It's unclear where the money is coming from? Your "End product, income" doesn't cover initial funding. Also, if people have to pay to use it, I'm not sure how it would be Open Source.
I suggested that its free to use but if game make sales the engine organisation gets a commission, this will make it possible to fund the developement. So a kind of open source where dedicated people can get access and do developement. With regards to funding there must be collected from angel investores and other.
Also:
-What if I was to be a developer who contributed code to the engine, would I have to pay?
If no: How much code would I have to contribute before I can use the engine free of charge? Would adding one line of code make the engine free?
If yes: So, I have to invest my time to build a tool and then pay someone else money to use it?
-If the engine is open source, what's to stop me from taking the engine source code and using it without paying royalties? In other words, how would you enforce the licensing?
-If people have to pay a commission to use the engine and I am an engine developer, how much money would I get? How much would you get, considering you aren't a developer?
-If you're going to get start up capital from angel investors, what's your sales pitch to get the millions you'll need? How are you going to convince them that there is a positive ROI for an engine you're hoping to collect commissions on but give away for free?
-And probably the most important question of all: What is your stake? How much skin do you have in the game? The wrong answer will be "zero" or "not much". Especially when you're asking everyone else to be major stakeholders (in terms of time, money and effort).
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