Wait, is Unity allowed to just change its fee structure like that?

If you were developing a Unity Engine game on Monday, you did so with the general understanding that you wouldn't be charged additional royalties or fees beyond your subscription to the Unity Editor software itself. If you were developing that same game on Tuesday, you were suddenly subject to shocking new terms that would impose charges of up to $0.20 per install (starting next year) after certain per-game revenue and install thresholds were reached.

 

This change led to a firestorm of understandable anger and recrimination across the game development community. But it has also led some to wonder how such a massive change is even legally possible. Can Unity just unilaterally alter the fee structure its developers were relying on, even for development projects that were started (or even completed) under completely different legal terms?

 

The answer, it seems, depends on how you interpret some seemingly contradictory clauses that have appeared in various Unity terms of service in recent years.

Unity: We can do what we want

To be clear, Unity says its new fee structure won't apply to any game installs made before the newly announced structure goes into effect on January 1. But in an FAQ, the company suggests that games released before 2024 will be liable for a fee on any subsequent installs made after the new rules are in effect.

 

"Assuming the game is eligible and distributing the Unity Runtime, then runtime fees will apply," the FAQ reads. "We look at a game's lifetime installs to determine eligibility for the runtime fee. Then we bill the runtime fee based on all new installs that occur after January 1, 2024."

 

That might be surprising for developers that released a Unity game back in, say, 2015, when Unity CEO John Riccitiello was publicly touting Unity's "no royalties, no fucking around" subscription plans. Now, even developers who paid $1,500 for a "perpetual license" to Unity back then could theoretically be subject to additional per-install fees starting next year (provided their game is still generating sufficient revenue and installs).

 

Unity has yet to respond to a request for comment from Ars Technica, but a spokesperson outlined the company's legal argument in a forum thread after reportedly "hunt[ing] down a lawyer":

 

Our terms of service provide that Unity may add or change fees at any time. We are providing more than three months advance notice of the Unity Runtime Fee before it goes into effect. Consent is not required for additional fees to take effect, and the only version of our terms is the most current version; you simply cannot choose to comply with a prior version. Further, our terms are governed by California law, notwithstanding the country of the customer.

Read through old legal documents with me

Broadly speaking, the general legal agreements signed by all Unity developers give some support to this position. At least as far back as 2013, the Unity EULA has included a broad clause that says the company "may modify or terminate the subscription term or other Software license offerings at any time."

 

But that straightforward "we can change whatever we want" language became a little more complicated in early 2019. At that time, Unity was caught up in another controversy over a terms of service (ToS) change, this one involving a new clause that seemingly banned the popular cloud-based multiplayer development kit SpatialOS.

 

 

While Unity eventually worked things out with SpatialOS maker Improbable, the development community was justifiably worried that future ToS changes could impact their projects. To calm things down, Unity announced a new "commitment to being an open platform" that included an important protection against any further sudden ToS changes. As the company wrote in the announcement blog post: "When you obtain a version of Unity, and don’t upgrade your project, we think you should be able to stick to that version of the ToS."

On a GitHub page that Unity set up to track those kinds of ToS changes, that promise was given a translation into legal jargon (emphasis added):

 

Unity may update these Unity Software Additional Terms at any time for any reason and without notice (the “Updated Terms”) and those Updated Terms will apply to the most recent current-year version of the Unity Software, provided that, if the Updated Terms adversely impact your rights, you may elect to continue to use any current-year versions of the Unity Software (e.g., 2018.x and 2018.y and any Long Term Supported (LTS) versions for that current-year release) according to the terms that applied just prior to the Updated Terms (the “Prior Terms”)

 

On the surface, this section would seem to suggest that a game released before Unity's new terms go into effect could stick with the older, install-fee-free ToS that existed at the time the game was released. The only potential hitch would come if you wanted to update the project to a later version of Unity; in that case, as the ToS states, "your use of any new version or release of the Software will be subject to the Updated Terms applicable to that release or version."

 

What's more, this 2019 version of the ToS was explicit about including a "non-exclusive, non-transferable, royalty-free right" to "distribute the Unity Runtime as an integrated part of your Projects" under certain broad conditions. That would seem to disallow the kind of "Unity Runtime fees" the company soon plans to charge for Unity game installs—at least for old, un-updated projects that decide to stick with the old ToS.

 

Both the "keep your old ToS" and "royalty free runtime" clauses continued to appear in Unity's "Editor Software Terms of Service" through an October 23, 2022 update, suggesting that unupdated projects made on Unity 2022.x and Unity 2021.x LTS (or earlier) might be able to keep the fee-free legal structure they were built under. But then, with little notice, an April 2023 Editor Software ToS update removed that safety valve entirely.

 

A note at the top of that April version mentions that the new version includes an update to a section on "modification of terms." In practice, that "update" meant the "keep your old ToS" clause introduced in 2019 was simply deleted wholesale and not replaced. In addition, the "royalty-free runtime distribution" clause was updated to indicate that such distribution was "subject to payment of applicable fees," quietly laying the legal groundwork for this week's install-fee announcement.

 

Unity also seems to be going out of its way to eliminate at least some extant signs that its previous "Software Terms of Service" were any different. That promised GitHub page tracking ToS changes no longer works, though identical forks of GitHub still capture the old language (Internet Archive snapshots suggest the GitHub removal happened sometime after July 2022). An older "Software Additional Terms" document with the "keep your old ToS" clause intact, dated March 2022, is still available on the Unity site as of this writing.

A second ToS?

The April update is bad news for developers who unknowingly used the latest version of the Unity Editor since then, seemingly subjecting themselves to the new rules in the process. But projects created under older versions of the editor (and terms of service) might still be shielded by the old "keep your ToS" clause, right?

 

Unfortunately, it's not that simple. That's because the Unity Editor Software ToS (which has been getting lots of attention on Reddit and elsewhere) is supplementary to a wider Unity Terms of Service document that applies to all users of Unity's products and services.

 

Those superseding terms are much more liberal regarding Unity's rights to "modify the Agreement at any time and without prior notice," full stop. And there's no sign of the "keep your old ToS" clause here, either:

 

By continuing to access or use the Services after we have provided you with notice of a modification, you indicate that you agree to be bound by the modified Terms. If the modified Terms are not acceptable to you, your only recourse is to cease using the Services. (emphasis added)

 

In other words, if you don't want to be subject to the new rules, these overarching Unity terms suggest your only way out is to stop using Unity's services altogether (which seemingly includes distributing the Unity Runtime needed to install and play your game in the first place). What's more, these overall terms explicitly allow Unity to "increase, modify, or add new fees and charges for any of the Services from time to time by posting such changes to the Site or within the Services Panel" with at least 30 days' notice.

 

"Your continued use of such Software and/or Developer Service after the effective date of any such change means that you accept and agree to such changes, as applicable," the updated ToS reads.

 

The oldest version of this general Unity ToS I was able to find archived dates to January 2022, so it's not entirely clear how long this superseding language has been in effect. But the similar language in the 2013 EULA suggests this is not an entirely new legal protection for Unity.

 

Interestingly, that January version of the overarching ToS also includes a sentence specifically noting the different clause letting you ignore changes to the software ToS. The current general ToS eliminates that sentence and explicitly says "for the avoidance of doubt" that its modification rules also apply to "the Additional Terms" (i.e., the Software ToS).

We’ll see you in court?

So what do all these changing and seemingly contradictory ToS clauses mean in practice for a working Unity developer? The answer isn't totally clear.

 

"Certainly in the black and white language [in] the contract as it sits today, it appears that [Unity] are covered," game industry attorney Richard Hoeg said in an excellent YouTube livestream analyzing the legal issues here. "But there are questions of timing and older versions, especially for games that have been made and finalized a while ago, well before this change was made."

 

Where Unity might run into some legal exposure, Hoeg said, is in the apparent conflict between the overall ToS (which Unity says you are subject to as long as you use its services) and the Software ToS (which until recently said you can keep using an older version if you don't update your game). "That's an ambiguity that... we try to avoid first and foremost when we're writing contracts in legal land," Hoeg said.

 

 

In general, this ambiguity would usually be resolved with the more general ToS overriding the "additional" Editor Software Terms, which are considered ancillary in legal parlance. At the same time, Hoeg said a developer could argue that they had reasonably relied on the ancillary language in the Software terms, including the clause that would conceivably let them keep those terms even in the case of future changes.

 

"Someone could have looked at that and said, 'Yes, I'm going to invest my time and efforts,' and by changing that without making it known and then changing the fee structure here in September of 2023, it's possible you might bring a claim," Hoeg said.

 

A developer who wanted to pursue that kind of claim in court could argue using the concept of promissory estoppel, or the "notion that you can't just change the deal if somebody else relied upon it," as Hoeg put it. "You made a promise to a party that you were going to give them the Unity tools that they weren't going to have to pay money [for], and they spent four years of their life in investment, in education, learning the Unity toolset and getting ready to build a game, and then you change the pricing right at the end," Hoeg said by way of hypothetical argument.

 

While Hoeg said he might be personally amenable to this type of argument, it could be a tough, technical claim to make in an actual court. It's the kind of argument where you basically "throw yourself on the concept of justice and hope that things turn out all right for you," as Hoeg put it.

 

That might be the kind of legal argument some Unity developers are preparing to make, though. Indie developer Xalavier Nelson, Jr. told Axios that "some of the most significant developers in the space using the engine" are considering a class-action lawsuit over the changes, following a Tuesday social media post suggesting the same.

 

"I can't see how that is legal," Cult of the Lamb developer Massive Monster told PC Gamer. "They absolutely have lawsuits coming their way."

 

In the end, though, this kind of potential legal wrangling is only necessary when the usual conventions of business partnership break down entirely. "A lot of the time, these contracts are going to be written in such a way that the companies have broad authority to do what it is that they will do, and you will wind up in a position of trust," Hoeg said. "As lawyers, we're not in the 'trust me' business. You, as a business person, as the client, have to determine whether you have a sufficient trust or closeness with your business partner to believe that they're going to hold things relatively the same..."