This is basically committing hara-kiri on the product and looks to be effectively a company killing decision, unless there is something we are missing ?
But it's not. Unity is extremely unprofitable as a company (-50% operating margin.. lol..).
They would be fine if they hadn't started burning money like there is no tomorrow after their IPO back in 2020. The company was still unprofitable but had decent growth and would've broken even in a year or two. Then they decided that they need to double their headcount (to almost 8000 people...) in two years and start buying random companies for exorbitant prices (I guess why not? Money is free after-all).
Now they don't have a choice and have to maximize their rev. growth or the company is f**d. IMHO the engine itself would probably be in a much better spot had MS (or even FB) bought them 5-10 years ago and they could've easily paid as much as their current valuation minus Weta, IronSource, whatever they bought before.
> company killing decision, unless there is something we are missing ?
Probably. I mean the pricing changes seem to be very complicated and most people are only looking at a single number ($0.2) which seems to be there only to force everyone above the 200k revenue/install threshold to upgrade to Pro tier. Seems like 80-90% of all users won't pay anything for installs and the average for those who do is probably to be somewhere between 2-5 cents which is not unreasonable financial (it still seems like a slightly bizarre price model in general).
The way they presented this seems to be a disaster marketing wise. But about on par given the general level of idiocy amongst their upper management (especially their "marketing department").
Stable profits are worthless. (Forget the fact that, y'know, they keep the company alive, everyone paid, and everything that actually matters to 95% of people working fine.)
All that matters is growth. Growth is what gets CEOs praise from shareholders, bonuses from boards, and even-higher-paying CEO jobs elsewhere.
Unity never had those though or any profits for that matter (they have been burning cash for almost two decades..)
> All that matters is growth
Yeah, but in this case they have been more focused on growing their costs rather than revenue (which is not exactly ideal even from the "Wall Street" perspective).
If what you say is the case, then this is still a dumb move, because it's still acting as if the choices existing Unity developers have are "pay Unity whatever they want, or get out of the business", but it's at least not quite as directly related to Wall Street brainrot.
I guess it's down to how the video game/engine market works. A tiny proportion of their users make massive amounts of money while essentially paying peanuts to Unity (well.. I guess at least in relation to what value it provides compared to storefronts/ad companies/platform owners etc.), while the bulk makes barely anything.
They don't want to go with a rev. share model due to various (pretty valid reasons) and therefore they seem to be really struggling with monetization. So they came up with this Frankensteinian compromise/abomination which hardly solves anything:
- most of their biggest customer will continue paying pennies (as % of revenue).
- most users are under the 200k/1000k limit so these changed don't even affect them in short term (of course it might make them reconsider whether they really want to continue using Unity)
- the not that large but very vocal (their corporate won't go around complaining on twitter/reddit/etc.) group of mainly indie developers in between is kind of screwed (at least if they make F2P or cheap mobile games). However it's not like they pay Unity that much money currently, so their executives who obsessed with maximizing short-term revenue growth don't have any reason to care about what happens to them.