[question]Towards the royalty Payments

Community Community & Industry Discussion
1

ok, first while i do know and totally fine with the royalty fee, i got a little confuse with it.
ok i know which normally i only have to pay the 5% royalty only after my first million (1.000.000.00) and only pay for what comes after that million like if i made in a quarter 2 millions i will have to pay 5% only for 1 million not for the 2, and which i only have to pay when my total earns on each quarter is 10k+(10.000.00), if i earn less than 10k in a quarter i don’t need to pay royalt for that.

now comes my confusion, which is about the “crowdfunding” for what i understood, if i go to a crowdfunding like kickstarter, i have to pay the royalty of 5% of each tier and each person which i’ve offered a way to “play the game earlly” or be pratical to have acess to the game" and only the value related to the acess, like:

i make a 4 tier
tier 1
10$ you gain a “thanks from me” ( no royalties)
30$ your name will be added in game when it released and tier 1 (royalties over 20 of 5% which means 1$)
50$ earlly acess and tier 1 and 2 (royalty over 40$ 20 for tier 2 and 20 for tier 3)
70$ a t-shirt of the game and tier 1, 2 and 3 (royalty from tier 2 and tier 3 in a total of 40 from both tiers and nothing from tier4 due to not being "direct part of the game/project)

now comes my confusion, it means which the money i get from the crowdfunding will count towards the one million cap to pay the royalty or its a apart royalty, like if i rise let’s say 2 millions in a crowdfunding and pay the crowdfunding royaltie, when release the game and it start to sell i have to pay royalty already at the beginning, in the first quarter anyway even if my sales didn’t reach the first million mark???. or i still have the 1 million mark before have to pay again royalties???

they are 2 different royalties or one can afect the other???

and about the tier what i told was right??? i means i only have pay royalty for when a tier is refered to give stuffs direct from the project like "extra content or earlly acess and any other type of “reward tier” don’t count towards

also the stuffs about the rewards tiers are like what i told right, i only have to pay a royalty when it’ is direct related to the project like a in game reward or earlly acess, merchandise like shirts, toys which don’t have any direct impact in the project can be “free” or partially free if they don’t have others tiers inside then right? in case they have others tiers inside i only pay the value of the "inside tier which is part of the current tier right?

i would really love if someone specially from the unreal team can proper answer those questions

well thanks in advance for any replay/help/answer;

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Royalty calculation is only based on the game itself, so if you give things in your crowdfunding tiers that are not the game itself then you would not include that towards your total for royalties. So in your case, Tier 3 gets the game along with whatever the first two tiers gives, which in this example that means that if you subtract the value of the content from the lower tiers then the game itself you are valuing at $20 ($50 - $30)
Your total sales would include both the crowdfunding sales (just for the value of the game itself) along with any sales you get for the game once it’s officially released.

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then the one million mark is for both game itself sales and crowdfunding,??? that is the par which if making me confuse, because the crowdfunding say which i must pay in the get go, once i get the money from the crowdfunding i have to pay the 5% without matter the 1 million at last is what it’s looks, because let’s say which in the crowdfunding i got 500k related to the game itself then in theory i would not need to pay anything because it’s still under the 1 million mark and only after i’ve received more than 509.999.99 in a quarter which i would had to pay which in this case wold be for the 10k+ more, this part really looks confuse to me.

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The crowdfunding is essentially a game sale, which is why you still need to pay royalties on it. It’s under the same licensing terms, so whenever you get the crowdfunding money you need to figure out if you owe anything. But again for crowdfunding you should only count money that would be paid to get access to the game by itself, if one of the tiers includes the game along with other rewards then you would not include the value of the other rewards.

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