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OnLive was sold for just $4.8 million
OnLive was sold for just $4.8 million
October 10, 2012 | By Mike Rose

October 10, 2012 | By Mike Rose
More: Console/PC, Business/Marketing

Troubled cloud gaming company OnLive was sold for just $4.8 million earlier this year as it went through the insolvency process, a report from San Jose Mercury News states.

OnLive sold all of its assets to an unnamed company in August, letting go of all of its staff in the process, although the exact details of the deal were not divulged.

Now a new report states that venture capitalist Gary Lauder paid $4.8 million for OnLive just before the liquidation of the company was set to happen.

Joel Weinberg, CEO of Insolvency Services Group, the company named as the assignee in the insolvency, noted that the amount was the best that OnLive could have hoped for. Weinberg's lawyer confirmed with Mercury News the authenticity of the detailed letter.

Notably, the letter also states that OnLive had at least $18.7 million in outstanding debts before the sale, meaning that the company's creditors will now receive no more than around 26 cents for each dollar that they were owed.

In comparison, Sony paid approximately $380 million for rival cloud gaming company Gaikai earlier this year, with the aim to deliver cloud gaming and other streaming content on "a variety of internet-connected devices."

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Alex Nichiporchik
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There goes the whole cloud gaming hype.

Bob Charone
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poor Sony overpaid by $375 million for Gaikai it seems!

Nooh Ha
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Remember, OnLive had a load of patents which will have been included in the assets. Gaikai had just one.

So, they overpaid by $379m IMO...

Alan Rimkeit
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Yeah, someone over at Sony really screwed up there. Of course David Perry, Rui Pereira, and Andrew Gault are all LOVING IT. ROFL.

Jeremy Alessi
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I still think this concept has merit but in many ways it was based on the limitations of graphics hardware. These days it's just not an issue anymore. Graphics are no longer the driving factor of the industry.

Rodolfo Rosini
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Just to clarify some of the comments:

- the patents are not part of the sale as they were Perlman's own, they were just licensed to OL

- in order for cloud gaming ever to cater beyond the demo/presale stage (where Gaikai shined hence why it was acquired) the tech needs to support virtualization (i.e. more than one concurrent player per box). until then the economies of scale do not make sense no matter how hard OnLive PR rep inhale from that bong trying to tell you otherwise

Skylar Kreisher
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It's interesting to look back at all the buzz around OL and how the investors seemed to think it would revolutionize the industry and make traditional digital distribution models obsolete. Fund managers who don't understand game consumer's behavior shouldn't be investing in untested game markets. Unless DARPA reinvents the internet, server-side game processing and content generation will always result in some meaningful latency. They didn't need to spend hundreds of millions of dollars to find out that consumers wouldn't be interested in an inferior experience. Anyone who's ever tried playing a modern game on a HDTV with 120Hz+ buffering turned on knows that realtime games are nearly unplayable when there's even the slightest delay.