The cloud-based game service OnLive was recently sold for less than $5 million, which was recognized as one of the most embarrassing industry failures of 2012. The deal caused many of the company’s employees losing their jobs, with the investors writing off their stakes. The sale was completed almost three months ago, but for some reason was kept secret.
According to the industry reports, the experts had previously estimated OnLive’s value at as much as $1.8 billion. Indeed, the business was very promising, especially considering all that cloud-based development in the technology market. In the meantime, the company’s rival Gaikai was acquired by Sony for $380 million three months ago. Unfortunately, the efforts of the company to get a better price backfired.
According to the insolvency experts from Insolvency Services Group who handled the sale, in the event that the sale hadn’t been completed, the company wouldn’t have had enough money to cover the huge costs of preserving and marketing OnLive’s patents and other IP.
The cloud-based video gaming service allowed the users to play premium games online without owning a console. The technology in question has been regarded as an innovative approach that would replace dedicated games devices. Unfortunately, the service didn’t get enough users: although OnLive claimed it had 1.5 million active users at the moment, the independent reports found out that only around 1,600 subscribers were using the service simultaneously. OnLive company ended up with the debts of $18.8 million.
The buyer, Lauder Partners, seems to be interested in OnLive’s patents that are worth hundreds of millions of dollars. In the meantime, the employees have been deprived of their rights to stock in the company. The investors who had spent tens of millions of dollars on a stake in the business also suffered: they would only be compensated only if the funds were left over after paying the debts. However, this is unlikely to ever happen, the experts have to admit.
The list of OnLive’s shareholders includes AT&T, BT, HTC, and Time Warner. The buyer of the company, Lauder Partners, is still offering the service across the United States, the United Kingdom and Belgium.
According to the industry reports, the experts had previously estimated OnLive’s value at as much as $1.8 billion. Indeed, the business was very promising, especially considering all that cloud-based development in the technology market. In the meantime, the company’s rival Gaikai was acquired by Sony for $380 million three months ago. Unfortunately, the efforts of the company to get a better price backfired.
According to the insolvency experts from Insolvency Services Group who handled the sale, in the event that the sale hadn’t been completed, the company wouldn’t have had enough money to cover the huge costs of preserving and marketing OnLive’s patents and other IP.
The cloud-based video gaming service allowed the users to play premium games online without owning a console. The technology in question has been regarded as an innovative approach that would replace dedicated games devices. Unfortunately, the service didn’t get enough users: although OnLive claimed it had 1.5 million active users at the moment, the independent reports found out that only around 1,600 subscribers were using the service simultaneously. OnLive company ended up with the debts of $18.8 million.
The buyer, Lauder Partners, seems to be interested in OnLive’s patents that are worth hundreds of millions of dollars. In the meantime, the employees have been deprived of their rights to stock in the company. The investors who had spent tens of millions of dollars on a stake in the business also suffered: they would only be compensated only if the funds were left over after paying the debts. However, this is unlikely to ever happen, the experts have to admit.
The list of OnLive’s shareholders includes AT&T, BT, HTC, and Time Warner. The buyer of the company, Lauder Partners, is still offering the service across the United States, the United Kingdom and Belgium.
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