Why the Unity subscription model isn’t good for anyone most people

Disclamer: Yes, I might be overreacting. Perpetual licenses are still available, David Helgason says people asked for this and it seems there really is a small group of people/companies who gain an advantage from this (see comments). If it’s just that (a not super-flexible but somewhat cheaper way to get Unity Pro licenses for companies that need additional licenses for a short amount of time) then all is well. If it’s an evil plan to go all Adobe on us, then it might still work, but you have been warned…

I’m not against subscriptions per se. I can see situations where a software subscription could be benefitial.

  • Have a big project and need 2 additional seats for just 3 months? Subscription!
  • Need an Android Pro license for just this one project? Subscription!

I also see that cutoff-points for new versions are harder to justify if you’re nice enough to constantly push new features instead of holding them back for the next big release.

With a subscription you know in advance when you have to pay and how much. That can be convenient.

I guess software subscriptions could be alright. But this model is not. Subscription suggest flexibility, but at a minimum duration of 1 year we can forget about that. I stand by it – this is not good for anyone. (Edit: You know, except for the part where I took a step back, edited the title and added a disclaimer)

Let’s talk about the pricing.

I’ve been using Unity for about 5 ½ years now. All in all I’ve spent ca. EUR 3815,- on it. That’s around EUR 700,- per year.

Subscription costs EUR 57,- per month, so EUR 684,- per year. (If I stopped right there that would sound good, right?) But after the big initial investment I’ve been paying under EUR 1000,- every TWO years for upgrades. Read: Under EUR 500,- per year. And that is for Unity Pro with iOS Pro.
– The subscription for iOS Pro costs an additional EUR 57,- per month, so that would make EUR 1368,- per year.

EUR 500,- =VS= EUR 1368,-

That’s EUR 1368,- per year and you own shit. (Limited time offer!)

Ok, so existing customers shouldn’t buy it. What about new customers?

If you buy Unity 4 Pro with iOS Pro today you pay EUR 2280,-. If they stick to the 2-year release cycle you have a year left, then you can upgrade to Unity 5 Pro with iOS Pro for about EUR 1000 (maybe a bit more) and use that for 2 years. So, EUR 3280,- for 3 years if you buy. EUR 4104,- for 3 years if you subscribe. EUR 4280,- vs. EUR 6840,- after 5 years.

If you have only a year left to live and you want to spend it working in Unity, by all means – subscribe! In all other cases…

But here’s why this subscription thing worries me so much…

It points in a very uncomfortable direction. I know Unity has a pretty good track record, they’re a nice company full of nice guys and girls. I hear even their investors are so nice they don’t care at all about their money.
I want Unity to stay a nice company. And I’m more than willing to pay my share to make it so.

But I’m starting to smell evil…

A subscription model could have been a nice, flexible and cheaper way to get people started with Pro (sure, somewhat more expensive in the long run, no problem), with nice options to upgrade to the full version when you subscribe long enough… But no. As it stands now it looks like a silent first attempt to squeeze more money out of us customers. And believe me – If the subscription model promises a lot more money, the next step will be to incentivize me to switch to said subscription model.

  • Shorter release cycles?
  • Subscription-only features?
  • Higher prices?
  • Who knows…

If they want EUR 1368,- per year for a subscription, does that suggests they think that that’s about what every serious Unity Pro user should be willing to pay?
Is Unity (the application) growing more and more powerful? Sure.
Am I using most of the new features? Nope.
So maybe Pro just isn’t for me anymore?
But then who’s it for? The big studios?

Is it no longer for small full-time indies like me? You know, the ones they’ve been going on and on about? The ones they want to empower, etc., etc.?

If their plan is to make the bigger studios pay for the development and give me everything I need for free, then I’ll say sorry and send them flowers. But as it stands now I need some Pro-only features and I’m happy to pay EUR 1000,- every other year, but much more than that would hurt. I need other software too. I need all kinds of hardware to test on. I need to pay the rent and I need to feed a kid. Some suggest I might even need a vacation.

Bookmark the permalink. Follow any comments here with the RSS feed for this post. Post a comment or leave a trackback: Trackback URL.


    David on May 24, 2013 at 14:56 | Permalink

    I think you are assuming your situation applies to everyone. We aren’t a big studio, but this is ideal for us.

    In our case, we often do contract projects with two to ten people, and it usually means buying more licenses for contract artists, scripters etc. Paying Unity on a monthly basis for 12 months is ideal for these projects because the publisher will often cover the cost (which they won’t for perpetual licenses) and even if they don’t, it keeps my expenses in line with milestone payments.

    I don’t see any sign that Unity is dropping perpetual licenses, so I don’t see why anyone would object to Unity offering an alternative way to pay for the software.

    col000r on May 24, 2013 at 15:23 | Permalink

    If it’s just that (a not very flexible but somewhat cheaper alternative for a small number of people) then all is good. If it’s an evil plan to make me pay more and get less, then it might still work but Unity and me, we’ll no longer be friends. It will be a business relationship. And nothing more.

    Martin on May 26, 2013 at 01:08 | Permalink

    Hi Markus,

    I enjoyed reading your article, and you more or less hit the point. Most of your thoughts ran through my mind as well when I read the announcement.

    Anyway, I think I need to write about some additional things, because I think, with all due respect, you are a bit naive when it comes to your relationship with Unity Technologies.

    Fact is that you completely depend on what UT does. Every single decision they make affects you, your business, and your business’ financial health. When they jump, you jump. You don’t have a choice, because you don’t have much (actually useful) alternatives in the middleware sector. You can either use Unity, the most versatile, affordable engine currently on the market, or write your own engine. There’s just no serious competition here. And for a one-man company like you, writing your own engine is almost impossible, from both a financially and practically point of view.
    So whatever financial or technical decision UT makes, you have no choice but to swallow it.

    Sure, UT is a nice company. Most people there are beautiful folks, they have their heart at the right place, they try to listen to the community and try to do a good job. But make no mistake: That’s not because they love you and all their other users and what they do, it’s because that’s good for business. It builds up trust into the platform and tells you that it’s really OK to trust them with your business, because they’re there for you, no matter what. That’s how good advertisement and customer relations works.

    But here’s the thing: UT is not a non-profit organization, it’s a corporation with investors that needs to make money and grow continuously to be able to support their growing workforce and to stay interesting for investors.
    David Helgason doesn’t get tired of pointing out that he and his board doesn’t plan to sell the company in the foreseeable future. But technically speaking, that already happened in 2009 when Sequoia invested the first 5.5 million USD into the company. Venture Capital is investment money that you buy with company shares, you trade money for an adequate part of the company, and with that usually also voting rights.

    What surprised me most in your article is that you actually believe that UT’s investors are so nice that they don’t care about money. That’s just too cute.
    I have a little bit of personal experience with the Venture Capital industry in San Francisco and the Valley, and believe me: There’s not a single person, no matter how nice, who doesn’t care about money above all else. Venture Capital is, per definition, the pinnacle of the free-market capitalism in the US. They hand out billions of Dollars each and every year to support companies worth supporting. But they don’t do this out of the goodness of their hearts, they do it to multiply their money, to grow even more. It’s the toughest, most cut-throat business I have ever been in direct contact with.
    Now how does that tough, cut-throat business of Venture Capital fit into your picture of investors who are so nice that they don’t really care about their money? See, there are a couple of dozen large VCs in SF and the Valley, and they all are constantly looking for the next big thing, the next great idea that might go through the roof like Facebook or Google. Having an image of being all nice and cuddly helps you secure deals with new startups who are of course preferring a nice investor over one with a controlling reputation. Being nice on the outside is part of this business, but so is delivering the numbers.

    UT’s amazing community, nice developers, and cozy relationship with its customers is an important tool to bind customers to the company. David is a smart guy and he cultivates this image for a good reason: Among it being a cost-saving, 24-hour support system for UT’s users, it gives potential investors a certain sense of security that they are investing in a company that won’t implode any time soon. But that’s just one part of what an investor is looking for. The other part is capital gains, the return of the investment. Any VC I have ever talked to will not invest into a company that doesn’t promise at least a 10- to 50-fold return of their investment. So to get the round A investment of 5.5 Million, David had to convince Sequoia that UT will, over the next few years, be able to make them something between 50 and 250 million, minimum. And that’s just the profit, after taxes and all other costs, that they can get out of the percentage of shares they have bought, not total revenue.
    Generally, you got two options to reach this goal:
    a) Either Find a way to make this kind of money on sales and growth alone. I suspect that in the case of UT, this is not impossible, but quite improbable.
    b) Or you either go public, or sell the whole company to another company, and make that money from selling your shares.
    Option b) is more likely in UT’s case, I think, and also what VCs usually are more open for, because it minimizes their investment’s risk; they don’t have to wait for the real growth and revenue to take place, the mere promise of being able to reach this level of revenue one day is often enough to sell the company to a bigger fish. (See Instagram, among others.)

    So, the long story short: There is no such thing as a nice investor who doesn’t care about money. And there’s no such thing as a nice and cuddly relationship between you and UT. Your livelihood, your income from making games, completely depends on the tool they sell, and they need your money. It’s not a friendship, it’s a business relationship. Please don’t make the mistake and think differently, just because they have such a nice community and friendly developers. David and UT’s board will continue to look for ways to grow their revenue streams. There are only so many developers out there, UT can not grow indefinitely on a growing user base alone. That’s why they implemented the Asset Store, started Union, and that’s why they are now testing out this subscription model.
    If the subscription model works, and switch all the way, they can grow their yearly revenue by roughly 30 to 50% from existing long-time customers alone, and they manage to get all the short-term business that, until now, didn’t choose Unity because of the higher initial investment. Going all Adobe on you is a very good way to maximize revenue and make it look like a really good deal to most of their users.

    The future will show where UT is heading with Unity and their business, but for my personal taste, they grew a bit too fast in the past few years and lost touch with their hard-core user base. David will most likely protest this statement, and he’s probably right in doing so, but that’s how I feel.

    Anyway; I enjoyed reading your point of view and I think you’re right in thinking what you think. If more people like you voice their disfavor this whole idea might just blow over and go away. But even if it does, David and UT’s board will find another way to maximize their revenue streams. That’s what they do, and there’s no point in wishing they wouldn’t. The good old days where UT was just a small team with the praiseworthy mission to democratize the game development industry are over. It’s about time to see UT as what it is now: An international corporation, with financial obligations and a mission that is much more complex than it ever was.

    RippedOff on May 27, 2013 at 09:38 | Permalink

    At first the subscription model excited me – finally I can get the pro version. I’m a ‘one man band’ about to release my first app.

    But then I started doing the sums.
    US150 a month (pro +ios). Then if I want android that’s another 75 a month….

    So why shouldn’t I just get a personal loan and pay it off and own it? I almost would at these rates. The only way this isn’t a rip-off is if they release a new version every year – so knowing this would be helpful.

    I’m sitting on the fence now, not sure which way to turn… Maybe if they made it 75 for the LOT it would be a no-brainer.

Post a Comment

Your email is never published nor shared. Required fields are marked *


You may use these HTML tags and attributes: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <strike> <strong>