Unity to cut another 600 jobs

As others have said, layoffs are the norm now, covid bonanza withdrawal + recession.
The apex example of how a company could function with less people is Twitter.
What I'd like to see is some more focus on non-game app tools, but without sacrificing the game tools that made Unity the most popular engine in the first place

 

With how frequently Twitter is breaking since the mass layoffs; I don't think its a good example.

 

Not just breaking, but each change to twitter brings a surge of new active users to other social media platforms as well, to the point where they've been struggling with the load. The idea that twitter is in a better place now both technically and as a service is a really weird stance people have been taking.

edit: Also by Musk's own admission, the company is currently worth less than half of what he bought it for. On top of that, almost every advertiser has been alienated by the way the site's been managed, meaning it's not exactly bringing in much in the way of money, especially with how few subscribers twitter blue has. Twitter is a prime example of severe mismanagement, not layoffs handled well.

 

I dont know, twitter works for me XD, what is there to break . Just display post, have a basic search and ad functionality...thats it.

Unless u pack it with tracking code, shadowban code and crap like that then no surprise it may not work in some areas .

I think they will get their grove, there were too many ppl there for how simplistic the platform is...they dont need thousand of ppl to filter out "thoughts that does not align with certain ideology" .

 

I'm using twitter a lot more now. maybe I'm the exception

 

Does it make the engine profitable tough? Because, while all these services look valuable if you're a beginner or know nothing about game development, they have a massive flaw.

Every moderate size studio (around 15 people) I've worked with have no interest in the ecosystem Unity is trying to build. They already work with a competing service, will use a Unity service like Plastic SCM whether Unity owns it or not and will develop their own in house solutions if possible.

Even if they use these services as a starting point, they'll drop them as soon as they make enough to cut the middleman.

Unity fail to see that they're developers trying to sell to other developers. We're not Apple users, we don't need Unity to have a CICD, collect user statistics or connect to an ad network. We already have in house people doing that without the drawback of being locked into someone else's ecosystem.

Someone posted the Steve Job video earlier and it's perfectly on point. Unity's management has no idea what we need. They're creating an ecosystem because they saw companies like Apple being successful with it but never checked if there is demand for it.

Unity, I'm here for the engine. That's what I'm willing to pay for. I don't need you for anything else.

 

This is what happens when you have your CEO be from EA itself.

 

In case of twitter I'm not sure if Musk even pursued profit. More likely he wanted to alter site policies.

There's a nice gotcha here.

The question you should be asking: does it make COMPANY profitable. Because it is the company being publicly traded, and not the engine, and engine is not the only thing it is doing.

 

Yes, Unity reported Q4 of 2022 as profitable. No data is available yet on 2023.

A lot of studios don't have the resources to cut out the middleman. And some who technically do don't bother with it because replacing all those services costs a S*** ton of money to develop and maintain. Not to mention a lot of time.

You might not need Unity's services, but they're right there and fully integrated. There are a lot of benefits for choosing 1st party tooling.

Unity is profitable because of these services which some studios opt to use, they are not trying to mimic anything. The core engine has never been profitable and never will be profitable on its own. It's very expensive to develop and maintain and the technology is getting even more complex with every year. The costs are only going to increase.

Are you paying for the engine though? And even if you are paying Plus or Pro, engine licensing is not their main revenue stream. Nor is the asset store which brings in chump change compared to everything else. Again, Unity engine on its own is not profitable and it can't be profitable without services built on top of it. People need to understand this.

 

Wasnt it like first time since they went public or first time since long time they were profitable?

 

Yes, because some companies opt for aggressive expansion and growth right after IPO at the cost of short term profitability. It's a deliberate strategy to enter new markets, acquire new tools that play nice with the core product and do bunch of other generally beneficial things that in theory should yield higher profit in the future. Doesn't mean the company is not viable.

Some people like to interpret this is a last ditch effort to save a sinking company via random acquisitions, but there is no indication yet that Unity are in financial trouble. Layoffs are happening across the whole IT industry, and Unity's layoffs are far from the worst. I'd start to worry only if Unity lay off an additional 8%+ of their workforce or if there are additional layoffs in general.

 

We will see if 2023 is finally fully profitable year, considering their strategy.

 

Have you seen how many good looking and seemingly well playing games of this nature are being made, finished and released like this, with Godot?

I ask because I've just seen someone in this thread saying that Godot isn't a competitor to Unity, but it seemingly is, if you count the small team realm as something that's been a significant market of Unity's for any time.

 

We've been hearing this sort of thing for years. It'd be nice to have a sort of actual date on this future because as it stands now it feels like these acquisitions have been good for people in the ad spaces and archviz but not the people using a game engine to make games.

Hell, I can't even get decent responses to things that have been announced where I'm in active communications with people in Unity. I was in an email back and forth with sales trying to figure out anything about Unity AI (is this one of these mind blowing things?) that went completely dead. It does not inspire confidence when trying to get answers is so vague has us hitting walls.

 

Thats the point, we hear rumours , but we need meat .

I hope we finally see something this year, or next year. We need something to be excited and hyped for Unity

 

IDK, if you're talking about that short AI anim gif they published during GDC, multiple reputable Unity developer with media-presence stated that they participated in a closed (NDA-protected) session in person and they liked what they saw. So it may or may not will be mind-blowing, or even cancelled in the future, but it isn't dead. But whatever, nowadays if Unity doesn't give up everything on day one, it considered dead. Don't get me wrong, you think whatever you want to think, it's your human right, but it looks silly from where I'm looking.

Why? I prefer steady stream of stability and needed features. I don't want to be excited for Unity, I want features helping me doing stuff. Unity is not a game. It's a tool. Really should be an expectation to treat it as such. IMHO

 

I said the emails went dead. The email chain they started with me.

 

My bad, I misunderstood your sentence there and your past posts about Unity's standing didn't inspire the belief that you have positive or neutral thoughts on the subject, which obviously fueled my response. I apologize for my error.

 

Because it draws more ppl to the engine, more potential devs and more potential revenue stream for Unity. We who are using the engine for years yearn for stability , but ppl who are deciding where to bound their career with which engine need that extra push

 

Could this be an opportunity for Unity to align with the interests of their users, and switch to a royalty model?

 

If Unity offers a royalty that isn't substantially better than Unreal's this would backfire immediately and even if they did it'd see a lot of users moving over to royalty free offerings like Godot.

 

Those are the obvious negatives.

The obvious positives are that they'd tap into the success of their successful users and be incentivised to help all users be more successful.

 

Okay, but why would the successful users stick around if they could get a better deal elsewhere? If they're getting the same deal, the fact Unity is asking for more money might push them over the edge if they're considering switching engines. If they're getting a better deal, that's still a possibility.

Rev share isn't a good idea and I'm certain they've considered it internally.

 

We know that they've considered it internally as it has been brought up in interviews. Here's one from March 2015.

https://www.gamesindustry.biz/theres-no-royalties-no-f-ing-around-riccitiello

 

Yeah, the royalty model would put more burden on the users paying the most and paying at the first place for other services in general. Unity's model has a great value though: it's clear and predictable. You have N users who needs Unity Editor in your organization, you pay for N licenses. Unless you aren't financially successful and you are making less than 200k in revenue, then you pay less or none at all.

 

i don't usually read walls of text but your post was interesting... Anyway, beside of the usual hate from now (from some time ago) very boring users ho we already know they are going to say something bad, most of the users here are telling the truth even if it sounds bad, telling the truth is not being rude imo, is just the way it is, the economic problem is also the big factor here of course, but other tools no that big as unity are releasing amazing features that are definitely going to change the way games are made in a good way, like unity used to back in the day and if you add the lack of information it is easy for us to think and feel that unity is now an unispired tool, sorry if that sounds bad, but it is what it is, we still love unity, i love unity but the only reason why i'm not trying unreal right now is because i'm not a coder and i do not want to learn another lenguaje -.-" (there is also other game engines that uses c#)

what kind of game dev are you? right now i think i don't want to be like you lol XD... I'm 3d artist and i'm excited for all new features i'm waiting for all my 3d tools...

 

The kind, who is developing stuff since way before the Berlin wall fell, who saw a lot and learned (sometimes on the hard way) that people can induced to become excited for the stupidest of the stupidest things. Do you remember when Steve Jobs got on stage and sold CTRL-C/CTRL-V to people on an iOS? And they got excited. A basic feature which was part of the OSes since the late 1970-ies. And this jerk comes onto the stage and gets the crowd excited for it in way into the 2000-s...

Getting you excited has no value for you. It has value only for the company. It enslaves you and makes you attached. And if you're doing business, attachment always has a price. I rather wouldn't pay it if I don't want to. So I don't get attached.

This obviously doesn't mean I am not glad when I see cool features introduced or see the improvements the company makes, it just means that those are nothing more than indicators and I am not looking for them.

This last GDC. The roadmap was a lot of things, but it wasn't exciting. And I think this is a good a thing, I glad to see what they have done and planning to do,

But obviously I am only a solo dev, who mostly works on other people's stuff and even that is just a second job / hobby.

 

i knew you were going to say that -.-" anyway, being excited by future features is not bad in any way, is just an positive emotion for knowin that you will do things easier... again, you are maybe a pro AAA devs with more than 543584354 years developing games, but i definitely do not want to be like you xD. I assure you i'm working on 3d "since way before the Berlin wall fell" and i get excited with new features all the time

 

I feel like I need to make a correction to a post.

I do believe this is false. Unreal is more than capable and performant enough to run even on low end mobile devices. You just wouldn't generally use Unreal for that purpose as other engines are better at it.

Unity HDRP and DOTS have similar limitations. Probably due to the use of compute shaders which wasn't widely supported in the past. That said, I was able to run nanite and lumen on a 10yo PC. The technology has been there for a while. It's just consoles and mobiles have a lot of catching up to do. And I believe they have plans to roll out WebGPU which supports compute shaders.

To get on topic. I am curious to know how these layoffs will effect the development of unity features such as DOTS. DOTS was expected to be production ready by 2022 LTS (they're taking their time with this release) but just looking at the ECS thread it seems it's plagued with issues (even my own experience isn't overly positive, I find 0.51 far more stable) so I wouldn't be surprised if they delay it once again.

 

If anything I would expect more cuts to come, and that's not a reflection on Unity but the entire tech industry. Unity has cut maybe 20% of its work force over the last 12 months? Twitter is down 90% (an extreme example) but many other companies are also drastically cutting down. I don't see it impacting Unity negatively in the long run, it's definitely sad for those affected.

That being said, I was made redundant once and it was the best thing to ever happen to my career. It doesn't seem like it initially but there's so much opportunity out there, and sometimes your position is holding you back from that.

The GDC roadmap was interesting.

The sections are. Improving asset bundles, improving package manager, bringing Unity C# up to standard with modern C#, Fixing input system performance, Fixing UI Toolkit performance, Improving Unity search, [New!] Memory Profiler, Improving multiplayer support, Unity Pay to use Services Plug, ECS, Upgrading to DX12, Improving Rendering Packages, Improving XR Toolkit.

I'm very happy about this roadmap, but it is essentially a patch note, and an admission that many 1.0 features aren't where they need to be. At least that is being acknowledged and worked on. I'm still using Built in Render Pipeline (URP has unexplained massive performance cost in 2022 editor), still using raw input (new input was 20% of frame time on meta quest), still using IMGUI (UI Elements not compatible with VR), still using OVR (XR Toolkit didn't have hand tracking support for years, ray caster vs grabbable are exclusive? generally bad UX), using custom Cloud Content Delivery (Addressables not set up for additive content delivery, unless you create hacky catalogs), Still using Photon (network vars buggy on Unity Netcode for gameobjects.)

Every time I start a new project I try to use the new features, but inevitably have always reverted back to "legacy" features. My last company tried to upgrade to URP maybe 2-3 times over a couple years. Each time having to give up after wasting a couple weeks because there'd be some major bug at some point.

 

Why, for the simple reason that Unity would HAVE TO propose that they actually do work on improving those things that matter to those devs that would earn Unity the most money. It makes, forcibly, through mutual interest, a mutual relationship.

It's not about asking money from those that would pay more, it's about Unity having an opportunity to drastically increase their revenue, or loose it. Up to them. Unionising development, so to speak.

 

I don't get it. You guys are crying on this very forums all day long that Unity doesn't care about small developers and indies anymore, they only cater for the big partners, who pay the bills.
Now you're proposing a giant double-U-Turn so they can pay more and be catered for even more, since the smaller users aren't paying anymore, those have to be subsidized (having to match the other engine's offering). So why they actually should do this?

 

A large portion of gaming revenues come from hit products. Games that are standouts and strike a chord with player bases, and which sustain market popularity for increasingly long periods of time. There's no way to know which will do this, ahead of time, with any degree of certainty.

A large portion of game makers will end up paying nothing on a royalties based system because they won't hit the thresholds of success. But those that hit it big often hit it HUGELY, and will need to service their games and want to make them ever better, including improvements to the underlying engine. When Unity has a mutual interest in doing this for successful games, everyone wins.

This isn't a revelatory model, and there's no need to cast grouping ascertains like 'you guys' for something so patently obviously better aligned to the interests of everyone involved.

This also weights improvements towards those that have the largest player bases, which means idealised considerations of performance and feature needs, instead of attempts at checkpoint marketing of new engine features (that are invariably never finished and certainly never polished) on the basis of something possibly being the next big thing in games.

 

You are right, it isn't. It's complete nonsense. Unity has all the same incentive to help those starving artist small developers, because that way they can make them not starving artists, who then will pay pro license and start purchasing services and learn multiplayer and whatnot. After their hit, when they got money to do so. Again, there is zero sense for Unity specifically to disturb the waters here.

Unless of course Unity can get a constant influx of revenue from somewhere unrelated, like Epic does exploiting children and people with psychological problems like addictions and of course, their wallets. Then Unity also can switch to revenue-share with the million entry amount.

 

The enormous difference is in enormity, and in the tiny number of super successful games relative to the amount made that fail.

The most a successful team will pay to Unity is currently capped, significantly, as is Unity's interest in their continued success at enormous scale.

This capping is clearly not working and clearly not driving effort and endeavour back to the basis of the engine, hence the enormous amounts of capital and goodwill that's been spent on mergers and acquisitions.

One of the most profitable arms of gaming, that's more hit based than all others, is that which Unity incidentally is appropriate for, casual gaming. It's also the bread and butter of the company they're merged with.

Yet Unity's spent no money on improving their engine for this category of gaming since they began down the DOTS path. A royalty model on all games would allow them to tap into the enormous revenues of casual games, and incentivise them to improve their product for this category, one that they otherwise seem disinterested in, that looks increasingly likely to be significantly taken from them by Godot and GameMaker Studio, because Builtin is on life-support.

Instead of the royalty model, IronSource is attempting to create one by proxy, through "services" to makers of casual gaming, but this is so obviously contrived and full of gotchas that most makers of casual games make every possible effort to involve entanglements in such relationships, contracts and obligations with all manner of casual game publishers. IronSource no longer needs to wag the dog, and can instead steer Unity to royalties based mutual interest in this market, and all others.

 

I don't think that Fortnite-bashing is relevant here? The point would apply for any hugely successful game, monetisation model aside.

Makes sense. Whether a project makes $200,001 for $200,000,000, the fees owed to Unity don't change, where a royalty-based structure would have them make ~1000x more income in the second instance.

I don't follow how these two are linked? "We didn't make a bunch of extra money when Among Us took off, so lets go buy something" just doesn't make sense. How would buying something solve that?

By their current model, licensing income scales with number of Pro / Enterprise customers, and I see no direct connection between buying other companies and the number of paying customers. "Woah, Unity just purchased Weta, lets get some more licenses"? That doesn't hold water either.

On the other hand, there's a pretty direct connection between helping indies breach the income thresholds, thus directly converting them from Personal to Plus / Pro where they need to pay.

Back on larger businesses, the outcomes of purchasing Weta, SpeedTree, etc. sure may help them sell licenses, but I don't think we've seen much (or any?) of that yet in public. It's entirely possible it's been happening behind closed doors, of course.

 

Who is bashing Fortnite?

The license model's limitations are obvious, hence their desire to buy things that could be on-sold as add on services and premium subscriptions. The issue being the ever diminishing sizes of niches to which each appeals, and the well funded and well established rivals in those spaces.

Unity's largest audience of users, by far, is small to medium game making, from which they're not making bank, but could, and in ways that benefit all involved.

Royalties directly link their success to that of their largest user base in exactly relative ways, and mutually align endeavours. It's (granted) a philosophical change in relationship and growth models. But since they're tapped out, and likely unable to do any more mergers and acquisitions, and need to fund the evolvement of purchased tech, I don't see they've got much choice left.

It's not as though they'll easily be able to take on more debt for more buys. That market and opportunity has sailed.

 

The Unreal royalties model doesn't apply to large studios who can afford negotiating custom licenses, much like how the biggest Unity clients can afford enterprise licensing deals that doesn't involve paying per seat.

I'm not sure it would make much of a difference on Unity's revenue since they make the bulk of their engine money from those enterprise customers.

 

((Opinion
It is the usual thunderstorm in a cup of water.

Unity does something, people discuss it on forums, and in the end discussion doesn't change much, while unity keeps doing its thing.

This too, shall pass, as they say.

 

It's the surprising smash hits, that elevate small and medium teams to enterprises, that Unity would make the most money from, if they took on a royalty model. Those same teams would be most happy to benefit from contributing to the furtherance of aspects of Unity by the votes of their revenue shares, for what they'd like help with in the unrealised parts of their future progressions.

Then they'd negotiate, too, for that better future, one way or another. If Unity doesn't agree to help them with pain points of the engine, the dev teams will put exacting dollar figures on employing others to do it for them, and Unity would feel their pain because they'd be out the values the stuff they want for their teams costs, in those negotiations. The harder Unity makes it for these teams, the more ruthlessly these teams will re-negotiate terms/rates etc. And threaten to leave, altogether, in meaningful ways, with leverage. Win/Win... more money for Unity, better Unity through shared appreciating of the endeavours and what it takes.

 

Partly blame the Federal Reserve, and the skyrocketing interest rates, especially short term business loans, the cost of doing business has increased, while revenue is going down. Who is most affected by this downturn in business financing? Technology companies.

 

Independent food growers, producers, distributors and retailers. By design.

 

Question is, on average, how many indie games passed 1mln $ mark to actually pay even a penny of the royalities?

 

Don't think just indie. Think small to medium game studios. They're not classed as indie, and pump out many more games (not just passion projects) and most of the high ratio hits (low expenses, high profits) come from these kinds of small to medium sized game making organisations.

The other tier of super success ratios comes from very small teams working on casual games.

Both of these groups, currently, pay the bare minimum to Unity, and that would change each time they hit it big. And most of these types of teams use Unity, for various legacy reasons pertaining to familiarity and the speed this gives their productions.

Further, there's nothing to say that a million has to be the cut off point for royalties, it could be less, and a sliding scale.

Unity is a convenience factor, for them. They're not able to make small enough, light enough, responsive enough, casual games in Unreal, and know Unity far better than they do Godot... and the content pipeline matters, as time is their enemy more than expenses.

They're mostly little production outfits deliberately aiming to make a hit by throwing spaghetti at a wall. They more they're able to chuck more types of pasta at the wall, in the hopes of something sticking and being a game as a service to build on, the more they're willing to accomodate tail end costs of using that engine. Take a look at what IronSource has been doing for the past few years, DIRECTLY attempting to appeal to these kinds of makers to come and submit through them for publication and promotion so they can use the little teams as workhorses to hone their freemium models on... etc

 

A bigger point... there's no blood left in the game making stones.

Unity has peaked in terms of user adoption, perhaps as long as two years ago. Nothing they can do in the short to medium term will reverse this trend, and many other game engine companies have smelt the blood in the water. From Godot adding C# support to GameStudio's increased endeavours and the likes of many others.

And the general fall off in aspirational game developers is huge, too. They're never coming back, as the golden ages of independent gaming dreams are massively diluted/faded.

The big companies have much better options to choose from, all of which aren't struggling to finish "new" core technologies (DOTS for how many years now, SRP... light mapping... input, UI etc)

Who, given a big enough budget to choose Unreal and build the kind of teams it needs, is gonna consider Unity for product visualisation or game development?

That ship has sailed because DOTS is stillborn and SRP is a largely failed initiative, and none of the billion dollar purchases look like adding compelling reasons to overlook these issues anytime soon.

Unity has to make some hard decisions about how to increase profits. One of them is sacking staff and closing offices. The others revolve around increasing revenue. That means selling some things off and getting more out of the users. Without compelling services, the only best way left is to align with the success of users, through royalties, and the division of publication systems for the various platforms, optimised for them, at premium tiering royalties.

You can question this all you like, but there's almost no other way, precisely because the SRP divisions have sufficiently fractured the Asset Store that it's no longer a compelling reason to use Unity... which means a double loss in terms of engine licensing AND Asset Store sales declines.

Ask some of the highly successful Asset Store makers when their sales peaked. That's highly illuminating information as to the meaningful usage metrics of Unity.

 

Assuming the data I found for 2022 didn't lie...

It goes like this.
6000+ steam releases per year.
Out of those, 80% earn under $5000.
1.16% earns over one million. That's before taxes and 30% cut.

That's 70 titles. The biggest earner was Elden Ring.

Top ten included Dying Light 2, Total war: Warhmamer, Monster Hunter Rise, God of War, V Rising, Lego Star Wars, Dread Hunger, Raft and Core Keeper.

Out of those V Rising, Core Keeper, Raft are unity, Dread Hunger is unreal 4, the rest are custom engines.

 

That's true, though:
- Interest rates rise everywhere to fight inflation.
- Everyone (especially executives) knew that was coming.
- No one (other than "investors") forced any company to waste their resources on futureless projects (like metaverse) and pointless buyouts.

Stuff like mass layoffs and monetary problems are happening only because of extreme mismanagement.

 

Then why are we having a conversation following massive layoffs and terrible stock price?

How much is "some"?

What's your (or anyone else's) experience on what percentage of financially successful studios keep using Unity services?

Of course there are, but are they attracting successful companies?

Take Unity Analytics for example. It's an undeniably good idea to answer the need to collect data on your software usage. Right?

In my experience, studios don't use it because they already have a team working on a custom cloud service and back office. They already have systems to collect data and using someone else's becomes a drawback.

And we haven't talked about legal requirements yet. If I'm an investor in your video game studio, I won't allow you to share the numbers with Unity or risk a data leak.

Same goes with Unity ads, as soon as you product takes off, Unity middleman's share will get bigger than contacting an advertising agency. Displaying a picture and a link isn't hard and you'll be able to collect your own data to make sure you're properly paid.

I'm sure these services are profitable to Unity, but they're not a long term strategy if they get dumped instead of growing with their clientele.

The core engine was profitable when I started using it.

It's Unity's choice to make it free and not have a paid offer with significant extra features.

I'd be happy to pay more for the engine, if there were features to pay for. The market is right there waiting for Unity to make a move. Make pro features and I'll pay for that.

Yes I am paying for the engine. That's the point, for the engine.

When Unity uses my subscription to acquire Plastic instead of fixing bugs or creating valuable features, That's something they do for themselves, not for their customers subscribed to the engine. I don't see a return on investment.

I pay and see nothing in return. What is the incentive for me to spend more?

If Unity was doing extremely well, I'd accept that I'm a minority, but that's not the case. They're firing employees while ignoring customers willing to spend more.