Hi5 president and CTO Alex St John has said that OnLive won't work – a fact that he says is too bad because "it's the right notion and the wrong execution."
Talking to GamesIndustry.biz at this year's GDC in San Francisco, St John said that now people have more than one TV screen in their homes and 3D chips are in a multitude of devices, the idea of having a games console which sits in the living room is outdated.
However, he argued against the solution being game-streaming services such as OnLive, saying that problems such as latency hadn't been solved.
"The mistake they have made, which is fatal, is that they've solved the video delivery problem – the image part, that can work. So the thing they understand best, I look at and go, 'I'll be damned, I actually believe that works. That was tricky, yeah.' But there's no solution to this other stuff that they're kind of dismissing, and because there's no solution they're going to have a bad time getting their VC's money and it's a shame because I'd like to see it possible for it to work, but it's just not.
"The VCs, people who aren't engineers, haven't really built all this technology, the story sounds good, it sounds kind of plausible, the demo kind of works, and without a really deep understanding of how these things are built it's not obvious to everyone for a while until the money goes away."
St John also believes that this generation of consoles will be the last – increased value can no longer be delivered through more power and better graphics, he said. Differentiation in recent years has come from motion control, multiplayer and social dynamics, and with internet connections getting faster, people will turn to online PC platforms for the best gaming experiences.
"That's why I joined Hi5 – because this is where the exciting, next generational pioneering is going to happen. And it's going to happen on the PC. The console platforms, it's going to take so long for the market to sort itself out that it's going to have moved past that," he said.
A Hi5 game developer program was announced at GDC, which St John says has been implemented to attract the best games to the site.
Instead of using the traditional social networking business model - "Here's some APIs, good luck to you and send us money. And join the sea over there" - Hi5 would work with the most talented developers and fund those that need funding, he said.
"We'll say, come do a deal with us, we'll integrate your game on the site, promote it across the property, you can take it to Facebook and other places as well, but we want to do a great job of launching those titles on our platform.
"We know that when you establish a momentum and reputation, consumers will go, 'yeah there's lots of crap games on Facebook, the good stuff and the newest stuff is over here'," he said.
"I think that over time, as you have clarity of vision, you can be a better destination for people who just want to play games with their friends. Here's a vehicle that does nothing but that extremely well, and the content's all very good."
You can read the full interview with Alex St John, in which he talks about the problems with social networks and how they need to progress, and his opinions on the console market here.