OnLive, the pioneer company in streaming video games over the Internet, is closing down by the end of the month after selling most of its assets to Sony.
The pending shutdown of OnLive marks the end of a turbulent story for the company, which has received funding from big names such as Warner Brothers, AT&T and Autodesk.
Sony will be acquiring the patents held by OnLive, which will assist the company's purchase of a similar service named Gaikai for technology that will allow Sony to stream video games directly to PlayStation consoles. It is believed that Gaikai powers the Sony PlayStation Plus service that allows PlayStation 4 owners to play older titles from the PlayStation 3 console through the cloud.
OnLive launched six years ago with the radical proposition that users with a sufficient connection to the Internet could stream video games from a data center into the user's home, similar to the way NetFlix works today.
OnLive's service was launched in the middle of 2010 with a monthly rate of $14.95, in addition to the cost of the titles that the user acquires.
The monthly fee was soon dropped, with the games available to users able to be played on any PC, Mac, smartphone or tablet that can support the service. Amazon even added support for OnLive to its Fire TV and Fire Stick devices.
While the idea was great on paper, it never lived up to its potential because back in 2010, there were not enough households with the high-speed broadband Internet required to properly stream video games.
As time passed and it became more accessible for households to acquire high-speed Internet connection, customers instead preferred to purchase their video games from traditional channels, as playing these video games will not require an Internet connection and will have no troubles regarding performance.
OnLive made several attempts to recover, including the launch of a virtual desktop service that allows users to access Windows programs through their browsers. However, the efforts simply were not enough.
Three years ago, the entire workforce of OnLive was laid off with the company giving employees with worthless options for their separation pay. OnLive's assets were then sold to a private equity company for only $4.8 million, which is a massive drop from the one-time valuation of $1.2 billion for OnLive.
The company was revived last year with the CloudLift service, which allowed users to take games being played to be continued on any capable device. It seems that the service was not successful either, as OnLive will now close down for good.
