Great concept, I can't wait to play with it in person :) A few thoughts:
I'm a little skeptical about how robustly it will perform, but I am sure they will have a chance to prove their technology soon. I'm sure everyone who's played online has dealt with lag spikes, just due to random congestion, noise, route changes, that sort of thing. It seems that this system will be much more sensitive to those kinds of network delays.
One thing that they didn't talk about was really how high latency-sensitive games fit into this framework. I'm talking about timing games, such as Guitar Hero, or games that need twitch reactions like Street Fighter. Players of these games frequently complain about latency that happens between the console and the display, nevermind the the latency of a network. (HDMI decoding delay has made playing these games kind of a pain on some HDTVs) Anecdotally, I notice that in these kinds of games, delays around 5-15ms delay can make a huge difference.
Even still, I think a lot of action games can be very successful on this kind of system. Platformers (like Super Mario, Little Big Planet) and driving games do involve real-time reaction, but the way we play these things, our actions are more predictive, than reactive. ("I'm running towards the edge of the roof, and I'll get these in about half a second, so press jump.... now!") In these kinds of games, our brains sort of "build in" the latency into our actions, so we're not as sensitive to them.
One point that I think they should have emphasized is cheat prevention. On many PC games, there's trainer's, aimbots, all sorts of cheats that make playing on public servers very suspect. With this system, they're reducing everything down to just control input and video output, so the opportunity to cheat in a game is significantly harder.
I have a funny feeling that the monthly subscription fee will be something more than I'll want to pay. They have to deal with the cost of maintaining high-end gaming servers, and what I'm sure will turn out to be an enormous network bill. I'm sure it will be reasonable, because in their model, instead of maintaining my own high-end gaming PC, the burden will be on them to keep the hardware up to date. It will just be more than I want to pay.