Update 2: An official statement has been issued by OnLive, confirming their acquisition.
Update: OnLive may not be complete dead, but the service will likely be bought out by a currently unknown third party.
OnLive has become the focal point of the latest industry rumors, as talk of the layoffs and possible closure spread. Yet OnLive has denied claims of their doom, though the layoffs could very well hold true.
Unconfirmed reports early in the day suggested that the cloud gaming service was in deep trouble and had laid off its entire staff. However, OnLive's director of corporate communications Brian Jaquet was quick to deny at least some of these rumors by saying, “No, let me be clear. We are not going out of business.”
Any attempts to glean anymore from the company were met with replies along the lines of "We don't respond to rumors."
The whole thing started when inXile's Brian Fargo tweeted that he'd received emails from OnLive employees stating the company would be closing by day's end.
Fargo later followed up with another post containing the alleged email, which supposedly reads:
I wanted to send a note that by the end of the day today, OnLive as an entity will no longer exist. Unfortunately, my job and everyone else's was included. A new company will be formed and the management of the company will be in contact with you about the current initiatives in place, including the titles that will remain on the service.
It has been an absolute pleasure working with you and I’m sure our path with cross again.
OnLive's adamant denials regarding closure and unwillingness to comment on the staff layoffs have led to more rumors suggesting the company might be bought out. Earlier this summer, OnLive competitor Gaikai was acquired by Sony for $380 million.
Thanks for the heads up, tekmosis.