Who Actually Gets Paid When You Buy a Game in Australia

Almost every explanation of where your money goes when you buy a game is written in US dollars and stops at the storefront cut. “Steam takes 30%” is the whole analysis.

That is the first deduction, not the last, and it is not even the first one in Australia. Here is the same purchase followed all the way down, in the currency you actually pay in.

Start With What You Actually Paid

No Australian buyer sees a US$70 price tag. A current full-price release here typically lands somewhere in the region of a hundred-odd dollars, and that number is inclusive of GST. So the first thing to understand is that the headline figure and the amount that enters the revenue waterfall are not the same number.

Since 1 July 2017, GST applies to imported digital products and services sold to Australian consumers — the change often called the “Netflix tax”. The rate is 10%, and for sales through a major storefront the platform is generally the entity that collects and remits it as the electronic distribution platform operator, rather than the developer.

The practical effect: roughly one-eleventh of the sticker price is GST and never belonged to anyone in the supply chain. On an $110 purchase that is $10 going to the ATO before a single commercial party is paid.

The Storefront Cut, and Why 30% Is Not Always 30%

What remains is the net sale, and this is where the storefront takes its share.

The widely quoted 30% is the standard rate, but the major PC storefront has published revenue tiers for some years: the share drops to 25% on revenue above US$10 million for a title, and to 20% above US$50 million. Those thresholds are per-title and cumulative, which means the effective rate a studio pays is a blended figure that only a small number of titles ever get to enjoy.

Mobile stores run a different structure again, with reduced rates for smaller developers introduced from 2021. Console platform terms are not public.

The thing to take from this is that “the platform takes 30%” describes the worst case, which is also the case that applies to almost every game, because almost every game never reaches the tiers.

Engine and Middleware

If the game was built in Unreal, Epic’s standard licence takes a 5% royalty on gross revenue above a lifetime threshold of US$1 million per product — and Epic waives that royalty for revenue earned through its own store.

Unity has taken a different route. Its 2023 Runtime Fee announcement — a per-install charge — was met with an industry revolt, walked back, and then cancelled outright in September 2024, returning the model to seat-based subscriptions. That episode is worth remembering for a reason beyond the fee itself: it established that engine terms can change under a shipped game, which is now a risk studios price in.

Middleware sits underneath all of this — audio, physics, analytics, anti-cheat — usually on a licence fee rather than a revenue share, but it comes out of the same pot.

The Publisher, and the Word “Recoup”

This is the deduction that surprises people, and it is usually the largest.

If a publisher funded the game, the money it advanced is not a gift. It is recovered from the developer’s share of revenue before the developer sees anything. A studio can ship a commercially successful game, generate real money for everyone in the chain, and receive nothing beyond the development funding it already spent — because the title has not yet recouped.

What gets charged against recoup is where the negotiation actually happens. Development cost is expected. Marketing spend recharged to the project is common and can be very large. Platform certification, localisation, QA, engine licences and sometimes a share of the publisher’s own overhead may all land on the same account.

A studio on a favourable deal recoups development only. A studio on an unfavourable one is paying back a marketing campaign it did not commission and could not veto.

What Is Left

Work an $110 Australian sale down: about $10 is GST. Of the roughly $100 net, the storefront takes its share — call it 30% for a title that never reaches the tiers, so about $30. Engine royalty, if the title has passed its threshold, takes a few dollars more. The remainder, somewhere near $65 to $70, goes to the publisher and is applied against recoup.

Only after the advance, the marketing recharge and everything else on that account is cleared does the contracted royalty rate start paying the developer. For most games, that moment never arrives.

Why “Sold 500,000 Copies” Tells You Nothing

This is the practical payoff. A unit number, on its own, is not a financial statement.

It does not tell you the average selling price, and discounting is deep and constant. It does not tell you the refund rate, or the regional price mix — a copy sold in a low-priced region is not the same revenue as one sold here. It does not tell you the budget the number has to clear, or how much of the spend was marketing charged back to the project.

When a studio announces a sales milestone and lays staff off in the same quarter, those two facts are not in tension. They are describing different lines.