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The humbling of Epic: A giant turns around
The humbling of Epic: A giant turns around Exclusive
April 3, 2014 | By Leigh Alexander

It's strange to see Epic Games humbled. For years, in my work for Gamasutra, I was a regular visitor to the company's annual engine demos at E3 or GDC, always chaired by a bombastic Mark Rein.

Rein loves Unreal. At an industry event you can hear his enthusiasm from halfway across the room. "Hey Mark," I'd say, "let's talk about procedural generation and spline deformation!" "I love it," he'd roar. You'd have someplace to be, and he'd grandly wave you over to a sofa, a big high-definition monitor and declare, "Just look! Just look at this! Isn't it awesome?"

Usually the PR wouldn't even be present, like they just trusted his energy. Or had given up trying to put a lid on him. I started calling him the "Reinmaker," a half-joking nickname that I like to think I made up.

It was always an entertaining, even an intimidating spectacle. It was sort of like going to see a face-melting, apple-red muscle car, where the guy just loves to open the hood and turn the engine on and talk to you about every little part. Then my annual visits to the booth stopped. The last time was in 2011, maybe, when I went to talk to Cliff Bleszinski about how triple-A would never die.

Cliff doesn't work there anymore. He admires games like Rust now. The market's undeniably changed. The high-tech arms race has taken an unexpected left-turn into fragmented but flourishing markets: App development, Steam, open-source stuff, Unity. You know. For the past couple of years I haven't been invited with the same kind of enthusiasm to look at Unreal Engine updates.

At GDC, the company announced an interesting about-face: its arms race was effectively over, and it would offer new features and a new business model geared at capturing the Unity audience -- those are my words, and the words of everyone else who buzzed about the news during GDC, not Epic's, of course. What Tim Sweeney said at the announcement's unveiling were things like "outdated model" and "now, absolutely anybody can gain access to Unreal Engine 4."

So I decided, during GDC, to ask Epic if I could come and talk to Mark Rein again. Instead of Rein, the company offered me the chance to speak with Paul Meegan, its relatively newly appointed VP of product development. Meegan founded Epic China, did a brief stint as LucasArts' president, and returned to the company in 2012, a year which also saw the retirement of Epic president Mike Capps and the departure of production director Rod Fergusson.

When I arrive for my appointment, Meegan immediately strikes me as a different type of guy. There is a diplomatic grace about him, and a genuine warmth. He's in a tough position, having to talk about the humbling of the game industry's longtime muscle car -- to accept responsibility without negative self-talk -- and he knows what I want to talk about and he meets my eyes with a certain dignity.

"We became part of the big industry machine. I think there are good things about that, but there are also a lot of things that prevent you from doing the right thing by the people who use your technology."
"There is a purity and simplicity to saying, 'What do we think is the right thing to do,'" he tells me. "And, 'How do we restore having a direct relationship with the people who play our games and use our technology?"

"We became part of the big industry machine," Meegan says. "I think there are good things about that, but there are also a lot of things that prevent you from doing the right thing by the people who use your technology."

What are the things, I say. What are the problems with the infrastructure? What has Epic done wrong? Meegan pauses, and answers carefully but, I don't think, disingenuously: "Any time you are balancing complex relationships, or you have a lot of people who are all trying to accomplish slightly different goals, it is an extra layer of sort of distance and abstraction between you and gamers, or you and developers," he says.

"We wanted to stick a really simplistic approach: If we were on the other side of this, what would we want to have happen?"

"We said," he continues, "'We need to make it accessible, so that everybody can use it, and it's not just the tool of well-funded large teams. We need to make it easy to use, we need to support platforms, we need to be really generous, and make sure we succeed when developers succeed -- so we don't front-load the cost, and then we have an incentive.'"

"If we're going to have a subscription model, then let's make it so that if you don't like it you can cancel without any penalty, at any time, and you can keep using the engine, if you're a student, or you're an indie, and you don't have the funds to pay every month," he continues.

The Unreal Engine 4 source code is also now available. "It's risky," says Meegan, "because we're putting ourselves out there."

What does it feel like, I ask. I don't really often ask that of tech execs, at least not expecting a real answer.

"It's a little scary," Meegan says. "We... have to become vulnerable in a way, and we have to be willing to put ourselves out there in a way we haven't in a long time. We've gone through a period where everything felt very managed, and we had to let go of that, and be willing to be vulnerable and take risks."

Is it going to be hard to re-learn and understand a new audience? Meegan shakes his head gently: "We're game developers. The gap is small. We make games every day, and many of the people who work at the company do all sorts of their own projects," he says. "It does feel like we're going back to our roots."

Meegan says he sees the company's founder, Tim Sweeney, as 'the original indie.' At the company headquarters is a wall of Sweeney's work through the years, Meegan says, dating back to the time when Sweeney programmed his own games, did all the art, wrote the manual, released his work as shareware. Sweeney loves to show the wall of history to visitors -- it's important, then, for him to remind everyone that at some time, he put floppy disks into a mailbox, he alone.

Since then, the company has made, over the years, a painstaking investment in good code, Meegan believes. The company's been quiet the last couple of years because of a redoubling of that investment -- "as we looked at how we get the engine out to everybody, we felt we should play to our strengths," he says.

"Philosophically, we believe that if we're generous and we provide value to people, that value will come back," he continues. "The biggest challenge that we recognize is that we have to earn the trust and respect of the people who use the tech... to scale it in a way that it works for a whole lot of indies is a different challenge. That's now, for us to contemplate and it will keep us honest, but we get up every morning and we are all incredibly psyched to come to work."

It takes deliberate effort to adapt a company and a product that's historically focused on big teams and triple-A and make it suitable for the new climate, says Meegan. He says the company's "first effort" -- the Unreal Development Kit -- has been a learning experience. "We didn't do everything right," he says. "I'd say we were still between worlds, and we weren't able to make it available in a way that was realistic to anyone, and it wasn't easy to use. So we learned from that."

The announcement of a new direction has seen a tremendous response, Meegan says. Since then, according to social media, execs have been falling asleep on couches and staying up all night to answer emails. "Now it's time to earn that trust," he adds.

There's a long pause. "I think," he says, "sometimes it's about the bell you're not ringing. The transition we've been through, reinventing the way we operate and think, had more to do with, 'We're game developers'... Obviously we have Fortnite in development, we're going to be bringing that out relatively soon, and we have more games in development behind the scenes."

"But we're taking the same approach we're taking with tech: humble, a direct relationship with players... humble, and bringing people together."

To find out more about the nuts-and-bolts, tech and business behind Unreal Engine 4, don't miss Gamasutra's interview with Tim Sweeney.

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Rodolfo Rosini
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Epic's challenge is that today 9 out of 10 computing devices are not PCs and their unique selling point (being the best graphics engine in the market) is just simply not in demand, moreover even in their home turf other engines are closing the gap.

Right now the jury is still out if developers are willing to pay 5% in royalties for better textures.

Wendelin Reich
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Think about the 5% royalties in this way: do you think that using UE4 (versus not using it) can increase your revenue (after platform costs) by 5.3%, which is the increase you need to recoup those 5%?

If there wasn't Unity etc., this would be a ridiculous question.

In other words, Epic is offering a very good deal. You may argue why Unity is or isn't a better one, but there is no denying that game engines have essentially become awesome, semi-interchangeable, cheap commodities over the last few years.

Don't worry about those 5%. Worry about platform costs (30% everywhere - why is this so stable?) and worry about increased competition (from all those UE4 devs) instead...

Greg Scheel
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The reputation of Unreal is quite significant, when I tell people that I am developing in Unreal 4, they are always impressed. The AAA reputation carries a lot of weight, and grants my work credibility.

Michael Thornberg
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I hope developers choose an engine based how productive they can be using it. Personally I feel I am way more productive using Unreal 4 than Unity. And I do like Blueprints a lot. I still use Unity, but I find it less intuitive to work with than Unreal 4. Maybe you feel different? I can (of course) only relate to my own personal impressions in this case. Still, I think few developers choose an engine based on it's graphical capabilities these days. Especially since most engines today are really close to eachother, graphically that is. Which is good of course, but I feel tools are a much more important factor here. And I can't deny that Unreal 4 have much more experience in this area than their competitors. Cryengine for instance have a lot of ground to cover here. Despite being graphically superior to anything else. Unity is quite good, but it isn't as intuitive. Some things I also find directly annoying (but I won't debate personal issues like that here) So if I were to choose between the two today, it is probably quite obvious which one I would choose. Then I haven't touched the financial (and the availability) aspect of it all.

Jennis Kartens
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Can you quickly sum some features up what has changed within UE4 workflow-wise?

I have used UDK and Unity (2 or 3) and UDK was extremely tiring when it came to the process of importing stuff and quickly get new models, textures etc. in it, while Unity had both there a faster workflow as well as in actual coding.

Your post sounds like a lot of those issues may have been resolved within UE4? I am currently considering buying it, but I am not entirely sure yet.

Jed Hubic
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I always feel like the fear of 5% royalties comes from those who it won't ever be relevant to.

Greg Scheel
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The credit card companies will take me for 1.5% to 2%, the tax man will get me for loads, should I place my work on the app or play stores they will take me for 30%, 5% is nothing; and there is no way I would otherwise be able to make a game that looks as good.

Paul Tozour
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Paul Tozour
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> Right now the jury is still out if developers are willing to pay
> 5% in royalties for better textures.

You're missing the point of Unreal Engine 4 completely.

Matt Massier
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Genuinely curious about this;then what is the point of Unreal Engine 4?

Michael Thornberg
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@Jennis Kartens:
Actually it is better if you just go to YouTube and look it up :) It simply is too much to talk about. But in short: Script is killed. Blueprints replaced Kismet. No more copying the same stuff over and over for let's say a building filled with toggable lamps. But really, look in YouTube, there are already plenty of tutorials there.

But let me instead put it this way: For $19 (one month, you can stop after the very first month) you get everything, and you get to keep it forever. You don't need to pay anything else. Develop and finish your game, product whatever. Tell them you're going to sell the game, and *if* you make money. Pay 5%.

Compare that to Unity.

Michael Thornberg
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@Matthew Massier:
What is the point of any engine? It is up to you really. Everybody should use what works best for them.

Paul Tozour
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> Genuinely curious about this;then what is the point of Unreal Engine 4?

Basically what Michael Thornburg said -- too much to try to recap here.

For me, the biggest advantage is the combination of C++ with full source code, and Blueprint.

C++ means you can use a fast, popular, well-documented, and highly-standardized programming language, along with modern compilers and plenty of debugging and profiling tools. So you get full control over memory management (compared to C# or Java which are undeniably inferior in this category), const-correctness, the Standard Template Library, lambda functions, etc. Also, you have all the code available to use.

Blueprint support means you ALSO have an incredibly easy-to-use, type-safe, highly intuitive, and relatively well-documented language that you can also extend from C++. You can write entire apps with Blueprint, OR just use it for design-side scripting and do the rest in C++ ... it's up to you. And because changing a Blueprint doesn't require you to recompile the code, development is incredibly rapid.

Blueprint even supports interactive debugging and setting breakpoints.

AFAIK, every other major game engine either requires you to use a programming language that's slower and less powerful than C++, or use a terrible scripting language (usually some awful, proprietary mess derived from a hackneyed language like JavaScript (yuck!) and is non-standardized, lacks documentation, and is usually text-based and/or interpreted at runtime).

C++ and Blueprint is really a "best of both worlds" scenario.

Amir Barak
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Not to start a language flame war but I think you might be over-selling C++ here (and I love C++ don't get me wrong)...

Garry Grossmann
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Information you provide at the very beginning of your comment is very misleading. "A computing device" by itself means nothing. Once we enter the "gaming platform" part of argument, only then we may discuss problematics of engines. Just like not all PCs are used for gaming, hardly all smartphones and tablets are used for gaming. I play Auralux for a few minutes a day on my phone. But that doesn't make it a gaming platform in my eyes. I will never take mobile gaming seriously as long as it maintains it's current form.
A year ago, most marketing departments predicted that consoles wouldn't be successful anymore and that they'd be replaced by mobile platforms at the very beginning of the generation. There's no sign of that happening. The funny thing is that lots of them didn't even invest into any major titles for this time period.
A couple of years back, the same marketing departments used to claim that PC gaming would die off in a few years. Again, there was no sign of that happening at no point during the previous generation and their claims seem so ridiculous now, with the market changing so drastically.
Mobile gaming does have a HUGE player base, but vast majority of the games are played casually. While to some it may seem that it's a good idea to target the largest base of players - go ask Nintendo how that worked out for them and ask Microsoft how it's working out for them compared to their direct competitor. Casual base is the most unstable one. Core base, while may not seem interesting financially to some, is much more stable and to a certain degree represents certainty. Above all, game aimed mainly at the core base will be played by the casual base, but rarely the other way around. If you build up good audience and don't disappoint them, they'll keep coming back. However, it has to be a dedicated audience, not people who'll play the game for twenty minutes a day in-between classes or during a break.
People who want to make games want to make them not to make money, but because it's something they enjoy doing. There's usually much easier jobs for people with those skill-sets. So while mobile may be interesting with it's userbase, dedicated gaming hardware will always be in demand.

Laura Bularca
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"Philosophically, we believe that if we're generous and we provide value to people, that value will come back," he continues.

This is amazing to hear, especially from someone like the VP from Epic. Indeed, this article makes me very positive towards the future of this dear industry of ours.

Andreas Ahlborn
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The Unreal Engine (especially in its 3rd iteration) has proven that it can grow steadily in quality, robustness & usability.
A Mindbending 400+ AAA titles used it last gen (
ngine_3 ).

Still, i think utilizing its real strengths need teams of 10+ people, more than the average indiestudio consists of, so I think this will be not cannibalizing unity on the low end.
Another case is the mid-tier segment, where global players like Blizzard started to pick up Unity, because it was a lot cheaper back then (Hearthstone was done in Unity).

And what can I say, Netcode, Onlineplay is not necessarily a strength of Unity. I definitively expect that if Hearthstone will be successufl that Blizzard will switch to Unreal some time in the near future.

Paul Tozour
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> Still, i think utilizing its real strengths need teams of 10+ people

Have you tried it yourself yet? This isn't true at all. My studio is only 3 people right now and UE4 has given us a huge leg up.

Andreas Ahlborn
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Haven`t tried UE4 now, my experiences were with UE3 the time when they first releeased it to students for free (around 2009 I think). Back then I was very initimitated by the UI. Is UE more accessible?

Paul Tozour
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Yes. It's an entirely different ball game.

Terry Matthes
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I love the direction the Engine has gone. Dropping Unreal script was brilliant. Blueprints is very powerful as well. The new interface is also far more flexible and intuitive. It really feels like a proper 3D app that is much easier to use and navigate.

If you don't notice the difference its because you've never used the software. The change is that drastic. The free version of Unity is (to put it politely) not "good" when compared to UE4 and feature wise Unity pro can't really compare either.

I also agree with the poster who mentioned that those that bitch about the 5% royalty probably will never make a game anyways. That is a monstrous deal for such a piece of software. In fact I challenge anyone to find a better deal with comparable technology.

The one thing I really did like about Unity was the resource management. Now that the saving process and the whole idea of "packages" has been reworked in UE4 this is no longer an issue.

Bertrand Augereau
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How on earth "dropping the script" could be brilliant?
How were you hurt by the possibility left to advanced users of writing code?
I know several gameplay coders who work on Unreal projects who are very very disappointed by this.
(Considering it seems to be the same bytecode)

Paul Tozour
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> How on earth "dropping the script" could be brilliant?

Try it and you'll see. Blueprint is a million times nicer, safer, and faster to use than UnrealScript (or any other game scripting language I've seen or used).

Bertrand Augereau
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Then it would be the first time ever in history where visual programming would be more expressive and easier to manage and refactor. These things just don't scale. Do they merge properly on a VCS?
Merely trying it won't exhibit all the problems in the long term.
Yet I have to agree than game scripting languages are often half-baked.
Luckily, Epic fully embrace the use of customer C++ code, which makes it much less of an issue.

Michael Thornberg
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@Bertrand Augereau:
How about trying it before trying to kneecap it? You obviously have no idea what it is.. or what it is meant for. I also sense you don't really *care* to know either.

Jorge Gonzalez
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While i acknowledge that maybe this is the right direction for epic, i'm sad to see the free version go away, as there are devs like me who hoped to use it to study the engine and can't afford the service payment, because If you live in a third world country, like i do, 19 bucks a month is actually a whole lot of money.

Greg Scheel
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You only need to pay that fee once, download the engine and code, then cancel, and keep on working on your game. Just re-sub when you are ready for release, or to get updates.

Or, you can most likely just search torrents for the source code, it has to be out there somewhere. No shame in it, just learn, work, and pay the sub fee when you have a product ready, or nearly ready, to ship.

Michael Parker
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I'm a bit confused by the $19 a month thing. What's to stop everyone just canceling their subscription as soon as they've downloaded it. And if everyone does that, whats the point of the per month license?

I'd love to check it out to see what it's capable of, for curiosity, but it seems odd for there to be a pay barrier in the way of even considering looking at it?

Troy Walker
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updates? bug fixes? platform extensions? publishing?...

if you're a beginner, it's a great incentive... pay when you want for what you need and not continuously for.. marginal updates or non-existent fixes.

Greg Scheel
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I piss that much down the toilet in beer each week.

A week of beer, or a month of updates and fresh examples? Answer: I cancelled my EVE sub, will play f2p games for inspiration and information, and keep Unreal subbed.

Edit: I think of it like this, Unreal Engine 4 is the best sandbox game ever.

Mark Morrison
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Your kidding, right Michael P.? $19 a month and no annual commitment? I can't think of one reason any professional or aspiring to be professional interactive media developer would not jump on this immediately. In the middleware engine space it doesn't get more high fidelity than UE the right hands of course :)

Troy Walker
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I don't have a problem with the 5% royalty, but that is on gross... so on "net" that is more equivalent to ~7% ? (depending on other cuts from gross).

Gregory Booth
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Some of the benefits of UE4 I see for a Unity developer are:

Source Code!
Divestiture of an old mono with allegedly poor gc
Better graphics
Visual scripting out of the box with Blueprints
Low out of pocket cost for all features
Unreal's rep

Some of the negatives:

System requirements
Android is "rough"
Slightly larger mobile exports, can get to OTA size though (per forums)
Tackling a new learning curve
Some resistance to C++ for some
5% royalties

None of the negatives stopped me from heading over to TigerDirect to
throw together a new box. Can't wait to play with Unreal 4.


Greg Scheel
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Unreal runs at no more than 50% cpu on my q9550, gtx 660; I would have to burn some bank to get better performance, although I don't think the q9550 can handle dx11.

Daniel Borgmann
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Does UE4 provide any benefits for creating 2D sprite based games? What appeals to me most about Unity is its versatility, and the recent addition of native 2D support put it at the top of my list.

UE4 does sound very interesting though, especially since I have some experience with the toolchain while Unity still feels pretty alien to me. But if I spend the time to learn a new engine in and out, then I wouldn't want to be limited to certain kinds of game projects or visuals. So how versatile is UE4 really?

Greg Scheel
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The Tappy Chicken example works fine, and it was coded entirely with blueprints. I am not sure how well it will run on a phone, but it should be ok. I am going to set up an android development environment, and will report back on the build process and it's results.

Ok, Unreal 4 comes with an nvidia android environment, under Unreal Engine/4.0/Engine/Extras/Android. After installing this, with debug enabled on my phone, I was able to package, install, and run 'Tappy Chicken'. It works ok, although it did 'stop' running at one point. My expectation is that an experienced android developer would be able to figure out why, and solve it.

What is interesting is how the 2d stuff is represented in the 3d editor, it displays as a billboard on which the game happens, with a camera set up to watch it. Using Unreal for 2d development is likely overkill, but it does work, and works well.

Nick McCrea
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Like many others in this thread, I think UE4 at this low upfront cost, on these terms, is monumentally good value. The engine is fantastic, documentation and samples are first rate. Perhaps for those looking to do mass-market stuff it's a bit too heavyweight (particularly on mobile), but I can see this challenging Unity's dominance.

I will be very interested to see whether Unity respond with a price drop or a new subscription + revenue share offering. Unless the majority of their revenue comes from small, revenue positive studios (to whom a revenue share would be unattractive and who therefore won't like Epic's terms), I don't see how they have a choice...

Alan Youngblood
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"It does feel like we're going back to our roots." - This is what I was hoping for the past decade as I saw Epic diverging from who they were. I remember about a decade ago buying UT 2003 and 2004, for the games, but mostly for the engine. For $40 at Target (Remember when they were still a viable business because networking security wasn't such an issue?) I got an awesome game and the tools to make, mod or create something new around that game.

Valve was the only other company doing that sort of thing at the time. Oh, and good luck making your own engine. It's as silly now as it was then, it was more ridiculous back then. Even API's and IDE's have come a long way in recent years. Both companies had the problem of making non-FPS games with their engines. I worked on a project from around '07-'10 in Valve's Source engine and I described it to others as being great for making Valves games, depending on how different your game was it could be much more difficult. (All anecdotes here should be re-evaluated with current engine workflows, I've adopted using Unity and other tools these days, so I would imagine many of the issues I had in the past to have been addressed by now)

For Epic I see the next big step is to simultaneously continue humbling themselves and also do as much as they can to build an active developer community. (I also realize those are both nearly mutually exclusive of one another). One of the biggest value-adds for Unity in my opinion is that enough people use it and write about it on the official forums, their own blogs, youtube it, whatever that I can pretty much get an idea of where to start and what to do with something in a quick google or reference docs search. This retention metric will also play into acquisition. I can't imagine I'm the only dev out there that looks for a thriving community when I want to invest time in a dev environment.