It's definitely early days, and there are pretty big questions that need to be answered - what hardware will they release, what exactly will be streamed or not, what will the image quality be like vs internet speed - will it be a subscription service etc.

It will not replace physical releases - it's a generation too early for that. What could happen is Sony release a cheap-ass PS4 alongside the regular model, one that ONLY plays streamed games. Pay $99 upfront and then a $20 subscription every month to play the whole PS4 catalogue streamed. 

What I guess at is a full playstation-branded streaming service, across Sony phones, tvs, tablets, laptops and of course game devices. What with Gaikai recently announcing a deal to stream to Samsung Tvs, and with Sony releasing playstation mobile on HTC handsets, I think there's possibility for streaming other manufacturer's devices as well. What this means is that they can tell publishers that, instead of releasing games on a new platform (PS4 or Vita) with an install base of only a few million, they will be releasing their game for ALL streaming compatible  devices - instant install base of >100 million. 

The question of content is much harder - it will be very expensive for them to run thousands of PS3s in a cluster just to stream games to your devices,  whereas running them on PC is apparently much cheaper. For PS3 games with PC counterparts that's not an issue - they can stream the PC versions (with better-than-PS3-graphics intact!). But for PS3 only games...the Cell (what a mistake, seriously) is too hard to emulate on PC - no idea how they'll get round that. Streaming PS1 and PS2 games will be ideal, as they run at such lower resolutions and can be emulated on very cheap hardware. PS4 games....so many unkowns that I can't speculate much further. Forwards compatibility? PS4 games streamed to PS3/Vita? Who knows.

i don't think that's true.  the point of the cloud based service is you have servers that are waaay more powerful then anything an end user could buy.   at work i run off a similar type service for web delivery of software.  my tech is ~4 years old and waaay better than anything a ps4 could hope to be.  the point of a cloud service is that you can get better performance for less cost by taking advantage of a lack of down time. 

it is kind of like a co-op.  you operate your console for a few hours a day while it remains off for the other ~20 hours.  if 6 people pooled their money together (4 hours of time dedicated to each person) then you could buy something a heck of a lot more powerful without incurring additional cost.  this is the basic principle one how cloud services make money and why they can provide really power stuff you could never dream to buy on your own.

It's true. I just went to Gaikai's  website and tried to stream Crysis 2. I can't say it ran at more than 15-20 fps. And my internet is 800kps(supposed to be 5.5mbs, but this is At&T we're talking about).

If anyone thinks this will replace consoles, they should just try it out for 10 minutes. They'll come running back.

how exactly get game developers paid for that? how much will ea get for a fifa and how much will activision get for cod or so? no clue how they calculate how much developers have to get compared to other developers for different games of the subscription fee you pay.

Thank you. My god this is an interesting topic indeed. Forwards compatibility, what an interesting though. Also, too bad the PS3 will be so hard to PC emulate. Has anyone succeeded to emulate it at least through software?

I agree. My point was made off of Sal's graph:

See how Gakai is managing current gen graphics at a 50ms Game pipeline using specific server hardware? That's what I was referring to. It's also pulling it off at 30fps compared to Onlive's 60fps (option or enforced I'm not sure).

The example of your workplace, is it referring to server clustering, failover and load balancing? If so, I'm still sure there is some sort of quota system to guarantee a level of service, over which the server cluster can't exceed, and that is dictated by the general HW performance of the nodes. imho the current tech is limited to 50miliseconds latency until the servers are upgraded (which will cost balls). In other words, I think my point about current gen graphics is still tangible. Probs they can't pull it off just yet and need to wait for a generational jump in server performance. IDK, you tell me you work in the field :]

Certainly is. And no, nobody has and the consensus is that it would be extremely difficult to do any time soon.

Easy solution to this. Once they upgrade their server machines, they'll make sure the PCs used will be able to emulate the PS3 through hardware. This is now Sony's property so the HW now could become proprietary Sony PCs.

THEY WOULD NOW BE GIVING PROPRIETARY SONY SERVER SPECS TO US!!! (If that were true)

Get ready for the Zombiepocalypse guys, the world is shaking :D

Depends on your connection. You only need a decent speed for HD video streaming (720p) but games are a whole other beast, requiring beast internet for good visuals and performance. It won't be the method of choice for gamers for a while.

Are you saying that because movies require no rendering time and are pre-rendered, thus require 0 "Game Pipeline" latency?

Ultimately Gakai seems to be achieving it using alternative methods and solutions. I'm not sure if they can pull off 1080p, since the higher the resultion, the higher the latency (compression, #packets required). But better graphics won't affect latency in any way after the rendering stage I think. It's only resolution that radically affects performance if I understand correctly.

With that in mind, will 1080p be possible anytime soon?