Okay.
This looks like a step forward for PC gaming, but I don't see how this will completely obsoletize console gaming. It looks like it can gain a fair bit of Third party support, but first parties will remain on their exclusives. Plus with a massive internet community, there are always the problem of hackers, this is the primary reason I'm not with this.
It seems people always forget hackers, that and piracy, which would be all the more trouble for something that is ran by PC, there can spawn software meant to make any game playable through "OnLive".
Then the viruses, which need no introduction.
This may not completely revolutionise gaming, but will just be joining the competition, and no doubt this is a "score 1" for PC gaming.
Microsoft and Sony can update their firmware to offer live streaming, which is the only thing I saw that was cool about OnLive. Nintendo has a makeshift replay function in certain games, not to mention the "targeted demographic" will have no need for OnLive, which is another reason OnLive will not revolutionise gaming; it is clearly designed to appeal to those who like to refer to themselves as "hardcore gamers", and those who fit the nonspecific criteria of one. Casual and Solo gamers will have no need for OnLive.
Bear in mind that 65% of all gamers are casual.
Rough Estimate, may be wrong.
tl:dr version: Start at "Okay" and keep reading until "wrong", lazy motherfucker.