Developing game engines is expensive. It takes a lot of engineers a lot of time to build an engine and the tools to create content and assets for that engine. For a smaller studio that survives from game project contract to game project contract, the time (and money) saved by running with an off-the-shelf engine can make a huge difference in securing a new contract. It’s a lot cheaper to use an existing engine and pay a few thousand dollars a year for a license than it is to hire a team of engine programmers to build an engine.
Big publishers may continue to encourage their studios to use their own internal engines because it can be cheaper for them in the long run - they can potentially use the engine across multiple projects at multiple studios and they don’t have to worry about the engine’s licensing costs. They’re big enough that developing and customizing their own engine makes sense. The smaller studios, unfortunately, lack the size to take full advantage of spreading the cost developing one’s own engine across multiple games. They can build their own engines to use over time, but it’s much riskier to do so for a smaller studio than a larger one.
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