Analyst “sceptical” of OnLive’s success

It appears as though a myriad of contentious factors, including subscription fees and install base, may well stifle OnLive’s hopes for future success, according to Todd Greenwald, senior research analyst for Signal Hill. Asserting that while the concept appears solid, he still remains “somewhat sceptical that OnLive will really turn the gaming world upside down any time soon.”

Greenwald notes that while OnLive skips out on the hefty down payment associated with traditional consoles; the subscription fee quickly adds up, making for a more expensive system in the long run. In addition to this, Greenwald also points out that “even if successful, the installed base will be too small to be material for large publishers like EA, Activision, THQ and Take-Two. Perhaps 500,000 to 1 million units, compared with 67 million Wii, 39 million Xbox 360, and 33 million PlayStation 3 units.”

Though OnLive’s initial entry may be somewhat scuppered by current constraints, I feel as though it wasn’t really intended to be a success straight out of the gate, more a foothold for what may become a lucrative and viable way to play games in future.