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The trouble with Ouya

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Ouya console and controller (Credit: Ouya)

The little system hoping to change the world faces some huge challenges.

When it was first introduced last July, the Ouya game system sounded like a dream come true for gamers frustrated with traditional consoles. With a focus on independent games, an affordable price point and a developer-friendly design, it seemed like a breath of fresh air for the industry.

Now the system is finally in the hands of its early Kickstarter backers -- just two months from hitting retail shelves -- and it appears the dream may well turn into a nightmare.

The Android-based console certainly doesn’t look like just another home system. Roughly the size of a Rubik's Cube, it offers high-definition graphics and sells all of its games digitally. And, as an incentive for customers, all of the games sold in its app store will be required to at least offer a trial portion for free.

Those promises were enough to drive a tremendous amount of money to Ouya’s creators during its initial Kickstarter run, topping out at over $8.5 million – over 8 times as much as the original goal of just under $1 million. Unfortunately, it appears money can’t buy love.

Critics are slamming the system in early reviews. Ouya management seems unable -- or unwilling -- to answer questions dealing with business basics and potential legal pitfalls. There's still a little time to right the ship, but unless drastic action is taken, Ouya's promise may be left unfulfilled.

Early reviews based on the units sent to Kickstarter backers have been universally negative. The Verge, which gave the system a score of just 3.5/10, points out numerous flaws with the controller, the interface, and the lack of software support. "Ouya isn't a viable gaming platform, or a good console, or even a nice TV interface," the site writes. "I don't know what it is, but until Ouya figures it out, it's not worth $99."

Engadget was just as harsh, saying "It's simply not ready for retail. The system is rough around the edges in many ways, quite literally when regarding the controller, but the interface and menus also could use work."

The company isn't taking the criticism well, saying in a statement that it "has sent no review units out to press. Any reviews you have seen online are a result from individuals who received early backer units from supporting our Kickstarter."

What Ouya management fails to recognize, though, is that once a system is in the hands of people who have paid for it -- as those Kickstarter backers did -- it's a fair target for criticism. Is it a beta, or even alpha, release? There's an argument to be made for that. But that doesn't change the fact that the company decided it was in a good enough state to ship publicly.

The pushback over the initial reviews is just one of many surprising and confounding moves made by Ouya. While the company has implied changes will come with the June 4 retail launch, CEO Julie Uhrman, in a conversation held March 26th, said the hardware is "done," with no changes coming, though the software would likely still be tweaked.

While she called the system's controller "our love letter to gamers," that controller is one of the chief points of criticism. The cover plates feel flimsy and lack smoothness, and the controller's four input buttons have a tendency to stick, as explained nicely by Joystiq.

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(Credit: Ouya)

Hardware reviews, like those listed above, can tackle the system’s shortcomings. What really worries me about Ouya is the way the company has handled -- or has refused to handle -- some other pressing concerns.

Ouya says it doesn't know how many games will be available at launch. That's fair since development schedules are fluid and the system encourages independent development. But in February, Uhrman told attendees at the D.I.C.E. Summit that game makers have already committed to 450 titles for the system. As it turns out, that number was taken not from any sort of internal research, but lifted from a community site. You'd expect some sort of vetting process to take place before the CEO repeated it.

The lack of parental controls is doubly disturbing. At present, there’s no way for parents to prevent kids from playing games they feel are inappropriate. Ouya has said it plans to correct this before the system's retail launch, but it has decided against working with the ESRB, the video game ratings board, opting instead for its own screening process. With the government squarely focusing on game violence in the wake of the Newtown tragedy, that could open up a seriously ugly can of worms.

Also, while many of the games featured on the Ouya will be microtransaction-based, Uhrman had no answer when asked how the company would be compliant with the Children's Online Privacy Protection Act (COPPA). While this might not seem like a big deal, many legal experts expect the Act -- which covers parental notification and consent -- to be the largest looming issue on the industry's radar. Just ask Disney, which was hit with a $3 million fee in 2011 for violations, or Nickelodeon, which was forced to pull its SpongeBob Diner Dash game entirely.

Finally, Ouya's decision to make its console a disposable commodity makes little sense. Talking about an improved, second version months before the original system hits shelves is downright lunacy. It sends a loud and clear message that the company realizes it's already shipping a flawed, inferior product.

Even worse, Ouya has widely proclaimed its plans to release annual hardware updates, apparently figuring that fans will happily shell out $100 per year for the latest hardware.

This not only makes tremendous assumptions on the part of the buyer, it obliterates the value proposition of Ouya. If you bought a PlayStation 3 on launch day, you paid up to $600. That works out to about $100 per year at this point -- exactly what Ouya costs, but with the ability to play both AAA games as well as some (though not as many) smaller titles.

There's also the question of whether Ouya will be able to afford that second (or third) run of hardware. The hardware's retail performance is questionable, given the lack of mainstream marketing or awareness and the coming onslaught of marketing from Microsoft, Sony and Nintendo. It's further unclear if Ouya is selling the hardware at a loss – Uhrman grew tight-lipped when asked, saying only "we're comfortable with our business model."

Without cash, future rounds will be tough to make. And with the rough early reception, that cash is going to be hard to come by -- making Ouya just another console that dreamed of hitting it big, only to flop when it hit retail.

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