Having tested the PlayStation Now service in the closed beta and now the open status I believe that you also need a decent upload speed as well for things to work out.
Since the server is communicating back and forward to your console, it will need a decent upload speed as well.
Few months ago I had 15down/3upload speed and I had difficulty streaming movies in HD. During the movie the quality would fluctuate back and forward inconsistently.
Few weeks ago I upgraded to 60down/10up and no more issues.
So far I tested Dead or Alive 5, Of Orcs and Man, Ninja Gaiden Sigma 2 and I'm currently playing Final Fantasy XIII though PlayStation Now.
In all honestly, smooth like a butter, I couldn't even tell the difference in visuals from the disk version and the response was excellent, especially with fast paced games like Sigma and Dead or Alive.
It's a fantastic service that works, however I don't believe the speed of the Internet is yet properly established.
Also, the prices could use some work. I'm ok paying 5$ for 30 days renatal however, some newer games outright ask for 15$ or 20$ for the same month.
Mind you some of this games are older and can be picked up for cheaper in retail.
I would love to see subscription option added, similarly to Netflix where you can enjoy majority of the games at one yearly or monthly price. Not to mention, add PS and PS2 classics as well. :)
With proper internet connection PS Now works, extremely well. However, how much will it cost to consumer is another story.
From personal experience in close beta and now in the open, I wouldnt recommend anything less then 20 down/5up for good experience and higher for optimal gaming.
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