OnLive sold to Sony, service will be shutdown soon
OnLive, the struggling company that made the OnLive cloud based streaming gameplay service has decided to shut the shop. Today, OnLive has announced on their blog that they will not be able to keep the company running and that they will be selling much of their assets to Sony Corporation. Those who have purchased OnLive console will be able to continue using the service until 30th of April 2015. A new company OL2, Inc. is formed to buy the assets.
“We were driven by analyzing the opportunity based on first principles, and held off selling until we had proven critical milestones. We are happy that Sony is validating the innovations of OnLive by purchasing our IP and selected assets, and are immensely proud of the work that has been done by the talented team at OnLive, and we thank them for their amazing work. We are also grateful to our customers, game publishers, distribution partners and many other partners who have helped make this a reality over the years. We look forward to a bright future for cloud gaming at Sony.“, said, the OnLive team.
Though OnLive improved its tech and business model since 2012, though they had a healthy conversion rate of 64-78% for free trial to paid subscribers, OnLive could not increase the lifetime value (TLV) of a subscribe and it stayed well below the cost to acquire subscribers. This led to where they are today. Selling the assets to Sony makes lot of sense as, in today’s world, it is better to be part of a company that sells lot of game consoles and titles and have cloud gaming as an ‘add-on’ instead of ‘the only option’.
