[raincole]

Unity had 7000+ employees before layoff.

Valve maintains one of the biggest platforms, and their own game engine. Valve also developed CSGO, TF2, and Dota, all popular online games that need constant maintenance (and even big content updates sometimes). Valve also invested in VR and sells hardware.

Valve has 1200 employees.

To me it's easy to see why Unity lose money.

[teamonkey]

Unity are currently asking for 4% of revenue over $1M for developing the engine and toolchain that game developers will use all day every day. Valve skim 30% of the retail price of the game for the priveledge of hosting a game on their storefront. This is why Valve makes money.

[gmerc]

Valve delivers massive value equivalent to entire departments in a publisher through their steamworks system.

Distribution, Analytics, Multiplayer, Anticheat, Publishing Services, Anti Piracy, Storefront, Sales, Mods, Custom Content Integrations, Localisation, and most importantly discovery (things you pay for dearly outside on mobile).

They never had need to convince developers that the fee is worth it and they never had to retroactively change terms of service. They have continually invested into the system and built the trust.

Most of all, Valve chose the long term sustainable business model when everyone else in the industry tried to extract per download charges from gamers. So gamers chose the company that sold them their game collection, just in the cloud instead of nickel and diming.

And developers chose valve because they were infinitely more trustworthy and offered better tools than any of the legacy publishers. They never increased the fees because they made bad bets either (and they had a few like VR)

Yes there’s a case to be made that the 30% should be reduced now, but realistically few could compare Valve to Unity when it comes to execution and long term value balancing for developers and gamers.

[teamonkey]

I just find it really strange to think of Valve's 30% cut to be value, when its main advantage is being an oligopoly, but Unity's 4% cut to be rent-seeking, when it's the foundation and toolset for the software being made.

[raincole]

It's both rent-seeking.

But I can't help but feel you're willing to twist the facts to defend Unity. I'll list some facts for the readers:

1. The 4% cut is a rumor at this point. It's not confirmed.

2. Unity didn't just announce a 4% cut at the first place. They announced a fee per install. It's an unprecedented business model. No other semi-popular game engine does that, ever.

[teamonkey]

I'm not defending Unity, I'm just not defending Valve/Steam (also App Store, Play), which is a much, much bigger drain on revenue.

The Unity pricing structure is complicated and badly managed. The fees were previously uncapped, and it allows for edge cases where the fees look like they could exceed revenue. It causes problems for givaways, bundles and Gamepass deals.

Still, for many situations the math works out so Unity is cheaper than Unreal, even before this 4% rumour. You wouldn't want to accidentally hit one of those edge cases though.

[OkayPhysicist]

The baffling thing is that the new monetization scheme seems especially designed to destroy the freemium/mobile market, which is exactly the market they've been so actively courting the last few years.

If you told me that Unity was going to try and monetize through some strange approach, I would have guessed that the scheme would have favored the freemium approach, not turned it into an extremely risky gamble.

[daemin]

I think it's easier for people to rationalise a simple cut of each sale rather than a fee for each "unique" installation. In the first case you can calculate that percentage easily in a spreadsheet and account for it in your business. In the second case it's totally unknown how to budget for. Should you assume 1, 2, 5 installs per purchase? How much of your revenue does that account for?

People would rather have a higher fee that is certain than a lower but uncertain fee (of course no fee would be best).

[ye-olde-sysrq]

I think the best argument you could make to say steam is a monopoly is to say that their plan is roughly:

1. Make a platform gamers love to use so much that they will still use it even if other stores are literally giving the games away for free

2. Build a brand that your target audience recognizes worldwide and trusts with their entire game collection.

3. "Exploit" the fact that your audience loves your product and brand so fanatically that you can charge the same amount on an open platform (PC/windows/linux) that other app stores need walled gardens (apple/android - literal lockin and literal near-monopolies/duopoly) to be able to charge.

I really struggle to find a way to frame Valve as the bad guy here. It's PC. There's literally nothing stopping you from just installing as many app stores / launcher platforms as you want. And it's not all-or-nothing - people DO use multiple launchers/stores. What gamer doesn't begrudgingly have Origin and at least one of EGS or the Blizzard/battlenet launcher installed alongside steam? And yet people still use steam, and spend the most money there by far.

[vintermann]

> What gamer doesn't begrudgingly have Origin and at least one of EGS or the Blizzard/battlenet launcher installed alongside steam?

That's me! Not that I could have had any of those, as far as I'm aware. When it comes to Linux support, Steam isn't just the best, the others are actively bad.

[purpleflame1257]

I have EGS installed literally because they give away free games. But their storefront/launcher is extremely slow and buggy in comparison to Steam's.

[raincole]

Yes, tool makers just can't take the same margin as publishers/platforms do. It's nothing new. Microsoft Words can't take 80% (like a traditional publisher) of your book's retail price, nor even 30% (like Amazon).

I'm not "defending" Valve (actually I find it's very worrisome that they're a game developer and a platform at the same time.) I'm pointing out the fact in no way Unity can sustain 6x of employees than Valve.

[vintermann]

I'm betting that Unity's customers, which includes a horde of mobile app developers, are a bit more demanding to have (and keep) than the few - if any? - outside Valve who license Source 2.

It would be great if you could be Valve. Everyone wants to be Valve. But you are not Valve. Especially not if you're publicly traded or a private equity rollup - things Valve has stubbornly resisted becoming.