That's seems a sensible way of addressing a fuckup, especially considering that the plans now are very reasonable and indie-friendly.
So naturally, people start exploring other options that don't suffer from the same problem. Unity, realizing this, backpedals. Which yeah, makes sense, but people who got burned by the change already got burned, and they want to avoid it in the future.
I understand both sides, Unity needs to make money, otherwise it won't be around. And game developers need to feel like they're making a choice they can still justify and feel safe about in the future.
They likely have also put effort into moving to other frameworks, and if those are working out well enough for them there is no point making the effort to go back even with this change reverted.
Same for new projects that went directly elsewhere: unless Unity offers significant benefits (and the project controllers feel that Unity can be trusted not to repeat the rug-pull later) the effort of changing stack are likely not worth it.
Unity's thinking they could change the terms unilaterally whenever they want and not actually being able to make it stick suggests to me that Unity misunderstood the arrangement more than the users on the other side of that agreement. Yes, Unity had the legal power to change the agreement, but clearly the market disagreed with that move and Unity bore consequences that apparently they weren't ready to bear.
In the end it seems that Unity learned that legal power is not the same as market power and that they didn't have the real power to change that deal... and they learned it the all the hard way.
If you just look at things like market share it's easy to lose sight of the fact that we're all tool vendors like the dude in the Snap-On truck.
Many have moved on. Dropping the fee doesn't mean they will come back. Even if it made financial / career sense, they were burned, still with a bad taste in their mouth from the experience. They cannot trust that Unity won't screw them over some other way in the future, better to keep going with their newfound direction if it's starting to pay off.
When your users / developers lose trust in you, it's the beginning of the end.
The resultant puff of smoke brings the component’s behavior from the logical world to the physical one—tangible evidence of an unfortunate finality-of-outcome, an intricate IC become just a lump of charred sand again.
Likewise Unity could have done a whole lot of things with their licensing framework while users still had trust in their behavior. But now that they’ve blown out the figurative trust “chip,” they’re gonna have to find a way to get a new one before they get much out of tinkering further with their licensing circuit.
Yet, trust once lost is hard to regain. In the grand scheme of things it’s probably too late.
For what? The damage is done but the engine is still ...fine. They'll have this black eye but they're not dead in the water. If you're an enterprise customer, you'll probably be asking to lock in terms for quite a while, though.
Large orgs are, indeed, likely locking in terms, but Unity's whole market was basically people building things initially in tiny setups with it, with more convenient access than Unreal.
It's more or less the same mistake flavor that IBM made with killing CentOS - they killed their onramp of the 500000 tiny projects using it because it was trustworthy enough, and that also kills the existence of 50 projects that go onto to be massive successes built on it.
Firing the CEO did help, though.
Not firing him was 100% certain to be for the wrong reasons.
But nothing prevent them from doing the same again if their indicators say it would be profitable. Developers just don't want to take the risk anymore.
One element of why the recoil was so strong was that this wasn’t consumers reacting angrily when the price of their favorite widget went up. This was Unity threatening to bankrupt entire companies and destroy livelihoods.
Once that trust is broken, specific to the tech stack underpinning your whole business, it is very hard to get it back.
How many times have they abandoned a networking library or built a new UI system that you have to relearn. Then right when you get the hang of it they release the next thing that maybe is better but also has big problems.
There are now so many half baked systems it just feels like a mess.