Okay, seriously though, I think if this doesn't turn out to be some sort of Infinium Phantom bullshit thing, it could actually work in the right contexts. Charge a subscription, offer up the games, do whatever your 7-years-in-development (bullshit) servers do, find out that yeah most people in the real world end up with some lag and blockified displays. You know what, that's fine. I could totally play a bunch of games like that - games I want to play, but don't really need a copy of necessarily, and don't care that much that I'm not getting the best experience out of. Like, I'd play Halo 3 with it. I don't give nearly enough of a shit about Halo 3 to buy it (and a 360), but I'd like to go through it once for the sake of completion if nothing else. MGS4... that's not so much about the graphics or reflexes, so I'd play that server-side, sure (though I'd buy it too eventually, again for the sake of completion). Pretty much the entirety of EA's library, which they seem to have already signed on with so hey, awesome. At the very least, you know you can't possibly end up with any sort of copy-protection bullshit dragging you down.
Of course, there will always be some games that I will want to OWN, and play on my own goddam machine, thank-you-very-much. I will never, ever, ever play TF2 this way, that's retarded. I wouldn't play Smash Bros. this way, and probably not SF4 either. MGS4, like I said, I'd play it server-side until I got a PS3, but I'd really rather have a copy of it because, fuck, I'd like to own a copy of it. And so on, and on, and on... you get the idea.
This isn't nearly going to kill consoles, or retailers, as the dumbass marketing guy they have keeps wanting to claim. Hell, GameStop's still in business despite Gamefly, Gametap and Steam, so there's definitely always going to be some value in going out and buying a physical copy to put on your shelf. This is just an alternate way of going about your gaming, just like the others, and if it actually goddam works then I'm all actually goddam for it.