Question regarding 5% royalty and revenue share

Community Community & Industry Discussion
1

I’m trying to figure out how to calculate the net revenue I receive from a game sales on digital distribution platforms, but I’m unsure how to interpret the language in the UE4 EULA in the context of a revenue share arrangement with a publisher. I realize that this topic has been discussed before, but neither this forum nor Google appear to have a definitive answer for this particular question.

Let’s say I sell a game for $10.00 on Steam. If I understand the UE4 EULA correctly, then the 5% royalties are based on these $10.00 (= $0.50), regardless of how much I actually receive after Steam takes their cut. Is the same, then, also true for the cut my publisher takes?

So, $7.00 remain after Steam takes their 30% cut, $2.10 remain after the publisher takes their 70% cut. Of those $2.10, do I have to pay $0.50 royalties to Epic, leaving me with $1.60?

My guess would be that it indeed doesn’t matter how little of a cut I receive from the publisher, I would always have to pay $0.50. But I would appreciate if anyone with experience in this matter could confirm.

Thanks!

2

The Epic 5% royalty is on the amount before you subtract anything, so if you sell the game for $10 it will always be $0.50 no matter how much anyone else gets from royalties.
How much you pay your publisher depends on your agreement with them.

3

Right, so as described in my post. Thanks. :slight_smile:

4

If Epic took 5% then Steam took 30% and your publisher took 70% that would make 105% deductions so you’d be making a loss on every sale.

5

Depends on the publishing deal, I guess. In my experience, revenue share models are usually based on the revenue that’s actually received from the distribution platform, after they deducted their fee. So the percentages are not accumulative, as quoted in my example.