Royalties on software + hardware bundles

Community Community & Industry Discussion
1

I have a tough question that doesn’t seem to be handled by the EULA.

I’m planning to develop a product that is a software + hardware bundle.

The software component would be a game developed using UE4.

The hardware component is a very expensive handcrafted trophy. The decisions made by the player during the game are used by the craftsmen to craft the trophy which is then shipped to the player. Thus, though the trophy is the main product and the game is the secondary product, the trophy requires the game as a prerequisite.

The price will be displayed to the user as X for game and Y for handcrafted trophy. However, the two are always sold together and are not available separately.

Would I have to pay a royalty on X + Y or only on X?

2

You would only pay for X–the price of the game. That would be similar to how things would go on Kickstarter where for example you could have a $20 tier for the game and then a $30 tier for the game+T-shirt and you would still only count royalties on the $20 value of the game.

Things can get weird though if you don’t have a value of the game by itself but I haven’t seen that situation come up yet.