On the operation of massively multiplayer online games.
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  • … And We’re Gonna Try

    Posted on March 25th, 2009 Bryant

    Speaking of streaming games, OnLive wants to implement that cloud gaming solution. 720p resolution at 60 FPS — hey, that’s really similar to what Dyack was saying would be possible, huh? I think some people are going to be disappointed, since there’s not much OnLive can do about intermediary network problems, but we’ll see.

    This leaves the question of cost. I’m wondering about the cloud computing resources OnLive plans on using. Barring substantial rewrites, the cloud would need to have either high end video cards or something capable of a really good emulation, right? Maybe some custom hardware to provide banks of nVidia/ATI processors? You wouldn’t run this on a standard cloud, because a standard cloud doesn’t provide really good DirectX capacity.

    I can’t really speculate honestly because they don’t talk about their pricing model at all. If they charge a buck an hour, then they’re making enough per year ($8,760) to pay for a single desktop-class computer outright. Assume hosting is another couple hundred bucks a month? I don’t know, because I don’t know what their hardware is. Add on headcount for ops, headcount for everything else, a percentage for the game publishers. I don’t think that really adds up well even if you amortize it out over three years. I’m also simplifying, because the majority of computer equivalents won’t be in use 24/7.

    $20/month for an all you can eat subscription? There are 720 hours in a month. Say we’re targeting an average of $2/hour for hours played. The average usage for this ought to be higher than 10 hours a month. You’re selling convenience, after all.

    $10 for 24 hours in realtime with one game? That’s not going to fly with consumers.

    Whoops, I speculated after all. It’s an intriguing question. Steve Perlman has a decent track record, so I can’t assume this is just a publicity bubble. He does seem to be the kind of guy who’ll spend as long as it takes to polish a product. We may be waiting longer than Winter 2009 to see this sucker.


    4 responses to “… And We’re Gonna Try”

    1. Chris K

      I don’t think you’d go broke if you planned to lose a little money on the player who plays one game exclusively for, say, 30 hours a month – so long as you’re not losing any more money if he goes on spring break and plays that same game for 60 hours in a week. I think the real money comes from charging people for getting bored – same as the price difference between basic cable and premium channels. Well, and charging people who forget to cancel their account, too.

      It seems like you just about have to charge people monthly, hourly, and per game in some way. The monthly charge has to be there to make money off the person who doesn’t really have time to play but can afford to not cancel (both symptoms of having a job), the hourly charge has to be there to prevent a four-person dorm room from playing 20/hrs a day, and the per game charge has to be there (in some form, even if it’s just a premium on the monthly fee to have access to more games) to make money off people who are willing to pay extra to play 20 different games in one month.

    2. Bryant

      I don’t know if triple charges would fly. Double charges, maybe — we pay for cable and then we pay again for On Demand, right? Except I just pay once for Netflix.

      You could maybe make the premium fee apply if you want to play more than X games, no matter which ones they are. I.e., it’s a volume fee, not a premium game fee.

    3. Chris K

      That’s pretty much the system I was envisioning – I just think that someone who just wants to be able to play Crysis 30 hours a month will pay less than someone who wants to play every major release this month for 5 hours each. It will also be very easy for the former to decide he wants to be the latter, so he can make two separate $30/month decisions instead of one $60/month decision. (“Look at all these great games that were released in the past two months! Each retails for $50, but for $5 each, you can play all of them as much as you want*! * – premium account includes X hours per month.”)

    4. […] OnLive claims are continuing to spark debate. Mostly of the form “sha, right, that’s not […]

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