Stadia Pro Revenue Model Change Has Game Developers Worried
A gaming platform lives or dies by the number and quality of games available on it. The latter, in turn, is dependent on attracting developers and publishers to make a bet on that platform. Although it has been around for more than a year now, Stadia's long-term survival has always been in question because of developer and publisher support. Now it seems that developers are once again questioning Google's commitment to the cloud-based game streaming platform, thanks to an important change it made to Stadia Pro's revenue model.
At first glance, the changes Google announced last week seemed to favor all developers. New games launching from October 1st, 2021, until some time in 2023 will see an 85/15 split between developer and Stadia, at least for the first $3 million in sales. It won't last forever, though, and it will revert to the "standard" 70/30 revenue sharing sooner or later.
The problem, however, is the change that Google is making for the games that are offered for free on the Stadia Pro tier. Instead of upfront payment for games like Google promised in its previous terms, developers will instead get 70% of revenue that's based on player engagement. In other words, the more days a Stadia Pro game is played in a month, the higher that revenue and the higher the cut that a developer will make.
The problem is that this new revenue-sharing model might be skewed to favor certain types of games only. Online games like PUBG definitely have the advantage because there is no definite end game and content just keeps getting added. Players of single-player titles or even co-op games with end content will most likely taper off at some point.
It remains to be seen whether this new business model will end up being more profitable for developers, especially when they factor in direct sales outside of Stadia Pro. The changes, however, are already adding more worry to developers on top of fears that Google might pull the plug at any given point in time like Google often does.