OnLive is a company that has been claiming to do the seemingly impossible -- they plan to set up a sort of "cloud gaming" console, where instead of hardware in individual houses (like we have now; you buy a console for your home), they'll have hardware over the Internet, and stream your game to you like watching television. All of the processing and coding will be done on a remote server, but with signals flowing from your controller, it'll seem like you're just playing Xbox at home. It all works in theory, but in practice, Internet connections aren't solid or stable enough to send commands and full HD video back and forth without enough lag to make things unplayable.
Still, without actually releasing a product so far, OnLive claims they can do it, and now they're claiming to do it on the iPhone as well. AppleInsider reports that at a recent event in New York, OnLive showed off the same game service running on "2 iPhones, a tv, and a computer" simultaneously, with gamers on all the devices able to communicate and watch each others' gameplay. CEO Steve Perlman admits it's a "tech demo," but doesn't go into detail on what that means (it could simply be a demo running separately on the devices, to show what it would be like, or I've heard of OnLive events where the server is sitting in the room next door). And of course, there's no date or information on an actual release yet.
OnLive's service definitely sounds possible someday -- as Internet connections get faster and hardware gets even cheaper, it's not a stretch to think we'll eventually move the heavy processor lifting to another location, leaving much tinier consoles and PCs taking up space on our desks and TV stands at home. But so far all it seems they've got is an idea (and the money that excited financiers have put into the project). We'll have to believe it works when we see it.