In recent years, the gaming industry has witnessed a significant shift: AAA game developers are increasingly partnering with third-party commercial engines.
At the 2024 Game Awards (TGA), 2K Games and its developer Hangar 13 announced they would abandon their proprietary Fusion Engine in favor of Unreal Engine 5 for the latest Mafia installment, Mafia: The Old Country.
Similarly, CD Projekt Red (CDPR) has transitioned from its in-house REDengine to Unreal Engine 5 for the next-generation The Witcher series. Game director Sebastian Kalemba confirmed that the series’ preview trailer was created using a customized Unreal Engine 5 version and rendered with an unreleased Nvidia GeForce RTX graphics card.
This shift isn’t isolated. Black Myth: Wukong and Atomic Heart, both powered by Unreal Engine, have enjoyed widespread acclaim. Notably, Black Myth: Wukong transitioned from Unreal Engine 4 to Unreal Engine 5 during its development. Even studios renowned for investing heavily in proprietary engines, like those behind the Silent Hill 2 Remake and the Halo series, are embracing Unreal Engine 5.
What’s driving this trend among AAA game developers? While small- and mid-sized studios have long relied on third-party engines due to limited resources, the growing adoption of commercial engines by industry giants signals a broader transformation in game development priorities.
The fading prestige of proprietary engines
A game engine is, at its core, a comprehensive, standardized, modular, and versatile toolkit for development. In large-scale projects involving teams of hundreds, prebuilt and functional collaborative platforms are indispensable for streamlining workflows and ensuring efficiency.
For years, proprietary engines symbolized the technological prowess of a game company. Only the largest corporations could marshal the significant technical and human resources required to develop engines tailored to their games or commercialized for industry use, often gaining both prestige and profit in the process.
Take Valve’s Source engine as an example. It powered legendary FPS titles like Half-Life 2 and the Counter-Strike series, evolving over time to support diverse games, including battle royale games like Apex Legends. Players have often celebrated the distinctive characteristics of games built on proprietary engines, which provided unique visual and gameplay experiences.
However, a shift is underway. Increasingly, major studios are turning to commercial engines like Unreal Engine, signaling a departure from the traditional reliance on proprietary tools. This change reflects a broader trend: maintaining or modifying proprietary engines has become prohibitively expensive and inefficient.
Former CDPR developer Bart Wronski shared candid insights on X (formerly Twitter) about the challenges posed by proprietary engines: “Every game [CDPR] dropped the whole engine, rewrote it from scratch hoping this time it will be better and work, but then due to crunch hacked the hell out of it with it not being maintainable or usable at all.”
Similar challenges plagued the developers of the Halo series. “Some components of Slipspace are almost 25 years old,” remarked Chris Matthews, studio art director at 343 Industries, in an interview with Xbox Wire. “Although 343 were developing it continuously, there are aspects of [Unreal Engine] that [Epic Games] has been developing for some time, which are unavailable to us in Slipspace—and would have taken huge amounts of time and resources to try and replicate.”
Fundamentally, game engines are tools for achieving desired gameplay effects and enhancing development efficiency. For studios, selecting an engine often boils down to a meticulous cost-benefit analysis.
Older engines frequently accumulate “technical debt”—entrenched bugs or inefficiencies that become increasingly difficult to resolve over time. With staff turnover, attempting to overhaul such systems can prove daunting, risking widespread failures. In contrast, modern commercial engines, built on decades of iterative development, offer a more stable and scalable foundation.
CDPR’s game director Jason Slamajuic has lauded Unreal Engine 5 for its reliability, noting during a live stream that small code changes rarely cause disruptions elsewhere in the codebase. For studios grappling with the spiraling costs of maintaining proprietary tools, commercial engines like Unreal Engine 5 provide an appealing alternative.
This trend also highlights the technical maturity of modern commercial engines. Systems like Unreal Engine now encompass robust rendering, physics, visual effects, and cross-platform capabilities, addressing the complex demands of AAA game development. Their standardized workflows allow studios to focus on creative aspects rather than rebuilding technical scaffolding. This evolution is evident in Unreal Engine’s development history.
Unreal Engine, first released by Epic Games in 1998, debuted alongside Unreal Tournament. The game’s intricate maps, diverse weaponry, and innovative gameplay modes captivated players and laid the foundation for the engine’s trajectory as a transformative force in game development.
From its inception, Epic continuously enhanced Unreal Engine, prioritizing advancements in graphics, rendering, performance, and cross-platform capabilities. By the release of Unreal Engine 3, its groundbreaking features—such as advanced character modeling, scene construction, and dynamic lighting—had revolutionized the industry. During this era, even Chinese online games touted Unreal Engine as a hallmark of innovation in their marketing campaigns.
Unreal Engine 4 pushed the boundaries further, excelling in large-scale environments and detailed game elements. Iconic titles like PUBG, Fortnite, and Final Fantasy VII Remake demonstrated the engine’s ability to deliver stunning production value and visual fidelity.
However, an examination of the winners of the “Game of the Year” award at The Game Awards (TGA) from 2014 to 2020 reveals a gap. Despite Unreal Engine’s widespread adoption and technological sophistication, none of the winners—games like The Witcher 3: Wild Hunt, Overwatch, The Legend of Zelda: Breath of the Wild, God of War, and Sekiro: Shadows Die Twice—were developed using Unreal Engine. Instead, these masterpieces emerged from studios leveraging proprietary engines.
This dynamic shifted dramatically by 2022. Unreal Engine-powered titles began to dominate the stage, with a dozen upcoming or recently released games based on Unreal Engine featured at that year’s TGA ceremony.
The introduction of Unreal Engine 5 marked a more striking transformation. Renowned studios like CDPR and 343 Industries have adopted it for flagship projects. CDPR, known for The Witcher 3: Wild Hunt, aims to streamline its management of multiple concurrent projects, while 343 Industries leverages Unreal Engine 5 to reimagine the Halo universe.
Unreal Engine 5’s technical breakthroughs have solidified its position as an industry leader. Its “Lumen” global illumination system provides dynamic, real-time lighting solutions, while “Nanite” virtualized geometry enables the direct importation of high-precision models with billions of polygons. The “Niagara” particle system further elevates the engine by introducing GPU-based particle simulation. These features exemplify how Unreal Engine 5 combines cutting-edge technology with efficiency and scalability.
While the shift away from proprietary engines reflects broader trends in the industry, the technical and commercial advantages of Unreal Engine 5 are undeniable. Its capabilities mark a qualitative leap in game development, signaling the true beginning of third-party engines rivaling and even replacing proprietary ones in AAA game production.
Despite its versatility, Unreal Engine 5 is not without limitations. No commercial engine can fully accommodate every studio’s unique vision. Ubisoft, for instance, continues to use its proprietary AnvilNext engine for Assassin’s Creed Shadows. As technical director Pierre Fulton explained, this decision reflects the studio’s distinct design philosophies and development priorities.
It would be more accurate to say that the adoption of Unreal Engine 5 highlights the diminishing viability of proprietary engine development for many studios. As commercial engines evolve and become more cost-effective and feature-rich, the decline of older proprietary engines is unsurprising.
The gaming industry is evolving from a craft-like, workshop-style approach to a more standardized, factory-like production model. Unreal Engine 5 embodies this shift, offering robust solutions for today’s complex game development challenges, while also underscoring the changing dynamics of how games are created.
The future of game engines
Mainstream third-party engines like Unity, Cocos, and Godot already dominate much of the game development landscape, powering everything from mobile apps to PC games, and from expansive 3D open worlds to charming pixel-art 2D titles.
The arrival of Unreal Engine 5 has further shifted the balance, making third-party engines an increasingly attractive option even for studios aiming to create landmark games with distinctive gameplay, narratives, and visuals. For AAA projects that demand large-scale collaboration, the appeal of standardized, integrated, and user-friendly tools is hard to ignore. As commercial engines continue to expand their market share, the advantages of building proprietary engines diminish. This trend points to two potential developments:
- As third-party engines gain influence, competition is likely to intensify. Developers, often swayed by pricing structures, could become the focal point of this rivalry. Controversies like Unity’s recent pricing disputes may serve as a preview of future clashes, with developers pressing providers for fair and transparent terms.
- The dominance of current graphic engine companies may be challenged by fresh contenders. Game content creators and tech giants with no prior foothold in the space are already eyeing the market. Google, for instance, has unveiled its GameGen technology, capable of generating high-quality visuals in real time. Similarly, Giant Network’s YingGame signals a nascent shift toward integrating artificial intelligence into game engine technology.
Unreal Engine’s pursuit of photorealistic visuals is just one approach among countless possibilities. When this aesthetic is mass produced and widely adopted, player fatigue can often follow.
In contrast, the appeal of boutique, workshop-style games remains strong. This sentiment might explain why Astro Bot won TGA’s top award in 2024, reminding us that diversity in game styles is as vital as innovation in technology.
KrASIA Connection features translated and adapted content that was originally published by 36Kr. This article was written by Xue Dexing for 36Kr.