Gamertell

When OnLive was unveiled to the public at GDC 2009 it sparked many discussions about the future of gaming. It also led many to believe that the idea behind OnLive is a good one but we currently lack the ability to make it work on a large scale.

OnLive is a subscription-based gaming service that doesn’t require an expensive console or a high-end PC. It can be run on any computer through a simple plug-in or on televisions by using the OnLive Micro Console. All the data from the game would take place on OnLive’s servers which would stream the game back to your PC, Mac or television without lag or graphical imperfections. It would offer a lot of the games that can be found at retail without stripping out functions such as multiplayer gameplay.

The brains behind OnLive are confident in their ability to make OnLive work as planned but, unfortunately, we won’t be seeing the service at E3 2009. It seemed awfully strange that OnLive would miss out on one of the biggest gaming conferences in the country but OnLive’s Chief Operating Officer Mike McGarvey explained why OnLive will be absent on the OnLive blog.

McGarvey wrote about how games are going down the same road as the movie industry. Much like movies, games are getting much more expensive to make. He notes that the average multiplatform game can cost $30 million to produce, market and ship to retail stores. The standard price for such a game currently costs $60 and will have to sell a ton of copies in order to turn a profit. Publishers also have to eat the revenue lost by used game sales and piracy which makes it even harder to make money.

McGarvey thinks OnLive can solve that problem by doing away with packaging and distribution costs. They’re basically going to cut out the middle man.

So, the reason why OnLive won’t be attending E3 is because McGarvey sees E3 as a place for retail platforms and publishers. OnLive wants to be separate from the traditional practices the videogame industry must go through in order to be successful at retail. It’s beginning a new era of broadband videogame distribution and E3 is not a part of its master plan.

McGarvey ensures us we will be hearing more about OnLive this year. The external beta and launch is also expected to happen before we say goodbye to 2009.

Read [OnLive The Blog]