[Cross-posted from the KySat blog]
The new prize calls upon teams to create autonomous rovers that could land on the moon, travel at least three-tenths of a mile (500 meters) and send video, images and data back to Earth.
The first team to succeed would win $20 million - that is, if the job is done by 2012. After that, the prize drops to $15 million, and if no one is successful by the end of 2014, the money could be withdrawn. If a second team succeeds before the deadline, $5 million would be given as a runner-up prize. Another $5 million would be reserved for bonus tasks - for example, roving for longer distances, taking pictures of old lunar spacecraft, finding water ice or surviving the long lunar night.
No more than 10 percent of a competitor's income can come from government contracts. See Alan Boyle's entire article for more, including comment from other private space ventures on the announcement.
Video of the announcement may be found at the X Prize Foundation.