Just two years after its inception, OnLive, the cloud gaming service that some saw as the future of video games (and some still do), has hit a brick wall. The company laid off about 200 people last Friday, and has shifted its assets into a brand company. “OnLive, Inc’s board of directors, faced with difficult financial decisions for OnLive, Inc, determined that the best course of action was a restructuring under an ‘Assignment for the Benefit of Creditors,'” the company said in a press release. What went wrong? For starters, Joystiq cites a source who offers a damning indictment on the gaming service’s popularity, stating that during peak hours, there’d only about 1,800 users on the network. A paltry figure, especially compared to OnLive’s claims of two million users. OnLive’s investors include AT&T, Time Warner Inc and smartphone maker HTC Corp., which stands to take a $40 million hit from the whole fiasco.