It is more and more apparent that the model of Onlive is going to be the future. We are getting used to online and on-demand content delivery through services such as Netflix. Onlive is doing the same with video games - especially with a new plan to make games accessible for a $10 fee per month. We already have shown that we do not necessarily care about physical ownership of media anymore, if we know that content is always accessible in a fast and convenient way. If we can access games online anywhere and anytime, why would we download them and not play online right away?
If you think about it, a thin client / cloud gaming approach could also solve other problems consoles are criticized for: It really would not matter what hardware you have at home as long as your service provider upgrades and provides the best possible experience. Especially Nvidia and likes to criticize console gaming today and its old graphics technology. Cloud gaming would give gamers the ability to always stay up to date.