Archive for May, 2009

Games in the Cloud

Posted in OnLive 2009 on May 29, 2009 by John Spinale
John Spinale, VP of Product Development, celebrates after the OnLive press conference. (March 2009)

John Spinale, VP of Product Development, celebrates after the OnLive press conference. (March 2009)

So far on this blog we’ve talked about the technology behind OnLive and the business side of Games on Demand. Now I’d like to talk about what the OnLive gaming platform means for game developers and how that helps us to deliver a better overall entertainment experience to our audience—all of you gamers out there. Personally, this is what I’m most interested in, having spent the better part of my career both building and playing games.

Ultimately, we’re starting off with the premise that our success as a gaming platform will revolve around the quality of the games we deliver and the overall experience surrounding them. So, how do you make this happen? Fortunately we’re starting with a clean slate, making this one of those opportunities that only comes around once in a lifetime (if you’re lucky!). So time to back up and get a little philosophical…

To start, we acknowledge that great games come from great developers: find the best folks working on the most innovative games and then provide them with an environment in which to be creative and productive. And this goes for developers of all sizes, from tiny little independent teams to big, well-backed studios at major publishers.

Then, provide them with something that they can really innovate around, something fundamentally different. Games on demand open up new doors for developers. Data centers full of high-end gaming hardware create the potential for games done to a level of scale and fidelity never seen before. And since the OnLive platform’s always online, we must really embrace all the network and community aspects, taking note from other platforms both proprietary- and Web-based. Fortunately, the list goes on in this area…

And lastly, you stay out of their way. Don’t make their life harder than it needs to be in terms of process. Don’t pretend you know what the consumer wants more than they do. Align your interests to make a win-win scenario on the business side of things. Keep the relationships simple and clear and don’t compete with them. Make it fun…

These basic rules drive everything we do at OnLive, and we’re confident that this will lead to revolutionary innovations in the space. I’ll spend some time on all of these major themes as we continue the discussion here on the OnLive Blog, as there’s way too much to get into all at once (this one’s already way too long). But suffice to say, we’re working hard on all three of these areas in an effort to bring you the best possible gaming experience. Hopefully you’ll agree as we continue to unveil the results. Stay tuned…

Off to E3 for meetings next week!

—John Spinale, VP of Games and Media

Why OnLive and Why Now?

Posted in OnLive 2009 with tags , , , , , , , , , , on May 15, 2009 by Mike McGarvey
Steve Perlman and Mike McGarvey take questions from the audience at the OnLive press conference.

Steve Perlman and Mike McGarvey take questions from the audience at the OnLive press conference.

Hi, I’m Mike McGarvey, OnLive’s Chief Operating Officer, and I’m pleased to be making my first post to the OnLive Blog.

“Why OnLive and why now?” are two of the questions I’d like to explore as we unfold our strategy in the video games space. Due to a number of different factors, which I’ll outline in a moment, the currently available distribution methods for video games present extreme challenges for developers and publishers. This isn’t a new development by any means. For years, industry experts have been monitoring and predicting this outcome. OnLive addresses these challenges by evolving the current game distribution methodologies, establishing a direct channel between the game content and the consumer, thereby enabling a higher overall return on a lower back-end investment.

In many ways, the current quandary the video game industry faces was foreshadowed by the movie business: skyrocketing production costs, a narrow distribution pipeline and static retail prices. Movies got bigger and more expensive, but ticket prices and the methods of delivery did not evolve along with the costs. Video game publishers now find themselves in a similar situation.

While it may seem counterintuitive to question the business model of a thriving industry—it has been projected that video games sales will meet or exceed $60 billion in 2009—there are some fundamental flaws in the economics that we are aiming to address with OnLive.

First off, while the costs associated with video game development, distribution and marketing have increased exponentially over the last ten years, prices have remained static. The average multi-platform game now costs upwards of $30 million to produce and bring to market, but the retail price has remained fixed at approximately $60. That makes the return on investment much more challenging for publishers. Yes, demand is up, but the cost to develop has risen so dramatically that it’s become extremely difficult to break even on a new title, let alone make a profit. Other factors such as used game sales and piracy are also negatively impacting profit margins.

OnLive has the potential to change these dynamics by removing packaging and distribution costs. Because we’ve eliminated physical media and full downloads, there’s nothing to steal and nothing to resell, giving publishers complete control over their product. By providing a powerful end-to-end development-to-distribution model, OnLive can dramatically alter video game economics, increase profit margins and provide new and enhanced monetization channels. Not only does this increase revenue, but it also means that the money typically allocated for high distribution costs can be spent instead on design, development and marketing, leading to better overall product with greater awareness and a better value for the consumer.

So, while retail has been the mainstay for distribution of top video game titles since the industry’s inception, OnLive is now breaking that mold. We will be delivering the same top video games titles exclusively through broadband Internet, in the same release window they are available in retail, but with significant economic, convenience and feature benefits to both publishers and gamers. And, this is the main reason why OnLive won’t have a booth at E3 this year. More than anything, E3 is a retail-oriented conference, both for retail platforms and retail publishers, and OnLive is neither. You’ll hear and see plenty from us this year in the run up to our external Beta and launch, delivered directly to your home through your broadband connection.

In the meantime, I’ll be exploring video game economics in more detail throughout the year in future blogs. This is an exciting time in the game industry; we’re standing on the precipice of several monumental changes and improvements. I look forward to discussing them with you in this space as we move forward.

—Mike McGarvey, OnLive COO

Server Hopping with OnLive

Posted in OnLive 2009 with tags , , , , , , , , , , , on May 12, 2009 by Steve Perlman

This is the first tech posting where we go “under the hood” and look at OnLive technology. If you are not a techie type, it’s probably not for you, but come back later on. We’ll have some really cool non-tech postings, too.

The OnLive Arena

The OnLive Arena

To the user, OnLive is exceptionally easy to use: The latest high-end titles are available on PC and Mac (via a small browser plug-in) or on TV (via the OnLive MicroConsole). Games startup instantly. There is no physical media, no downloads, no patches, no updates, and no high-end hardware is needed to play the games. Pretty much any XP/Vista PC or Intel-based Mac will work. And, you never need to upgrade your PC, Mac or MicroConsole™: you’ll continue to be able to play increasingly higher performance games on your existing PC, Mac or MicroConsole.

But to achieve this level of simplicity, “behind the scenes” OnLive is an immensely complex computing system. It’s a type of computing system called a “cloud computing” system, because computing occurs in a data center within the Internet (aka “the cloud”). But, OnLive is a cloud computing system that is quite different.  In this post, we’ll explore one of those differences: how in a typical OnLive session you use many different computers (called “servers” because they are in data centers), and how you seamlessly transition from one server to another.

When you are using OnLive, while it seems like you are using just one immensely powerful server that is constantly providing a non-stop video experience, nothing could be further from the truth. Actually, from the moment you start up OnLive you are using many servers working together in a myriad of different ways, sometimes with a server dedicated to your use, sometimes sharing a server with other users, sometimes using several servers at once, and sometimes a combination of some or all of the above.

For example, let’s consider a typical user who tried out OnLive at the Game Developer Conference and played for five minutes (say, navigating the user interface, playing a few games, snapping and watching Brag Clips™, and spectating other users playing). Given that range of activities, the user easily used more than a dozen servers at different times. Just to identify a few: some OnLive servers ran (i.e. “hosted”) particular games, other OnLive servers hosted the user interface, and others handled the distribution of spectating video streams and Brag Clips.

As the user transitioned from one experience to another (e.g. clicking in the user interface to start a game), OnLive would “hand off” the user from one server to another, transferring the “user state” (e.g. all the data unique to that user, including the live characteristics of the Internet connection) from the user interface server to the game server, while switching the live compressed HDTV video/audio from the user interface server to the game server. And, all of this occurred on a video frame boundary. So, from the point of view of the user, it seemed like the video was just continuing onward from the user interface video to the game video as if it was running on the same server. In actuality, it was seamlessly handed-off from one server to the next.

And, when using OnLive, you are using even more servers than just the ones you transition to. For example, massive spectating (when you watch lots of thumbnail video windows of live games being played) is tapping into “IP Broadcasts” (i.e. data broadcasts over OnLive’s internal networks) of the live video generated by many different servers hosting many other users. And, when you play back a Brag Clip, yet another server is handling that for you. So, one question you might ask is, why does OnLive go to all of this trouble to transition users around from server-to-server? There are 4 main reasons: 1) many things (e.g. massive spectating) simply can’t be done with one server, 2) it allows us to always provide users with state-of-the-art performance, 3) it dramatically lowers our cost of operations, and 4) it dramatically reduces power consumption.

For example, if a user decides to play a very high-performance game, the user will be transitioned to a very high-performance server that can handle the game. If the user is running a lower-performance game, then the user will be sent to lower-performance server (OnLive has many classes of servers), and, in the case of many games, we can have more than one user share a single server without any impact on gameplay (“real-time virtualization”).

Every six months or so, we install new servers with the latest GPU and CPU technology, able to run the latest most advanced games. But the older servers are still fine for running lower-performance games (or, say, the OnLive user interface), and users never know what server(s) or shared servers are hosting their games. Needless to say, this not only gives gamers access to the very latest gaming hardware, but it also dramatically reduces OnLive’s costs of operation since, at any given time, many users are playing games (or in the OnLive user interface) and require less than state-of-the-art performance. And, from a user’s point of view, the experience is always fast and high quality because each game plays on a server providing the level of performance required. But of course, behind the scenes, OnLive transitions the user seamlessly from server-to-server, leaving the user with the perception of simply having one incredibly high performance and flexible computer.

Finally, OnLive consumes far less energy by only providing each user with as much computing power as is needed for the particular task the user is doing. Not only is this good for the environment (particularly if the user is using an OnLive MicroConsole in the home, which only consumes about a few watts), but it also further reduces OnLive’s costs of operation. Good deal all around.

So, OnLive not only provides you with far more computing power than any single computer or console when you do need it, OnLive provides you with far less computing power when you don’t. Gameplay is always state-of-the-art, but cost of operations and energy consumption is minimized.

I hope you found this OnLive tech overview interesting. As you can imagine, designing and building this technology was really fun. It’s rare to have a chance to design a mass-market system based on a completely different view of computing, yet one that provides an experience to the user where all of the complexity and tricky engineering is invisible.

More cool tech postings to come…

—Steve Perlman, OnLive Founder & CEO

Welcome to OnLive

Posted in OnLive 2009 with tags , , , , , on May 7, 2009 by Steve Perlman
Steve Perlman unveils OnLive at the 2009 Game Developers Conference

Steve Perlman unveils OnLive at the 2009 Game Developers Conference

Hey there. Welcome to the OnLive Blog.

I’m Steve Perlman, OnLive Founder and CEO. It’s been about a month since we announced OnLive at the Game Developer Conference (GDC) in San Francisco. In that short amount of time, we’ve seen an incredible level of interest among gamers, people in the video games industry and also people involved in technology and media. It’s been amazing (and fascinating) to watch people turning over the concept of cloud-based gaming on demand and looking at it from different angles and through different lenses. We definitely get the sense that OnLive’s announcement touched a nerve.

And, it was such a blast watching people use OnLive at GDC. There’s nothing quite like seeing someone who has never used a new technology walk up to it and start exploring it from scratch. We get extremely valuable feedback from “fresh eyes”, and over the three days of GDC we rotated team members from the OnLive development team to staff the demonstration kiosks. It was great for them to get direct exposure from people interacting with the OnLive system and also great for game developers curious about OnLive to get very informed answers to questions.

We collected and reviewed feedback from people that tried OnLive at GDC (really informative!), and folded it into the OnLive development process, continuing to refine the OnLive Game Service as we get it ready for our Beta program. One of the awesome things about a cloud-based technology is it gives us enormous flexibility to continue to tune and refine the system, not just now, during development, but on an ongoing basis after Launch. We are very much looking forward to that (it’s a software developer’s dream), and we think you’ll enjoy using a service that steadily gets better without requiring updates or upgrading hardware.

Of course, we still have plenty of work to do before OnLive will be available, but we want to start sharing our thoughts about OnLive in more depth (and less formally) than we do on the main onlive.com website. We’ll be communicating directly to you. You‘ll be seeing me contributing some more entries, and you can look forward to postings from other OnLive team members and perhaps a few special guests. We’ll use this space to keep you posted on OnLive developments while also sharing our thoughts on the past, present and future of the video games industry.

There is a lot to say. We very much believe that OnLive marks the beginning of a new era in entertainment. Again, welcome to the OnLive blog.

I very much hope you enjoy it.

—Steve Perlman, OnLive Founder & CEO