I've been hearing about OnLive for about a year now, right after it was first announced. The idea was certainly interesting - but like many people I had my doubts that it would work as well as advertised. Yahoo! just ran an article on it, talking about some of the pros and cons they found with it. What is OnLive? In short, it's a way to play top end computer games without having a console system or top end computer. The games are actually run on their servers and the video is streamed back to your screen. Basically, it does all of the work behind the scenes for you. It apparently supports Mac computers too, so they would have access to some cool games they might not normally.
The good from what I've seen? No consoles, no top-flight computers needed, it's easy to purchase stuff and it seems to run pretty well.
The bad? Well, for me these stand out - you buy the games and pay for a service. Decide to quit paying for the service - you lose access to your games. As someone who does a lot of used game purchasing and selling, this makes me a bit twitchy in and of itself. The graphics are not as good as having a top end machine (I'm sure there's some scaling done to help smooth out the transfer of data) - and I am a bit of a snob with my graphics and sound (isn't this one of the main reason we traded in our Xbox's, Playstation 2's and Gamecubes for 360's, PS3's and Wii's?).
Another downside the article pointed out, and a primary concern for most people in general, has been the potential for lag. Game lag is frustrating, and by the very nature of the service there is going to be some. A lot of people won't care. Some, like me, would probably find it rather annoying. One thing the article didn't touch on is if the lag gets even worse than 'normal' when playing online matches or you get to a very graphics intensive part where even on a console you experience tearing or dropped frames.
The last deal killer for me? You have to be on broadband with ethernet. No dial-up, no wireless. My 360 and my wife's computer are the only wired systems. My laptops? My desktop? Nope - and I don't sit anywhere near our router, so that would be a a major shortcoming as well.
It's an interesting idea, and with console costs being rather expensive, but I think this is an idea that would have gained more traction a couple of years ago when the costs were higher. Now that there's been price cuts to the big 3 consoles and a decent computer doesn't really cost too much to build - it almost feels to me like OnLive may have come out a bit too late for its own good - but time will tell I suppose.