Kickstarting Ouya: Crowd-Funded Venture Capitalism or Maybe Just a Big Scam

In February, three-year-old crowd-funding site Kickstarter drew buzz for reaching a remarkable threshold: Two projects seeking money reached $1 million in funding.

That’s small potatoes now. Six months later, a campaign to develop a new video game console that would be cheap and friendly to independent developers brought in a whopping $8.5 million dollars.

Ouya is the console’s name, and if it succeeds (no, $8.5 million isn’t enough to make it a sure thing), crowd-funding could move beyond a tool for individual projects into a new way of bringing innovative system changes to product and hardware development.

That’s a mighty big “if” though, to be sure. Ouya (pronounced Oooh-yah) promises a $99 game console that uses Android’s operating system and is pretty much completely open to game developers of any size. It’s a big gamble—is there enough of a market interested in moving from mobile platforms back onto consoles? Ouya managed 63,000 backers on Kickstarter. When the Playstation 3 launched in Japan in 2006, more than 81,000 units were sold in the first 24 hours.

Ouya also recently inked a deal with Vevo to stream videos through the console, because no consumer technology can survive in the market doing only one thing anymore.

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Photo courtesy Engadget

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