OnLive's MicroConsole gets a release date; will it make a difference?

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I really enjoy OnLive's streaming game service in theory. It works quite well and I often fire it up to mess around in a game demo or peek in on some stranger playing a game (you can block that if you don't want people watching you). But in practice I don't really dig into OnLive's games very much because I already have a ton of games on my PC.

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This is why I'm really excited that OnLive's "MicroConsole" starts shipping on December 2nd. Now I can easily take OnLive into the living room. Instead of sitting in my office chair I'll be stretched out on the couch playing PC games that have been tailored to work with the included controller. If OnLive can get good traction on this idea (and to do that they really need to build out their library of games) then the console makers might have reason to start worrying.

Think about it. For $99 you get the MicroConsole, a wireless controller, an HDMI cable and (for now at least) a voucher for a free game (valued up to about $50). That's a pretty good deal for a family on a budget. Of course there's a catch: you need a fast broadband connection (at least 3 Mbps, 5+ Mbps recommended) to use the service. Games generally cost the same as they do in stores (around $50 for new AAA titles with the price dropping as a game ages). Now these days a lot of console gamers rent, rather than purchase, their games. OnLive supports what is essentially renting a title by selling a 3-Day or 5-Day pass for a few bucks (the price varies but as a rule of thumb figure about two dollars per day), except you don't need to get in the car and drive to a store to rent them. In fact OnLive is the perfect couch-potato game console since you don't even have to get up to swap disks!

Of course this will all be meaningless if the MicroConsole doesn't work well. I've already pre-ordered mine and will post a review once it arrives and I've put it through its paces, but OnLive supplied some journalists with review units ahead of time, and so far what I've been hearing is pretty positive. Joystiq said:

Controller flakiness aside, I have to say that I consider the OnLive MicroConsole (and its controller) to be a pretty fantastic piece of hardware. It's instant-on and relatively quick to get into games, the navigation's snappy and, as hard as it has been to believe, the picture quality from a normal viewing distance is largely superb.

(The reviewer had some situations where he had to pop the batteries out of the controller in order to reset it and get it to sync with the console; a problem he hopes will be fixed in the retail version.)

VentureBeat ran a 15 minute video interview with OnLive CEO Steve Perlman which offers a nice overview of the MicroController and the service. I'll embed it below.

The business model still makes some gamers uncomfortable since you're paying full price for a game that you don't physically possess. If OnLive closes down your investment is lost. That's a valid concern, but what might alleviate it to some extent is news that OnLive is adding a flat-rate subscription service that will give you access to older games and indie titles. Think of it like a Netflix of gaming. The newest titles won't be covered (though you'll still be able to buy them). OnLive says to expect more information on this new angle to their service some time in December. Assuming its priced attractively this could entice some of the skeptics to give the service a try.

One other major hurdle stands between OnLive and success: the social aspect of gaming. OnLive gamers play in a silo with other OnLive gamers (to the best of my knowledge). If I buy Borderlands on OnLive and you buy a boxed retail copy, there's no way for us to play together. A related problem is that none of the social gaming IM services (such as Raptr or XFire) work with, or track, OnLive games. It'd be wonderful if OnLive could figure out a way to break out of their silo and integrate with the general PC gaming landscape, but I'm not sure if that's possible. Make no mistake, OnLive is very social inside its silo, so if your friends are all on the service none of this will be a concern. But at this early stage that isn't very likely.

I'll have more to say about OnLive after I get my hands on a MicroConsole, but in the meantime I'm interested to know if anyone on the fence about the service is swayed by the opportunity of easily moving your PC gaming into the living room (yes, I know you can hook up a gaming PC to a big screen TV but the fact is most people don't, nor are off-the-shelf PC games optimized to use a gamepad like OnLive games are). How about it?

Peter Smith writes about personal technology for ITworld. Follow him on Twitter @pasmith.

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