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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.

"If you can find a PS3 anywhere in North America that's been on shelves for more than five minutes, I'll give you 1,200 bucks for it." -- SCEA President Jack Tretton
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