The success of video games on mobile devices has begun to drastically affect the video game industry. Free-to-play game pricing has begun to invade both PC gaming and console gaming, and nearly every large game publisher is now putting out games for iOS and Android. The success of the Ouya Kickstarter has shown that there is some demand for more casual Android games on a larger screen.

Now, it appears that Amazon is looking to enter the video game console market. Game Informer is reporting that Amazon is developing an Android video game console. According to the report’s unnamed people “who have knowledge of the in-development hardware,” the console will be released by the end of 2011 – perhaps as soon as Black Friday. A newly designed controller is also rumored to be in development.

Amazon has reportedly been gathering veteran game developer talent into its Amazon Game Studios team for months. The studio was announced late last year, and it has already released more than one game, including the mobile game Air Patriots..

Though the Ouya Kickstarter campaign was wildly successful, reviews of the console have been lukewarm, largely due to the lack of exclusive games for the device. If Amazon is able to launch its console with a variety of great original games, then the company’s already established base of Kindle Fire gamers, the incredible marketing power of the Amazon home page, and a price far lower than Sony’s or Microsoft’s new consoles could make an Amazon gaming console a real player in the gaming industry.

(via Game Informer)