Game studios have helped make Roblox a multibillion-dollar business. Are they getting squeezed out?

Roblox is now a multibillion-dollar business, having turned over nearly $4 billion in 2024 alone. And a significant part of the growth that made it a multibillion-dollar business is thanks to independent video game development studios that have spent years building games and branded experiences for Roblox‘s platform.

But those studios now say they’re being squeezed out, with Roblox sending them a “dramatically lower volume of brand introductions” in an effort to keep more partnership cash for itself.

Several studios told Digiday that since Roblox began running programmatic ads in May 2024, they feel like they are in direct competition with the very platform for which they produce content.

Back before Roblox introduced ads, the main way for brands to market on its platform was by commissioning their own custom digital destinations. Companies like Vans, NASCAR, Walmart, Fenty Beauty, and more all created places where established fans and potential new buyers could come, soak in the brand identity atmosphere, play some minigames, and collect some rewards.

Roblox itself didn’t build these experiences. Instead, when brands came to it asking about how to connect with its users, it would pass their queries off to independent studios in the Roblox Partner Program. Those studios would then make tens or hundreds of thousands of dollars by creating brands’ custom experiences.

But with Roblox now self-placing ads across games on its platform, it was (allegedly) less incentivized to pass brands’ marketing queries to studios.

“There are limited introductions to studios, unless it’s in Roblox’s best interest,” one studio rep (speaking on the condition of anonymity) told Digiday. “I can tell you that we certainly see a dramatically lower volume of brand introductions than what we were used to in the past.”

As an example of how things are working at Roblox under the new ad push, tax prep firm H&R Block recently partnered directly with Roblox to run ads in Club Roblox and Mega Mansion Tycoon, two games made by independent studios. In the past, H&R Block might have worked with an independent studio to make its own game/experience–but now, it’s paying Roblox to place ads within already-established games.

While the creators of those two games were involved in placing H&R Block’s ads, and presumably got a cut of revenue generated by the placements, it’s still a different scenario than what might’ve happened during tax prep season in 2023.

“We work with Roblox directly to build and work with creators,” Andrew Martinson, H&R Block’s Senior Marketing Manager of Media and Strategy, said in a statement. “So our actual partnerships are with the developers of the two games that we are integrated with.”

When asked about the ad push, another studio exec told Digiday, “I don’t think it’s personal–it’s just incentives. And the incentives are: ‘we’ve got to sell and generate a certain amount of revenue.'”

Despite that sentiment, the push has “soured” the relationship between Roblox and studios in the Roblox Partner Program, people familiar with the matter said. Some said they believe Roblox needs to implement tools that better show brands just how effective in-game experiences built by studios can be compared to ads.

Digiday also reports that while Roblox’s introduction of programmatic ads has affected studios, it hasn’t had the same effect on the sort of creators who made nearly $1 billion last year selling things like in-game items (avatar hairstyles and clothes, decorative and environmental items, etc). Their business is separate.

In a statement, Roblox said it views independent studios as “strategtic creative partners that we bring into the vast majority of brand conversations.”

“As we continue growing our in-house partnerships team and advertising business, our focus is on building tools and solutions that benefit and delight our community of creators, users, and brands,” it said. “We are also expanding our partner ecosystem and connecting creators aligned with this mission with brands for impactful collaborations.”

One thing is clear: Even the perception of competition between creators and the platform for which they make content can hamstring the UGC economy those creators have built. If Roblox wants to continue placing ads, it might want to consider prioritizing its relationship with the independent studios that helped make it the metaverse dominant it is today.