One of the pipe dreams of every gamer is to be able to play console-quality games on tablets and smartphones. Well, that day has come, as you can now use an OnLive app to run full versions of games like L.A. Noire and Batman: Arkham City on an iPad, iPhone, or Android tablets and smartphones.

OnLive is announcing today that it will be able to run console-class games on tablets and smartphones by streaming full console games to the devices from web-connected data centers. The service functions much like how OnLive streams high-quality games-on-demand to desktop computers and laptops. But now the service has been tuned to work with Wi-Fi or 4G-connected mobile devices, which typically have much less capability to run a high-quality game. Tablets supported include the iPad 2, HTC Flyer, HTC Jetstream, Samsung Galaxy Tab, Motorola Xoom and the Amazon Kindle Fire.

OnLive’s hope is to disrupt the mobile game business, where developers haven’t been making games at this quality level. Of course, OnLive’s games — accessible at rental, full purchase, or subscription prices — will cost a lot more than many 99 cent or free mobile games. But these new OnLive games will raise the quality bar far above high-end iPad games such as Infinity Blade II, which just debuted in the App Store. Players will also be able to start playing on a PC, shift to a tablet, and then pick up where they left off when they get back to the PC. The OnLive games are instantly playable; no download is needed.

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“Gaming on mobile devices will never be the same,” said Steve Perlman, chief executive of OnLive, in an interview. “We are delivering on our mobile vision.”

The games aren’t stripped down mobile versions. They are the console games themselves, formatted to run on the smaller screens. Steve Perlman, chief executive of OnLive in Palo Alto, Calif., said in an interview that it took a considerable amount of work to make it possible to run the high-end games on such low-end computing devices. Not all of the games are touch-enabled, but OnLive is in the process of converting a number of them so they can run with touch controls. And it has a wireless controller that can be used to play the games that don’t have touch controls. Full told, more than 150 games are available for play on OnLive on mobile.

I’ve had a good look at a number of games, including Defense Grid Gold and Virtua Tennis 2009 with the touchscreen and Unreal Tournament with a wireless controller. They run with fluid motion on the iPad 2.

Perlman said that the free OnLive app will now be available across as many as 500 million iOS (iPod Touch, iPad, iPhone) and Android devices in the U.S. and the United Kingdom. OnLive uses a combination of compression and cloud-based computing power to run games in internet-connected servers. Then it sends images from those games at high speeds over the internet to the user’s own machine, which can display them on the screen. To the user, it seems like the game is running on the local machine. In fact, the game is being streamed as if it were a video. Users can play instantly without waiting for downloads.

These streamed games have lots of advantages. A user can log into the OnLive service and his or her saved games from any machine. Publishers don’t have to worry about piracy or used games because each user is authenticated via the online connection. And the user does not need a high-end PC to play high-end games. In June 2010, OnLive launched in the U.S. for players using PCs, Macs and laptops. In the fall of 2010, OnLive launched its Micro Console, which allowed OnLive games to be played on big-screen TVs.

In June at the E3 show this year, Perlman demonstrated OnLive working on Facebook pages and on an iPad. But the iPad was only able to display Brag Clips or allow users to spectate. It wasn’t yet able to reliably games on tablet devices. Users can now rent games for as little as $1.99 for three to five days, or buy them for $49.99, or subscribe to a library of games for $9.99 a month. Now, users can take all of the games they ordinarily can get through their rentals, purchases or subscriptions and play them on the mobile devices. In September, OnLive launched in the U.K.

In some ways, the mobile OnLive isn’t a surprise. HTC invested in OnLive last year, and Perlman has been showing OnLive running on devices such as the HTC Flyer smartphone and the iPad for a while. But Perlman said that OnLive had to absorb the data from the tests over the past year and rewrite a number of its compression algorithms to make the service run more reliably on each individual tablet or smartphone. More devices will be added over time, and more games too.

The L.A. Noire game is a coup for OnLive. RockStar games redesigned the interface for L.A. Noire for tablets and touch. The new design creates a more immersive experience for the user, said Rowan Hajaj, vice president of finance and corporate development for RockStar, a division of Take-Two Interactive. L.A. Noire, which debuted this spring on the consoles, has highly realistic facial animations and lip sync technology, which results in ultra-realistic human characters. The game will be exclusively available on mobile via OnLive as a rental or purchase in the near future.

“We believe that this will not only appeal to current players of L.A. Noire, but also reach a new audience of casual tablet gamers who have never seen a game close to having the cinematic engagement of L.A. Noire,” Hajaj said. “We see our partnership with OnLive as pioneering an entire new era, and new market, in high-end gaming.”

The load times for the games are actually faster than they are on the consoles. Games such as L.A. Noire will run at 60 frames per second.

“L.A. Noire is one of the highest-performance games available,” Perlman said. “We wanted a headline game for this launch.”

You can play a game on an iPad 2 with a Wi-Fi connection. It is playable with as low as 1 megabit per second bandwidth, but 2-3 megabits per second is recommended. You can watch players in spectator mode in the Arena section. You can view Brag Clips, or videos that record your exploits in games. You can navigate to games and tap “Play Game” to get started. The visuals should be as good as what you see on a laptop, gamer PC, or a game console.

About 30 games are playable using a tablet’s touchscreen interface. Some games like L.A. Noire and Defense Grid Gold were either redesigned by the publisher for touch (as “native touch games”) and other games use a virtual gamepad overlay, which has an emulated mouse capability that responds to touch. Games in this category include Darksiders, Lego Batman, and Lara Croft and the Guardian of Light. More touch-enabled games are coming.

With the $49.99 OnLive Wireless Controller, more than 150 games can be played on the tablets and smartphones. Games that work well with the wireless controller include Batman: Arkham City, Saint’s Row: The Third, Deus Ex: Human Revolution, and Homefront.

OnLive is revealing compatibility with AT&T and Verizon’s 4G LTE cellular service, enabling full high-definition resolution, low-latency gaming wherever there is 4G coverage. The work with AT&T began a while ago as AT&T invested in OnLive. Devices which tap the 4G network and run OnLive games are the HTC Jetstream, Samsung Galaxy Tab and Motorola Xoom.That means you can pretty much play OnLive anywhere — indoors, outdoors, in the back seat of a moving car. The Amazon Kindle, which just debuted, is a cool new device. But it doesn’t have much processing power and it doesn’t work with the wireless controller for now.

On 3G devices, the latency is about 150 milliseconds, which isn’t playable for many games. That means you should play on Wi-Fi when using an iPad or iPad 2. But the 4G devices are just about instantaneous, Perlman said.

The OnLive app is available as a free download at the Apple iTunes store and the Android Market starting today. A year ago, OnLive had only about 20 or 30 games available. Now it has more than 150 and will soon be at about 200. Almost every major publisher has already released games to OnLive or is in the process of doing so, Perlman said. Only Activision Blizzard is missing from the list at the moment. Perlman hasn’t yet disclosed how many subscribers OnLive has. But he said, “In terms of growth, it’s happening. We are in that adolescent state where really interesting things are coming out. The shape of our growth curve is not unlike the launch of the Xbox 360.”

In fact, after the tablet and smartphone launch, Perlman said that productivity apps — such as Microsoft Office — will launch on OnLive early next year. To recap, OnLive’s investors include HTC, AT&T, Belgacom, Warner Bros., Juniper, and Autodesk. Partners include Vizio, Dell, GameStart Here, GameSpot, Intel, SRS, ATI Technologies (AMD), Nvidia, and Marvell.

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