OnLive Is Either Shutting Down or Isn't, Depending On Who You Ask [UPDATED x3]

UPDATE 3:Engadget is reporting that at least "50%" of the staff at OnLive has been laid off, and that the company has been bought by an as-yet-unknown third party.

UPDATE 2:IDG News' Martyn Williams reports that he's outside OnLive's offices right now, and has seen multiple employees exiting the premises with moving boxes.

UPDATE: Kotaku is reporting that despite OnLive's denials, the company is filing for bankruptcy in the state of California. The intent, according to Kotaku's source, is to reform the company as a new entity with a smaller staff. What that company will look like and what it's plans are for OnLive's current services are still unclear. Other sites are also citing more sources from inside OnLive confirming the layoff portion of the story. Still some questions floating around, but it looks like things are becoming a bit clearer.

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Here's one of those rare cases where we're going to report that on the fact that story exists, as opposed to the factualness of said story, because quite frankly, we have no idea either way.

Earlier this afternoon, reports began to surface that cloud gaming service OnLive might be shutting down. This info appears to source back to Brian Fargo, a developer not directly affiliated with OnLive who nonetheless claimed a source inside the company had told him the shutdown was taking place. Not long after, Mashable posted a report proclaiming that the entire staff had been laid off this morning, and that the company either would be shutting down outright, or forming a new, seemingly staff-less company focused on licensing intellectual property patents the company owns.

OnLive, on the other hand, is refuting much of this. The company's head of corporate communications Brian Jaquet responded to multiple inquiries regarding the shut down with a statement saying, "We don't respond to rumors, but of course not." He then proceeded to say a bunch of nice things about the company's future projects, while also not mentioning or acknowledging the layoff portions of the news. Hmm.

So basically we, the gaming press, know about as much as you do. Several sites are reporting anonymous sources confirming the layoffs at the company, but the actual shut down of OnLive appears to perhaps be exaggerated. Or maybe it isn't, and nobody's told Brian Jaquet yet. In which case, oops.

Regardless, we know something is happening at OnLive. We just don't know what, exactly. This is what news looks like in the Internet age, people. We'll let you know when we confirm something. Anything, really.

Word

Edit: Also, hope the workers land on their feet somewhere.

Reporting that we don't know anything.

Great.

@Sil3n7: I think every site is doing that in this case though.

As an OnLive user- hoping its not the end. I still think the idea is good.

This would also be a bad way for this to all end.

It'll be interesting to see how this affects the Ouya.

If it does happen, it would be interesting to see how they handle it. People have purchased games in their store. Those game licenses might be forfeited. Or would they work something out with other services (e.g. Steam or Origin) to have their customers' licenses transferred? Would the game publishers do anything to help their customers? Have there been any other major digital distribution stores shutdown?

This rumor may hurt future sales on their platform. I know I wouldn't want to buy a full priced game when there is potential for that service to be shutdown soon.

OnLive

OffLine

2012

Great timing, OnLive - while GB's news guy is on honeymoon. Klepek's gonna be pissed.

@Sil3n7 said:

Reporting that we don't know anything.

Great.

Honestly I much prefer an article actively recognizing the bullshit inherent to rumors and unconfirmed reports than writing it up as a rumor.

Shit. I forgot this thing even launched

I've been worried about this happening from the beginning. I was there at the SF launch event at the Museum of Modern Art, and I was there at GDC when almost all their demos had to be shutdown due to the terrible event center wifi. Basically, everything sounded great on paper, but in reality it's an incredibly difficult technical feat. I think the biggest issue comes down to the fact that not as many people have good internet connections as some people think. Also, those who use wireless can pan on piling on more lag than what is already there. Oh, and think about the servers that run these game. That has to be a huge expense. As much as the tech is impressive, I just don't know if the world is ready for it yet.

They are filing for bankruptcy because of course they are.

@Sil3n7 said:

Reporting that we don't know anything.

Great.

It's reporting strange happenings. Of course the OnLive people aren't going to come out and say to press "Guys! We're going under!" Maybe try being less of a dick and remember that "Story developing..." is a common phrase in journalism.

@DetectiveSpecial said:

Great timing, OnLive - while GB's news guy is on honeymoon. Klepek's gonna be pissed.

"Honeymoon" AKA "in deep cover posing as an OnLive middle manager"

@DetectiveSpecial said:

Great timing, OnLive - while GB's news guy is on honeymoon. Klepek's gonna be pissed.

Why ? I don't recall him ever being a fan of the thing.

lol i forgot OnLive was a thing still

Whenever a company denies massive layoffs is it to save face, stockprices? Or just to not seem like heartless corporations? I guess no company wants to admit shit is getting real.

@Ravenlight said:

@DetectiveSpecial said:

Great timing, OnLive - while GB's news guy is on honeymoon. Klepek's gonna be pissed.

"Honeymoon" AKA "in deep cover posing as an OnLive middle manager"

isn't that the plot from superman 2?

Well, yep. I still thought OnLive was in beta: I didn't realize it had properly launched.

OnLive's biggest problem is that it's designed for a broadband network which simply doesn't exist outside of selected cities in the US. In Britain, only central London can really offer the proper speed for it. The wilds of the Oxfordshire countryside certainly can't get that speed yet, and BT say it'll take until 2018 to install fibre-optic cabling around the country.

I don't even know what OnLive is.

Here's one of those rare cases where we're going to report that on the fact that story exists, as opposed to the factualness of said story, because quite frankly, we have no idea either way.

I bet in 10 years time people will "remember" onlive as like the Dreamcast is talked about now, saying that it was ahead of its time and they were never cynical about it (despite the fact that likely only about 1% of them would have even tried the service).

@gbrading: I live in London and have a fairly solid connection of 50mbps down with Virgin Media. I tested it a little while ago and it was still very bad. I can play Dirt 2 and Deux Ex at very high settings on my computer so when I tried them on Onlive, I could really tell the difference. The resolution was low, there was green and purple fringing for some reason and the input delay made it impossible to play Dirt 2.

Something like this is why I never bought anything from OnLive (you know, besides the lag, the blurry, compressed images and not really owning anything). I thought that ultimately, these guys would either be bought out or simply muscled out of the market by companies with deeper pockets. Now it looks like they might not even get that chance to exist that long.

Maybe not enough people are buying enough games to keep the service going as is?

@AuthenticM: Not a fan of the thing......but a fan of the scoop.

I'm kind of disappointed that Giant Bomb reported on this before anything was certain. Just adds fuel to the fire.

@ajamafalous said:

It'll be interesting to see how this affects the Ouya.

Two possibilities: Ouya doesn't get OnLive, or no effect at all. If people preordered Ouya solely because of OnLive, they have until March to cancel.

@AlwaysBeClothing said:

Whenever a company denies massive layoffs is it to save face, stockprices? Or just to not seem like heartless corporations? I guess no company wants to admit shit is getting real.

Perceived brand value going forward, perpetuating an image of a healthy company when negotiating with prospective new buyers, and yes, attempting to keep the company stock from bottoming out (which is although in this case irrelevant, as Onlive is not a publicly traded company).

So that's why the were so pissed when Sony bought Gaikai, they wanted to be bought by Sony before they died.

Schrödinger's OnLive

@MariachiMacabre said:

@Sil3n7 said:

Reporting that we don't know anything.

Great.

It's reporting strange happenings. Of course the OnLive people aren't going to come out and say to press "Guys! We're going under!" Maybe try being less of a dick and remember that "Story developing..." is a common phrase in journalism.

Yeah it is a common phase in journalism, not good journalism.

while i doubt it i hope onlive release the tech for download becose its kinda nice tech.

It's a sad day to see something as cool as OnLive going under. I didn't use the service, I feel my computer is good enough that renders it obsolete, but it was a great idea.

On a related note, how does this affect OUYA's solidity now? I know OnLive was a large part of their pitch and it seems that this might cripple a lot of positive points for the system.

It is great idea, but way too many places the internet (like most of the UK) is not good enough for it still.

@DetectiveSpecial said:

Great timing, OnLive - while GB's news guy is on honeymoon. Klepek's gonna be pissed.

He is on his honeymoon with his new bride. I GUARANTEE you he couldn't care less.

EDIT: Here is proof of what I am talking about. Tricky just posted this: http://yfrog.com/15z66cbtirrgyylsownqskvaz

i wonder if they had bet everything on being bought out by sony.

if durango isn't b/c with the 360 maybe microsoft can snap them up cheaply for the same reason sony did gaikai.

@ck1nd said:

It's a sad day to see something as cool as OnLive going under. I didn't use the service, I feel my computer is good enough that renders it obsolete, but it was a great idea.

On a related note, how does this affect OUYA's solidity now? I know OnLive was a large part of their pitch and it seems that this might cripple a lot of positive points for the system.

OUYA is a pipe-dream at best and a scam at worst regardless of whats going on with On-Live. What the OUYA team has promised simply cannot be delivered in the time-frame and at the costs they are claiming. They're either deluded or lying.

Wow, really? Damn. That's too bad, I was waiting to go back and play that when it got better, but... Huh.

@AuthenticM said:

@DetectiveSpecial said:

Great timing, OnLive - while GB's news guy is on honeymoon. Klepek's gonna be pissed.

Why ? I don't recall him ever being a fan of the thing.

He's a fan of Scoops

This info appears to source back to Brian Fargo, a developer not directly affiliated with OnLive who nonetheless claimed a source inside the company had told him the shutdown was taking place.

I'm glad you decided to note the unconfirmed sourcing in the article, but I hope that in the future the press is able to recognize that if something is going to be a story...it will be a story.

If an unofficial source tells you that a company will go bankrupt then you call an official source. If the official source has no comment you investigate as much as you can. The best way to find out if Onlive will file for bankruptcy is if the company announces they will file for bankruptcy or if you watch the bankruptcy court database for mentions of Onlive.

This isn't as bad as the Half-Life 3 at Gamescom stuff from a couple days ago, but it is still pretty non-story right now. I thought that Giantbomb had more info in the update so I clicked on the article. Turns out it was just more "anonymous source" stuff from Kotaku. It's more believable that the company is reformatting, but there is still no official word.

@Mr48 said:

@ck1nd said:

It's a sad day to see something as cool as OnLive going under. I didn't use the service, I feel my computer is good enough that renders it obsolete, but it was a great idea.

On a related note, how does this affect OUYA's solidity now? I know OnLive was a large part of their pitch and it seems that this might cripple a lot of positive points for the system.

OUYA is a pipe-dream at best and a scam at worst regardless of whats going on with On-Live. What the OUYA team has promised simply cannot be delivered in the time-frame and at the costs they are claiming. They're either deluded or lying.

You don't know that, and I highly doubt you've done the math to prove it.

I don't know what they plan on doing for everyone that bought games on the service. But I expect not much if anything and that makes me sad.

Damn you, Curt Schilling!

so an episode of the newsroom next season will have this be a story right?

I think they call this "restructuring" which sometimes occurs due to "corporate insolvency". Basically, they can't pay their bills so they need to make big changes.

I'm not surprised at all. The national broadband infrastructure isn't advanced enough to make this technology feasible. They were ahead of their time and suffered for it.

Reporting that we don't know anything.

Great.

If this is true (and I wish we'd wait until we have some actual facts before putting up stories - no-one comes here to get the news first, just for accurate reporting and intelligent and humourous comment) its not that surprising I guess.

Onlive always sounded like a good idea just a little ahead of its time. The network just isn't there yet unfortunately. Give it 5-10 years and this will be a service used everywhere I would guess - unless it really is impossible to sort the lag problem out.

I think companies like Gamespot and CEX which make big profits on used games are breathing a sigh of relief.

Also it will be really interesting to see what people who bought games through the service are entitiled to - my guess would be nothing. Have they actually bought the game or do they just pay for the service? I'm guessing the latter. Any ONLivers care to confirm?