Epic Games to cut royalty rate on Unreal Engine games
The recording of the keynote from Unreal Fest Seattle 2024. The announcement of the Launch Everywhere With Epic program starts at 00:31:20.
Epic Games is reducing its cut of the profits from games developed in Unreal Engine for developers that launch those games through its Epic Games Store.
Under the new ‘Launch Everywhere with Epic’ program, the royalty rate for Windows, macOS and Android games released on the Epic Games Store before or simultaneously with other online stores will be reduced from 5% to 3.5%.
Below, we’ve put together our FAQs on the new pricing for Unreal Engine, which is due to come into effect on 1 January 2025.
How does Epic Games currently charge for Unreal Engine?
Epic Games currently charges to use Unreal Engine, its game engine and real-time renderer, in two ways.
For non-games work, like VFX, virtual production and architectural visualization, it now charges a subscription fee of $1,850/year.
The fee is only payable by studios with revenue over $1 million/year: artists and studios earning under that threshold can use Unreal Engine for free on commercial projects.
For games, Epic charges a royalty rate – a cut of the game’s worldwide gross revenue above the first $1 million earned – which is currently set at 5%.
How is the way that Epic Games charges for Unreal Engine changing?
From 1 January 2025, the royalty rate Epic Games charges on games released on the Epic Games Store before or at the same time as other stores will be reduced to 3.5%.
The reduction does not apply to games already available on the Epic Games Store before 1 January 2025.
There is no change to the pricing of Unreal Engine for non-games work.
Which platforms does the reduction in royalty rate apply to?
The ‘Launch Everywhere with Epic’ program initially only applies to Windows, macOS and Android games.
For iOS games, Epic is “temporarily waiving” the requirement to ship simultaneously on the Epic Games store because of the “commercially prohibitive” Core Technology Fee that Apple charges developers to distribute products outside its own App Store.
What else do game devs have to do to qualify for ‘Launch Everywhere with Epic’?
As well as being launched on the Epic Games Store, to qualify for the ‘Launch Everywhere with Epic’ program, a game must have “parity” on the store.
That means it must have “substantially the same” features and content as the editions available on other online stores, including localizations and updates.
Marketing material – including pre-launch marketing – must also treat the Epic Games Store in an equivalent way to other online stores.
You can find more details in Epic Games’ new EULA, which game developers have to accept to qualify for the ‘Launch Everywhere with Epic’ program.
How does Epic Games charge developers to use the Epic Games Store?
Epic Games charges developers 12% of the revenue for games sold through the Epic Games Store.
For games sold exclusively through the Epic Games Store, this charge is waived for the first six months of the exclusivity period.
Games in this Epic First Run program will also qualify for the reduced 3.5% royalty rate.
In addition, revenue earned on games sold through the Epic Games Store for which Epic is the payment processor does not count towards the first $1 million earned.
Why has Epic reduced its royalty rates on games sold through the Epic Games Store?
Epic Games has been trying to encourage developers to shift from other platforms like Steam since first launching the Epic Games Store for Windows and macOS titles in 2018.
In August, it extended the Epic Games Store to Android games worldwide, and to iOS games inside the European Union.
The announcement has also enabled Epic to draw attention to its ongoing legal battles with Apple and Google over the conditions imposed developers selling games through their online app stores: games which include Epic’s own enormously successful Fortnite.
When will Epic Games announce more details of the ‘Launch Everywhere with Epic’?
Epic says that it will announce more details of the royalty reduction ahead of it coming into effect on 1 January 2025 so “developers will have ample time to plan”.
The firm also says that it will provide at least four months notice if the waiver on iOS games is changed.
Read Epic Games’ announcement of the Launch Everywhere With Epic program
Read Epic Games’ current FAQs on the license terms for Unreal Engine
Read the new Unreal Engine EULA
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