4 ms·

Seems like every company these days are trying to figure out how to increase the rents that they collect. No actual value add, just trying to optimize to make

Seems like every company these days are trying to figure out how to increase the rents that they collect. No actual value add, just trying to optimize to make that top line number go up. It feels very end-of-business-cycle.

diggan 3y ago
Not sure you could argue that Unreal Engine hasn't provide any actual value, it basically helped spawn a whole new area in film production via the whole "Virtual Production Sets" that you can build with Unreal Engine.
- lamontcg 3y ago
  I'm saying this pricing change doesn't add any value. I would be literally impossible to argue that UE doesn't add any value, which is why I'm not making that argument.
  - diggan 3y ago
    I'd say they already added the value but never charged for it, until now. Seems fair to me.
    - lamontcg 3y ago
      Which still means that this change doesn't add any value. I'm uninterested in if it is "fair" or not.
      - diggan 3y ago
        So if someone builds something of value but doesn't charge for it until 2 years later, you'd say that they aren't providing value with this change? I mean, I get what you mean, but seems needlessly pedantic to just "forget" the thing that is being charged for and because there was no other changes made with the new price being added, the change itself isn't adding any value. Regardless, I get what you mean, no value for you that they start charging. True.
        lamontcg 3y ago
        What I'm saying is that in the aggregate that as more companies are doing that it begins to look like the proverbial "rearranging the deck chairs on the titanic" or "everyone looking for their seats before the music stops". This is because macroeconomically everyone's sales numbers are someone else's expenses. You can get down into the weeds where even though this is just resource allocation of capital that it is doing useful work in the economy to correct a misallocation of capital, but my point is more that this is a late-business cycle signal. Businesses are looking at their finances and looking at the interest rate environment and trying to squeeze more sales out of their existing customers. That is an indicator that the financials at Epic Games probably weren't trending in a good direction. And I'm unsurprised to find this fairly recent news article: https://www.cnbc.com/2023/09/28/epic-games-is-eliminating-16percent-of-its-workforce-and-selling-bandcamp.html https://www.cnbc.com/2023/09/28/epic-games-is-eliminating-16... Even with the success of UE and Fortnite they're still a money losing business. They've probably been surviving off of cheap debt since 2009 but that has now ended. Multiply that by all the businesses in the Russell 3000 or whatever that have been doing exactly the same thing.
AlexandrB 3y ago
Yup. A good time for open-source alternatives to re-assert themselves in the market. Low interest rates made commercial software unnaturally cheap for a long time. Will also be interesting to see how well subscription-based software fares when people start tightening their belts due to inflation and rising interest rates.
- lamontcg 3y ago
  Yes, someone who gets what I'm talking about.
almatabata 3y ago
In this case it went from completely free to pay something. The completely free tier clearly could not last. The company has to pay the bills somehow. They wanted to gain market share in the sector and now that they think they want to recoup some of the cost. You have cases where companies jack up the prices out of pure greed but i would not count this as one. Why should studio not pay a license fee for high quality software like the unreal engine?
- lamontcg 3y ago
  Please read the other thread completely and particularly my last comment. I'm making a macroeconomic comment, you're assuming I'm arguing about the morals of the microeconomic decision making here. Arguing about the morality or ethics or greed involved isn't useful. Just like it wasn't useful to argue about greed involved in our recent spike of inflation. This fairly large company is still just another cog in the macroeconomic machine and their behavior is almost deterministic. The more interesting question to me is what it indicates about the macro climate and if there's stormclouds on the horizon or not.

diggan 3y ago

Not sure you could argue that Unreal Engine hasn't provide any actual value, it basically helped spawn a whole new area in film production via the whole "Virtual Production Sets" that you can build with Unreal Engine.

lamontcg 3y ago
I'm saying this pricing change doesn't add any value. I would be literally impossible to argue that UE doesn't add any value, which is why I'm not making that argument.
- diggan 3y ago
  I'd say they already added the value but never charged for it, until now. Seems fair to me.
  - lamontcg 3y ago
    Which still means that this change doesn't add any value. I'm uninterested in if it is "fair" or not.
    - diggan 3y ago
      So if someone builds something of value but doesn't charge for it until 2 years later, you'd say that they aren't providing value with this change? I mean, I get what you mean, but seems needlessly pedantic to just "forget" the thing that is being charged for and because there was no other changes made with the new price being added, the change itself isn't adding any value. Regardless, I get what you mean, no value for you that they start charging. True.
      - lamontcg 3y ago
        What I'm saying is that in the aggregate that as more companies are doing that it begins to look like the proverbial "rearranging the deck chairs on the titanic" or "everyone looking for their seats before the music stops". This is because macroeconomically everyone's sales numbers are someone else's expenses. You can get down into the weeds where even though this is just resource allocation of capital that it is doing useful work in the economy to correct a misallocation of capital, but my point is more that this is a late-business cycle signal. Businesses are looking at their finances and looking at the interest rate environment and trying to squeeze more sales out of their existing customers. That is an indicator that the financials at Epic Games probably weren't trending in a good direction. And I'm unsurprised to find this fairly recent news article: https://www.cnbc.com/2023/09/28/epic-games-is-eliminating-16percent-of-its-workforce-and-selling-bandcamp.html https://www.cnbc.com/2023/09/28/epic-games-is-eliminating-16... Even with the success of UE and Fortnite they're still a money losing business. They've probably been surviving off of cheap debt since 2009 but that has now ended. Multiply that by all the businesses in the Russell 3000 or whatever that have been doing exactly the same thing.

AlexandrB 3y ago

Yup. A good time for open-source alternatives to re-assert themselves in the market. Low interest rates made commercial software unnaturally cheap for a long time. Will also be interesting to see how well subscription-based software fares when people start tightening their belts due to inflation and rising interest rates.

lamontcg 3y ago
Yes, someone who gets what I'm talking about.

almatabata 3y ago

In this case it went from completely free to pay something. The completely free tier clearly could not last. The company has to pay the bills somehow. They wanted to gain market share in the sector and now that they think they want to recoup some of the cost. You have cases where companies jack up the prices out of pure greed but i would not count this as one. Why should studio not pay a license fee for high quality software like the unreal engine?

lamontcg 3y ago
Please read the other thread completely and particularly my last comment. I'm making a macroeconomic comment, you're assuming I'm arguing about the morals of the microeconomic decision making here. Arguing about the morality or ethics or greed involved isn't useful. Just like it wasn't useful to argue about greed involved in our recent spike of inflation. This fairly large company is still just another cog in the macroeconomic machine and their behavior is almost deterministic. The more interesting question to me is what it indicates about the macro climate and if there's stormclouds on the horizon or not.