By Dan Gallagher, MarketWatch
SAN FRANCISCO (MarketWatch) -- OnLive Inc., a start-up company that made a splash last year when it unveiled a video-game streaming service, said Wednesday that the service will be launched on the market on June 17.
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Steve Perlman, CEO of OnLive, made the announcement during a presentation at the Game Developers Conference in San Francisco on Wednesday morning. The venture-backed company came out of stealth mode during last year's GDC, showing off its service that will allow customers to play high-end games such as "Call of Duty" and "Bioshock" without game disks, or consoles such as the Xbox 360 and PlayStation 3.
Perlman describes his service as "cloud-based gaming." The actual game s hosted on the company's servers, and streamed in real-time to the customer's PC or TV. The company spent several years developing technology so that gamers would not experience any controller delays.
The service has been in beta tests for the last several months. Perlman said it will become commercially available on June 17 for $14.95 per month - though that fee will not cover the additional costs of buying or renting games. Prices for games will be set by publishers and be announced as the games become available, he said.
The OnLive service will be available through PCs and Macs first. The company's micro-console, a small black box that users can plug into their TVs, will become available later in the year, Perlman said.
OnLive is part of a larger trend in the video game industry, which is moving aggressively to new digital distribution models. While any games are still sold as packaged goods through retailers, more services are allowing gamers to buy and download games through the Web. See previous story on digital distribution.
"Without discounts on games, we note that pricing may be a gating factor to mass market adoption of OnLive," wrote Colin Sebastian of Lazard Capital Markets in a note to clients on Wednesday. "However, if successful, we believe OnLive could have a meaningful impact on the industry, offering publishers a lower-cost distribution channel and consumers convenient access to high-quality games."
He said that -- over the long-term -- OnLive could have a "multi-billion dollar market opportunity."
Console makers such as Microsoft Corp. /quotes/comstock/15*!msft/quotes/nls/msft (MSFT 25.81, -0.22, -0.85%) , Sony Corp. /quotes/comstock/13*!sne/quotes/nls/sne (SNE 31.22, -0.68, -2.13%) and Nintendo /quotes/comstock/11i!ntdoy (NTDOY 35.21, +1.15, +3.39%) all operate online game channels. Third-party publishers such as Electronic Arts /quotes/comstock/15*!erts/quotes/nls/erts (ERTS 15.93, -0.08, -0.50%) , Activision Blizzard /quotes/comstock/15*!atvi/quotes/nls/atvi (ATVI 11.88, +0.10, +0.85%) and Ubisoft /quotes/comstock/24s!e:ubi (FR:UBI 7.27, -0.12, -1.56%) are also evaluating digital distribution options, and some are supporting OnLive.
Dan Gallagher is MarketWatch's technology editor, based in San Francisco.
