Twist! – OnLive Bought, Gets ‘Substantial Funding’

By Nathan Grayson on August 18th, 2012 at 10:00 am.

Things were looking pretty grim for OnLive earlier, but now they’re just looking… confusing. The service found itself looking at a seriously stormy forecast (with a strong chance of bankruptcy – something not generally followed by a rainbow – figurative or otherwise), with reports of lay-offs flying out of the woodwork at an alarming rate. OnLive, meanwhile, coped by adamantly refusing to comment – only making the whole situation look even more dire. Apparently, though, things aren’t quite as bad as they originally seemed. OnLive’s taken a big hit, but it’s not down for the count. The cloud gaming pioneer’s been purchased, and it plans to hire and re-hire “a large percentage” of former staff members.

Here’s the OnLive’s statement on the matter, as received by VentureBeat.

“We can now confirm that the assets of OnLive, Inc. have been acquired into a newly-formed company and is backed by substantial funding, and which will continue to operate the OnLive Game and Desktop services, as well as support all of OnLive’s apps and devices, as well as game, productivity and enterprise partnerships.”

“The new company is hiring a large percentage of OnLive, Inc.’s staff across all departments and plans to continue to hire substantially more people, including additional OnLive employees. All previously announced products and services, including those in the works, will continue and there is no expected interruption of any OnLive services. We apologize that we were unable to comment on this transaction until  it completed, and were limited to reporting on news related to OnLive’s businesses. Now that the transaction is complete, we are able to make this statement.”

So basically, it sounds like OnLive was up to its eyeballs in financial quicksand until some unnamed benefactor yanked them out at the 11th hour. Elsewhere, however, things don’t sound quite as rosy as the fallen Cloud Lord is making them out to be. Joystiq, for instance, has heard tell that OnLive let go of “at least 50 percent” of its staff. If true, that means it’s got a lot of rehiring to do.

For now, though, there’s not much else to say – mostly because no one’s really talking. Hopefully we’ll find out more soon, seeing as transactions involving billion-dollar companies tend not to stay quiet for too terribly long. As for cloud gaming in general, meanwhile, I’m not actually very worried. OnLive got too big for its own good, while more forward-thinking companies like Gaikai stayed flexible and – if things keep to their current course – may well end up driving the next console generation. So cloud’s here to stay, but only time will tell if one of its first big standard-bearers will be backing it up.

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101 Comments »

  1. googoogjoob says:

    Why can’t they just let it die? :(

    • mr.ioes says:

      Cause the idea itself is neat. Not that any of PRS’ readers would be target group though.
      @”50% of stuff fired”: I can’t find any numbers indicating how many people they even employeed. If there’s only 2 dudes working for this company, rehiring won’t be much effort …

    • Megakoresh says:

      It’s good news! I really like the idea of OnLive and would personally prefer it to replace all the TV-based gaming consoles. I think it’s vastly superior since it’s cheaper with the same quality and also doesn’t hold back progress like consoles do.

      Nvidia is doing their thing as well, which is really good. Maybe internet is not good enough for this in all countries yet, but other than that there are really no reasons why anyone would prefer an Xbox or PS tot his type of service.

      • fish99 says:

        Well it’s not the same quality since it’s a compressed 720p video stream, and it has input lag, and requires no one else in your house to be hogging your connection.

        • RvLeshrac says:

          Yeah, the problem with OnLive is that the target audience – people who don’t buy the latest PC hardware – conflicts with the fact that you need a *minimum* of 10mbit to have a decent experience on the service, and you’re much better off with 20+mbit.

          Sticking point there is that the people who aren’t buying the latest hardware aren’t spending $100/mo on internet access, either.

          Well, that, and the fact that ISPs are still allowed to cap bandwidth on ‘unlimited’ service.. 40 hours of gaming a month on OnLive will eat 150- 750 GB.

    • Vinraith says:

      Because the idea of having total control over the goods your consumers are “purchasing” is just too tempting for people with scads of money. No more piracy, no more mods, no more resale, perfect tracking of every aspect of usage, from a publisher perspective this is the future.

      Which, of course, is why we absolutely must kill it.

    • Lukasz says:

      the idea would be good if it worked also as a regular digital shop. only then that thing can work.
      heck. if i had a decent net connection and it was available in australia, i would use this shop over steam anytime.

      valve should have bought them.

  2. jon_hill987 says:

    Well that is a disappointment, I thought we had seen the end of this rubbish for a minute there.

    • Clockwork Peanut says:

      this ‘rubbish’ let me play amnesia and assassins creed while I was in Canada on my tiny crappy netbook, can you not recognise that the service has merits? I may not require it when I’m at home, but what about the people that do not want to pay the extra for a gaming pc? The service is only going to get better and consumers are better off with the choice to use it.

      • Premium User Badge

        Ksempac says:

        “Choice” that’s the main word.

        OnLive is scaring me. Because once this thing is successful, what prevent a publisher to say “you can play our games on OnLive (or similar service), we’re not distributing them anywhere” ? And once you have all your games on OnLive, say bye bye to mods, customisation, etc…No more choice.

        That’s not far-fetched, EA already has games that are only available through Origin. If OnLive manages to get a fair share of the market, they could sign exclusive deals with publishers, who would be most happy to get the ultimate anti-piracy/total-control of your gaming tool

        • Clockwork Peanut says:

          Yeah, it’s a fair point, maybe I’m a bit more of an optimist ^^. With regards to modding/customisation its true that we already see extensive limits imposed by certain publishers, but on the flip side other publishers do not impose these limits in spite of the fact that they totally have the means to.

          Then on the distribution end of things, i guess its a toss-up depending on what consumers are willing to accept. PC gamers seem to be nice and pernickity, so I wouldn’t expect an Onlive-like service to become the main distribution source.
          Publishers might try and force it down our throats, but I don’t think it would work. I for one haven’t ended up buying Diablo III or Battlefield 3 (both games which I would otherwise have bought by now) because of irritating distribution choices on the part of the publishers. It would seem that I am not alone either…

          • Premium User Badge

            Ksempac says:

            I didn’t buy Diablo III or Mass Effect III either for the same reason, but Diablo III was the fastest-selling game on PC at launch.

            So, unfortunately no, the majority of gamers (PC or otherwise) aren’t concerned much about their freedom/choices/etc. Even those that do are conscious about this can give it away when the next game is shiny enough (again refers to Diablo 3 sales number).

          • Arglebargle says:

            Blizzard games don’t really count, as they could make one about juggling turds and it would sell millions. Installed user base and all.

        • smiggs says:

          I’ve always seen onlive as a console you can have on your pc it offers most of the same advantages as consoles the only characteristic it shares with pc gaming is the mouse and keyboard. It doesn’t represent the future of pc gaming because it isn’t pc gaming this is a console and its niche at best with the power of Microsoft and Sony in this space it won’t last, but there is no need to give it any more bile than you would Xbox or PlayStation.

    • Calneon says:

      Holy shit, lighten up. If you don’t like it, don’t use it. Don’t wish for the company to go bankrupt putting many people out of employment just to satisfy your opinion that ‘it will never work’.

      • Frankie The Patrician[PF] says:

        Yeah, all this hate is sickening…

      • Shortwave says:

        Yea’ but like they were hardly off their feet before they already cut a deal to have a PC centric game first appear on it. Which is a pretty grim indication of what we can expect in the future maybe? It’s sort of a douche move to the PC community honestly when it CAN’T work for the entire community properly.
        Stuff like that man, it sucks.
        They should at least have enough respect to not try to corner PC gamers into using it when it clearly creates this make hate towards them and it doesn’t even work well for everyone.

        I feel as if theres probably a better solution around the corner somewhere near.

        • Chandos says:

          Not sure what you’re saying here…. how is OnLive “cornering” gamers into using it, making them signing contracts at gun point?

          The real cornering is done by hardware manufacturers and developers chasing photorealism, which constantly pushes existing hardware into obsolescence at an unparalleled rate, not to mention the $60 a pop AAA pricing strategy with limited chance of trial before purchase.

          Of course they will put PC-centric games there, because it’s not my Xbox that requires me to upgrade once a year to be able to play the latest shit that has come out; that’s the PC’s specialty, and that’s where the consumer pain is.

          • mashakos says:

            this is just silly.
            You want to play the latest photorealistic PC games at 720p/30fps? Pay $300 for a new PC or $200 for an upgrade.

            how many months of onlive is that? Oh wait, a PC doesn’t disappear after a set time period.

      • D3xter says:

        Those POOR programmers working on SkyNet lost their job, oh the inhumanity! Whatever shall they do when they aren’t developing tools to destroy PC gaming and consumer rights?

        • psyk says:

          I hope I will never see you on steam then.

          • RvLeshrac says:

            You’re comparing Steam – a service which allows you to download content to your system and, even if your account is banned, still allows you to play the single-player games you’ve purchased – with OnLive – a service where if anything happens to the service, your money and games just vanish in a puff of smoke.

      • FataMorganaPseudonym says:

        If there was a company selling sandwiches made from fecal matter and human skin, I would be opposed to that company as well and would also hope that it goes out of business. My concern for the employees of that company would be very, very small indeed.

        I feel the same way about OnLive. While not quite on the same level as a crap-skin sandwich, I do think their “service” is an exceedingly horrendous idea and I wish this company (and any others similar to them) would burn. Simple as that. The employees who worked there and who made the whole thing possible do not have my sympathy at all, and I hope whoever these mystery investors are end up losing all of the money they put into OnLive.

        So, yeah, the news that this company apparently isn’t going under is, to me, bad news. Your mileage, of course, may vary.

  3. lordcooper says:

    Glad to hear they’re still trucking on, there’s a lot of potential in this tech.

    • jon_hill987 says:

      No there isn’t, Physics prevents any potential by limiting the maximum speed of anything including data to approximately 3×10^8 ms^-1.

      • Obc says:

        he didn’t say LIMITELESS potential, just potential.

      • SiHy_ says:

        So… the speed of light not fast enough for you?

        • Premium User Badge

          Morlock says:

          Depends on where the server stands. If you play in London and the server is in New York it takes at least 50ms for you to see the result of a button press. On our future Mars colony Amnesia becomes unplayable.

          • PleasingFungus says:

            RPS.txt: on our future Mars colony Amnesia becomes unplayable.

          • slight says:

            Except if you play in the UK then the servers are in the UK, so you have a much lower latency.

            People also forget that the input latency through things like triple buffering and lag from wifi controllers can add a huge amount of lag in console games and people mostly don’t notice. OnLive and similar services are certainly viable for a wide range of games.

            Also I’d expect the quality of the streaming to improve as their custom encoder’s speed improves (allowing more complex encoding in a given amount of time) and average available bandwidth for end users increases.

            Charging full price for a game you’ll cease to own if the company *AHEM* GOES BUST *AHEM* on the other hand can fuck right off. Same problem with Steam except that I know any game on Steam will be available cracked so if they do go bust and take their auth servers with them I know I can morally if not necessarily legally access my game collection.

      • gladius2metal says:

        watch Carmack’s keynote from Quakecon 2012, he talks about the whole topic and he says from a technical standpoint it is totally feasible (not breaking the laws of physics, but to play games and not noting the difference)

        • RegisteredUser says:

          I did, and it worries me.
          Generally the consensus seems to be that this is coming, whether in OnLive or that somethinggoku or what it was alternative form, but inevitably. Not as a full replacement, mind, but as something that will exist alongside. Could have bad enough consequences still though.

      • lordcooper says:

        SILLYFACE!

        You seem to fall into the common trap of thinking that your personal dislike of something robs it of all merit. I happen to detest pretty much all FPS games, but they still have a place in the world. Don’t take yourself so seriously fella, it’ll put you in an early grave :)

    • Frankie The Patrician[PF] says:

      This. I for one look forward to it as soon as I have a decent connection…which is more likely than acquiring a PC able to run Crysis 3.

      • Vorphalack says:

        Either you vastly over estimate the system requirements of Crysis 3, or vastly under estimate the power of mid range PC hardware these days.

        • Premium User Badge

          Continuity says:

          Yep, thing to bear in mind is that Crysis games are not developed for the PC only any more, so they will never push the envelope in the same way that the original Crysis did.

    • RandomEsa says:

      There is a lot of potential to strip customers from their rights even more if that is what you’re saying.

      • MasterDex says:

        Remind me, how can an optional service strip legally binding rights?

        • D3xter says:

          How about you people think just a year or two ahead beyond the shiny $1 buying price of a game that is purely good-natured?

          I mean, the last console generation for instance didn’t change the PC gaming market at all… it’s not like every bigger game is a console port, that must be my imagination. And Steam didn’t release anything else other than Counter Strike and Half Life 2 and got popular and has lots of “Exclusives” with the power to dictate terms to a lot of people.

          Obviously the choices people are making NOW by using said service will have NO IMPACT WHATSOEVER in the future, because all that’s happening is people buying $1 games, right?

        • RandomEsa says:

          If Onlive’s system becomes a new standard then you would lose, among other things:
          1) Being able to play all games at all times (see Uplays extended downtimes and the likes)
          2) Playing with maximum graphics details and options enabled
          3) Playing normal multiplayer (OnLive for instance only hosts Multiplayer between other OnLive players because of latency, it would be simply too high if you had to send packets this way: Client –> OnLive Server –> Game Server –> OnLive Server –> Compression Algorithm –> Client)
          4) Setting up Multiplayer server and hosting LAN parties would be no more
          5) No more playing Offline or when the Net is out
          6) No more installing Mods
          7) No more tweaking INI files
          8) No more cheating (even the good Offline kind where you give yourself a little bit more money or a bigger head)
          9) GaiKai or whatever service would likely sit on your save files.
          10) No more being able to decide if you want to Patch or not or Rollbacks
          11) They could make games even more of a micro transaction mess than they already are and add unskippable advertising to the list of things to worry about
          12) They could remove games or game features FOREVER with nobody owning a copy if at any point games would be exclusive to such services (god forbid), Manhunt or similar damaging your reputation too much and not selling enough? Get rid of it forever. A certain feature or spot of your game (nude scene, Coffee Mod or whatever) giving you trouble with the media? Get rid of it forever. You put out the newest FIFA/NHL/NBA 2035 and want people to buy it? Discontinue services for any and all older versions.
          13) Possible loss of Indie/free niche markets in favor of the big “AAA” titles, why would they support small/unknown companies that barely anyone will likely play with their servers in favor of the mass-market AAA market games they could run instead?

          • RegisteredUser says:

            This and more.

            People need to understand this.

          • Unaco says:

            If OnLive’s system became a new option, then we wouldn’t lose out anything. And gain a whole load.

          • fish99 says:

            Unaco did you even read the post you replied to?

          • Unaco says:

            Yes.

            Why? What did I say wrong? If the OnLive tech advanced, and it became an optional way of consuming games, what would we lose? We’d gain the option of playing our games through streaming, but not lose any of the things RandomEsa says we would.

          • alundra says:

            They can’t understand it, they’d rather bury their heads in the sand all the way up their asses that having to think for themselves.

            I wouldn’t worry this much about this, not a lot of details on the air, anything could have happened, at any rate, in 50 years, if at all, when every potential customer to this has a non capped, lighting fast and reliable internet connection, for free, maybe this can threaten to end gaming as we know it.

            Until that time, it’s nothing more than the software industry of greed wet dream in their lust to control and milk they shit out of their customers.

          • Vorphalack says:

            I think we can all dispense with the ”optional” argument the second OnLive sign an exclusivity deal. At that point your options are use it or loose out. I don’t think anyone here is stupid enough to believe OnLive wont be pushing for that, right?

          • MasterDex says:

            I’d like to believe that no one here is stupid enough to think a developer would be foolish enough to do that.

          • Vorphalack says:

            Are you deliberately ignoring the precedent of console boxes? And Origin? And soon to be UPlay? And Steam? Why wouldn’t OnLive push for an exclusive? They are gonna need a captive monopoly to break into the gaming market, and that will shaft anyone who doesn’t want to buy into the system.

          • Unaco says:

            @Vorphalack…

            OK. When an exclusivity deal is signed, then we can drop the “optional” argument. Which hasn’t happened yet, unless you count FTL’s exclusive demo on OnLive… which was time limited anyway.

            So… until there is this exclusivity, and OnLive (or similar) is actively preventing, on a large scale, the usual means of consuming games, I’m gonna keep with the optional argument.

          • MasterDex says:

            @Vorpalhalack: No, I’m not ignoring the consoles, origin, Uplay or Steam. I’m simply discounting them for various reasons. I’ll outline now.

            1. OnLive’s profitability for developers cannot be compared equally to that of the consoles. OnLive, for a number of reasons which I don’t think I need to mention as they’re quite obvious and touted constantly by its detractors, does not have the same pull as Microsoft, Sony or Nintendo do where exclusivity is concerned. Giving OnLive, or Gaikai for that matter, an exclusivity deal would most certainly hurt a developer or publisher’s bottom line making it an infeasible hope for OnLive, even if they try and push for one.

            2. Origin only represents the PC market and only stocks EA titles. For those reasons, any possible damage to the industry is very limited. The same goes for Uplay and Ubisoft.

            3. Steam serves many developers so that’s a different matter and many games, aside from Valve games, already require Steam to run. However, for now, the chances of a developer making Steam the only distribution method for their games is pretty slim.

            So we still go back to how much pull OnLive can have in regards to signing an exclusivity deal and the chances of that happening are proportionately larger than the chances of any of the above getting an exclusivity deal. It just wouldn’t be wise for a developer to grant exclusivity to OnLive. It’s going to be a long, long, long time before it even becomes a slight possibility and by that time, there’ll likely be many more cloud gaming services keeping it difficult for Onlive to have that kind of pull.

            We can spew out ‘what ifs’ until the cows come home. What if OnLive makes consoles obsolete and causes PC gaming and all that encompasses to rise to the top? What if OnLive crashes and burns and cloud gaming, with all the advantages that it could bring is never revisited again? What if OnLive is the one thing in the future to save gaming? What if it becomes a monopoly that we all have to kneel before? What if consumer rights laws are rewritten so that OnLive can maintain that monopoly? What if it becomes Skynet and sends robots to kill us all? What if, what if, what if.

            What if’s are all well and good but let’s ground this debate in fact and the fact of the matter is that OnLive won’t be receiving any exclusive games for a long time to come, if ever.

          • Vorphalack says:

            It’s not just a what if, I think it’s the most likely course of action. Without an exclusive title to grow the user base the OnLive service will likely die a slow death. I cannot imagine the new investor simply standing by while it goes under. There must be some sort of rescue plan or it wouldn’t have been saved. As for the economics of getting an exclusive title, I don’t see it being far fetched at all. If the developer is well compensated, even to the point of OnLive running the title as a loss leader, then why would any developer turn them down? Whats to stop this new investor simply buying out a developer in the same way Microsoft acquired Bungie?

          • Chandos says:

            Nice list. The point is, however, you can’t make OnLive go away, just so that your fears never come true. Just like any other business in any other industry, OnLive (or similar companies) will remain to the extent they solve a problem for the consumer in a way that no other products do. If PC gaming world does not want OnLive, yelling at it to go away won’t work; the only way it will disappear is either to make the problems they solve non-issues, or to offer even better solutions in other ways.

            In a sense the core issue with this approach here is not much different than game devs and publishers yelling at piracy or 2nd hand games market to go away. They too solve a problem for the consumer (which the yellers are unwilling to acknowledge or tackle) and are therefore here to stay in some shape or form. Just like piracy being a service problem, cloud-gaming is a hardware mobility (play anywhere) and affordability (no upgrades, free trials) problem.

          • D3xter says:

            I’m not really getting how you don’t see it… having a market of their own is their endgoal, and as far as I can say they already started with that, it’s only a matter of time till there will be “Exclusives”: http://www.joystiq.com/2012/05/20/hawken-to-be-playable-via-gaikai-prior-to-official-release/
            All the $1 deals and tryout-deals are there for a reason and are trying to push for their growth, once they have managed to garner a certain size this is EXACTLY what is going to happen and it will have wide effects on the market in its entirety, we already know Blizzard and UbiSoft would really like this to happen and EA + Bethesda presumably too, after all they’ve already dabbled in Always-Online DRM.
            SONY already bought GaiKai, presumably for the reason of making use of it in one way or another and once a certain market breadth is reached expect the likes of Activision, EA, and UbiSoft to presumably come out with their services too and push you into using them (as they are doing right now).

            Everything “starts” small like this, if Microsoft didn’t find a certain market with their DLC on the first Xbox they likely wouldn’t have introduced it as an important part of their platform on Xbox360 and we wouldn’t be sitting in this DLC mess etc.
            Your purchasing decisions and “trying of cool-looking service” have a larger impact on the industry as is not only a short-term “oh lol, I bought game for cheap!” effect.

            I also don’t see what supposed “problem” it is about to solve, I don’t really see playing “AAA” console games or PC games on a 4′ mobile phone with very limited input capabilities as a problem “to solve” and would rather keep consumer rights as they are thank you (I don’t see them as much of a problem by the way).

          • Phantoon says:

            This won’t be optional when it meets success.

            It’ll just be worse than Steam, and I defend Steam.

          • RandomEsa says:

            Everything on the list are things that are something that Onlive won’t support or can’t support with the current technology.

            For example how would we play a single player game offline? How would onlive recognize what mods we run and stream it for us? ( my 2 major grapes). Sure you can play pc games that require a decent setup to run properly but for a cost of customization and less freedom that we currently have in the pc market.

            Onlive-like might not be standard for the next 10 years but we will certainly go that way if the publishers have any say on the matter.

          • wodin says:

            No more graphic card upgrades (who needs them you’ll be relying on Cloud)
            No more build your own PC
            Stagnation of technology (how often do you think cloud will upgrade it’s hardware? Also who will be making graphic cards anyway as everyone will be slaved to the cloud)
            Eventual death of the PC and everyone has TV boxes Cloud style, there will be no choice. The hardcore gaming crowd on the PC wouldn’t be able to fund the hardware side of it on their own.
            Add in tablets and phones it’s a war on all sides. Seriously, the PC was never under threat from consoles alone, but now we have three things, next gen console, tabletsphones and finally cloud box (which will be the next lot of consoles after the next gen)

        • MasterDex says:

          I’m still not seeing any infringement of legally binding rights being mentioned, perhaps because such an infringement would be, you know, illegal.

          And seriously, “You people”?! I’m one guy with an opinion of my own, don’t try dismiss what I said by shoehorning me into some imaginary clique.

          The problem with you people (and I use that because I’m responding to three of you) is that you all believe that cloud gaming will be the end of traditional gaming methods. It won’t be and if it ever was, that would be decades down the line, at which point cloud gaming services would be so numerous that we’d have enough choice that very few of us would actually care.

          Regarding the affect of consoles on PC gaming: Despite the downsides of console-focused development, there have been many upsides for PC gaming as well. If anything, the console focus has aided in strengthening the PC platform as it has pushed many players in the industry, for selfish and altruistic ends, to seek to alleviate the problems with the PC as a games platform (and let’s not pretend there isn’t a plethora of them) as well as pay more attention to the PC as a legitimate profit-making platform. In fact, I’ll go so far as to say that this latest console cycle has seen the PC become healthier than ever before.

          There’s a difference between consumer rights and consumer privileges. Look up their individual definitions if you don’t know what that difference is.

          Whatever, doomsayers can only see one outcome – Apocalypse. Trying to have a balanced discussion with one is as futile as trying to stop technology advancing.

          • Phantoon says:

            Sorry, what? That came across as gibberish. Maybe I’m too tired, or maybe it’s that you said that consoles weren’t bad for PC (look at all the terrible ports/games we just plain haven’t got).

          • RandomEsa says:

            So not owning a product that you have bought and can’t access it anymore because onlive decided to pull a plug on it ( or ban you) is not a violating consumer rights? You can have an opinion but when your opinion is almost destructive to your consumer rights I might say that your opinion isn’t a good one.

            Onlive is an interesting piece of technology, but its just way too a head of it’s time.

            P.S. When you dismiss another person(s) opinions about a subject matter and in a same sentence trying to have just a balanced discussion is rather snobby of you.

          • MasterDex says:

            @Phantoon: I didn’t say that consoles weren’t bad for PC, I said that there were some upsides that came with the downsides for PC.

            @RandomEsa: No, it’s not a violation of a consumer right because you never owned the game in the first place. When you use a service like OnLive, which is no more than an option as a consumer, you are paying for a license to play games not to buy them. That does not infringe on any consumer rights, if it did, rental services and services like Netflix would be illegal, and as we can see, that’s clearly not the case.

            I agree that OnLive is ahead of its time, I said as much when it first became a word on the tip of gamers tongues.

            PS. I wasn’t trying to dismiss anyone’s opinion but I’ve yet to see any OnLive doomsayer, including yourself, consider anything but the worst possible outcome with many of you actively calling for complete failure. It’s one thing to say you don’t like what they’re doing so you’re not going to concern yourself with them but it’s another to campaign for them to be burned at the stake.

  4. Moni says:

    Smiley face, for people not losing their games. Sad face, for lost jobs.

  5. Zeewolf says:

    So basically it’s a scheme to get out of the debt they had.

  6. DickSocrates says:

    Why would anyone want a company like this to fail? It’s not for the manchild that posts his PC specs in his forum sig.

    It’s an interesting idea. Maybe it is a fundamentally flawed idea that won’t ever take off, but if that’s true then nature will take its course. It doesn’t impact you.

    • Zeewolf says:

      The problem is the horrible implications it has, and the fact that, well, it will take off. And we’ll all be worse off when it does. We’ll get the benefits of being able to play on crappy hardware, but we’ll lose everything else. This is not just always online, it’s always having your gaming experiences and possibillities 100% controlled by the publishers and cloud providers.

  7. kwyjibo says:

    Sounds like they wanted to fuck over their original investors and employees. Wonder who the buyer is, and what the terms were. RPS – flex those journalism muscles and find out.

    http://techcrunch.com/2012/08/17/source-onlive-found-a-buyer-cleaned-house-to-reduce-liability-prior-to-acquisition/

  8. merseybeatnik says:

    Seems like the purchase of Gaikai sent Online spiralling into depression and so in one last bid for attention it climbed upon a high ledge and said ‘Im gonna do it! I’ll jump, nobody cares about me why should I?’ Until it was coaxed down from the ledge with talk of a purchase. It seems a weird way to do business but I hope the desperate measure ultimately saves more jobs then it threatens to lose.

  9. HisMastersVoice says:

    Reeks of hit and run acquisition. Wouldn’t be surprised to see it quietly liquidated or “re-purposed” within 6 months, leaving a bare bone structure for some time after to keep current subscriptions running until they expire.

    I also hate OnLive now. Not because of what if offers, but how it conducts it’s business. Skinning people that work for you because you can? Dear God, Adam Smith is rolling in his grave so fast he could power up a small star.

  10. Premium User Badge

    Driveshaft says:

    I’m curious. If the service DID go under, what would happen to all those folk who have bought games?

    It’s not like customers could even be asked to make their own permanent back-ups as would (perhaps) be the case if a digital download service went out of business.

    • Zeewolf says:

      All their customers would lose access to their games and that would be it.

      • Premium User Badge

        Driveshaft says:

        As I feared, and why I didn’t hand any of my money over to them (besides their ridiculously high prices).

        It’s also why I don’t pay full price for games on disk and only buy digital when the cost comes way down.

        Sometimes I fear that gamer’s aren’t being cautious enough with these newer forms of distribution. You’re giving them licence to rip you off.

        • psyk says:

          So steam, and buying digital games when they are cheap is sending the same message as when it was full price congratulations at stopping nothing.

          • Premium User Badge

            Driveshaft says:

            Not at all. Digitally distributed games drop in price relatively quickly compared to their disk-based kin.

            My point is, digital distribution does not provide a physical item or have the same level of security in its permanence. It is therefore worth less to the consumer.

            I have little problem buying digital at a discounted price. Full (disk level) price though? No way.

            People are pre-ordering digital copies, for crying out loud. The savings made by publishers via digital distribution will never be passed on to the consumer at this rate.

            To pay the prices they charge via OnLive, where you never possess the game’s data let alone a disk, is foolish. Worse than foolish.

            Hope that makes sense now. Just… er… try to tone down the sarcasm in future, ay champ? This isn’t Kotaku.

      • Ninja Foodstuff says:

        That’s it in a nutshell. In fact I just published an article on this very topic. People need to realise, this is the case, be it entrusting your data to a relatively small company like OnLive, or a larger one, like Valve, Microsoft, or everyone’s favourite, Apple.

  11. kwyjibo says:

    So why did OnLive 1 fail? Why couldn’t they get more venture funding (there’s tons of it floating about) for their original company? Both their technology and their business model was more mature than that of Gaikai.

    I think it’s because their operating costs were too high. OnLive, to deliver their game streaming experience must have needed custom graphics rendering powerhouses at their data centres. They couldn’t rely on cheap scalable commodity hardware like Amazon Web Services. Their data centres were probably burning through cash.

    So I think we’ll see a realignment in their strategy going forward. I think you’ll see them concentrating on cloud delivered Office applications focused on the b2b space. I think they’ll go after the guys at Citrix. Revenue is a lot more reliable, customers are actually willing to pay (and overpay) for stuff. They can rely on commodity hardware, reducing their costs.

    It’s going to be difficult for them to scale back their gaming, giving their investments. But it’s difficult to fuck over half your staff, so it’s doable.

  12. Frankie The Patrician[PF] says:

    So much for Kotaku’s credibility….

  13. Stormtamer says:

    Glad alot of people are keeping their jobs, but from the reports ive read, the old management did a terrible job of dealing with the staff over this.

    Mixed on what to think about the whole thing.

    They seemed to not settle on an actual audience, and afew other issues let them down.

    They didnt really advertise to the familys, who have a good connection, buy wanted to save the money on buying a PC or an Xbox, who would of been a great audience for the PlayPass service.
    Then on the flip side, gamers with a good enough connection already owned PC’s or consoles, and everything was the same price, and played better on Steam, Origin and Impulse.

    Other issues i had were them teaming up with BT Infinity.
    An actual connection that would let you stream these games well… and is only available to like half the UK, until 2014, and even for those people who have a similar or better connection already, if you have a business line, your probably not waiting for a streaming service, to save money on buying a good gaming PC…

    The Microconsole was also useless.
    It was wired only, which i think kinda defeated the point of ‘cloud gaming’. So if you wanted to catch the ‘plug in and play’ casual user’s you wouldnt, because they didnt have a connection near their TV, and even if you set up a wifi bridge, you had to do that through a network hub or PC anyway, so why not just use the OnLive client, or just get a PC for the wirelss connection?

    Other thing than bothered me was the way they dealt with customers during the IPad app thing.
    Went from this big fanfare about it all (which was justified) to stopping all mention of it, to then bringing out this Microsoft office streaming thing, which went completely against what the company was about, and then just not saying anything atall. Not the best way to keep your customers interested really…

    Think in the end it was probably a year or 2 too early to survive.
    If it had been announced now, and launched at Christmas, it would of have a good run during the broadband upgrades were getting in the next year or so, and have more customers.

  14. Cinnamon says:

    Sounds shady to me. Letting all your staff go then rehiring some of them with new contracts? Ayn Rand would be proud I guess but is this what people want from a company that they are supposed to trust with their game collections.

  15. RegisteredUser says:

    Awwww man. :(

  16. Winged Nazgul says:

    I wonder if they’re rehiring the people who leaked the fact they were going bankrupt?

    Onlive as a technology is pretty impressive. As a product, not so much. Its clear audience is obviously smart TV users, a group that wasn’t even much of a demographic at the time of its founding.

    Here’s TB talking about who exactly would use this service (8 minutes into the video):

  17. wisnoskij says:

    Actually it sounds more like they had a plan to sell the company but thought that they could get cheaper employees if they fired them first and than decided if they were going to rehire them.

  18. Unaco says:

    Good news, somewhat. Let’s hope they shift their business focus after this, but still keep working on the technology etc. As a business they were, as many have pointed out, doomed to failure… But as an idea, I hope it really takes off, and gives us another way to consume games, alongside the current methods. Optional, and all that.

    As a total flight of fantasy… Imagine if it was Valve buying them up. Imagine, if you will, Steam Stream: I buy a game (either on physical disc or through Steam), I add it to my Steam account (so I can download it and play it anywhere I have access to the net), and I install it on my main desktop etc. I play it, and really enjoy it… I then go and see a friend, and tell him/her about the game… but more than that, I use their computer to access my Steam account and Stream and play it with them for the evening, without need to download or install it all. (or other, similar scenarios… you’re travelling, with just a netbook for company, but good net access). Similar to, say, BBC iPlayer… I can download a program (usually if it’s a longer thing, or I want it in HD), or I can just stream and immediately watch it I want to.

    That’s ultimately how I’d like this sort of thing going… an optional way to access my games in my (for example) Steam Account. That’d be swell.

  19. trjp says:

    Get the console into actual shops with 3 month’s PlayPack included for £49.99 – get people’s credit card details when they register and watch the money fall into your bank for monthly subs and the odd new game.

    The market they need to crack are the TV users – the console owners (or potential owners) – put the screen where you can watch people playing games onto a MASSIVE TV in somewhere like Currys or Tescos and you’ll sell a metric tonne of them…

  20. Premium User Badge

    orbit_l says:

    I’m kind of disappointed in RPS for not titling it “OnLive Lives On”. Or was the pun quota used up in the WoW:MoP article?

  21. PopeJamal says:

    Sony purchased Gaikai, I wonder if Microsoft picked up this little guy. Hmmm…

  22. jack4cc says:

    Damn those vc necromancers! Let it stay dead!

  23. KarachiKid says:

    I am a console gamer mostly. I have a PC but it’s four years old. I’ve upgraded it but it’s not enough for the latest games. I have a laptop too, but that is also old and doesn’t have a dedicated graphics card. I also have a Galaxy S2 which has pretty crap games outside of emulation. But I also have OnLive.

    OnLive gives me the option to play the latest PC games on either device. I always connect with Wi-Fi even on my desktop. I have never suffered from noticeable lag. I managed to get a gold medal on Arkham City’s challenge maps using my phone and a PS3 pad connected via Bluetooth. I did this numerous times at work. Then, when I got home, booted it up on my PC and carried on.

    I have very little money these days being a full time dad with a mortgage and other responsibilities like bills and petrol. OnLive gives me convenience and over 200 games (some crap, some awesome) for £7 a month.
    As for the games being expensive then you’re almost entirely wrong. Some are, true. But OnLive are almost always having a sale for whatever reason. I think it was the Queen’s Jubilee sale where I picked up Deus Ex: HR (with expansion), Arkham City and Mafia 2 for a combined price of under £10. Also, I got Darksiders 2 with an OnLive micro console for £26.

    I absolutely back OnLive. The games will never stand up to the better PCs running the same games natively, but I don’t have to spend hundreds buying a new one and I can carry on playing on my phone/laptop/television which no game on Steam or Origin can give you.

    Also, with the subscription (which is worth it’s price on its own) the latest releases are cheaper than most places.

    • mashakos says:

      If you ave a console, why are you playing the same PC games you can have anyway at 720p using onLive? Not sure about the logic. Could be a case of being able to play PC exclusives? Not enough pc exclusives to cover the subscription cost TBH.

      I personally find the idea of cloud gaming to be exciting, in spite of the fact that I have been financially comfortable with building high end PCs (for myself) for the past 8 years. It’s just too early to be enthusiastic about the current lackluster implementations.
      720p (defeats the purpose of playing PC ports), with video compression artifacts and questionable availability (I bet only a handful of countries have enough servers where the client is of any use. I’m not in one of them).

      Also, I’ve seen a few youtube videos of peopl reporting that older or more obscure titles hosted at onLive are running at low settings. A good tel of where this service is headed – the latest “primetime” titles get the best representation while the older titles running at the worst possible settings. Would be hilarious if a new user wanted to finally play Crysis, only to see it running at low.

      Until bandwidth improves to where video can be streamed at any resolution (2560×1600, yeah!) and the cost of cloud gaming servers makes this a reality, I’ll stick with my high-end PC.

  24. mashakos says:

    not to sound like a dick, but I really never saw onlive succeeding.

    Not their concept mind you, but the fact that a startup can pull it off. Unlike say twitter or facebook (which are currently ginormous), cloud gaming can’t really start on a single shared low spec hosting server and scale up from there when angel investors start knocking on the door. The infrastructure has to be there from the start, which means that a company has to have enough reserves to keep the infrastructure going at least for a year or two till subscriptions start generating a profit.
    We’re not talking a bunch of data servers here either, these servers have to be specced with expensive graphics hardware and memory, while even purchased in bulk would be quite costly.
    No way a startup can handle this much financial hemorrhaging.

    • KarachiKid says:

      Onlive didn’t come from one server and grow. Perlman got too many servers which were expensive, but not being used. The subscription base just wasn’t enough. The cynicism from the comments in here are probably a good indication of how the general public (journalists and consumers) view the service, which is why it failed.
      I, for one, love it. If I was an eccentric bajillionaire then I would float the company myself. Sadly, I am not. I have barely a pot to piss in. But I still pay my subscription fee and preach the Good Word.

      At any rate, your entire comment is wrong. Have a read here: http://www.joystiq.com/2012/08/18/documenting-the-death-of-onlive-notes-from-the-companys-final/

      • mashakos says:

        “Onlive didn’t come from one server and grow.”
        Not sure if I should throw a “captain obvious” retort or not…
        To state my point in simpler terms: there was no way onlive could handle keeping the service running the way they did. Which is, to wit, setting up the advanced infrastructure and paying for it out of pocket indefinitely till subscriptions brought in enough revenue to cover the cost.

        EDIT: To simplify it even more: this is not an endeavor for startups.

        • KarachiKid says:

          Now you’ve lost me entirely. Your idea of simple seems completely contradictive.

          “The infrastructure has to be there from the start, which means that a company has to have enough reserves to keep the infrastructure going at least for a year or two till subscriptions start generating a profit.”

          If your use of the word ‘infrastructure’ refers to the servers necessary to support the client base then they were there from day one. There were too many of them. Which is why costs went through the roof as they were not being used but cost a bomb to buy/rent and maintain. The only other context I can think of for your usage of that word would be in substitute of ‘client base’, in which case then that particular sentence makes sense, but can easily be misread due to the context.

          • mashakos says:

            Let me try again:
            cloud gaming needs many servers from day 1
            startup cannot pay for many servers from day one till day 700
            no money, all problem (lol)

        • KarachiKid says:

          Okay, I understand what you’re saying. But here’s why I don’t get it.

          “There’s no way to exactly estimate how many servers we’d need. So we literally bought thousands of them, and all the equipment and networks to go with it,” Perlman told employees.

          So they had many servers from day one. And this is their problem. This quote was taken directly from the link that I posted.

          • mashakos says:

            That’s why I made the point that this idea, as good as it is, just is not feasible for a startup to successfully pull off. I can see it working if Sony or Microsoft took on the challenge and invested millions into their own system over time till it took off, but for a startup?

  25. absolofdoom says:

    Dammit.