OnLive video gaming tech was sold for less than $5m

Cloud video gaming service OnLive was sold to a venture capital group for just $4.8m (£3m), it has emerged. The sale – which also involved many of the company’s workers losing their jobs, and investors writing off their stakes – took place in August.
Analysts had previously discussed the business being worth as much as $1.8bn. Its rival, Gaikai, was sold to Sony for $380m in July. Creditors were told efforts to secure a higher price might have backfired. Mercury News revealed the details after obtaining a letter from the firm handling OnLive’s bankruptcy-like process.
"Had the sale to the buyer not taken place, the assignee would have been left with inadequate capital to fund the significant costs to preserve and market OnLive’s patents and other intellectual property, thus greatly reducing expected recoveries essentially to those of a forced piecemeal auction," wrote Joel Weinberg, president of Insolvency Services Group (ISG).
Gaming’s future?
OnLive allows users to play "premium" PlayStation Xbox games over the internet, without the need for a console.
Remote servers run the software and stream video footage to users, who play the game using an OnLive gamespad on a computer, smartphone or television – in the latter’s case with the aid of a special adapter. Many gaming industry insiders have predicted subscribing to a cloud gaming package could ultimately become more popular than buying a dedicated games machine.
However, to date it has had limited appeal. OnLive has said it had 1.5 million "active users" at the time of the sale – although reports suggest that only about 1,600 subscribers were using the service at any one time. Even so, the unexpected sale of the firm to Silicon Valley-based venture capital group Lauder Partners caused controversy when it was announced.