Will there ever come a time when an Xbox, a Playstation and a Wii can play together in true cross-compatibility?

Unless Microsoft (MSFT), Sony (SNE) and Nintendo (NTDOY) merge into one mega-conglomerate, it's not very likely. However, a company called OnLive might be able to circumvent all three.

This week, the folks attending the Game Developers Conference (or GDC) in San Francisco were treated to a peek at what will no doubt be the future of gaming: Streaming, high-quality titles in a community-based setting without lag, consoles or physical media. It will officially debut in late 2009, with a beta-testing session this summer.

Created by WebTV founder Steve Pearlman and former Eidos chief Mike McGarvey, OnLive is very different from current online gaming outlets: It doesn't require each title to be downloaded and installed; instead, they run instantly off a central server.

And unlike the Bejeweled game you currently have running in that Yahoo (YHOO) window, these top-tier titles are capable of running in HD (720 pixels) with no hiccups along the way - provided you have a powerhouse broadband connection. Otherwise, standard quality will have to do.

But the games themselves are what's turning heads. High-end titles like Crysis, Burnout: Paradise and GRID push the hardware capabilities of PCs and Xboxes to their limits -- the meeker Wii notwithstanding -- but run with barely any noticeable difference on OnLive.

This was never possible before without a significant download time.

Already, game publishers Electronic Arts (ERTS), TakeTwo (TTWO), THQ (THQI), Eidos, Atari and several others have signed on to have their games made available through the service.

OnLive works like this: Users install a base program on their PC or Mac to run the service, though a palm-sized device attached to your HDTV would also work. After paying a subscription fee, players can rent or buy games from OnLive's extensive catalogue, connect to friends through a community-based system, and launch a multiplayer session. All running instantaneously - which means no updating consoles or video cards.

Other than broadband speed, every upgrade remains server-side, and software patches occur without the need for user installation and bothersome trips to Gamestop (GME) or Best Buy (BBY). And software piracy also drops significantly.

Although the demo blew everyone away at the GDC, there are nagging concerns that might crush this too-good-to-be-true service. Since many people can barely get a Hulu video to stream without a handful of buffering breaks, would brief lapses in an OnLive connection mean an accidental death - or a completely crashed game?

Video compression is already in place for HD settings, but how far does it need to go when Wi-Fi slows to a crawl? And forget playing OnLive in a crowded Starbucks - all online packets need to be free.

Game publishers don't last forever - think Acclaim and Titus. Will the games of defunct developers remain? And what happens if OnLive goes under? Users will naturally have to eat subscription fees, but their entire gaming library will also go kaput.

OnLive has almost a year to iron out all the kinks. But in that time, gamers will be waiting with bated breath to see if it lives up to the hype.




In memory of our fallen friend and trusted colleague, Bennet Sedacca, 100% of the donations made to the RP Foundation through April will be channeled to philanthropic endeavors consistent with the RP mission, working closely with the Sedacca clan in the distribution of those funds. We thank you kindly for your support as we strive to effect positve change in the lives of children.