OnLive is back with new business model, new leadership

Back in 2009, internet entrepreneur Steve Perlman’s OnLive made a big promise: to allow players to stream high-end games from powerful remote servers and onto their local hardware, marginalizing the need for expensive PCs and increasing the ubiquity of video games in general. In some regards, OnLive was a success. The technology was functional, though for many of the demanding traditional players the service was targeting, cloud streaming simply did not compare favorably to the performance and responsiveness of locally-installed games. Amid financial turmoil, OnLive -- as we knew it -- folded in 2012, and Perlman left. Since then, OnLive has been under the radar, to say the least. But today OnLive, headed up by lead investor Gary Lauder, is announcing a relaunch, pinning this do-over on a new double-sided business model, and leadership that has a game industry background. Lauder is joined by former IGN CEO and co-founder Mark Jung, who’s serving as OnLive’s executive chairman; VP of business development Carrie Holder (formerly of EA Partners); VP of product and marketing Rick Sanchez (former Disney Playdom VP); and TV and video veteran Don Gordon as SVP of engineering (formerly of Gracenote). The company is now approaching the business of cloud gaming from two fronts: OnLive now has a consumer-facing business (as it did in its previous life), and a new business-facing service. The consumer side is the subscription-based CloudLift, which encapsulates local downloads supplemented by streaming game services. This angle came after Lauder stepped in to buy the company and its tech in August 2012, and reevaluated OnLive to find out what its strengths really were. OnLive’s strength, he says, was not in replacing local play, but to complement it. There's no more initiative to try to go head-to-head with digital distributors and consoles. With CloudLift, OnLive wants to offer players the ability to play games locally and streamed, without making them pay for the same game twice (in the past, customers would have to buy once from a retailer and once from OnLive). This will work with players' existing libraries, with their games that are supported by CloudLift. At launch, it only works with Steam versions of supported games, though the tech theoretically can work with other distribution platforms. “We wanted to allow gamers to play their game locally on PC … and when they’re not [at their PC], they can get it OnLive,” says Lauder. The CloudLift service however does come with a recurring pricetag of $15 per month, a fee that allows people to play supported games in the cloud across various devices such as Android, low-end laptops, and supported TVs, in addition to the local download they purchase. Basically, you buy a game from a digital retailer (again, Steam-only for now), and if the game is CloudLift-supported and you have a CloudLift subscription, you can also take advantage of cloud streaming. Supported games are synced automatically so players can pick up where they left off on a different device, and multiplayer is supported. OnLive has forged partnerships with publishers to support a launch lineup that includes Batman: Arkham Origins, The Lego Movie Videogame, Saints Row IV and Type:Rider. The company says it has dozens more CloudLift-supported titles on the way, including Europa Universalis IV and F1 2013. OnLive will also directly sell download codes, which will come with a complementary seven-day CloudLift trial. The company is also offering a PlayPack subscription, a $10 a month deal that lets players stream a library of 250 games to OnLive-compatible devices. The difference from CloudLift is that it doesn’t include the local download aspect. As for developers getting their games onto OnLive, marketing VP Sanchez says it’s easier than before. “We’ve dramatically changed the way we onboard games, so it’s pretty simple,” he says. The business side of OnLive is a completely new model for the company called OnLive Go, which sees OnLive provide its streaming services and tech to help virtual world developers and publishers bring games to Android tablets, Macs and lower-end laptops. OnLive is partnering with Linden Lab on a mobile viewer for Second Life, called SL Go, and with Gaijin Entertainment on the simulation game War Thunder. Even with this repositioning of business models, there is still the question of latency. Lauder says there have been typical advancements at the CPU and GPU level that have helped reduce latency compared to the original OnLive. Other changes in OnLive tech have taken place, he says, as well as the addition of two datacenters that help reduce the proximity of OnLive's servers from customers. He also cited a survey from internet content delivery service Akamai that recently said 34 percent of people in the U.S. have above 10 Mbps internet connections, and that's increased year-over-year by 82 percent, which would also help latency and capacity issues. “Due to changing our technology and business model, we expect we can handle almost an order of magnitude greater amount of users [than before],” says Lauder. He didn’t reveal current user numbers for OnLive, but says because OnLive is effectively relaunching, that number doesn’t really matter much anyway. “Our new service is so different from the old service, that we did not materially invest in the [previous] service because we’ve been putting all of our eggs in the proverbial basket of this new one,” he says.