I couldn't care less as long as there are games to play. Digital distribution doesn't bother me as long as I can download the game as many times as I want without being treated like a criminal. The hardware vs. cloud thing is a different debate though.
Can our current internet connections handle services like OnLive without any hiccups? That's a big question. In general, I don't think we're ready for it yet. It would be great if we were, as it could turn any PC or TV with an internet connection into a gaming setup. However, the connection would have to be absolutely flawless. I have a wireless N network in my house that is absolutely lightening fast. I can stream HD video no problem Xbox Live's instant on 1080p streaming service works absolutely flawlessly even though my Xbox 360 is using a wireless connection with a wireless G receiver. But I still don't feel like I would want to rely entirely on my network to deliver my game content. If I don't have internet access on my PC, 360, or PS3, I can still play my games offline. If I am running all my games off of remote servers and lose my internet even for a couple of seconds, I am screwed.
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