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Cloud-based gaming service has more beta users than it expected to have in users for first year

Gamers today that want to play on their PC or with a game console on a TV have to purchase the game titles they play, often at prices of up to $60 or more per title. In the future, gamers may just logon and play the games they want from cloud-based servers rather than needing a local console or a physical game.

OnLive officially debuted its cloud-based gaming service and demonstrated the service at GDC 2009. The company was very quiet with the development of its product and has announced that it has completed a round of new funding.

OnLive won’t specify how much funds it raised, however, the level of funding for the company included investors from AT&T Media Holdings Inc. and Lauder Partners. Original investors in OnLive included Warner Brothers, Autodesk, and Maverick Capital. The original investors also participated in the new round of financing.

OnLive CEO Steve Perlman would only say that the new round of investments represents a "large investment at a large valuation."

The OnLive service plans to officially launch this winter and is undergoing beta testing right now. OnLive reports that it is having to rethink its original estimates for adoption over the first year the service is available. The company reports that hundreds of thousands of people signed up for the beta test period of the service. That number was more than the company estimated would adopt the service in the first year it was available.

Perlman said, "Our projections have changed. Our projections originally for the first year were less than the number of people that have so far signed up for beta. So I guess we underestimated."

How much OnLive users will pay for the monthly service needed to play games is still unknown. So far, the service has signed up publishers like EA, Ubisoft, and Take-Two Interactive to provide game titles.

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By bighairycamel on 9/30/2009 2:15:38 PM , Rating: 3
The company reports that hundreds of thousands of people signed up for the beta test period of the service. That number was more than the company estimated would adopt the service in the first year it was available.
That only means lots of people have heard about it, that doesn't mean nearly as many people will actually sign up and pay to use it.

RE: Beta
By FITCamaro on 9/30/2009 2:29:27 PM , Rating: 2
Seriously. Hundreds of thousands, if not millions sign up for beta testing all kinds of games. That doesn't mean they all stay to play the game when its launched.

I'd like to see some feedback from anyone who got into the beta.

RE: Beta
By inighthawki on 9/30/2009 2:59:42 PM , Rating: 2
I wonder what the latency on the controls will be. If the games and code are being executed on machines across the connection and you have a bad net connection, can you even imagine playing a game where the input delay is > 100ms...

RE: Beta
By tviceman on 9/30/2009 3:17:49 PM , Rating: 2
Latency has simply *got* to be a noticeable issue that will be hard to overcome in many (not all) games.

RE: Beta
By monomer on 9/30/2009 4:41:31 PM , Rating: 2
I believe that OnLive will licence the technology to ISPs and Cable companies, and the servers will be located at the ISP, so you should be seeing input latencies of <10 ms.

RE: Beta
By gamerk2 on 10/1/2009 4:16:45 PM , Rating: 2
Input latency will kill this. If not, bandwith caps will.

RE: Beta
By ThePooBurner on 9/30/2009 5:47:33 PM , Rating: 4
That's exactly what i was thinking. We have a new tech that everyone is saying may be the future of gaming and change the way everything is being done. You can bet that everyone is going to want to see if they want to bother with it and if lag will be as big of a problem as we all think it will be. Not only that, but a lot of us buy highend GPUs so we can have QUALITY graphics, not just fast. The idea of getting 60fps of compressed graphics isn't very appealing, so trying it out and seeing how the IQ is would be huge. I really wouldn't adjust the numbers if i were them. This is just people using the beta as a way to demo the tech and see if it's worth the bother.

The only thing that might make it worth paying to use is if there was a games catalog that you got access to. Cause if you had to buy the right to play any particular game PLUS a subscription fee you can forget it. No one is going to want to pony up for that. Especially if they already own a game and just don't want to upgrade their system to get better FPS.

RE: Beta
By MatthiasF on 9/30/2009 7:23:36 PM , Rating: 4
Interest = possible demand.

I'm interested and if it runs well, will most likely be a customer.

Because I'm tired of buying games on Steam that I can't give to friends, or paying $50 a pop when a monthly fee will get me unlimited on my PC.

Netflix/Gamefly/OnLive FTW.

RE: Beta
By superPC on 9/30/2009 7:36:46 PM , Rating: 3
wow i didn't know that onlive was targeting below 1 million user in the first year. that's pretty low. xbox, ps all sold more than 5 million consoles a year. with service cap that low, people might get denied when they want to subscribe (if all goes well in the beta test). not a good thing for a new company to be denying subscriber.

Various Uses
By Inkjammer on 9/30/2009 2:39:09 PM , Rating: 2
I imagine this may break down into microclouds (e.g. hotels with their own central gaming clusters that can allow people to game in their hotel room to play on their laptop via LAN system). Hotels love to charge people per hour for entertainment (and people love to pay for it, apparently). If you have a laptop then all you'd need to do is connect to it. Having it LAN based would resolve latency, too.

Even if this never takes off as a "game from home, anywhere, everywhere" thing there are quite a few other uses for it. Colleges could do gaming subscription fees (student entertainment + school profit), standardize gaming leagues, more versatile netcafes, etc.

Micro clouds -vs- mega clouds. The technology is pretty interesting.

RE: Various Uses
By kashman007 on 10/1/2009 5:34:02 AM , Rating: 2
I have to say, that is a brilliant idea. That could really work, but I suspect they'll decide to go the way blizzard did with battlenet in starcraft 2.

RE: Various Uses
By kashman007 on 10/1/2009 5:39:23 AM , Rating: 2
I'm actually really excited about this. I hate the gpu cycle. having to upgrade your computer atleast every year or so. consoles turn out much cheaper, and thats the only reason I prefer to game on consoles.
If I can game on my laptop, there is nothing I would love more. consoles would certainly get f*cked. although they(OnLive) could decide to make some sort of application for consoles and then you may never need to upgrade your console either.
whatever happens this OnLive model is certainly something to look out for, it will also solve the problem of piracy.

By Ammohunt on 9/30/2009 2:31:42 PM , Rating: 1
This is a really cool idea in about half a dozen different way if it works as advertised. My guess is that it will take off like a wildfire.

RE: Cool
By Senju on 10/1/2009 12:25:35 AM , Rating: 2
I don't know. I still prefer steam.
L4D on Steam rules!!!!

RE: Cool
By Hiawa23 on 10/1/2009 3:25:27 PM , Rating: 2
I am a console guy, & I am wondering why wouldn't Nintendo Sony or MS want to go this route as it seems that they would save on developing new consoles every few years & the platform wouldn't pigeon be holed to that specific hardware & it's limitations until the next gen came.

"Let's face it, we're not changing the world. We're building a product that helps people buy more crap - and watch porn." -- Seagate CEO Bill Watkins
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