“Fuck you, we’re not paying”: inside Unity’s Runtime Fee fiasco


Sources from inside Unity and across the mobile games business and have told us:

  • September’s Runtime Fee policy was “rushed out” and driven by Unity and IronSource’s intense battle with Applovin over the mediation business
  • The firm’s long-term profitability problem and tumbling share price were also a factor
  • Unity/IronSource has been offering some partners money to switch their UA and admon from Applovin
  • There was resistance to the Runtime Fee idea within Unity, but those concerns were ignored; it was announced before many staff knew anything about it
  • In the second version of the policy Unity had planned to go with a 4% revenue share, but the reaction to the first announcement was so fierce it got knocked down to 2.5%
  • The new policies effectively never really applied to larger partners anyway – most will be able negotiate their own rates through their account manager

One Unity insider told us that a major mobile game publisher – and one of Unity’s biggest clients – met with John Riccitiello himself days after the first Runtime Fee policy was announced. They told him, in the words of our source: “Fuck you, we’re not paying.”

Multiple sources told us that in the week of panic that followed the first announcement, Unity planned to announce a 4% revenue share for games that earned over $1m, slightly undercutting Unreal Engine’s 5%. But the response was so fierce it was knocked down to 2.5% in the tweaked policy announced a week and a half later.

Where it all started: ‘Unity’s unreal pay-per-install plan leaves mobile devs stunned – and potentially out of business‘.

Before the original Runtime Fee announcement was made, a very large group of senior Unity managers met to discuss the proposed changes, we’re told.

“Half of the people in that meeting said that this model is too complicated, it’s not going to be well received and we should talk to people before we do this,” said one source. “We were told Unity had spoken to people – but they didn’t tell us who. They obviously did have conversations with people, but not enough.”

“It felt very rushed,” they continued. “We had this meeting and were told it was happening, but we were not told a date. And then before we knew it, it was out there.”

Shots fired in the mediation war: ‘Unity is offering a Runtime Fee waiver if you switch to LevelPlay as it tries to “kill AppLovin”‘.

As we reported previously, Unity account managers had been quietly offering waivers on the proposed per-install charges if developers started using Unity’s LevelPlay ad platform. It was, as one developer put it, an attempt to “Kill Applovin”.

“What you picked up on was very accurate,” says another source. “Applovin is dominating and Unity tried to use this policy as a forcing agent to try and get back some market share.”

“It was IronSource and Unity’s play to increase their mediation business, effectively, and developers have been caught in the crossfire of this mediation war that’s been going on for a couple of years.”

Developers react: ‘Unity boycott begins as devs switch off ads to force a Runtime Fee reversal‘.

Another large mobile publisher told us that their IronSource contact had been teasing – or threatening – a move like this since late last year. They said that around twelve months ago, just after Unity and IronSource completed their merger, they were “offered a significant amount of money” to switch their UA and admon spend from Applovin’s Max product to IronSource.

“The offer was very, very attractive,” they said. “But we refused. Then I had a meeting with a very high level person from IronSource who told me, basically, that was the last time you could have got that money. He said you will have to switch to IronSource in the future.”

“He was saying that they will just clear Applovin out from the market,” our source continued. “But I didn’t think they would be doing anything with the engine. I thought they were developing some new technology or using the Unity engine to collect more data.”

Runtime Fee 2.0: ‘Unity says sorry – again – and reveals its revised pricing plan‘.

Our sources also noted that management-level naivety and Unity’s declining share price were also factors in the policy being rushed out. Unity stock got close to $200 in November 2021; before the first Runtime Fee announcement it was trading at around $36, and at the time of writing it is just over $26.

“I truly don’t think it was done maliciously,” our Unity insider said. “Ultimately Unity has lost a lot of money over the last 18 years – billions of dollars – and they need to do something to make more money. Sadly, it wasn’t delivered well, but the need to make more money is still there.”

The Unity staffer added that after the events of the last six weeks, many within the company have been busily applying for jobs elsewhere in the games business.

Fall guy: ‘John Riccitiello leaves Unity after price policy fiasco‘.

The furore around Unity seems to have calmed a little now that the policies have been tweaked and CEO Riccitiello has quit. But there’s another detail in the saga that’ll enrage mid-sized and small developers: our insider told us that all of the new pricing policies can be negotiated down, but it’s only Unity’s larger partners that are in a position to do so.

“Anyone in a bigger developer’s business team or the sales team is able to reduce the fees,” says our source. “It’s a negotiation. Some of the bigger clients will never pay that money because they’ll just go back to Unity, agree on a number or do something around the [LevelPlay] mediation to get away with it.”

“That’s what all of the big boys are going to do,” they added. “A lot of the outcry from indie devs was kind of misplaced really. None of them are going to get anywhere near the $1m anyway.”

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