Engine firm Unity and cloud tech startup Improbable have had a very public falling out.

The spat began yesterday when Improbable said that Unity had made changes to its Terms of Service which blocked developers using its SpatialOS tech from the engine.

Unity has since responded, saying Improbable's version of events is incorrect. The firm says this is the result of a negotiation with the London startup and that projects using Unity and SpatialOS will not be affected.

The middleware company also alleges that Improbable has been in violation of its Terms of Service for over a year and that this has been raised with the company several times.

The firm also says that the Terms of Service were tweaked as the language concerning cloud and streaming services was somewhat vague but has been changed to only support approved platforms.

"We believe that even though Improbable is violating our EULA, game developers should never pay the price for that," Unity wrote.

"We have been clear with Improbable that games currently in production and/or games that are live are unaffected, and we would have expected them to be honest with their community about this information. Unfortunately, this information is misrepresented in Improbable’s blog.

"We are genuinely disappointed that we have been unable to come to an agreement with Improbable, and their improper use continued until we took the action we did. Despite this fact, we can assure developers that they will be able to continue development while we resolve our dispute. We are committed to ensuring that developers will receive support for any outstanding questions or issues as we work through this problem."

Improbable has since released a statement about yesterday's events in which the firm tried to deflect attention from the dispute but about what it says about the industry. The London-based cloud firm also said that it is time for a code of conduct that 'enablers' - platforms and middleware - need to operate by.

That was before Improbable and Epic inked a deal to create a $25m fund to help developers using SpatialOS move their projects to the Unreal Engine.

While Epic has some serious clout, it's a bit hard to believe that the two companies could set this sort of deal up so quickly.

"We believe we are at the beginning of an unprecedented age of inclusive online games that become parts of our everyday lives," Epic chief Tim Sweeney wrote.

"Enabling this will take much more than Epic or Improbable; it will take a vastly more mature, broad-based industry to enable this future: a community of companies connected by values such as fair and openly disclosed business terms, respect for developer choice, and full interoperability between platforms, software, and services. We encourage others with a similar vision to reach out, so we can find ways to make it come sooner.

"To assist developers who are left in limbo by the new engine and service incompatibilities that were introduced today, Epic Games and Improbable are together establishing a US $25,000,000 combined fund to help developers transition to more open engines, services, and ecosystems. This funding will come from a variety of sources including Unreal Dev Grants, Improbable developer assistance funds, and Epic Games store funding.

"The game industry is evolving quickly, and is growing more developer-friendly every day. We’re grateful for the trust all developers have placed in us, and are excited about what’s to come."