...snip...
and you need a steady net connection.
wtf, this is really a big concern? alot of games REQUIRE it. mmos, competitive fps games, even casual co-op games.
It is a big concern, because it has two sides to it. For one, internet speeds aren't always reliable or present. Where I used to live, we only got half the speed our house was capable of, and the most the provider could tell us was "it must be metal in your house". Now, I live out in the country and am lucky that ONE company had broadband available for here and it's slow as hell. Some days, it's on par with dial-up, which is why I presently can't play online games. So cloud-gaming, while it might useful to people in cities with good connections, alienates everyone else.
The other half of this is that the server it's hosted on must be reliable. Anyone remember when Call of Duty came out? The last two releases, their servers CRASHED. No one was able to get online to play for a few days to a week. They had offline modes available, thankfully, to play with while they waited. If cloud-gaming became the new norm and EVERYONE bought Skyrim the day it came out, it'd be a huge strain on their servers and if they weren't up to the task, then no one would get to play because their servers were down.
So, unless there's a huge spike in their technology and resources, as well as for the players, it's not going to be a stable system for the majority - especially IF the majority are on it.
Another side to that, again, is the tangible side. And while I agree with everyone that I prefer a tangible product, it's not just because I prefer something tangible. I've had problems in the past, particularly with iTunes, where I've paid for a movie or TV show, then upgraded my computer - only to find out that I only had the rights to that ONE download of the file and would have to pay again. Meaning that once it's off my system, it's not mine anymore, even though I paid for it. This also falls into that. They can't keep every game on the server forever. So, say that I buy Morrowind on a cloud-gaming system. I bought it, and I play it. Years later, TES VII comes out and they decide "Morrowind's kinda old now...let's remove it", and so they do. Morrowind isn't on the system anymore. I've paid for it, and yet it no longer exists. That's the difference between having a tangible disk and a streaming game for me - the disk is here until I break it. The streaming is only there as long as they feel like hosting it, and I have no control over that.
I definitely see the advantages of it, so if it works well for you, that's great. But I can see that for many people, including myself, it's not just a system that works well for us.