Onlive is a neat concept, but unusable for me. The input lag kills it. For those of you who say that the lag is "unnoticeable": Well, maybe for you it is. But I'm one of those people who turn off Vsync in all of their games because the extra few milliseconds of latency is unacceptable. Having extra input lag because of your internet connection? Fuck no.
Not to mention, when I play a game, I want to see the graphics in their full 1080p uncompressed glory. None of that remote streaming crap. I bought a nice computer so my games can be locally rendered perfectly in real-time. Until Onlive is truly indistinguishable from the regular thing, I'll avoid it.
Also, the bandwidth usage is probably insane. My internet connection is good, but not great. If my brother was having problems streaming Netflix in the other room, I'd hate to have to tell him "Hey, uhh, sorry. I'm playing a video game (?)."
BUT, Onlive works very well for some people, and I have no problem with that. A year ago I thought they were destined to fail. Turns out I was wrong. I'm actually really impressed with some of the stuff they're doing. They've done a good job at staying competitive.