Onlive: Restructuring, Bankruptcy and Layoffs

Streaming gaming service OnLive has announced an Assignment for the Benefit of Creditors – a form of bankruptcy- that will see it close its doors temporarily while finances are sorted out with a new investor/owner. However, executives are vowing that the service will continue operation, despite layoffs and reports that even during peak hours, OnLive has less than 2,000 users.

“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,” reads the statement published by the firm in the wake of the news.

It also says that OnLive will be making some big announcements about new initiatives soon, though it seems hard to believe they’ll be anything that gargantuan, considering it sounds like the company is running low on funds.

Despite the confident wording however, OnLive’s bankruptcy has hit staff hard, with only half remaining after the fallout. Those let go have been offered consulting positions, with promises from executives that they will be rehired once the finances are in order. It’ll be interesting to see when, if ever, that comes around.

This announcement also throws into question whether the cloud gaming service will end up on the Ouya console, where it was set to provide the business end of the AAA gaming experience on the little Android machine. While it seems unlikely that any big investment would be required to make it happen, OnLive does need to be an active company in order for it to be achieved, something that’s not looking certain right now.

Source: Joystiq

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