Interview: OnLive Aims To Embrace Console Ecosystem As $99 TV Microconsole Launches

Today cloud-based game service OnLive begins accepting pre-orders for its Microconsole for the living room, aiming to bring consumers streaming games without the need for console hardware. The service launched its PC component in June, but the TV experience is a key component for a company that has been quietly whittling away a space in the market for itself. OnLive is available on Mac and PC via a wired ethernet connection, the service's Wi-Fi beta began in September, and now the Microconsole begins shipping next month. It's a small, light piece of hardware -- just a little larger than palm-sized -- that attaches to television sets and ships with a wireless controller. "Switching from game to game is like channel changing -- which is kind of a thing hard for us gamers to wrap our heads around, because we're not used to the world being like that," CEO Steve Perlman recently told Gamasutra, demonstrating the console for us. In fact, perception is probably OnLive's greatest obstacle on its journey to create a new vertex in a marketplace long dominated by consoles and discs. The Microconsole and its controller are positively retail-ready, graceful and attractive, and the company has focused on providing consumers with the simplest and most immediate gaming experiences it can in an interface that aims to minimize time when a consumer starts a new game or switches from one to another. The setup's $99 price also includes a free game (through a coupon), and Microconsoles begin shipping on December. But the company's goals are surprisingly moderate -- Perlman tells Gamasutra that the console-killer narrative is a media creation, and that OnLive's goals are quite moderate. In fact, at least for some time Perlman expects that the most eager adopters for the device will be avid core consumers who want to supplement, not replace the array of gaming devices in their home. "I wouldn't be surprised if a lot of them have consoles and gaming rigs," says Perlman. According to the CEO, one of OnLive's big selling point is its social features -- friends can simply watch others playing games, even those they don't own, and keep apprised of buddies' statistics in the games they do. In that way, OnLive's service can act as simply another way for fans to involve themselves in the gaming landscape. The company hopes the hardware's relatively low entry price will help -- with the Microconsole at $99 and the PC service requiring only an internet connection, the aim is to make some of OnLive's perks accessible to all kinds of gamers. For example, Perlman feels fans will appreciate the demo format -- gamers can play a title for a fixed amount of time, and then pay for the full version if they like, able to continue from wherever they left off in the demo. They also have the option to simply pay for more time with the game; rentals start at $4 and OnLive will also introduce a flat-rate plan, something akin to a "Netflix for video games" where catalog titles will be available under the plan, but new releases will be available a-la-carte. Further details of those pricing options will come next month. For many consumers, the free demos and the ability to view other players will be enough, Perlman suggests. "Console games are multi-tens of dollars even used," he says. "Average gamers spend about $20 a month -- they're making a big decision when they try a game. So we've very happy to be a kind of social network, too. A demo is a type of advertising for the publisher, and we get compensated for that." "In fact, if someone wanted to go and make OnLive run on an Xbox 360 or a PlayStation 3, we don't care," he adds. "We don't have an agenda one way or the other; it's a 50 billion dollar market, and a very small part of that will support a start-up. We have a smaller cost basis from the beginning; there's a huge subsidy Microsoft and Sony had to do to get [their consoles] out there. We have a very inexpensive little box." So OnLive doesn't need to see the existing console owners as "rivals", or pursue some agenda to own the multimedia living room. "They don't have each other's first party games," he says of the platform holders, "and we don't expect them to give them to us. It's vastly a third-party market -- next year, there will be games that can only run on OnLive." And that won't be because of licensing, he adds: "The limitations of 2005 hardware will have been reached," Perlman suggests. "OnLive servers are 2010 technology. And once you start seeing games like that coming out on OnLive, there will be significant differentiation." But talk about trying to replace hardware or physical retail isn't necessarily the narrative OnLive wants to tell. "We didn't design this package for online-only sales," Perlman says of OnLive's gracefully-branded black and orange matte box. That story "hasn't come from us," Perlman adds. "We've tried as best we can to talk about what our advantages are -- you've got how many tens of millions, or hundreds of millions of consoles out there and they're not going to disappear overnight. It's a matter of, how can we go there and embrace the ecosystem and eventually add new value?"