Economics

Kickstarted Video Game Console Gets Ready for Debut

Ouya starts shipping to backers; will formally launch in June

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The next Super Nintendo or the next Atari Jaguar?
Source: Ouya

A new video game console is about to hit the stores, and it's not produced by Sony, Microsoft or Nintendo, the current gorillas dominating the market.

Ouya, a much more modest $99 console, running off Android's operating system, will be hitting the market in June and will be available in stores like Target and Best Buy.

The launch of Ouya will mark the culmination of an interesting experiment. The completion of the console's development and release was paid for via a Kickstarter campaign that drew in $8.5 million in donations. Kickstarter campaigns have been successful in helping fund products and artistic ventures. But as gamers know, the days of a console being just a product are long over. Game consoles also now provide persistent services. Games can be purchased and downloaded via console these days, as can rentals of movies and television shows.  

Ouya's challenge will be not just getting the console into gamers' hands, but in being able to continue to operate an online market given its economically modest origins. I wrote about Ouya back in August and the skepticism over whether such a business model could possibly succeed.

Chris Kohler at Wired got his hands on the console in San Francisco just recently. It obviously is not going to be competing with the Xbox or the Playstation for the high-end games, but that's absolutely not the point of the system. Rather, it intends to be an avenue for smaller-game developers to more easily find an audience. Because of the huge boom of indie game development, the success of the system will depend on the ability for creators to use their marketplace and the ease of consumers in connecting to the types of games they'd like. Kohler notes the system Ouya will be using for its marketplace incorporates both an algorithm and human curation:

It's common knowledge in the world of iOS apps that you get noticed in one of two ways: Get featured in the store via Apple's secretive process of internal curation, or (by hook or by crook) get onto the top-grossing or most-downloaded charts.

"We don't think downloads or revenue are good indicators of what a good game is," [Ouya CEO Julie] Uhrman says. To that end, Ouya is crafting its own automatic algorithm that will determine whether or not a game is any good, based on other players' behaviors. How many times have they played it? For how long are they playing it? When a player turns on their Ouya, is it the first game they immediately boot up? All of these factors will influence how prominently games are positioned in the Ouya marketplace when a player clicks on "Discover."

There will also be an element of hand-picked curation on Ouya. That process, Uhrman says, will be led by Kellee Santiago, co-founder Journey creator thatgamecompany and now Ouya's head of developer relations. All new games will go into an area called the "Sandbox," and will be pulled up into the "Recommended" feed after they hit the jackpot on the automated fun algorithm, or are selected by Santiago's team.

There's still plenty of skepticism among gamers that Ouya's business model can actually work (just read the comments under Kohler's story). Portability and simplicity has contributed to the success of mobile phone gaming apps. Do people really want to play such games on their televisions? We will find out beginning in June. For the curious, PC Magazine has a slide show of some games that will be available at launch via Ouya.

Even if Ouya fails, console developers will likely learn a lot about building economic systems that accommodate the ever-changing nature of the gaming marketplace.