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Ouya left indie game developers in the lurch, but Razer is trying to help

Yesterday, game hardware company Razer confirmed that it had bought former Kickstarter gaming sensation Ouya. Ouya's distinctive Android console wasn't part of the deal, but Razer is getting the rights to Ouya's software, as well as its technical and developer relations teams. It's a lifeline for Ouya, which will be spun into a publishing service for Razer's own Android console. It's a boon for Razer, which is getting access to 1,500 Android TV games and said publishing platform. But for some developers who bet on the console, it might be a disaster.

Polygon and Motherboard have spoken to multiple developers who qualified for money from the Free the Games Fund, a $1 million initiative that supported Kickstarter-funded Ouya games. The fund was launched in 2013, and the money was supposed to be paid out after milestones that included releasing a beta, launching the game, and completing an exclusivity period of one to six months.

Ouya is said to be invoking a recently added bankruptcy clause

While Ouya hasn't spoken about the future of the fund, developers say they've been told that they won't receive any more money. That's reportedly because of a clause that lets Ouya or a studio break the contract if one of them goes bankrupt or dissolves. "Claiming Ouya no longer exists as a company to get out of funding commitments, while continuing to use the name in the announcements today as if they still are a company that exists, just stinks," one developer told Polygon. According to Motherboard, the clause was added earlier this year; Ouya has reportedly been seeking a buyer since at least April.

The Free the Games fund offered matching grants between $10,000 and $250,000, so losing even a quarter of a pledge could take a substantial chunk out of an indie studio's budget. The fund, which was meant to build out Ouya's catalog, has caused problems for the company before — developers allegedly started funding their own Kickstarter projects to game the matching system, causing them to overhaul the rules two months after launch.

A Razer spokesperson told Motherboard that it had not acquired the Free the Games Fund in its deal with Ouya, declining to comment on the state of the grants. In a later comment to Polygon, however, Razer CEO Min-Liang Tan said that Razer would be picking up Ouya's tab. According to Razer, $620,000 of the original $1 million has still not been paid out, generally because developers hadn't yet hit milestones.

The specifics have not been worked out, but Razer will honor a modified version of the deal with any developers still participating in the fund. While the Ouya agreement required a period of exclusivity, Razer will let developers sell their game on any platform. However, they'll also have to make up the funds by giving away games over Razer's Cortex store. (As Polygon explains it, if they receive $10,000 for a game that costs $10, they'd need to give away 1,000 copies.) It's not clear how great a deal this is in the long term, but it's still far better than what Ouya was reportedly offering: nothing.

Update July 28th, 5:20PM ET: Added comment from Razer.