NKD, you do know that ping times are round trip times, right? So 50 ms isn't exactly being generous since that's implying a 100 ms ping time.
I get 18 ms when I ping along the east coast. But then I don't have a crappy cable ISP.
Don't get me wrong, I agree OnLive has formidable challenges with computing power and the underlying economics, but I believe latency is being overblown as a problem by those who don't know much about internet topology.
Though I should say while average latency for customers with non-crappy (read non-cable) ISP's shouldn't be a problem, consistency of service (which Eurogamer points out) can be troublesome.