OnLive restructured under new management

Martyn Williams
20 August, 2012
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Cloud gaming service OnLive has been acquired by a new owner, it said. The move meant almost half of staff were laid off in a company restructure, but the company pledged to continue its operations.

In a statement today the company announced its recent changes:

“OnLive’s board of directors, faced with difficult financial decisions for OnLive, determined that the best course of action was a restructuring.”

“The OnLive® Game and Desktop Services, all OnLive Devices and Apps, as well as all OnLive partnerships, are expected to continue without interruption and all customer purchases will remain intact; users are not expected to notice any change whatsoever. OnLive’s current initiatives will continue as well, with major announcements of new products and services planned in the coming weeks and months.”

“An affiliate of Lauder Partners was the first investor in the newly-structured company, holding the view that OnLive is the future of computing and entertainment, and a passion to see OnLive’s breakthrough technology continue to grow and evolve.”

The company confirmed the dramatic changes to its employment with only “about half of OnLive’s staff” “given employment offers by the new company at their current salaries immediately upon the transfer, and the non-hired staff will be given offers to do consulting in return for options in the new company.”

News of changes at the company came first on Friday morning when Brian Fargo of InXile Entertainment tweeted “Their employees are sending out emails that OnLive will be closed by the end of the day.”

The tweet was quickly spread across the web and no information from OnLive was forthcoming.

In response a company spokeswoman declined to provide more information to a small group of reporters outside the company’s Palo Alto headquarters but a company statement on Friday said:

“The assets of OnLive have been acquired into a newly-formed company and is backed by substantial funding, and which will continue to operate the OnLive Game and Desktop services, as well as support all of OnLive’s apps and devices, as well as game, productivity and enterprise partnerships,” the company said in a statement on Friday.

“The new company is hiring a large percentage of OnLive, Inc.’s staff across all departments and plans to continue to hire substantially more people, including additional OnLive employees. All previously announced products and services, including those in the works, will continue and there is no expected interruption of any OnLive services,” it said on Friday.

Around 2 p.m. some employees were seen leaving the building carrying packing boxes. Others entered and still more could be seen inside but no one had anything to say.

One person entering the building, when asked if he worked for OnLive, paused apparently unsure of how to answer the question, then said “Kinda … sorta.” He declined to say anything about what staff had been told.

One woman, a box in her arms, stopped as she left the building to say goodbye to a colleague who was entering.

A large pile of moving boxes sits in the building’s basement parking garage.

OnLive operates an on-demand video gaming service that streams games to users via a TV adapter. The company runs the games on its server in the cloud so users don’t require complex gaming hardware at home. OnLive’s backers include Warner Bros., Autodesk, Maverick Capital, AT&T, British Telecom and The Belgacom Group.

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