OnLive Sheds Details on Implosion
Promises They'll Continue to Operate As Normal
Last Friday we noted
that broadband streaming game service OnLive mysteriously and suddenly fired all of their employees with no notice or severance package. Significant additional detail has surfaced since then, with the company announcing that OnLive and all assets have been acquired by a newly formed company, with VC firm Lauder Partners being the new company's"first investor." About half of the fired employees will be hired back, with some additional employees brought in on a consultant basis.
In explaining the rather shady-sounding transformation, the company says they've decided to restructure under an "Assignment for the Benefit of Creditors" arrangement that prohibited them from bringing OnLive shares or employees along for the ride. For whatever it's worth, the company insists that that OnLive will continue to function as it always has:
The OnLive Game and Desktop Services, all OnLive Devices and Apps, as well as all OnLive partnerships, are expected to continue without interruption and all customer purchases will remain intact; users are not expected to notice any change whatsoever. OnLive’s current initiatives will continue as well, with major announcements of new products and services planned in the coming weeks and months.
While the company says they have roughly 1.5 million, it's thought that the company's active, consistent user base is only a fraction of that: somewhere in the range of 2,000 users. Here's a full FAQ from the company for those interested:
Q. Will users see any change in the OnLive Game or Desktop Services? What about their purchases?
A. Users should see no change in the OnLive Game or Desktop Services. All of their purchases remain intact and available. OnLive has been up 24/7 since launch over two years ago and expects to remain so. OnLive has over 2.5 million subscribers, with an active base of over 1.5 million subscribers, connecting from a vast range of devices and networks, with many sessions running for hours. The user base is growing rapidly with OnLive’s addition into recently announced devices and TVs from major manufacturers. We expect this growth to continue under the new company.
Q. Is there any cash or stock in the new company provided for any OnLive, Inc. shares?
A. Unfortunately not. The nature of the transaction is such that only assets, not shares, were purchased. This is true for all shares of OnLive, Inc., whether held by investors, employees or executives.
Q. Did Steve Perlman receive stock or compensation in this transaction?
A. Like all shareholders, neither Steve nor any of his companies received any stock in the new company or compensation in this transaction at all. Steve is receiving no compensation whatsoever and most execs are receiving reduced compensation to allow the company to hire as many employees as possible within the current budget.
Q. Did all OnLive, Inc. assets transfer into the new company? Are any assets held by any other party?
A. All of OnLive, Inc.’s assets (e.g. technology, patents, trademarks, etc.) were transferred to an assignee, which then sold the assets to the new company. There was no transfer to any other party.
Q. Have OnLive, Inc. employees been offered positions in the new company?
A. Almost half of OnLive’s staff were offered employment at their current salaries in the new company immediately upon the transfer, and the non-hired staff will be given offers to do consulting in return for options in the new company. Upon closing additional funding, the company plans to hire more staff, both former OnLive employees as well as new employees.
The new investor Gary Lauder, is the first investor in the newly created OnLive.
Gary Lauder is one of the heirs of the multi-billion dollar Estée Lauder perfume fortune. »www.ft.com/cms/s/2/0099049a-0d51···434gHA1m
Who: Gary Lauder (b 1962), Williams younger brother. Managing partner of Lauder Partners, a venture capital firm based in Silicon Valley.
Rise to power: the only one of Estées grandchildren not to work for the family company, Gary has a BA in International Relations from the University of Pennsylvania, a BS in Economics from Wharton and an MBA from Stanford Graduate School of Business.
Out of the office: Gary co-created Aspen Institutes Socrates Society with Laura, his wife. The society aims to bring together emerging leaders from various professions to explore contemporary issues.
late to game... OnLive, if say, came to market in 2008, then they might have been bought by one of the "big three" (Xbox, PS3, Wii).
However, without content, commitment and exposure (I never heard of them except Joystiq blog), it is really late.
IMHO, history (Atari's Jaquar, NEOGEO, ...) shows that even if your console is better (graphics, play, resources...), if the market is saturated and economically poor, a risk is it is on the down turn.
Look how rumored EA is shopping around...it's worth is finite. You can't bet on FPS forever. And until platforms change (recall PS3 is a 10yr plan, where Xbox is on 8th revision). And my gaming friends (which are a good reference) note that content seems to be "A" through "AAA" titles released for 3rd quarter (Oct-Dec). Note all "top" titles are Sept/Oct and Nov release for Christmas.
said by brianiscool:Just the opposite for me. I tried it when I had the 35/35 service. I was surprised how responsive it was when playing a FPS on their service.
So, when this company came out I was very skeptical. Tried using their service, but it was extremly delayed. My connection is 35/35 and I was no impressed. The only good thing for this service if you want to demo a game.
| |AVDRespice, Adspice, ProspicePremium
said by brianiscool:C is constant
Maybe in 10 years we will be able to defeat latency.
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