Oculus covered a lot of ground during their opening keynote at Oculus Connect 3 this week; among many exciting announcements, one of interest for Unreal Engine developers might be how Oculus says that they’ll cover the royalty fees for any Unreal Engine applications on their store, up to the first $5 million in gross revenue.

That means that developers, who must normally pay the engine creator 5% of their gross revenue, can get up to $250,000 in fees covered for each game. Oculus, who earmarked this week another $250 million in VR content investment, has had a close relationship with Epic Games, the makers of the Unreal Engine, since the inception of the Rift headset. The engine enjoys a large presence both on the Oculus store and with Oculus’ own in-house VR experiences, such as Farlands and Dear Angelica.

Facebook Founder Says Company Invested $250M in VR Content, Will Invest $250M More

This could be a great deal for VR devs; getting into VR development can be difficult for many reason reasons, including financial, even though game development in general has kept getting cheaper and cheaper over recent years. Unity for instance, Unreal Engine’s biggest competitor, has also made game development much cheaper and more accessible. Like with Epic, Unity also has close ties and influence with Oculus, and Oculus has previously offered free Unity development licenses to its budding VR development community.

However, while the prospects for Unreal Engine developers seem nice on the surface of the announcement, there are no further details on how exactly Oculus will cover the Unreal Engine fees, and what restrictions there may be. For instance, no details have been given on whether or not this offer applies to developers who were already on the Oculus store prior to the announcement. It may be that they only want to spend money on attracting new developers into the ecosystem, in which case, the Unreal Engine developers who’ve already published on the Oculus store would not get the funds. There also doesn’t seem to be any details on how long this offer would last, or if they do in fact intend it to be something permanent. We’ve reached out to Oculus for clarification.

Getting to $5 million in revenue is a high and almost certainly unseen bar for any single VR application at the moment though, so for developers to take full advantage of the program, they’ll need to demonstrate more than just short-term success.

Watch Epic Games' Nick Donaldson Build a Scene in Unreal's VR Editor

Either way, there’s still a lot of value at stake, and it may prove a good influence on not just the Oculus platform, but the VR industry, as more developers get into VR, and start getting more funds needed for future VR projects.

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  • Pistol Pete

    Funny this sounds very similar to what Valve/Steam is doing for VR devs. But guess what. Valve states they will NOT make those games exclusive. Think Oculus will do the same? Of course not.

    • wheeler

      Exactly. Are they being upfront about what this is in exchange for? Pushing exclusives on the PC is a disgusting business practice. Enough with this “VR is a platform” bullshit.

    • Cristianfx

      thats why SteamVR is crashing almost everytime with the Dk2 o CV1.

      • DiGiCT Ltd

        SteamVR also crashes sometimes with a Vive, mostly when you have some faulty stuff setup in Unity or UE4.
        I can assure you its not Oculus specific it crashes.

    • Get Schwifty!

      And ultimately what difference does that really make (assuming its even going to go the way you think)? You got a Vive and either have to wait a time to play the “exclusive content” or use Revive? In the end they are helping seed content… every bit helps.

    • benz145

      Steam isn’t a game engine. To my knowledge, Valve isn’t waiving any of its platform fees for VR devs, so they are the same in that regard to Oculus.

      • DiGiCT Ltd

        Steam is a online game content platform owned by Valve.
        Valve has a game engine too and is called “Source Engine”

        • benz145

          Indeed, but almost no one is building VR games with Source Engine. Even Valve is using Unity for all the projects we’ve seen so far.

    • Andrew Jakobs

      Mind you, the cost WILL be deducted from the steamsales.. read the fine print. So you get the money upfront but will have to pay it back through steamsales, and only when you have repaid the ‘grant’ you’ll actually start making money…

  • DiGiCT Ltd

    There are alternatives to UE4 which dont ask gross revenue,
    Cryengine 5 is one of them.
    Unity also no gross revenue shares.

    Developers not willing to invest a little in their tools to make a VR game cant be taken serious anyhow.
    The mayor costs are 3D artist, those software licenses and workstation specs are high compared to just what a programmer needs,
    Reusing code is also easier as reusing 3d art, as code players dont see, but visuals they do.

    • benz145

      So you’re saying anyone using Unreal Engine can’t be taking seriously?

      • Liviu Berechet Antoni

        It can be taking seriously, it’s a great engine, but it’s very difficult for small teams to do anything with this offer. The average established game studio spend between £10m to £60m to make a game — so for them buying a UE4 licence where they don’t give away any royalties is a feasible business model. The conflicting aspect of this announcement is that they are addressing the emerging VR studios, who, unfortunately, simply won’t be able to afford giving 5% of their revenues — on top of the 30-50% margin that most platforms like stream, google play, playstation etc. charge.

        • Andrew Jakobs

          You can always create your own engine with it’s tools, but I think it’s cheaper in the end to just go with these engines and pay the royalties.. (I do agree the royalties for the UE4 are in a different line as they were with the UDK which was more indie friendly).. but then again, 5% over gross is still a lot smaller than the 30-50% the platforms like steam takes, IMHO those are the real moneygrabbers, for doing nothing really much they just take one third of your revenue..

          • Liviu Berechet Antoni

            UDK was such a great engine — for it’s time. It had it’s bugs, but you really felt it was worth the money (the multi platform aspect was quite a great feature back then, wasn’t it?).

            Yeah, it’s difficult to fight the platforms, it’s such a monopole, isn’t it? And it’s not like you have any other options… either you blow over or you just quit the industry.

      • DiGiCT Ltd

        No, people which nearly dont want to invest in developing games you cant take seriously.
        It is not the engine you choose as we use both, some UE4 users are even nagging about that 5% , although even before UE was way more expensive to use.
        Unity has its personal edition which does not cost anything, but you cant have a gross sales higher as $100.000/year , you need to upgrade, also they are per seat in unity and in UE4 they are per released project.

        In unity you see devs complain for refunds for an asset that cost $20, which is also just such a thing, if you need to prototype an asset yourself the cost will be much higher as $20.
        Hope you get my point better now.

    • Andrew Jakobs

      what nonsense, if you want you can buy a license to UE4, but it’ll cost you a lot.. And the UE is still a lot more mature than the Unity engine (which is also great). Also let’s not forget Unity is a license per seat, and it means a developer and a designer both need a license, any designer that uses the tools needs a license..
      But you are right, the engine itself is not the biggest cost, but if you’re a bigger company you can also just buy a license to the UE where you don’t need to pay gross revenue, but those licenses are very expensive..
      Yes you can go with the Unity engine, but there is a reason why the bigger studio’s use the Unreal Engine over the Unity engine..

      • Liviu Berechet Antoni

        That’s so true, isn’t it? 2 years ago VR seemed to be the best chance for the games industry to clean it’s act and empower the new studios and indie developers, but somehow, the big “evil corps” of the games industry managed to flip this around back to the point where indies and startups don’t stand a chance at competing in the market… :/

        • Andrew Jakobs

          Indies and startups always have a chance at competing in the market, but ofcourse it’s impossible for an indie or startup to do the same what the bigger companies can with a team of a few hundred people, that’s always been the case when graphics became more elaborate.. To be honest, at the moment is one of the best time to being an indie, with all the cheap tools available which previous were only available to the big companies with big money..

      • DiGiCT Ltd

        Both of those engines have their cons and pros UE is not perfect at all and so is unity not perfect.
        For coding unity is more easy as UE4 but for art UE4 is better again.
        It just depends on what you want.
        Designers dont need a unity license there is a unity personal edition which work as a plus and pro version so that statement your wrong.

        UE4 licenses are different as previous epic engines all is based on 5% gross revenue share with certain exceptions.
        Your information is outdated or you just want to make some noise, we use both engines and also added Cryengine 5 although this is still early to be usefull.(bugs)

        Size of a company does not matter at all, what matters is having skilled people and the money to invest to make a good product.

        • Andrew Jakobs

          You DO need a license if you’re a designer in a company over a certain amount of income, you’re not allowed to have 1 or 2 pro versions and the designer using a personal edition, you’re in violation of the license if you do..

          And you’re wrong in regard to the UE4 license, regular licenses are as you described, but you can go for a custom license (https://www.unrealengine.com/custom-licensing), so my information is NOT outdated, and i’m NOT making some ‘noise’.

  • DiGiCT Ltd

    Additional to this article :
    UE4 does not ask for all a gross revenue, although for games they do , but not for presentations, education or cinematic.
    Just look up on their site there are exeptions, so making cinematic VR expierence it migh end up for you getting nothing but also paying nothing ;)

    • DiGiCT Ltd

      Copy from their mainpage bottom.

      5% When You Ship

      The 5% royalty starts after the first $3,000 of revenue per product per quarter.

      Pay no royalty for film projects, contracting and
      consulting projects such as architecture, simulation and visualization.

      So yeah VR movie experiences its free!

  • Torben Bojer Christensen

    Why exactly Unreal engine, when Unity apparently makes for much better/smoother VR visual experience in a HMD (Take a look at The Lab, Tilt Brush ect.) than Unreal titles, now that Oculus also works closely with Unity? It does not sound like the same deal with Unity or is it? (It is said that Oculus “offered free Unity development licenses to its budding VR development community”)

    In any case: Would it not be better to push developers towards the engine that produces the smoothest and best looking VR experience? I have yet to see a Unreal engine title in VR that matches the unity titles, when it comes to visual quality in the HMD, even if as strong as possible supersampling is utilized on the Unreal engine title.
    (Geforce GTX 1080)

    Note: I’m not talking fundamental game graphics/game designs/looks as such, but distortion such as aliasing and shimmering when close-up to the screen in a VR/HMD experience.

    • yag

      You are saying supersampling works better in Unity games ? Interesting.
      It’s true that a game like ‘The Solus Project’ (made with UE4) is pretty aliased for me, even with SSAA (otherwise the game is beautiful).

      • Torben Bojer Christensen

        I did not think anything along those lines, as I/you do not even need to supersample The Lab ect. But now you mention it; AFAIK some Unity titles does their own native and measured supersampling, dependent on your hardware …As such The Lab also looked way better when i switched to GTX 1080 from GTX 970 without me chancing anything myself. (In fact manual supersampling tends to fuck up the natively applied supersampling in such titles)

        I play The Solus project (170% manual supersampling) and Raw Data (140% in-game supersampling to avoid reprojection) myself. …Both UE4 titles. And yes the graphics in it self is pretty, but the aliasing and shimmering unfortunately is much more manifest and visible than on the apparently much better VR optimized Unity titles, as they just looks much more distortion free, even without applying manual supersampling.

        • Sch@dows

          The Lab (except for robot repair) is build upon Unity with Valve plugin, which include adaptative quality (resolution, AA and other parameters are changed based on the margin the GPU have).

          During GDC, Valve explain why they chose Unity to develop their plugin : it’s because most of the UE based games are developed by big team with rendering engineers, while most of indie games (which don’t have neither big dev team nor rendering specialist) are made with Unity, so working with this engine was the best way to help the VR community to grow.

          That was not based on a judgment over quality of the engines.

          • Torben Bojer Christensen

            In the meantime I also found this explanation for the display quality difference on Reddit:

            The problem seem to Unreal’s standard deferred rendering pipeline, which pretty much sucks for VR games because it doesn’t support real MSAA anti aliasing, but only crappy post-FX anti aliasing which just looks horrible in VR (Remember we are talking HMD only). The unity titles simply look so much better in the HMD while maintaining a good framerate, because they make use of a forward plus renderer which allows for MSAA.

            So at least there is hope. When UE4 standard deferred rendering pipeline is updated with a forward plus renderer allowing MSAA AND the developers starts utilizing it, the problem should be be solved.

            quasi-quotations from: https://www.reddit.com/r/Vive/comments/4tbear/unreal_engine_deferred_rendering_and_the_lack_of/

          • David

            UE4 forward rendering branches, Oculus has a branch. And less officially the VR renderer mods for Ethan Carter have been shared (where it sounds like they largely disabled deferred rendering)

            I’d also like to emphasize that Valve’s Robot Repair was done using Source2. Unity does help democratize VR development and Valve’s contributions are excellent but to eke out the most performance and highest quality you’ll find UE4 is more suitable based on a superior multi core support and access to the complete engine source code. Unity will catch up as improvements are coming all the time.



          • Torben Bojer Christensen

            Happy to hear it. Looking forward to UE4 forward rendering titles sometime in the future.

            As a user i really don’t care what engine have been used. I do however care if it looks good or full of distortions.

          • Zerofool

            UE4’s forward rendering path will come natively in version 4.14 (it is based on the Oculus branch AFAIK) and will bring support for MSAA, finally. Take a look at the official UE roadmap:

            Epic’s Robo Recall will be using this rendering path apparently.

          • benz145

            Should be noted that Epic’s recent Robo Recall is built with a new forward rendered based on some work Oculus had done:


            The game isn’t just fun, also impressively beautiful. That’s the norm for pretty much anything Epic has set their minds (and their impressive Unreal Engine) to, but Robo Recall in particular uses some new tech from Epic to look extra sharp in VR.

            Epic Game’s Nick Whiting told me that the company wrote a new forward-renderer to eek out extra graphical detail in VR. Partly based on Oculus’ work, the renderer opens up the door to MSAA in VR which Whiting says really enhances the sharpness of geometry which is especially noticeable in VR thanks to stereoscopy.

  • Liviu Berechet Antoni

    Does anyone actually believe a game publisher like Microsoft / Ubisoft / Sony pays 5% of their multi billion sales per year to a game engine company? if you are an indie developer you must be crazy to pay 5%, just think about it, 5% of your gross revenue, before paying salaries, taxes, computers, advertising etc. (!!!).

    Don’t be naive. This is not “the game industry helping the new generation of developers”. Oculus helped build the VR pipeline for Unreal Engine and they helped promote Epic’s engine as the best VR engine, so you can be sure Oculus gets some of that 5% back. Unfortunately, the games industry has some disgusting business practices… I wouldn’t be surprise if that £250m fund is nothing more but a quick spreadsheet calculation of how much would Oculus / Epic make from 1% of software revenue per year — Goldman Sachs reports a VR software market size of 35 bn per year, so 1% is over $350m.

    But there is nothing you can do… :/

    • Get Schwifty!

      Welcome to free-market Capitalism… great things emerge but don’t look at the sausage being made….