity’s subscription costs would make it the more expensive option.
It’s important to note that both of these calculations are on gross revenue, which doesn’t account for your profit. So, if your gross revenue AND costs are $2,000,000. You’d still owe money to both Unity and Unreal, even if you didn’t make any profit.
Unity recently launched a Runtime Fee Estimator that can help you do your own calculations based on your specific usage.
