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After massive cuts, OnLive staggers forward

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.