HTC loses US$40 million from OnLive restructuring

OnLive has been forced to restructure after nearly going bankrupt

Taiwanese smartphone maker HTC said on Monday it will have to book a US$40 million loss from its investment in U.S. cloud gaming service OnLive, which is restructuring after nearly going bankrupt.

HTC announced the investment loss in a Taiwan Stock Exchange filing, stating that OnLive completed an asset restructuring during this past weekend because of a "lack of operating cash and an inability to raise new capital." The company declined to elaborate on its investment.

HTC made its $40 million investment in OnLive in February of last year, in what was seen as a move to eventually bring more online games to its company smartphones. OnLive, which streams games over the Internet through PCs, also started hosting games for Android tablets and smartphones at the end of 2011.

The U.S.-based company, however, has been forced to restructure because of the high infrastructure costs associated with running its gaming service, resulting in OnLive failing to make a profit. On Friday, the company said it had been acquired by an unnamed new owner, allowing OnLive to continue to operate its services. But as part of the restructuring, an unknown number of the company's employees have been laid off.

Other backers of OnLive include Warners Bros., Autodesk, Maverick Capital, AT&T and British Telecom among others.

HTC's loss comes a month after the smartphone vendor reworked another investment it had made in U.S.-based Beats Electronics, a provider of headphones equipment.

HTC had originally bought a majority stake in Beats at $300 million, in order to improve the audio systems on its handsets. But almost a year after the deal, HTC said in July it would sell back half its stake in the company, retaining a 25 percent ownership.

The Taiwanese smartphone maker said the stake sell back will give Beats greater flexibility to expand its brand globally. But analysts have said the investment in Beats likely fell short of HTC's expectations, with Beats' audio technology not enough to give the smartphone maker an edge over its rivals

Join the newsletter!

Or

Sign up to gain exclusive access to email subscriptions, event invitations, competitions, giveaways, and much more.

Membership is free, and your security and privacy remain protected. View our privacy policy before signing up.

Error: Please check your email address.
Keep up with the latest tech news, reviews and previews by subscribing to the Good Gear Guide newsletter.

Michael Kan

IDG News Service
Show Comments

Brand Post

Shining a light on creativity

MSI has long pushed the boundaries of invention with its ever-evolving range of laptops but it has now pulled off a world first with the new MSI Creative 17.

Most Popular Reviews

Latest Articles

Resources

PCW Evaluation Team

Tom Pope

Dynabook Portégé X30L-G

Ultimately this laptop has achieved everything I would hope for in a laptop for work, while fitting that into a form factor and weight that is remarkable.

Tom Sellers

MSI P65

This smart laptop was enjoyable to use and great to work on – creating content was super simple.

Lolita Wang

MSI GT76

It really doesn’t get more “gaming laptop” than this.

Jack Jeffries

MSI GS75

As the Maserati or BMW of laptops, it would fit perfectly in the hands of a professional needing firepower under the hood, sophistication and class on the surface, and gaming prowess (sports mode if you will) in between.

Taylor Carr

MSI PS63

The MSI PS63 is an amazing laptop and I would definitely consider buying one in the future.

Christopher Low

Brother RJ-4230B

This small mobile printer is exactly what I need for invoicing and other jobs such as sending fellow tradesman details or step-by-step instructions that I can easily print off from my phone or the Web.

Featured Content

Product Launch Showcase

Don’t have an account? Sign up here

Don't have an account? Sign up now

Forgot password?