Nintendo is the one VG company I don't think would be effected by OnLive.
OnLive WOULD compete directly against (obviously) high-end PCs, 360 and PS3 by allowing you to play the same PC games on a low-end computer or direct to HDTV (with USB doggle) as those systems do and get them at rental prices (especially tempting for those 6 hour games).
Except for a game like CoDWaW virtually nothing on Wii would be on OnLive, they aren't likely to have motion controllers nor appeal to the expanded audience that Wii has captured. Obviously no Mario or Zelda either. The only effect this would have for Nintendo, is to draw sales away from their competitors and give them an even greater marketshare advantage.
However that assumes OnLive even works. The start up costs for that service would be immense (it needs thousands of computers/servers to handle all the processing power needed and mega bandwidth), so I expect they'll launch in one city or state at a time and it'll be years before it's available ww.
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