OnLive sold, still called OnLive

After declaring bankruptcy on Friday and dumping most of its employees, game streaming service OnLive has been sold to an unidentified buyer and will reportedly get on with business as usual.

In an intriguing Freakonomics-style twist, an anonymous “reliable source” told TechCrunch that declaring bankruptcy and laying off its workforce was all part of CEO Steve Perlman’s plan, as it reduced the firm’s liability, zeroed employee equity, and put a cheaper pricetag on the company. According to a statement later passed to the site from OnLive, a “large percentage” of staff would be rehired – although not without some controversy.

A number of comments under the article from people claiming to be affected by the sell-out puts a more human perspective on the matter.

“My husband was an OnLive employee as well. One of those employees who puts in a full day in the office then comes home and puts in another 3-4 hours from home. We are currently pregnant with our second child and I have numerous serious health issues complicating pregnancy even further,” writes Stephanie Tait.

“My husband has been staying up until 1:00am night after night lately working for OnLive, only to come to work this morning to find out we have no job effective immediately, our stock is now worth nothing, there will be no severance, and if we don’t find a solution for health insurance before the benefits lapse on the 1st of the month then my pregnancy will become a pre-existing condition and we will be on the hook for all of the out of pocket costs ourselves. We went through job loss when the economy first crashed, so we have no savings or available credit to fall back on. Steve Perlman – you have NO soul. I hope the tech world begins to see you for exactly what you are and that investors blacklist your future ventures. You come out on top and your dedicated employees who have been giving above and beyond are left to lose everything.”

In a another statement, the company also promised OnLive subscribers that services would continue to “operate smoothly” under the new management, and that “major announcements of new products and services” should be expected soon.

Alleged Microsoft documents leaked earlier this year suggested that Microsoft had considered buying OnLive back in 2010. Shortly before E3 in June, Sony was rumoured to be looking at acquiring either OnLive or Gaikai, but rolled with the latter. More recently, Ouya and OnLive announced a partnership deal to supply a content streaming service for the console.