Bankruptcy Letter Reveals OnLive's "Death's Door" Price

[Karloff]

Bankruptcy Letter Reveals OnLive's "Death's Door" Price

The online gaming company OnLive still owes creditors $18.7 million. Even after its buyout.

You may recall that, when the purchase of troubled gaming company OnLive took place in August [http://www.escapistmagazine.com/news/view/119158-Venture-Capitalist-Bails-Out-OnLive], the deal closed for an unknown sum of money. Thanks to a letter from Insolvency Services Group - the company handling OnLive's bankruptcy process - now we know what it takes to buy a company at what consultant Geoffrey Berman described as a "death's door" valuation: $4.8 million. That price tag still leaves OnLive's creditors short $18.7 million, never mind an $80,000 tax bill that OnLive also owes.

Creditors can expect to see about $0.26 on the dollar when all claims are settled. One creditor, Regina Chan of family-owned bakery Prolific Oven, is still looking for the $2,000 that OnLive racked up in unpaid bills. "It's unfortunate for us because we are small," Chan said. The $2,000 represents about a month's worth of snacks that OnLive never paid for.

According to Insolvency Services Group, the deal was the best OnLive could hope for in the circumstances. OnLive had just enough cash to settle payroll obligations and nothing else, which meant that its patents and other IP were vulnerable. Without those assets or funds to market them, OnLive was one auction away from total extinction.

Insolvency Services Group has settled some of OnLive's original $30-40 million debt burden, but that still left a considerable amount of money owing to creditors like the Chan family bakery. OnLive is still up and running, thanks to the buyout. According to Silicon Valley's Mercury News, OnLive has claimed that the problem with its previous incarnation was not its business model, but its lack of capital. Perhaps new owner Gary Lauder has some ideas as to where that capital might come from.

Source: Mercury News [http://www.mercurynews.com/business/ci_21735364/onlive-assets-palo-alto-gaming-company-were-sold-4-million]

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[itsthesheppy]

Remember when this was the revolutionary future of gaming?

 

[TheMadJack]

Remember when this was the revolutionary future of gaming?

Exactly. Problem is the future is a fleeting thing.

 

[Lt. Rocky]

I was never welcoming with OnLive to begin with. The idea of cloud gaming sounded great, but what kept me away was the fact that if you stopped paying the monthly subscription, all the games you bought would be taken away from you.

Bullshit, I say.

 

[schmulki]

Remember when this was the revolutionary future of gaming?

No, I don't. I remember when they were telling me they were the future of gaming and I remember thinking, "interesting idea but no, this really isn't going to work, too many places where lag can hit and too much tech needed for the average user," but I don't remember them being the future of gaming.

 

[mad825]

Onlive seems to have their money in the clouds

 

[Ralen-Sharr]

I thought it was a bad idea to begin with, having latency affect you in a single player game would kinda crap on the experience.

 

[tautologico]

I thought (along with a lot of people) that it was not the right time for something like this from the beginning, but it's hard to say before trying. It's still quite possible that a company will be successful with the same idea in the future, especially with distribution models becoming more and more based on digital distribution.

I was never welcoming with OnLive to begin with. The idea of cloud gaming sounded great, but what kept me away was the fact that if you stopped paying the monthly subscription, all the games you bought would be taken away from you.

Bullshit, I say.

Maybe that's what they were able to negotiate with publishers at this time. It would be more sensible to maybe pay a monthly fee only and have a number of slots (depending on how much you pay) where you can put whatever game you want, and you only can change games in slots every so often. Kinda like Netflix for games. But I doubt publishers would like this model now. In the future, when more of the distribution goes through digital channels, publishers may change their minds and allow such a model to exist.

 

[Zipa]

Onlive is a good idea but it just won't work at this time, the internet backbone and infrastructure of many countries including large parts of the USA is just not there yet. Hell a lot of places in the UK still do not have fiber optic broadband (about 33% of households do) , my own town only just finished getting upgraded at the end of September. Maybe in 10-15 years it will work a lot better when more countries upgrade their internet backbone.

 

[The White Hunter]

Onlive is a good idea but it just won't work at this time, the internet backbone and infrastructure of many countries including large parts of the USA is just not there yet. Hell a lot of places in the UK still do not have fiber optic broadband (about 33% of households do) , my own town only just finished getting upgraded at the end of September. Maybe in 10-15 years it will work a lot better when more countries upgrade their internet backbone.

The cables for fibre optic broadband travel straight down the main street in my town. But we can't use it. I hate this country sometimes.

OT: Meh, never used it, heard it was alright but my internet would die if I tried such things.

 

[Zipa]

Onlive is a good idea but it just won't work at this time, the internet backbone and infrastructure of many countries including large parts of the USA is just not there yet. Hell a lot of places in the UK still do not have fiber optic broadband (about 33% of households do) , my own town only just finished getting upgraded at the end of September. Maybe in 10-15 years it will work a lot better when more countries upgrade their internet backbone.

The cables for fibre optic broadband travel straight down the main street in my town. But we can't use it. I hate this country sometimes.

OT: Meh, never used it, heard it was alright but my internet would die if I tried such things.

Sky told me that I don't live in a fiber optic cable area and are adament about their is no fiber optic exchange near me. Meanwhile at the top of my road is a fiber optic exchang which I have to drve past each day that has a big BT banner on it saying fiber optic now available. I am likely going to swap back to BT anyway since sky just jacked up their line rental.

 

[Albino Boo]

The 18.7 million is only going to be chargeable against the proceeds of the sale to the current owners. They debt from the old company does not transfer to the new company. Thats the whole point of an assignment for the benefit of creditors. The new owners is a venture capital firm with a 25 history of investments in interactive TV. Admittedly this is their most high profile investment but seeing the CEO is member of the Estee Lauder family he is not personally short of bob or two. The Lauder family are worth the best part of $30 billion.

 

[The White Hunter]

Onlive is a good idea but it just won't work at this time, the internet backbone and infrastructure of many countries including large parts of the USA is just not there yet. Hell a lot of places in the UK still do not have fiber optic broadband (about 33% of households do) , my own town only just finished getting upgraded at the end of September. Maybe in 10-15 years it will work a lot better when more countries upgrade their internet backbone.

The cables for fibre optic broadband travel straight down the main street in my town. But we can't use it. I hate this country sometimes.

OT: Meh, never used it, heard it was alright but my internet would die if I tried such things.

Sky told me that I don't live in a fiber optic cable area and are adament about their is no fiber optic exchange near me. Meanwhile at the top of my road is a fiber optic exchang which I have to drve past each day that has a big BT banner on it saying fiber optic now available. I am likely going to swap back to BT anyway since sky just jacked up their line rental.

I don't pay for ours and Sky can kiss my ass thy made us pay to replace a shit router that they gave us a few weeks ago new one isn't too much fucking better but at least the wireless will actually connect now.

 

[Zipa]

Onlive is a good idea but it just won't work at this time, the internet backbone and infrastructure of many countries including large parts of the USA is just not there yet. Hell a lot of places in the UK still do not have fiber optic broadband (about 33% of households do) , my own town only just finished getting upgraded at the end of September. Maybe in 10-15 years it will work a lot better when more countries upgrade their internet backbone.

The cables for fibre optic broadband travel straight down the main street in my town. But we can't use it. I hate this country sometimes.

OT: Meh, never used it, heard it was alright but my internet would die if I tried such things.

Sky told me that I don't live in a fiber optic cable area and are adament about their is no fiber optic exchange near me. Meanwhile at the top of my road is a fiber optic exchang which I have to drve past each day that has a big BT banner on it saying fiber optic now available. I am likely going to swap back to BT anyway since sky just jacked up their line rental.

I don't pay for ours and Sky can kiss my ass thy made us pay to replace a shit router that they gave us a few weeks ago new one isn't too much fucking better but at least the wireless will actually connect now.

Im ditching their asses, because despite advertising fiber optics on their website and it being available from BT they claim I dont live in a area with fiber cables. Dipshits. That and they are jacking the prices up. Still though I can't complain about the router I have, its on and downloads a shitload and hasnt died on me yet. Though it sometimes does derp out.

 

[The White Hunter]

Onlive is a good idea but it just won't work at this time, the internet backbone and infrastructure of many countries including large parts of the USA is just not there yet. Hell a lot of places in the UK still do not have fiber optic broadband (about 33% of households do) , my own town only just finished getting upgraded at the end of September. Maybe in 10-15 years it will work a lot better when more countries upgrade their internet backbone.

The cables for fibre optic broadband travel straight down the main street in my town. But we can't use it. I hate this country sometimes.

OT: Meh, never used it, heard it was alright but my internet would die if I tried such things.

Sky told me that I don't live in a fiber optic cable area and are adament about their is no fiber optic exchange near me. Meanwhile at the top of my road is a fiber optic exchang which I have to drve past each day that has a big BT banner on it saying fiber optic now available. I am likely going to swap back to BT anyway since sky just jacked up their line rental.

Im ditching their asses, because despite advertising fiber optics on their website and it being available from BT they claim I dont live in a area with fiber cables. Dipshits. That and they are jacking the prices up. Still though I can't complain about the router I have, its on and downloads a shitload and hasnt died on me yet. Though it sometimes does derp out.

I've had 2 of them die, in part because they're kinda cheap and shoddy and in part because morons in my house constantly turn the thing off. The new one derps out when the phone rings though and demands I reboot my PC to continue using it.

I'm moving away soonish anyway if I can help it and I'm likely to switch over to Virgin media.
I don't pay for ours and Sky can kiss my ass thy made us pay to replace a shit router that they gave us a few weeks ago new one isn't too much fucking better but at least the wireless will actually connect now.

Edit: Done derped sorry.

 

[redisforever]

Shame. They actually tried something new, and it worked, kind of. Welp, not like it was unexpected.

 

[TheDoctor455]

I was never welcoming with OnLive to begin with. The idea of cloud gaming sounded great, but what kept me away was the fact that if you stopped paying the monthly subscription, all the games you bought would be taken away from you.

Bullshit, I say.

Only for one part of the catalog.

There's another section where you only pay once, and you keep that game forever.
Or at least as long as the service is still running.

Which... I hope it'll keep running.
Love Onlive.