Steve Perlman shows off OnLive's disruptive MicroConsole (video)
Steve Perlman, chief executive of instant-play game company OnLive, is also chief pitch man for the company's games-on-demand service. Today, the Palo Alto, Calif.-based company is announcing it is taking pre-orders for its $99 MicroConsole and wireless controller.
Context & Ripple Effects
This is the moment OnLive stops being a software story and becomes a hardware one. The company opened its beta program in September 2009 and launched the pure-streaming service to the public in June 2010, when reviewers finally tested it in uncontrolled home settings rather than optimized demo conditions. With the $99 MicroConsole and wireless controller now open for pre-orders, Steve Perlman is putting a physical box in living rooms — a deliberate contrast with the $250-plus consoles it undercuts on price.
The pitch is that cheap client hardware plus data-center rendering changes who pays for compute in gaming. Engadget's hands-on pickup the same day shows the announcement travelled beyond the trade press, which matters because consumer skepticism after the June home tests was precisely about whether real-world broadband could carry the experience.
First-order effects
- Buyers get a $99 entry point into cloud gaming this holiday season — roughly a quarter of a current-generation console's price — shifting OnLive from a browser-and-PC service to a set-top proposition competing directly for TV inputs.
- Perlman's dual role as CEO and chief pitch man signals the company needs direct consumer demand to justify the server farms it has already built out since the 2009 beta.
Second-order effects
- Sony, Microsoft, and Nintendo face a competitor whose pricing floor isn't tied to subsidized hardware economics — if streaming holds up at home, their console-upgrade cycle becomes the thing consumers can skip.
- Broadband quality moves from background infrastructure to a gating purchase criterion, pushing ISPs into the gaming value chain as de facto gatekeepers of the experience.
Third-order effects
- If the pattern holds, game distribution splits between disc-and-download consoles and thin-client services where the marginal cost of a new 'device' approaches zero — forcing incumbents to decide whether to build their own cloud layers or fight the model.
- The capital intensity of data-center rendering concentrates cloud gaming among players who can fund server buildouts, making hardware announcements like this one a test of whether subscription-scale demand actually materializes behind the pre-order buzz.
The trend: Cloud gaming is moving from demos and betas toward living-room hardware, with cheap thin clients like the MicroConsole testing whether consumers will trade local consoles for streamed play.