Which game engine a developer uses is largely determined by the kinds of the products they develop and how they want to develop those titles. Obviously, for first person shooters, Unreal is a good engine. That's what Unreal is, and that is what its focus has been in terms of new technology. However, Unreal isn't necessarily a good choice for an adventure game or a sports game. Contrary to what you may see out there, shooters are not the only games around.

In terms of actually developing games, the benefit of using existing engines is reduced R&D time. Since the core engine elements are done, all you need to do is customize it for the product and create the content (easier said than done, of course). Less time spent making the tools, more time spent making the game. For many developers the cost of licensing and royalties is worth it. It could simply be a time and money issue. It could also be an experience issue. Writing your own game engine is no small feat, and not everyone can (or should) do it.