>>it still doesn't speak about the massive amount of computing required to run Crysis for every user they are streaming to

a non-issue (compared to the others)
A/ not everyone will be playing at once
B/ xbox360 @ 200$ (though selling for a ~50$ loss) ok say 250$
but theres a lot there thats not needed, thus say cost $150. (though in reality <100$)
C/ pc/consoles have to run in your house (it maybe >30degrees) whereas they can chuck thousands of cheap lesser power overclocked cpu/gpu's into a big cold storeroom

GPUs can run multiple applications on the same machine of course, but I was thinking more of a fully network GPU where applications submit draw calls over the network to be rendered onto a remote GPU render farm, which services 1000's of machines and instances on demand and scalably, then that output is sent to the compressor hardware and then streamed. I don't think they would place the GPU on the same machine as the CPU that just wouldn't scale at all, they would be limited to nearly a 1 to 1 hardware ratio which isn't economically feasible, but then again this is the first iteration, they might.

There is another initiative similar to Onlive, but uses AMD chipset, they use the render farm concept, I believe.

[EDIT: here is the link

http://games.slashdot.org/games/09/01/10/011250.shtml

]

-ddn