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The problem:
- A game which costs $20 makes about $10 on average (due to different prices in countries). For example, MGT2 costs $25 in the US and $4.50 in Argentina.
- In countries like Argentina, the game couldn't be sold anymore, because 20 installs over the lifetime, would lower the complete revenue to $0. In the worst case, it would even cost me money if too many installations were made.
- Updates could be made very infrequently, as an update might count as an install, or players might want to reinstall the game and try out the new features because of an update. For a game that has sold, say, 100,000, and in the worst case all players reinstall the game, that would be a cost of about $2000 (for that one update).
- Players (or whole groups of players) who are unhappy with your game can raise the cost to unpredictable levels. For example, if a small group of 1000 players reinstall the game 50x a day, that would be a $1000 cost per day for the developer. Within a month, a small studio like Eggcode would go bankrupt, or would have to remove the game from Steam immediately.
At the moment, I honestly don't know how to proceed. In the worst case scenario, many developers will be forced to remove their games from Steam on January 1. Which means that there will be no money for the development of the next game on a different engine (since you don't sell games on Steam during that time). In the default case, the old games have funded the development of a new game. Because of that quite a lot of units are sold during sales. But since the selling price of a game in Sale is too low, this option would not be possible.
Example:
- Mad Games Tycoon 1 & Mad Tower Tycoon 50% discount.
- This means that these games will be sold for $1-7 (depending on the country).
- But if too many games are sold in e.g. Russia, Turkey or Argentina etc., I pay money for this Sale instead of earning something.
No BS 95% of my games library uses Unity. It's the go to for indie devs everywhere
This is an incalculable financial risk.
Even if the invoices are sent to Valve or Apple, they will ban all Unity games from their platforms.
I'm not sure what justification they could have for that move. Some of these idiotic, greed-fueled business decisions are usually passed as "fighting against piracy" but I don't think anyone would be braindead enough to believe that in this case.
In this case it's purely greed. They think they've cornered a good chunk of the market and now it's time for predatory business practices.
As for why they are doing it, mismanagement. They have (or had) 7700 employees. They employee more people than Nintendo (6600), Epic has 2200. They've buried themselves in debt and expenses.
Basically, it is clear that every developer can expect at least $1-2 loss per sold game.
It will probably come down to the fact that all games will receive a significant price increase. Especially in the countries where the prices are very low (or are no longer sold there). For example, a "Vampire Survivors" can no longer be sold for under $2 in Turkey, Russia or Argentina etc.
However, this does not only affect low-priced games. For example, if I put "Mad Games Tycoon 1" on sale for 50%, the price would also drop below $2 in some countries. Even there, the risk is high that I pay more money than I earn.
I guess the times when games have a sale of 80% or 90% are over then.
Unless Unity completely reverses this announcement, I think I'll be switching the engine.
However, the developers' reaction was immediate. In addition, the head of Unity (or someone in senior positions) sold some of his shares in the company before this. This may be classified as insider trading.