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OnLive streaming game service closing on April 30 due to Sony buyout

Attributed to a Sony acquisition of patents likely related to streaming video games, the first major company that attempted to deliver live, playable streams of popular games is shutting down at the end of the month. OnLive launched the company’s streaming service approximately six years ago, but pivoted the business model a handful of times unsuccessfully in an attempt to gain users and generate revenue.

On the software side, OnLive attempted to attract users with a pay-per-game model as well as a $15-per-month subscription model that gave gamers access to streaming versions of games they already owned, specifically to play on devices like tablets and inexpensive laptops. On the hardware side, OnLive attempted to launch a $100 mini-console during 2010. Unfortunately, that piece of hardware never caught on with gaming audiences due to video quality issues as well as latency problems.

onlive microsoft
Image used with permission by copyright holder

Detailing the end of OnLive on the company’s site, a representative wrote “After five years of uninterrupted service, the OnLive Game Service will be coming to an end. Sony is acquiring important parts of OnLive, and their plans don’t include a continuation of the game service in its current form. Your service should continue uninterrupted until April 30, 2015. No further subscription fees will be charged, and you can continue to play all of your games until that date.

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For all existing subscribers, all stored credit data will be deleted at the end of the month as well as achievement data and saved games. No refunds will be issues on game purchases or subscriptions. Users that purchased hardware on or after February 1, 2015 can get a refund on purchased hardware by contacting the email posted on the FAQ page related to the closure.

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Regarding the Sony acquisition, the patents are likely related to Sony’s PlayStation Now cloud-gaming service. Often dubbed Netflix for games, PlayStation 4 owners can pay $20 a month for PlayStation Now to stream a large library of PlayStation 3 games.

Mike Flacy
By day, I'm the content and social media manager for High-Def Digest, Steve's Digicams and The CheckOut on Ben's Bargains…
Here’s why PlatinumGames and Sony are all-in on live service
Warriors look toward a beautiful sunrise and enemies in Babylon's Fall.

PlatinumGames President Atsushi Inaba turned heads in a recent interview when he indicated that the beloved Japanese developer would move away from the kind of single-player games it is known for. While PlatinumGames made a name for itself with linear, single-player action titles like Bayonetta and Nier: Automata, Inaba believes the company should make more titles that players can enjoy for long periods of time.
"When it comes to future game production, we want to focus on creating games that are different from the past," he told Famitsu (VGC translated the comments). "I would like to focus on creating games that can be enjoyed and loved for a longer period of time ... Considering the changes in the market over the next five years or so, I think it is absolutely necessary for us to do this."
Some fans fear this means PlatinumGames is about to embrace the live service segment of the video game market. This is worrying to some as Babylon's Fall, the first game of this kind for PlatinumGames, is shaping up to be a disappointing endeavor. Meanwhile, the single-player Bayonetta 3 looks like the kind of fast fun fans come to expect from the studio. 
PlatinumGames isn't the only studio chasing the live service dream. Sony is doubling down even more. After acquiring Destiny developer Bungie, Sony Chief Financial Officetr Hiroki Totoki revealed that PlayStation Studios plans to release 10 live service games by March 2026.
Games like this are controversial because they're monetized, and they vary vary in quality. You either end up a great success like Final Fantasy XIV or become an expensive failure like Anthem and Marvel's Avengers. So why are so many companies still pivoting to this model after high-profile disasters and disdain from hardcore gamers?
It pays to win
The answer is more straightforward than one might think. In reality, it comes down to what makes money. Yes, single-player games can still be successful and perform well for companies, but data from analysts highlights how much the DLC, microtransactions, and subscription elements of live service games make. Mat Piscatella, NPD Group executive director and video game industry adviser, explained this on Twitter, noting that 60% of non-mobile game content spending comes from DLC, microtransactions, and subscriptions.
https://twitter.com/MatPiscatella/status/1490711392449486851
It's not surprising that PlatinumGames executives see that the studio is leaving money on the table by not developing games that engage players like that. Bayonetta 3 could sell millions of copies when it launches later this year, but live service games could sell the same amount and then continue to make money years after launch.
Multiple analysts have recognized this trend too. Niko Partners senior analyst Daniel Ahmad tweeted a chart revealing that Sony made more from add-ons, microtransaction, and DLC content than digital and physical game sales combined. 
https://twitter.com/ZhugeEX/status/1490714400000512005
To stay appealing to investors and keep the business afloat, companies will go where the money is. This approach, unfortunately, can have some harmful side effects. We've seen it happen more recently with NFTs, but there's a history of live service games gone wrong as well. High-profile live service games like Anthem and Marvel's Avengers have failed because they got bogged down in nickel-and-diming players or did not ensure the quality of gameplay increased with the length. If your game isn't fun, no one's going to want to spend hundreds of hours in it just because they can eventually unlock some cool-looking things.
Babylon's Fall currently seems like it may not do well, so PlatinumGames needs to focus on quality if it continues to go down this path. 
Quality over quantity 
DLC and microtransactions do have a bad rap around the video game industry for a good reason. When companies merely focus on player engagement and sales data, they often forget to make games that players will enjoy. The best approach for Sony and PlatinumGames is to make sure the gameplay, story, and worlds are a lot of fun before they stretch the experience to last a long time. It also seems likely that neither PlatinumGames nor Sony should completely abandon the types of games they are known for.
In the same interview with Famitsu, Inaba states that PlatinumGames "would like to cherish and create small but brilliantly conceived games such as Sol Cresta, and games in which you can enjoy the process of clearing the game by going through one-off, well-designed stages, such as Bayonetta." Inaba also wants the games to feel like what the studio is known for, saying, "I want to lead PlatinumGames in a direction that is pure and unadulterated."
While Babylon's Fall makes this trend look worrying, we don't know if that's the only way PlatinumGames plans to create games that players engage with for a long time. PlatinumGames must learn from the shortcomings of Babylon's Fall and improve if it doesn't want to release a string of live service flops. 
Meanwhile, live service will be just one part of Sony's first-party game strategy in the future. While the Bungie acquisition may allow the company to make more live service games, plenty of single-player PS5 exclusives like Horizon Forbidden West, God of War: Ragnarok, and Marvel's Spider-Man 2 are still on the way. Sony also intentionally acquired Bungie because of its live service experience with games like Destiny 2, so it wants to approach that kind of game correctly. 
We've seen plenty of companies get the live service model wrong as it's a high-risk, high-reward market. To stay relevant, PlatinumGames and Sony might have to embrace forever games more than their fans may prefer. Still, if making great, fun games remains a priority, these companies shouldn't go off the rails anytime soon. They'll just make more money while doing it. 

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Sony will launch 10 live service games with Bungie’s help
Hive Guardians created by the Witch Queen Savathun

Hot off the heels of announcing its intent to acquire Bungie, Sony already has some grand ambitions for its move into the live service space. In an investor call, the company stated that it plans to launch at least 10 live service games over the course of the next four years, by March 31, 2026.

Sony's plan to forcefully move towards live service games is grand but will be aided, at least in part, by Bungie. "The strategic significance of this acquisition lies not only in obtaining the highly successful Destiny franchise," said Sony CFO Hiroki Totoki," as well as a major new IP that Bungie is currently developing, but also in incorporating into the Sony Group the expertise and technology that Bungie has developed in the live game services space."

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Sony doesn’t need an Xbox Game Pass killer — it already has one
PS4 (Playstation 4) using PS Now.

PlayStation Now was the first major step in game streaming services. Yes, we had plenty of other attempts with services like OnLive (which I also tried back in 2010), but none ever had the weight of a massive corporation behind it. Sony acquired the service formerly known as Gaikai in 2012 and transformed it into its very own exclusive streaming service that it's been working on to this day.

The thing is, after that initial purchase push, Sony has been pretty silent about PS Now. It's quietly gained 3.2 million subscribers as of March 2021, which isn't all that much when you compare it to the number of PS+ subscribers but is still a substantial number.

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