Recently Unity changed the pricing policies for its popular gaming engine that will become operative on Jan, 1st 2024.
The change introduced what has been defined as "installation tax" by many news outlets.
How is the Unity Runtime Fee calculated?
If a game or app meets the minimum thresholds for eligibility, the Unity Runtime Fee will be calculated based on the applicable rate (depending on the number of installs, the country of installs, and the user’s Unity plan) multiplied by the number of eligible installs.
The runtime fee schedule provides tiered rates based on your Unity plan (Unity Personal, Pro, or Enterprise). For a game with a high number of installs spanning more than one tier, the first set of installs will be charged at the first per-install rate, and incremental installs above the first set, charged at the second tier rate, and so on.
For example, let’s look at a hypothetical game made by a team using Unity Pro with the following revenue and install numbers:
Revenue from last 12 months - $2M USD
Lifetime installs - 5MThe Unity Runtime Fee will apply to this game, as it surpasses the $1M revenue and 1M lifetime install thresholds for Unity Pro. Let’s look at the game’s installs from the last month:
Prior month installs (Standard fee countries) - 200K
Prior month installs (Emerging market fee countries) - 100KThe fee for install activity is $23.5K USD, calculated as follows: (100K x $0.15 (first tier for standard fee countries)) + (100K x $0.075 (second tier for standard fee countries)) + (100K x $0.01 (fee for emerging market countries)) = $23.5K USD
Note that this example shows just the fee for the month in question. Fees will likely vary month to month based on the previous month’s installs, including the potential for months with no charge.
References: blog post announcing the change, FAQS on Unity site
As expected this caused an huge backfire in the gaming community, with many developers stating that Unity set a new low in the market and announcing their plans to leave what they now see as an enemy to the industry. Many also noticed that a tax based on the number of times a game is installed would actively harm f2p games, charity sales and so on.
At the same time many started to question the actual legality of this move.
The way the change is worded seems to imply a single sided, retroactive change to pricing for existing games using the engine. Some users have posted online very serious claims about potential frauds that in some cases even goes as far as claiming that the attempted change would qualify as an extortion.
An example of those claims, taken from reddit
I'm fairly certain that Unity is providing no service or product at end-user install time... So to try to charge for this would land under something I've heard termed as "illegal billing".
One big sticking point for me is that there is also no consent collected at time of end-user install from the party being billed.
If Unity is try to pass this off as some sort of service, then what added value was provided to the party being billed? Was there a way to opt out? (excluding terminating business with a product they are dependent on)
Even with free software products that had components that had fees attached to libraries being distributed: These fees could only be charged when the party being billed allowed the end-user to download the product. Because that was when the end-user obtained those libraries from the party being billed.
Banks have been forced to pay back fees that tied to no actual service. I don't think Unity can accomplish something that giant financial institutions could not.
This may legally be Extortion: Seemingly locking the party being billed into a business agreement that they have no control over and can never walk away from.
This may legally be Fraud: Unity sending a bill for these "services" where nothing was provided...
If 5 or 6 is true, this means potential jail time after they actually send their first bill. The actors who could be charged would be any and all management at Unity with decision power related to implementing this policy.
I'm not sure how this got this far because if I'm right... there is possible disbarment of any legal team members that were asked to advise and didn't try to stop them...
Lastly I do not think that many judges would look favorably on this. I think they would likely see this as profiteering (If I'm wrong and it is not extortion or fraud). This is because the companies using Unity staked their and their employees livelihoods on the pricing schemes first laid out. A massive swing in price for those locked into this ecosystem without strong justification for the price increase can lead to punitive damages.
In the same thread another user claims that:
In Germany, this price change could only be introduced without any problems under the following conditions:
no retroactive effect of the price change in terms of time
Price change valid from a key date in the future
Price change valid only for developments started from or after the key date.
Already finished products or started developments remain subject to the old price structure.
I don't have the required knowledge to validate this claims, so I am posting this question here to get some input from more experienced users in the field.
As you can see this is a quite big story at the moment, so I would love is someone could provide a more accurate analysis of the issue that goes past the usual "this has to be illegal" heart-based social media claims.
So my question is the following:
Can this change can really be pushed to already existing games that were developed in the past under different terms (this would seem an abuse since an existing game has no way to "walk out" of the contract without completely forfeiting its ability to be sold and thus monetize-able)?
Apparently Unity recently changed it ToS to remove a clause that protected the user from "retroactive price changes" and at the same time tried to hide the said update by deleting their public changelog repository... but I think that despite their attempts any already marketed game should still be subjected to the old version of the ToS?
If the scope of this question seems too big, please let me know if this can be fixed by scooping to specific countries and /or jurisdictions.
