Cloud computing enables service

While gamers have been able to rent new titles by mail for years, the options have been limited when it came to streaming services.

That’s changing now, as OnLive looks to leverage cloud computing and a Netflix-proven business model to offer instant streaming of new hit titles to players. Last month, the company released a set-top box, letting customers buy recent and catalog releases on an a la carte basis; this week it released an iPad app; and starting in January, it will offer a pair of new payment options.

The first, a $9.99 “all you can play” plan, follows closely in the shoes of Netflix, offering fairly recent and older titles but not brand-new releases. The company will also offer a Play Pass plan, letting people buy a three-day or five-day pass for newer titles.And, according to the Wall Street Journal, it’s also planning to launch a subscription-based movie streaming service in 2011.

The variety of revenue models is key to OnLive’s endgame — getting its service integrated into as many technologies as possible.

“OnLive will be built into TVs; it will be in Blu-ray players,” says CEO Steve Perlman. “Much as you see a (music) service like Pandora on many devices, you’ll see us.”

What makes that possible is the company’s use of cloud technology. Games are stored and played on its centralized servers and pushed to users via a broadband connection. When players press a button on their controller at home, that action is transmitted virtually instantaneously to the game and reflected on screen, meaning that virtually any screen with a decent Internet connection can be transformed into a high-end gaming system.

“There really isn’t a core competitor,” says Perlman.Perlman knows a bit about emerging technology. He previously led development on the technology behind QuickTime and founded WebTV. That helped bring onboard several high-profile investors, including AT&T Media Holdings and Warner Bros. — both of which, it’s worth noting, are tied directly to cable providers. (AT&T owns U-verse, and Warner’s parent company owns Time Warner Cable.)

OnLive may be the only streaming service of its type right now, but it won’t have the space to itself for long. In-development platforms like Otoy and Dave Perry’s Gaikai are waiting in the wings.Several publishers, such as Electronic Arts and Ubisoft, are getting onboard early, though. As the videogame industry shifts so rapidly these days, gamemakers are increasingly looking for ways to stay at the forefront of players’ minds.

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