OnLive bankruptPosted 10:48 pm on Saturday, August 18th, 2012 by James Martinez
A few days ago you might have heard this small story that quickly became a reality. OnLive, the cloud-based gaming company, ran out of capital. Its CEO Steve Perlman has been fundraising for the company “non-stop”. But as of this week, he just couldn’t make enough to keep everything running. This all came down to not being able to predict how many servers they would need to run the service, since they couldn’t they purchased thousands of servers; 8,000 to be exact.
The OnLive user based topped out at 1,600. Not only did OnLive have the servers, but it also purchased all the networking equipment to interconnect everything too. As with any large-scale server farm, maintenance is key. OnLive was locked into lengthy contracts that was burning all of OnLive’s capital.
During the last company meeting at OnLive, CEO Steve Perlman lined out everything, from the issues with the servers, and the explosion of employees to try to keep everything running. Steve was very apologetic to his employees about the whole ordeal, taking blame for where the company ended.
To pay off its creditors, OnLive entered into what is known in California as an “Assignment for the Benefit of Creditors. It’s a form of bankruptcy. All the employees got laid off as a new smaller staff will be hired. Obviously this is very sad to see. OnLive has had no downtime in bringing its service to its users but just didn’t have the customer base it needed to be profitable. During this changeover, all services will continue to work and “future products and services” will be unaffected.
OnLive is a great service if you have the bandwidth to take full advantage of it. I hope the company can grow from this and become the success and can be.
James likes racing games, puzzle games, and building computers. By day he works as a systems administrator, by night he is a writer. He likes to be comical and open to new ideas and technology.