OnLive CEO: “We Want to Be the Netflix of Gaming”

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They’re just used games. And the used games, as we’ve discussed, just re-circulate and re-circulate and none of that money goes to publishers. So, for the publishers, it’s not too hard for them to give us the games that are currently in the used market. Right?

Yes. That segues actually into my next question. So, clearly it’s an enticing pipeline for publishers for back catalog stuff. But you guys have done some day-and-date, simultaneous releases. How did that come about? You did it for Mafia II. You did it for NBA 2K11. You’d figure that if a publisher wanted to test out this market, it might be with some stuff that’s second-tier or more experimental. But these are two high-profile releases for 2K. Can you talk a little bit about how that stuff came about?

We’ve had seven day-and-date releases so far. And, you’re quite right. We ended up with these high powered, high-profile games. The publisher would much rather have someone buy the game on OnLive than on one of the other platforms, for all sorts of reasons. I mean, the margin is higher. They don’t have the physical box to make or the disc to print. And they don’t have the whole retailer margin part of it. But, the bigger thing is a third of US software purchases now are used games. So, when they throw it on to OnLive, they know it’s not going to end up in the used game rack. Right?


So they are moving like the wind to get us as many games as they can. The reason we haven’t had every single game released that’s come out day-and-date, has not been for lack of trying on the part of the publishers. It’s just that, they didn’t anticipate that OnLive would take off as quickly as it did. But this is the birth of something new. Long story short, you’ll be seeing more and more day-and-date releases, and it’s not because we’re twisting their arm. We’re a little start-up. We couldn’t twist their arm if we wanted to. It’s because they want us to succeed. They’d like to see OnLive succeed.

That said, what’s the next frontier?

I like to call OnLive again one of those “why not” technologies, as in why not. We’ve just launched an iPad app. We call it the OnLive Viewer App. And it’s not that games don’t run on the iPad. They actually run just fine. It’s just that none of the high-end games are touch-aware yet or motion-aware. Believe me, when they were designing Just Cause 2, they never imagined it would be running on an iPad. So, you’ll be able to do all of the spectating, brag clips and chatting. You’ll be able to check profiles. You’ll be able to friend people. All of that stuff will work just fine on the iPad wherever you are. But that’s just the beginning. So, we’re also going to be showing on Tuesday, and this is a surprise to everyone, we’re going to be showing Android running in Beta. Same way. The Samsung Galaxy Tab came out two weeks ago. It’s still not an iPad, but it’s the first Android tablet that’s getting a little bit bigger and a little bit closer to the iPad.

And, next year, you’ll see OnLive built into television sets. So you can turn on the TV and boom, you can play any game you want.

Is that actually a done deal?

Oh, sure. I mean, when you begin to see the inside of the MicroConsole, you begin to see the direction we’re going. We’re actually already very far along. And unlike adding apps to a TV that play one thing or another, when you add OnLive to a TV, the TV never gets obsolete. If you built in all the capability of an Xbox 360, there will come a point where you’re going to want to play a game that outperforms what the TV can do. Now, with OnLive, it’s fantastic. It works very beautifully. You’re going to see actually a lower latency experience with OnLive built into a TV than you currently get with an Xbox or Playstation 3 running locally going through a TV. Also, we don’t add any cost to a TV. So it’s not a hard decision for them. The only thing we change in the TV is the software.

That’s really cool. I remember when I first saw the service, the gambit seemed to be getting acquired by a Comcast or somebody like that. Then we’d see OnLive in cable boxes as another premium service that companies can charge for. But going direct to the TVs is even more enticing because I feel like you’re not beholden to the service provider and how they want to cap your bandwidth or whatever scheme they may have at a given time.

That’s correct. You will see OnLive built into cable boxes and IPTV boxes and so on. But the wrinkle there though is that their product cycle is pretty long. So it will take time before they rollout to their full user base. But that’s OK. I mean, again, I have a very Netflix agenda. We just want to be everywhere. We don’t want to piss anyone off. We just want to be everywhere.

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