I don't agree. There are plenty of people out there who prefer to play a game on a PC, regardless if it's multiplatform or not. Sure the hardware lasts longer than it did in years past, but you still need to "keep up" every few years if you intend to play the latest titles.
All that a PC needs to be capable of is 720p framerates to "compete" with OnLive and even then it provides a superior experience. Considering most people already own a computer, those interested in gaming aren't really being forced to add much to do modern gaming. And again, you are misinformed about modern hardware cycles. People write engines to the low end these days, they are not scaling downward anymore.
Again, Steam still requires you to have a decent gaming rig to run new titles with mid to high graphic settings
Since when does OnLive offer mid to high settings? You don't need a decent gaming rig to do what OnLive offers and spending a little bit extra cash once every three years gives you those mid to high settings you keep going on about.
The point or benefit (in their terms) is that you don't need to buy expensive hardware.
You sure need to pay for an expensive service and pay more for your games though, kind of negating the entire purpose of the exercise. This is ignoring the fact that most "convenience" gamers just buy consoles anyways. If hardware is so intimidating to PC gamers then they already have other, better options. Again, this is a solution seeking a problem. If the entire country were blanketed in fiber and their pricing structure was what they initially promised then we would be having a different discussion.