Shulou(Shulou.com)11/24 Report--

Prior to this, Unity mainly relied on a monthly fee model with small profits and quick turnover, but the company's core value was lower than revenue expectations, and far lower than similar technology and business model enterprises such as Adobe, Nvidia, Qualcomm, etc., while the core of Unity's development is still the rapid growth of revenue sources and game scale.

Titanium media App learned that in response to the controversy over the Runtime fee model for real-time 3D content creation and operation platform Unity, Unity responded in a clarification presented to titanium media App on the afternoon of September 14:

The Runtime fee model from January 1 next year only charges for newly installed games and needs to meet the two thresholds of installation and income, rather than continuing to pay permanent license fees.

Unity stressed that more than 90% of the company's customers will not be affected by this change, some of them are in the number of game downloads, large revenue scale, and meet the threshold of the Unity Runtime fee model.

It is reported that on September 12, US time, Unity announced an adjustment, saying that if the relevant conditions are met, an additional "Unity Runtime Fee fee" will be charged from January 1, 2024, which will depend on the number of games installed (different subscription service indicators), and the main principle is based on the frequency of games installed by users and the revenue of related games.

Marc Whitten, president of Unity Create, said that the core point of Unity's launch of Runtime is to ensure that there is the right exchange of value between the company y and developers in order to better invest in the development of engine technology, and to ensure that Unity can provide people with tools to make excellent game software. He stressed that Unity is listening to developers to ensure that the best service is provided.

In fact, before that, Unity mainly relied on a monthly fee model with small profits and quick turnover, but its revenue was lower than the value of its core products and much lower than that of similar technology and business models such as Adobe, Nvidia, Qualcomm and Arm. The core of Unity's development is still the rapid growth of revenue sources and game scale.

(for details, see the previous article of titanium media App: "Unity China: internal testing of Unity engine from September, AI technology will permeate the whole game development process")

In August, Unity (NYSE: U) reported revenue of $533 million for the second quarter of fiscal 2023, up 80% from a year earlier and better than the expected $515 million, but a net loss of $193 million for the same period. By contrast, Nvidia, which has graphics and AI engine technology, had second-quarter revenue of $13.51 billion and a net profit of $6.188 billion, up 843% from a year earlier; Arm,2023, which charges licensing fees for equipment, had fiscal revenue of $2.679 billion, much higher than Unity.

As a result, Unity has to choose to improve its business model to achieve greater value.

It is reported that the game that triggers the extra fee for Unity Runtime needs to meet two conditions at the same time: the game's revenue has exceeded the set minimum income threshold in the past 12 months; and the game has exceeded the set minimum number of life cycle installations.

Among them, Unity Personal and Unity Plus customers need users with revenue of $200000 or more in the past 12 months and at least 200000 lifetime game installations, while Unity Pro and Unity Enterprise customers need revenue of $1 million or more in the past 12 months and at least 1 million lifetime game installations.

On the afternoon of September 14, Unity made a clarification about the controversy between the market and developers.

The following is the original statement: we know that after the announcement of the new Runtime fee model, people are confused about some issues. Here, we would like to clarify some of the issues and concerns that we are most concerned about:

Who will be affected by the Runtime fee launched this time: this Runtime fee model has a higher threshold, and more than 90% of our customers will not be affected by this change. The customers affected are usually those who have achieved a considerable scale of game downloads and revenue and have met our installation and revenue threshold.

This means that for creators who have not yet achieved scale success, the cost of Runtime is very low (or not), while for those who have already achieved scale success, the fee is also a moderate one-off charge.

We charge for new installations only: once both the installation and revenue thresholds are met, you will only need to pay Runtime for new downloads generated after January 1, 2024. And, this is not a continuous payment, you only have to pay a fee for the new installation, unlike the revenue-sharing model, which requires a continuous payment of permanent royalties.

How do we define and calculate installation: assuming that the installation and revenue fee thresholds are met, we will only calculate the net new installation on any device from January 1, 2024. Developers do not have to pay Runtime fees for the following situations:

Repeat installation fee: we will not charge for repeated installation.

Fraudulent installation fees: we will not charge for fraudulent installation. We will work with you directly to deal with suspected malicious fraudulent installations or zombies.

Trial version, part of the game demo and Automated installation (DevOps) costs: we will not include these in the installation. The pre-emptive experience version of the game does not fall into the category of game demo.

Web games and streaming games: we also don't count Web games and streaming games into the installation.

Charity-related installations: Runtime costs and installation count will not apply to charitable donation programs / initiatives-related installations.

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