OnLive, a tech company that has been in self-described "stealth mode" development for seven years, has unveiled new technology that allows even the most complex PC games to be played on a television set or any PC.



The ambitious venture, which hopes to revolutionize the gaming world by removing the need to continually upgrade PC hardware or buy new gaming consoles every generation, makes use of cloud computing -- doing all of the game's video and audio processing on remote servers, then streaming the resultant images and sound back to the user quickly enough to play games in real time.



What's most important though, says OnLive founder and CEO Steve Perlman and COO Mike McGarvey, is that the system works with any standard PC game, and does not require developers to code for a proprietary system.



Other attempts have fallen short in that area, Perlman told Gamasutra in a demonstration preceding the announcement.



"The technology of any of those other companies does not generalize," he said. "You may be able to get a particular game with particular geometry to work, but not as a general system that can handle any video stream, whether it's cinematic or a complex video game."



"What OnLive does is seamless and completely transparent, and it does not have any requirements for the local system."



OnLive's service, which is planned to combine a relatively low monthly subscription fee with other per-game business models not yet fully determined, requires only a one-megabyte download to a computer, or a small plastic dongle (called a "micro-console") to connect to a TV; no GPU is required.



Once subscribed, users will be able to run any of the service's games, regardless of system requirements -- Gamasutra was able to try the system out with graphical powerhouses like Crytek's Crysis and Codemasters' GRID.



A number of major publishers including Electronic Arts, Ubisoft, Warner Bros., Take-Two, Eidos, and Atari have already signed on. And the company has announced a partnership with Epic Games that will see the Unreal Engine 3 easily adapt to OnLive's APIs.



"Not only have we solved the problem of compressing the video games, we've solved the latency problem," Perlman said to Gamasutra. "We knew, in order to make this thing work, we'd have to figure out a way to get video to run compressed over consumer connections with effectively no latency. Our video compression technology has one millisecond in latency -- basically no latency at all. All the latency is just for the transport, and we've also addressed that."



While it is of course impossible to completely eliminate the possibility of latency over a network, OnLive has actually gone to such lengths as to work directly with cable and internet providers to identify and repair inefficiencies in their systems that resulted in dropped packets or other flaws.



Eventually, the company hopes to provide even faster service by streaming directly through cable to users' homes, much like paid television currently is.



When it launches this winter, the system will feature various community features, as well as the ability to spectate other players' games in real time, even if the game does not natively contain an observer mode -- since all gameplay is delivered a video stream, that feature is integrated directly into OnLive itself.



[UPDATE: During Gamasutra's interview with OnLive, the company said that it doesn't currently perceive itself to have direct competitors, as services like Steam or the console download networks don't provide actual game streaming.



"You never know when you're developing something new whether there are competitors," said Perlman. "But at this point we've gone and spoken with most of the major publishers and none of them have seen anything that comes close to this."



Plus, McGarvey added, "We're going to hit 200 million people that Steam can't sell to, who have non-GPU-based PCs but want to play the latest games. Yes, they are a competitor, but we're a little more of a pure platform than just digital distribution. And we eliminate the need to purchase hardware. None of those [other services] expand the market like we do."]



To drive home the irrelevancy of game-specific system requirements using OnLive, the company plans to launch entirely with new PC games, but told Gamasutra it could later branch out to a broader range of eras and types of games.



"OnLive combines the successful components of video games, online distribution and social networking into one affordable, flexible platform that offers a new way for game fans to access and enjoy content," said McGarvey in a statement.



"By substantially lowering the barriers between content and consumers, OnLive has created an environment that is highly beneficial for every facet of the video game ecosystem. With OnLive, gamers can play what they want, when they want, how they want. That level of freedom has never been possible until now."