timppu: The article claims the main reason for Onlive's demise was that there was latency playing games through it, but I don't really think that was the main reason. After all, people play online action games where they see sometimes pretty bad latency too, and still enjoy it. The article kept mentioning how important low latency is for games like Super Street Fighter 2 Turbo... that is just an extreme and overused case. If latency is a big problem for the fighting genre, then SSF2T can't be played online either (cloud or not), against other people online.
The problem was pricing. They always forget to tell you that the CPU power in those "internet server farms which we borrow" is not free either. Someone has to pay for it, and it is you, the gamer. So the main obstacle with cloud gaming specialists is to find that optimal pricing point that gaming in the cloud doesn't feel too expensive to the user, and at the same time they make profit. Having millions of subscribers may help with that too, not sure if Onlive never simply reached enough paying subscribers in order to start making profit.
People are expecting Steam or GooglePlay level low pricing also from cloud games (maybe even cheaper, as they feel they are merely "renting" games from cloud services), and that is something they will not get, due to the costs related to "borrowing" those server farms. On the other hand, naturally they would save money on their computers etc. as they would probably need less CPU power then, but it is not like e.g. gaming consoles are _that_ expensive anyway...
Yes, cloud computing is for many cases a good thing and helps to use existing computing power more efficiently, a bit like IP based data traffic is more efficient than old circuit telecom where a line is created and reserved for each call separately. But there are still costs involved for those server farms, and someone has to pay for it.
The other reason might still be that most people were not quite ready to the idea of renting, not buying, games. Or at least they expect renting to be dirt cheap compared to buying a game.
As for that Crackdown game... maybe it works, who knows? If it is mostly an online multiplayer game, then people don't really care how much of it is computed somewhere else, as long as the game behaves well and it doesn't cost too much. For me that would mean free-to-play though, as I don't really pay for online-only games. :) Others seem happy to pay for them though, at least through microtransactions. Get the latest unusual visual effect for your Team Fortress 2 hat, wheee! Meh, I came here just to kill other players.
Agree. From what I remember back then most complains where not latency but pure "Ewww, yuck" to the whole Onlive concept.