cogadh: Yeah, but does Source have royalties paid on top of the initial licensing fee? No way to really know, I guess, but for the sake of argument, lets assume there isn't. In theory, Epic could be paid significantly more than $100K under that royalty agreement, over the life of the game's sales. You'd only have to sell a little over 25000 copies of a game at $20 each to make $100K for Epic. Under most circumstances, a game that only sold around 25000 copies would be considered a failure and most games using the Unreal engine are not failures, nor are they sold at only $20 a copy. If Epic has been that kind of royalty agreement all along, they've already made millions off the Unreal engine, way more than it must cost them to update and maintain the engine. I don't begrudge them or anyone else the right to make money off of their hard work, but in any other business, people would probably be crying "price gouging".
doesn't work like that.
when game is sold for let say 30 dollars. around 10-15 goes to retailer. remaining goes to warehouses / local distributors.
from 30 dollars publisher/developer gets 8-10 bucks. so 2-3 bucks of that go to Epic for every copy sold. a bit more if the game is sold directly through steam and other digital service. so they need to sell around 50000 copies. for indie game it might be hard. how many that golf 3d which cost a cent sold? how many it would sell if the game was priced 30 bucks?
and if the game sells for 15 bucks as most indie game do then they have to sell 100K copies to pay the same amount to epic as they would pay for source SDK.
Epic deal is really good. no initial costs (except for lousy 99 bucks.) and even if the game is a failure there is no real financial loss on obtaining the engine.
Furthermore if we take into account that indie games are made cheap with small teams then selling even lousy 50K copies can bring a profit.
and yeah. who has 100K laying around to buy an engine?
