Eric Johnson

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Under Fire, Ouya Game Developers on Kickstarter Say They Did Nothing Wrong

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The past week has not been kind to Gridiron Thunder and Elementary, My Dear Holmes. The in-development video games, both seeking funding on Kickstarter, met their crowdfunding goals on Tuesday.

And then the trouble started.

The background: Both games met those goals relatively quickly, with Gridiron raising $75,000 in 18 days and Elementary raising $50,000 in 13 days. And both games are participants in Ouya’s $1 million Free the Games Fund, which matches funds over $50,000 raised on Kickstarter by games made for the Android-based microconsole.

This drew the ire of bloggers and online forum commenters, who began throwing around terms like “sham,” “scam,” “fraud,” “lying” and “swindle.” Accusations that MogoTXT and Victory Square Games — the studios behind Gridiron Thunder and Elementary, My Dear Holmes — had somehow gamed the system slowed donations to the Kickstarter campaigns to a trickle and their teams found themselves playing defense.

Here’s the thing: Nothing either project has done or is accused of doing would violate the terms of Ouya, Kickstarter or Amazon Payments, which processes Kickstarter payments in the U.S.

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“If we violated anything at all, we might’ve violated some people’s opinions of what Kickstarter should be,” said MogoTXT CEO Andy Won.

To the uninformed observer, Kickstarter may seem antithetical to business, a destination for grassroots support of artistic projects. Ouya’s messaging around the Kickstarter contest — “free the games” — lends power to this myth. And while that’s part of the story, crowdfunding has also become a legitimate and popular means of fundraising for normal business products.

Under the rules, games participating in the Free the Games Fund must be exclusive to the Ouya for the first six months after their launch. The Fund matches every dollar they raise beyond $50,000, up to $250,000. That money is then doled out in stages — 25 percent at the end of the Kickstarter campaign, 50 percent when the game launches on Ouya and another 25 percent when the exclusivity period ends. The game that raises the most money on Kickstarter also gets a bonus $100,000 from the company.

As my Econ 101 professor said over and over, people respond to incentives. With the promise of free money for whoever pulls in the most dough from donors, Internet critics seeking to discredit the projects had a motive. And there’s some “evidence,” too: oddly named backers for Elementary, unusually large donations to Gridiron and the seeming failure to launch of all the other Ouya games currently vying for the fund.

MogoTXT and Victory Square both deny that they donated to their own projects to juice their numbers, and an Ouya spokesperson insisted to AllThingsD that the company has not put in any money, either — a theory raised by gamers suspicious of Ouya’s motivations amid recent image woes and supposedly “low” paid conversion numbers.

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Won and Victory Square CEO Sam Chandola also have pretty straightforward explanations for all the other evidence thrown against them this week. Chandola agreed that the backers of Elementary appeared “suspicious,” but noted that his company advertised the Kickstarter project aggressively on Facebook and in posts to online Sherlock Holmes fan communities.

He shared an email from a Kickstarter support representative agreeing with this assessment: “It’s very possible that these first-time backers have found your project through your outreach, or just by browsing Kickstarter,” the Kickstarter employee, named as Megan in the email, wrote. “I wouldn’t be surprised if Sherlock Holmes fans had a way of sleuthing these things out.”

As for those big donations to Gridiron? Won said he and his team have many friends in the gaming industry, some of them with deep pockets. And far from discouraging donations from friends, Kickstarter actively encourages it (scroll down to point #6).

“There’s no limitations on Kickstarter about whether you’ve got rich friends or poor friends,” Won said.

It is true that other Ouya projects participating in the Free the Games Fund contest have fizzled, but that’s hardly suspicious. With only eleven entrants the fact that two have passed their goals is not far off from the broader Kickstarter trend that 7 out of 10 gaming projects fail.

Even if MogoTXT and Victory Square were lying about backing their own projects — and I currently see no conclusive reason to believe that they are — they’d still be in the clear. The terms of the Free the Games Fund contest don’t preclude that sort of behavior, although the company reserves the right to disqualify entrants or cancel, modify or suspend the contest if its “administration, security, fairness [or] integrity” are corrupted.

Kickstarter’s official guidelines do not include rules that prohibit people from donating large sums and in its FAQ, Kickstarter absolves itself of responsibility for ensuring a project’s ability to produce results. However, project creators must agree to terms making their fulfillment of successfully funded projects legally binding.

In other words, these projects are not and will not be “scams” unless their studios don’t deliver and run off with the pocket change. If critics have any beef here, it’s with Ouya for adding new incentives on top of Kickstarter, since the company developed the contest independently of the crowdfunding platform.


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