How impressive is the Desktop Plus version of OnLive's iPad software? For $4.99 a month it basically lets you run full Windows on your iPad, and at blazing speeds to boot. This is the cloud done right. Mostly.

OnLive is a cloud-based gaming company, and what it has done is to take the same technology that shoots first person shooters to your screens and apply it to running apps over the cloud. The company leverages countless servers in data centers connected to gigabit ethernet to run various programs for you—including Microsoft Word, PowerPoint, Excel, and Internet Explorer—and then it sends that video to your iPad. Essentially, it turns your iPad into a display for one of its servers.

What's that mean in practice? First and foremost it means you can have Office on your iPad right now, today, and free, which was the promise of the original OnLive Desktop. You can edit documents, run video in PowerPoint presentations and basically do anything that you could if you were using Office on a desktop. You can use a software keyboard for input (which includes a Windows-centric keyboard layout) or hook up a bluetooth keyboard. It also recognizes handwriting, which is a neat trick.

OnLive Desktop Plus takes that functionality and adds something that feels magical: the Internet. Because OnLive is sending full-fledged version of IE to your iPad, you can use web apps like Dropbox or Gmail or, well, just about anything else. Flash video works everywhere, because again, it's being handled by remote servers and sent from their to your tablet. You're never kicked to a mobile site. You get to see videos on Hulu or Disney or anywhere else, exactly as they're meant to be presented.

The entire premise is that OnLive doesn't deliver all the data that its servers are crunching, just what you need to see on your screen. It's not sending you entire web pages, fully rendered. It's also not compressing video, so there's no buffering. Think of it as a video of your computer's display, where the stuff going on off-screen has been not only cropped out, but isn't delivered. (Audio, however, does come through even in the background.)

I was a little skeptical at the demo. Surely this was rigged, right? There's no way to download and display artifact-free video that quickly. But at home, things were mostly the same as they were at OnLive's offices.

Word was responsive and I was frankly amazed at how well the handwriting recognition worked (although it's still far slower than using a keyboard). Hitting Windows from my iPad felt little different than from my laptop, although the navigation was admittedly trickier.

Hulu, however, had some hiccoughs. The video wasn't synced to the audio at one point, and there were some noticeable artifacts. I was less impressed with that than I was with the apps. But for the most part Flash, typically a buggy experience even on a desktop, performed flawlessly. And it's amazing to see videos fire more or less the instant you load them, which happens thanks to OnLive's fat pipes and robust machines on the back end. Even over my sometimes janky WiFi connection, this thing took off. A 35 MB PDF file, for example, downloaded and displayed in 9 12 seconds on OnLive Desktop's browser. When I tried downloading the same file from my Dropbox app over Wifi, it took 24 seconds.

The company is also bringing an enterprise version to market in the near future. They showed me a version of Maya running on that today. To be able to run a $5000 program on your $500 iPad? That really is priceless.