Streaming games service launched

A new online video game distribution network hopes to revolutionise the way people play games and re-write the economics of the industry.

OnLive, to be launched at the Game Developer Conference in San Francisco, aims to let players stream on-demand games at the highest quality level.

The service could provide competition for Playstation, Xbox, and the Wii.

"OnLive is the most powerful game system in the world," said company founder Steve Perlman

"No high-end hardware, no upgrades, no endless downloads, no discs, no recalls, no obsolescence. With OnLive, your video game experience is always state-of-the-art," he declared.

Mr Perlman said that the company has developed a data compression technology that allows games to be powered on remote servers rather than on game consoles.

Users download games instantly through the OnLive MicroConsole or straight onto a PC or Mac. The MicroConsole also connects to any TV. All that is required is a high speed connection.

Gamers will be able to select from an on-demand catalogue of video titles stored on these data servers. The Palo Alto based company promises that the service will provide instant access to the most advanced games in the world, solo and multiplayer.

To date nine publishers have signed up including familiar names like Ubisoft, Electronic Arts, THQ and Atari Interactive.

'A world without consoles'

Initial reaction from the gaming press has been a mixture of the positive and the sceptical.

Sid Shuman of GamePro told PC World "When we finally got hands-on with OnLive, I gotta admit, I was impressed."

So far nine big game publishers have signed up to the service

Michael McWhertor of Kotaku.com admitted "We were a little suspicious of OnLive's capability to deliver perceptually lag-free on-demand games. But then we played a hasty online game of Crysis Wars on the service and became a little less suspicious. It seemed to work.

"Will it work in the wild? It might," concluded Mr McWhertor.

At VentureBeat, which is holding its own games conference called GamesBeat, Dean Takahasi said "OnLive's technology could eventually sweep through all forms of entertainment and applications, providing the missing link in helping the internet take over our living rooms."

"It remains to be seen if this is just vapourware," said Cesar A. Beradini of TeamXbox.com.

"The real question is what would happen if this actually works as promised? Is it the end of Sony, Microsoft and Nintendo as console manufacturers?" he asked.

From that standpoint Michael Pachter of Wedbush Morgan Securities told USA Today "OnLive shows the potential for a gaming world without consoles" if the pricing is right.

According to Mr Perlman a new era for gaming is here.

"We've cleared the last remaining hurdle for the video games industry: effective online distribution.

"By putting the value back into the games themselves and removing the reliance on expensive, short-lived hardware, we are dramatically shifting the economics of the industry. Delivering games instantly to the digital living room is the promise game fans have been waiting for," he said.