Why Steam Box Won’t Matter

 

After much anticipation, Valve finally made some news this week with a series of high-profile announcements. No, they didn’t announce Half Life 3; they didn’t even announce Half Life 2: Episode 3. Instead, Valve elucidated a little about their plans and ambitions regarding the long-rumored Steam Box video game console. Valve made 3 major announcements this week: they revealed SteamOS, their new Linux-based operating system that allows users to stream their Steam games and other digital content onto any device connected to a T.V.; they announced that Steam Box, who’s proper name is “Steam Machines”, will use SteamOS and will be distributed by multiple manufactures starting in 2014; and they revealed their new game controller, which uses track-pads instead of traditional analog sticks. What they failed to announce were expected price points. With legions of fans around the world, whenever Valves speaks, people listen. Unfortunately, these major revelations seem to have met with mixed reactions, leaving one to ruminate upon this vexing question: Will Steam Box even matter?

There Can Only Be 3

As video game history has shown us, there has never been more than 3 successful video game consoles on the market simultaneously. During the second console generation, which brought us the Atari 2600, Mattel Intellivision, and the ColecoVision, an inundation of shovel-ware lead to the fabled Video Game Crash of the early to mid 1980s. This was an era that pre-dated modern licensing laws and publishing arrangements. Any software company could and would make unsanctioned games for any console, over-saturating the market with low-quality games. With multitudes of competing consoles vying for consumer dollars combined with bad software, this over-saturation caused the video game market to collapse. After Nintendo released the Nintendo Entertainment System mid-decade, they established stricter licensing laws and elevated their standards of quality (note the Nintendo “Official Seal of Quality”). Since then, it is typical that only two mainstream video game consoles would scrap for dominance, with an occasional third console lagging innocuously behind. This lasted until the unprecedented outgoing current-generation, where 3 major consoles share statistically similar portions of the gaming market.

Where does Steam Box fit into all of this? That is a difficult question to answer. With 3 already recognizable and established brands fighting for space on retail shelves, it seems that a Steam branded video game console is already an afterthought in a crowded gaming market. With the impending next-generation of consoles palpably upon us promising to temporarily offer gaming experiences on par with PC gaming, the recipe for failure is already apparent for Valve as it is likely they will struggle to woo consumers away from the shiny, new systems that have features similar to Steam Box, yet came out months earlier.

Who is Steam Box For?

Many console gamers prefer consoles to PCs because of their low barrier of entry and ease of use. However, PC gamers are an enthusiastic, hardcore bunch. They love gaming, but they also take pride in the PC systems they game on. Because of the lack of standardization and conformity found in PC hardware, gaming PCs are just as varied and unique as the individuals who own and created them. On just about any PC gaming internet forum, enthusiasts are just as likely to list their system specifications alongside the lists of games they are playing in their posts. PC gaming enthusiasts are an elite and niche group who play games on their PCs for very specific reasons.

So, who is the Steam Box for? Console gamers will probably stick to the familiar hardware they already know and trust, and PC gamers who appreciate the Steam platform already have PCs; they already have a “Steam Machine.” Why would PC gamers want to “downgrade” to a console which lacks the versatility and upgrade potential of their PCs?

Nintendo was very fortunate with the Wii. They appealed to and welcomed previously uninitiated demographics into the world of gaming: the elderly and Soccer Moms. Valve does not have the same luxury of breaking into a new niche within the consumer market. The population the Steam Box is designed to appeal to is purely redundant. On one hand, you have the console gamers who are comfortable with the current console offerings; on the other hand, you have industrious PC gamers who already have access to Steam and the ability to connect their systems to a T.V. Both of these groups will have access to similar libraries of games and similar feature sets, relegating the Steam Box, once again, to merely an afterthought. If Valve is going to be successful, they are going to have to create a whole new population of gamers, similar to what Nintendo was able to achieve with their successful, last-generation hardware.

Steam is Known as a Game Developer and Digital Distribution Service

Thanks to Valve and Steam, the PC video game market has seen a resurgence in the last few years. Steam is well known for their epically incredible annual sales and weekly deals, giving the floundering PC market a much needed boost in its hour of need. Valve made their name and carved their reputation by having developed some of the most beloved and popular video game franchises of all-time. In recent years, Valve has been more than content to posture themselves firmly in the very lucrative digital distribution model of video game delivery and promotion. Steam is the largest video game digital distribution service on the internet, and Valve founder, Gabe Newell, is one of the richest individuals in the gaming industry. This is how Valve and Steam are perceived by the masses, and sometimes, perception is everything.

Although gaming enthusiasts yearn for progressive innovations in technology for their cherished hobby, they can be intransigent in their resistance to change. No one is clamoring for new video game hardware from an alternative manufacturer. People seem content with the current “Big 3” console makers, as indicated by the sales data of the last 5 years. Consumers also seem content with Valve and Steam being exactly where they are now, as a game developer and digital distribution service, respectively. Changing people’s common and popular perceptions of an industry giant may prove to be a very difficult and time-consuming affair for Valve, and time is a resource they don’t have in surplus. The next-generation will begin very soon, and the honeymoon effect gamers will experience with their new toys will carry over easily into next Spring. Presumably, this would be about the time Valve would begin marketing their Steam Box, just in time for Sony and Microsoft to start inundating our senses with announcements of new games and features to keep us interested in their new hardware. Nintendo may even join the fun by finally releasing some of their most anticipated Wii U titles. Just like there is little retail shelf space for a new video game console, there is also limited mind-share space for a new console in the perceptions of gaming enthusiasts.

 

By all accounts, next-generation video game hardware has been purposely engineered to approximate PCs in order to better facilitate and expedite software development, consequently reducing development costs. In other words, game consoles are becoming more like PCs, and the gaps found in the experiences and features both offer are narrowing with every generation. Whether a consumer purchases a PS4, Xbox One, or a gaming PC, that consumer is almost guaranteed a high-quality gaming experience. These new consoles are poised to compete with Steam in their own right, with their own improving and growing digital distribution services. At this juncture, it seems almost imprudent that Valve would attempt to compete on an unfamiliar front, while the competition has been preparing to compete with Valve and Steam on their own turf for quite some time. Valve may have been better served to focus on exploring the potential of the SteamOS instead, because that innovation may have greater potential to have a positive impact on the industry by providing Microsoft’s juggernaut Windows brand some viable competition. Valve may have found a crevice within which to enter into the market with the weakness of the Wii U sales so far, albeit it is difficult to perceive that they will experience anything but struggle in their attempt to do so. The only times an incipient company introduced a new console that was successful, they offered both gamers and developers something new and necessary for its time. Upon cursory and preliminary examination, the Steam Box offers nothing new or necessary for anyone. Just ask any PC gamer.

 

 

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