On the opposite side of the Los Angeles Convention Center from OnLive’s glitzy E3 booth, Dave Perry held a small briefing in a cubicle to talk about his own cloud gaming service, Gaikai.

Perry wanted to clarify that Gaikai is “the ultimate lead ever for a publisher,” as opposed to a full-blown gaming service for consumers. He’s positioning Gaikai as a try before you buy service, kind of like the InstantAction service that debuted in April, but with all the heavy graphics processing done on remote servers, allowing for immediate access to the latest PC games. The idea is to let publishers, and eventually gaming websites, embed video games directly into the browser, so readers can instantly try the game instead of watching trailers or looking at screenshots.

This stands in stark contrast to OnLive, which on Thursday launched its subscription service. Though OnLive subscribers can play demos for free, the service is less of a promotional tool for publishers and more of a final stop for gamers who have committed to spending money.

In my meetings with OnLive and Gaikai, each company displayed a gentle animosity toward the other. Perry said his data centers are going to “end up in rings around [OnLive’s],” and claimed that each of his servers can run many more virtualizations. He also questioned OnLive’s subscription model; Gaikai won’t charge anything to consumers, and will instead charge publishers, likening server time to advertising.

OnLive’s director of games and media development, Joe Bentley, said he has yet to see Gaikai in action. Though Perry showed embedded streaming games — along with software such as Adobe Photoshop — on a PC and an Xbox 360, the server was in the same room. OnLive’s E3 demos were running on a server in Silicon Valley.

My problem with Gaikai is the disconnect between trying a game and buying it. Let’s say you play the first 20 minutes of a game through your Web browser and are persuaded to buy. Then what? Do you start a lengthy download through Steam? Run to GameStop to buy the boxed version? The ideal solution would be a full cloud gaming service that players could easily jump to once their trials end, because once you’ve experienced instant gratification, it’s hard to go back.

That’s why I think Gaikai’s advertising service and OnLive’s subscription package would work wonderfully together, if only they could stop sniping at each other.

 
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