Unity no longer charges the proposed install-based Runtime Fee on games. Its current model is subscription-based, with eligibility tied to a studio’s finances and plan. Unreal Engine generally keeps game developers royalty-free until a product passes its lifetime-revenue threshold, then charges a percentage on qualifying revenue. Godot uses the permissive MIT license: there is no engine royalty or revenue gate, but redistributors must preserve the required notices.
At a glance: how the three models differ
Licensing cost is not just the headline percentage. A studio also needs to account for recurring seats, the revenue measure used to trigger payment, store-specific exemptions, source-code rights, and the compliance work involved in shipping the engine itself.
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| Engine | Fixed payment or subscription | Revenue or funding trigger | Variable charge | Source and redistribution position |
|---|---|---|---|---|
| Unity | Personal, Pro, or Enterprise subscription tier | Personal through $200,000 in total finances over the most recent 12 months; Pro from $200,001 to $24,999,999; Enterprise at $25,000,000 or more | No current Runtime Fee for games | Use is governed by Unity’s accepted plan and version terms; the supplied terms do not state a general source-redistribution right |
| Unreal Engine | Game developers can use the royalty model; qualifying non-game commercial uses may require a paid seat | $1,000,000 in lifetime gross product revenue directly attributable to the product | 5% of qualifying lifetime gross revenue above the threshold; $1,850 per seat per year for qualifying non-game uses that use the seat-license route | Source access is part of the commercial value proposition; redistribution and product classification depend on Epic’s license terms |
| Godot | No engine subscription or seat charge under the MIT license | No revenue or funding threshold imposed by the engine license | No engine royalty percentage imposed by the MIT license | Source is available; commercial redistribution and modification are permitted, provided the copyright notice and license statement remain with redistributed engine code |
The figures in the table describe the licensing structures available as of October 2026. Subscription prices, contract language, and eligibility programs can change, so a studio should confirm the terms it will actually accept before signing a commercial agreement.
Unity: what happened to the Runtime Fee?
The proposed fee was canceled
Unity canceled its Runtime Fee for games effective September 12, 2024. Unity President and CEO Matt Bromberg said the company was canceling the policy after consulting its community, customers, and partners. Unity’s current explanation is important: the fee was never applied to any new or existing game.
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That means an install-based charge is not a current Unity bill for a game project. Articles or budgets that assume every installation creates a payment obligation are describing the canceled proposal, not the present game policy.
What Unity charges instead
Unity’s current terms organize eligibility around the amount of money a customer has received or generated, measured over the most recent 12-month period. The applicable tier in the table determines whether a project can remain on Personal or must use Pro or Enterprise. This is a plan requirement, not a per-install royalty.
Unity’s pricing update states that Pro and Enterprise prices increased by 5% beginning January 12, 2026. The percentage is an increase to those subscription prices; it is not a new royalty on game revenue. The exact dollar subscription amount depends on the offer and timing presented to the customer, so a studio should record the quoted price and renewal terms rather than rely on an old article.
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Unity says the Runtime Fee does not apply to games made with Unity 6 or earlier versions. More broadly, a project’s obligations depend on the plan selected, the customer’s revenue or funding tier, when a subscription was purchased or renewed, and the version-specific terms accepted. A team migrating an older project should retain copies of the terms attached to its account and check whether a new version or plan changes its rights.
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Unity budgeting checklist
- Measure the customer’s qualifying finances for the latest 12-month period before choosing Personal, Pro, or Enterprise.
- Budget recurring seats and the post-January-2026 Pro or Enterprise pricing level, rather than a hypothetical install charge.
- Document the Unity version used for the shipped game and the terms accepted by the organization.
- Recheck eligibility after a funding round, publishing advance, acquisition, or other event that changes the studio’s finances.
Unreal Engine: how the 5% royalty works
The royalty base is product revenue, not installations
For qualifying products, Epic’s licensing page defines the trigger as all lifetime gross revenue above the stated threshold that is directly attributable to the Unreal Engine product, regardless of who collects it. The royalty rate is 5% on that amount. “Lifetime” means the calculation does not reset each year, so a product that crosses the line remains in the royalty regime as its cumulative qualifying revenue grows.
Gross revenue is broader than the cash that finally reaches a developer’s bank account. The relevant question is whether the revenue is attributable to the product, not which payment processor, publisher, platform, or distributor collected it. A studio should therefore keep product-level revenue records and map bundles, downloadable content, subscriptions, advertising, and other receipts to the applicable licensing definitions before launch.
Epic Games Store sales are royalty-free
Epic states that revenue generated from sales in the Epic Games Store is royalty-free. This is a channel exemption, not a general waiver of the royalty. Sales through other stores or direct channels remain subject to the product-revenue rules when they meet the licensing definition.
For a project that expects a significant share of sales through Epic’s store, the exemption can materially change the effective cost compared with an otherwise identical sales mix. Forecasts should separate revenue by storefront instead of applying one percentage to total sales.
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Non-game commercial applications use a different decision path
Unreal’s royalty model also covers commercial non-game applications that rely on engine code at runtime and are licensed to third-party end users. Other qualifying commercial uses above the relevant 12-month revenue level can require the annual per-seat license shown in the table. The seat route is therefore not a universal substitute for the game royalty; it depends on what the application does, how it is licensed, and whether it meets Epic’s definition of a qualifying commercial use.
Before shipping an architectural visualizer, simulation, training product, or other non-game application, identify whether end users receive a runtime product and whether the organization falls into the royalty or seat-license category. Put that classification in writing, because a change from an internal tool to a paid third-party product can change the license obligation.
Unreal forecasting strengths and risks
- Strength: a small game can avoid engine royalty payments until it passes the lifetime threshold.
- Strength: the Epic Games Store exemption can reduce royalties for sales made through that channel.
- Risk: a lifetime calculation can continue for years after launch, so a temporary annual sales dip does not erase prior cumulative revenue.
- Risk: bundles or multi-product transactions may require careful allocation to determine what is directly attributable to the Unreal product.
Godot: what “free and open source” means in practice
The MIT license grants broad rights
Godot Engine is released as free and open-source software under the permissive MIT license. The license allows a team to use the engine for any purpose, study and modify its code, and redistribute modified or unmodified versions commercially. There is no engine-imposed revenue threshold and no percentage of game sales owed to the project.
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Redistribution requires notices
If a game or tool redistributes the Godot engine binary, whether modified or unmodified, the distributor must preserve the required copyright notice and license statement. The notice obligation is usually handled in a third-party licenses file, an about screen, documentation, or another location permitted by the license and distribution platform. Removing the notice because the engine was modified would not satisfy the MIT terms.
Godot also incorporates other third-party components. Their licenses can impose additional notice or attribution requirements, so a studio should inventory the components included in its build and keep each license with its release records. This is the main recurring compliance task identified by the engine’s licensing model.
Your game remains your work
Godot’s license terms and copyright do not apply to the content created with the engine. Developers are free to choose how they license their game and remain the copyright owners of that created content, subject to any separate rights in art, music, code, trademarks, or commissioned work supplied by others.
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| Budget question | Unity | Unreal Engine | Godot |
|---|---|---|---|
| Can cost be estimated before launch? | Usually, by selecting the required subscription tier and seats; future tier or price changes remain a contract risk | Partly; the threshold and rate are clear, but lifetime sales, channel mix, and revenue attribution determine the final amount | Engine license cost is predictable because the MIT license imposes no royalty or subscription |
| What causes a sudden change? | Higher finances can require a different plan; renewal timing and version terms can also matter | Crossing the lifetime product-revenue threshold or changing a product’s classification can create a payment obligation | Third-party component terms or support and tooling choices, rather than engine revenue, change the cost |
| What accounting should be tracked? | Rolling 12-month finances, plan seats, renewals, and engine version | Lifetime product revenue, storefront source, attribution, and any non-game end-user licensing | Redistributed engine files, notices, modifications, and third-party licenses |
For a project with stable staffing and a subscription budget, Unity’s model is comparatively straightforward once the correct tier is established. Unreal can be cheaper early in a game’s life but requires a durable revenue ledger and channel analysis. Godot removes engine royalty forecasting, while shifting more responsibility for tooling, modifications, and support to the studio.
How to choose for an indie studio
Choose Unity when subscription tooling is the priority
Unity is a reasonable fit when the team values a mature commercial toolchain and can budget recurring seats within the applicable financial tier. The key planning task is not estimating installs; it is monitoring the rolling financial measure and maintaining compliance with the plan and version terms.
Choose Unreal when the royalty economics fit the product
Unreal suits a project whose economics favor a royalty only after substantial product revenue, especially when Epic Games Store sales are expected to be material. It is also attractive when source access and advanced rendering capabilities are priorities. The studio should model lifetime revenue by storefront and define how bundles and other mixed receipts will be allocated.
Choose Godot when control and permissive licensing matter most
Godot is the clearest choice when a team wants an open-source engine, commercial distribution without an engine royalty, and the freedom to modify the engine. The trade-off is organizational: the studio owns more of its tooling and support decisions and must maintain license notices for the engine and its dependencies.
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A practical compliance workflow
- Classify the project. Record whether it is a game, an internal tool, or a commercial application licensed to third-party end users.
- Choose the license route before production. For Unity, select the plan that matches the rolling financial tier. For Unreal, determine whether the game royalty or non-game seat terms apply. For Godot, establish a notice and dependency process.
- Create a revenue or finance ledger. Track Unity’s rolling 12-month finances or Unreal’s lifetime product revenue separately from unrelated studio income.
- Separate storefronts and products. Keep Epic Games Store sales distinct from other channels and document attribution for bundles, downloadable content, and subscriptions.
- Archive terms and notices. Save the accepted Unity and Unreal agreements, preserve Godot’s MIT notice in redistributed builds, and retain third-party license records.
- Review before launch and major updates. Recheck the applicable terms after a funding event, engine upgrade, product-classification change, or new distribution channel.
Common mistakes to avoid
- Continuing to budget Unity’s canceled Runtime Fee as though it were an active install charge.
- Applying Unreal’s 5% rate to every dollar of sales instead of only the qualifying amount above the lifetime threshold.
- Assuming Epic Games Store’s exemption applies to sales made through other storefronts.
- Treating Godot’s zero royalty as permission to remove MIT notices or ignore dependency licenses.
- Using a game license assumption for a non-game product that is delivered to paying third-party end users.
- Relying on a plan or price quoted for an older date without checking the current renewal and version terms.
The cheapest engine on paper is not automatically the cheapest for a particular studio. Compare the payment trigger with your expected business model, then add the operational cost of tracking finances, storefronts, source changes, seats, and notices. That process produces a defensible budget and avoids the most expensive licensing surprises.
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