In a recent announcement at Unreal Fest 2023, Tim Sweeney, the CEO of Epic Games, shared some significant changes coming to the pricing model of Unreal Engine 5. These changes have sparked discussions and concerns within the development community, particularly among those who rely on Unreal Engine for various industries beyond game development. In this blog post, we'll delve into the details of these changes, who they will affect, and what you can expect when they go into effect in 2024.
Table Of Contents
Why the Change?
Tim Sweeney's announcement shed light on the reasons behind these pricing alterations. Epic Games, the company behind Unreal Engine, had expanded significantly in recent years. They acquired several companies like ArtStation, Quixel Bridge, and Sketchfab, offering various services for free to users. This expansion led to a situation where the company had hired more employees than necessary. To address this, Tim Sweeney mentioned that they will be switching to a per-seat licensing model for Unreal Engine.
Who Will Be Affected?
The key question on everyone's mind is who will be affected by these changes. Tim Sweeney's speech clarified that the shift to a per-seat license will primarily impact industries other than game development. This includes sectors like film, VFX, live events, and the automotive industry. If you are a game developer, you can breathe a sigh of relief because Unreal Engine will remain free for game development.
A Revenue Threshold
While the CEO's announcement didn't specify the exact minimum revenue threshold for commercial projects, further clarification came from Tim Sweeney himself. Responding to a question on Twitter, he confirmed that there would indeed be a revenue threshold. However, it's essential to note that indie filmmakers and students or educators using Unreal Engine will not be affected by this change; the engine will continue to be free for them.
Speculation on Pricing
Given the absence of precise figures, some speculations have arisen regarding the potential impact of the revenue threshold. It's conceivable that projects grossing over a certain amount—possibly more than $100,000—may need to subscribe to an enterprise license, paying on a per-seat per-year basis. It's important to remember that these are speculative numbers and not official figures.
Epic's History with Revenue Sharing
Epic Games has a history of sharing revenue with developers, particularly in the gaming industry. If a game generates revenue exceeding a million dollars, Epic takes a 5% royalty on the revenue earned beyond that threshold. However, this royalty model does not apply to industries like film and automotive.
Conclusion
In summary, Unreal Engine 5 will undergo pricing changes in 2024, transitioning to a per-seat license model for industries outside of game development. A minimum revenue threshold will apply to these industries, potentially impacting larger projects and companies. However, indie creators, students, and educators can continue to use Unreal Engine for free. While these changes may raise concerns, they reflect Epic Games' efforts to adapt to their evolving business landscape.
It's important to stay updated on any official announcements from Epic Games regarding the specific pricing details and revenue thresholds as the implementation date approaches. These changes are a significant development in the world of game engines and 3D development, and their impact will become clearer as we move closer to 2024.
To get notified of upcoming posts on Unreal Engine, I invite you to subscribe to our newsletter:
And if you are just getting started learning Unreal Engine, have a look at the Unreal Engine for Beginners Course :