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- Valve’s recently announced Steam Machine seems to be exactly what Microsoft was planning for the next generation.
- The upcoming Xbox will likely be a lot more expensive, making the Steam Machine a better option for a console-PC hybrid.
- In addition to Valve, competition from PlayStation and Nintendo will put further pressure on the gaming giant in the coming years.
Valve’s latest announcement has revealed three new devices for the gaming industry, the most interesting of which is the Steam Machine.
This console-like PC effectively combines the best of the PC and console worlds, offering an accessible entry point into the world of PC gaming. In many ways, Valve has done exactly what Microsoft set out to achieve with its next-generation hardware.
Following this announcement, the elephant in the room needs to be addressed. Has the Steam Machine completely stolen the next-generation Xbox’s thunder even before the latter’s official reveal? I certainly think so.
Why it matters: Xbox’s hardware division has already suffered losses over the last few years, so Valve’s announcement could prove to be a major hurdle for the gaming giant moving forward.
Beaten To The Punch
When Phil Spencer and Satya Nadella outlined their goals to produce in-house hardware with access to Steam and other PC storefronts, the idea certainly sounded compelling.
In many ways, Microsoft’s concept sounded revolutionary for the world of console gaming. By offering a semi-open ecosystem and retaining the benefits of fixed hardware found in consoles, Microsoft could open up new opportunities for gamers and developers alike.
However, the Steam Machine does everything Microsoft promised, and then some. Thanks to SteamOS and Valve’s enormous library of games, it essentially combines the benefits of both PCs and consoles.
The specifications are no slouch either, and the Steam Machine should be able to rival the PS5 when it comes to current-generation gaming. In my opinion, this announcement has left Xbox between a rock and a hard place.
On one hand, the gaming giant can no longer go back to the traditional console approach after making such drastic changes to its business model. However, on the other hand, there is little reason to buy an Xbox if Valve’s hardware offers similar value and also represents the face of PC gaming.
Even with the promise of a more open ecosystem, Valve’s proposition just sounds a lot more interesting. If the Steam Deck is anything to go by, the Steam Machine will be quite a bit more customizable than Valve is letting on.
Be it playing games from other console generations, Windows installations, and third-party software, the Steam Machine should be able to do it all. I would even go as far as to say that Valve’s software experience will be better than the upcoming Xbox’s since the company is known for its software expertise.
On the other hand, Microsoft’s platforms, such as Windows, are still prone to various bugs and errors. There’s no telling, therefore, how well a new type of software experience will work on the upcoming Xbox hardware.
The Price Argument
Pricing usually makes or breaks consoles, but Microsoft has made it clear that it will no longer compromise on pricing. Following back-to-back price hikes for the Xbox Series S|X, Microsoft’s next-generation console is expected to be positioned as a premium offering.
Although official pricing is anybody’s guess for now, many have estimated pricing as high as $1000. Elsewhere, the Steam Machine should be priced relatively competitively since Valve is in a position to sell its hardware at a loss.
This exact strategy did wonders for the Steam Deck, and Valve was then able to make up for losses on the hardware through software sales. With the current growth of PC gaming and Steam, this strategy should work well for the Steam Machine, too.
Xbox, on the other hand, no longer has the luxury of falling back on software sales to make up for hardware sold at a loss. Between Game Pass and the dwindling interest in the Xbox brand, the gaming giant no longer has a large enough user base buying games to justify selling hardware at a loss.
An Interesting Future
Perhaps Xbox’s saving grace will be the fact that it will reap the benefits of selling games on both its own hardware and Valve’s upcoming machine.
Still, it’s hard to ignore the obvious fact that the Steam Machine seems to have stolen the spotlight. Even with promising new features like potentially free multiplayer gameplay, the next-generation Xbox hardware faces a behemoth in the form of Valve.
There’s also the unrelenting competition from PlayStation and Nintendo, both of which are doing a great deal better than Microsoft in the console market. As such, Microsoft might just need to come up with another unique selling point for its upcoming console.
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[Senior News Reporter]
Avinash is currently pursuing a Business degree in Australia. For more than 5 years, he has been working as a gaming journalist, utilizing his writing skills and love for gaming to report on the latest updates in the industry. Avinash loves to play action games like Devil May Cry and has also been mentioned on highly regarded websites, such as IGN, GamesRadar, GameRant, Dualshockers, CBR, and Gamespot.
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