The Unreal Engine 5 tech demo on PS5 wasn’t the only news Epic Games revealed today. The company also announced a change to the pricing structure of Unreal Engine which waives royalties on the first $1 million of project revenue, as well as the launch of Epic Online Services, a free suite of tools to enable in-game friends lists, matchmaking, lobbies, and more.
Alongside the reveal of Unreal Engine 5, Epic Games today also announced a change to the pricing of Unreal Engine. Previously the cost to use the engine for building games was a 5% royalty on gross revenue of the game. Now Epic says it will waive the royalties for the first $1 million in revenue, and then resume the 5% fee from there. This is a permanent change and applies retroactively to revenue from January 1st, 2020.
That works out to mean developers get back $50,000 (not counting platform royalties) from that first $1 million that would otherwise be paid in engine royalties.
Epic already waives engine royalties on all revenue generated from games sold on the Epic Games Store (where it instead collectes a flat 12% platform royalty), but this change now means that games built with Unreal Engine and sold elsewhere will get a sweeter deal. Unreal Engine is also free for personal use, free projects, and linear content creation.
Unity, the other popular game engine for VR content creation, ranges in price from $40 to $150 per month per seat, depending on project scope. A free version of Unity is available for free projects or those earning less than $100,000 in annual revenue.
In addition to the royalty change, Epic Games also announced the launch of Epic Online Services, a free suite of tools and services which allow developers to build cross-platform, engine-agnostic multiplayer capabilities into their games. The company says that Epic Online Services offers matchmaking, lobbies, peer-to-peer networking, achievements, stats, leaderboards, player data storage, game analytics, and player ticketing.