Game streaming technology developer OnLive showed the progress of its upcoming service by way of a session by founder Steve Perlman at the DICE Summit 2010 in Las Vegas, with demonstrated features including a new version of the beta, an iPhone version of the client, and new social features. OnLive, responding to what it perceives as the demands of modern consumers, allows users to play high-quality video games by rendering graphics remotely and streaming the frames as compressed video -- meaning no expensive game consoles or advanced PC graphics hardware is necessary on the user's end. Perlman cited a Sandvine study released late last year, revealing that real-time entertainment internet traffic is now 26.6 percent of total traffic, up from 12.6 percent in 2008. In fact, he said, the given delivery medium is becoming less and less important. People no longer say that they're going to "watch a DVD," for example; they simply say they are going to watch a movie, which could be delivered in any number of ways, including streaming. But, worryingly, Perlman noted that many of these industries outside of games don't actually make a big profit on streaming media. Even major sites like YouTube have seen major profit challenges. And video games are a different beast entirely. A large file is generally needed before a game can start loading, games are tied to specific devices like consoles, and online games can't be pirated. Still, Perlman believes that, even though lower-footprint Flash and iPhone games are much closer to being delivered instantaneously than their larger-scale cousins, their monetization model is much worse. The answer? There's a need for "instant gameplay of high-quality games," he said. To achieve that, the consumer must be focused on the game, not the client device, Perlman said, while the Internet mitigates issues with piracy and used console game sales. OnLive is predicated on that model. "If the money [from used games] is not going back to the people making games," Perlman offered pointedly, "in the end the games are not going to be as good." Perlman demonstrated the new beta version of the cloud-based system, which includes number of social elements and will roll out next week. While booting it up, he joked that the service ran smoothly "if you are using a legitimate copy of OnLive" -- a reference to an unauthorized OnLive beta review that surfaced, apparently outside the beta's geographical catchment area. OnLive has been doing years of testing in thousands of locations and homes across the U.S., and claims it has created the "first [video] compression algorithm in the world which is adaptive to the nature of the connection" -- meaning it changes based on the user's type of internet connection and other factors, such as the degree of packet loss. The firm currently data centers set up in the San Francisco Bay Area, Dallas, Atlanta, Chicago, and the Washington, D.C. area, It routes its streaming traffic through multiple internet providers to find the quickest way to each individual user. The DICE demo was streaming from the Bay Area data center, roughly 500 miles away. Showcasing a "major progression of social features" on the platform, Perlman demonstrated that users can now see friends and friends of friends playing games in real time through video streams, and send them messages while they play. Players can easily capture the last 15 seconds of any game and share them with friends by way of an Xbox Live-like social interface. All OnLive games load swiftly since they boot off RAID arrays in the data centers, but Perlman pointed out that games incorporating the OnLive SDK load even more quickly. He backed up the claim by booting up Unreal Tournament III, whose title screen appeared after only about a few seconds of waiting. As a final party trick, he showed Crytek's notoriously-demanding Crysis running on an iPhone version of the client. Like other OnLive games, it was actually a full high-definition version of the game running on the cloud, but resized to fit the iPhone's screen resolution. Perlman did admit that some combinations of games and platforms might demand considerable control redesign to ensure practical playability. Perlman said "hundreds of thousands of people" have signed up for the OnLive beta so far, and the company is ramping up new server deployment, with new servers going in this week. Declining to state what exactly is coming next for the service, Perlman concluded with, "We're going to have some things to announce soon."