Epic Games and Oculus have collaborated together for a new way for developers -- especially those classified as indie -- to cut operating expenses when developing games and apps for the Oculus Rift. Oculus' owner, Facebook, will be stepping in to cover royalty fees for some VR projects.
According to a post over on the Unreal Engine website, Epic Games and Oculus have teamed up where Oculus will cover royalty fees on games made using the Unreal Engine shipping onto the Oculus Store for up to $5 million in gross revenue per game. This announcement originally came from the VR company during their Oculus Connect 3 press conference in San Jose, California.
So if you make a game using the Unreal Engine 4, and it's real snazzy and awesome, if you add support for the Oculus Rift and make it a VR title and then manage to get it approved to be sold through the Oculus Store, the first $5 million in gross revenue will be royalty-free and you won't have to pay Epic Games a dime for having used the Unreal Engine 4 game engine.
Epic Games now makes a lot of their money from royalty licensing instead of traditional game development. Usually, developers would have to pay upfront to get their hands on the Unreal Engine. It basically meant that developers had to have enough disposal operating funds to even use the Unreal Engine. It was also the same way with the CryEngine and other top-tier design utilities.
After Unity Technologies stepped into the field and started making the tools more indie-friendly, Epic Games, around the same time, started utilizing the Unreal Development Kit that allowed developers to freely build games using a limited off-shoot of the Unreal Engine 3. This eventually evolved into their latest program for the Unreal Engine 4, where developers don't even need to pay upfront to gain access to all the necessary tools they need to build games and software using the latest design technology.
However, programs made using the Unreal Engine 4 have a 5% royalty fee on gross revenue from games sold on the digital marketplace. This means that developers are only paying out when their games are making money. And the more games that are made using the Unreal Engine 4 that are successful the more money Epic makes in return.
This collaboration with Oculus will likely give start-up studios and smaller development outfits the incentive to make their games with VR support with a chance to make it onto the Oculus Store so they can take advantage of the $5 million royalty coverage from Oculus.
Technically, if developers really wanted to skirt operating expenses, they could even avoid launching on Steam for the first $5 million in revenue to avoid paying Valve the 30% distribution cut that they take from games being sold on Steam. The extra cash could be used to help further improve the game or used toward operating costs of the next game.
Of course, the caveat here is that you would have to make your game compatible with the Oculus Rift and you would have to have the app/product/game approved by Oculus to appear on the Oculus Store. Assuming you can meet those requirements, then you can become eligible for making good on the $5 million royalty coverage.