Valve announces Steam Machines to challenge games console market
Described by the company as 'a powerful new category of living-room hardware', the Steam Machines will essentially be high-performance PCs with capabilities designed around gaming and other entertainment applications. Valve will not build the consoles itself, instead it is working with 'multiple partners', and there will be various models to choose from, all with different tech specs and price points (which are set to be revealed in more depth later). All the machines will run the SteamOS, a streamlined operating system announced by Valve on Monday.
3DO Jr. just like I thought.
Will end in the same result as 3DO Sr.
* No licensing fees.
* Building in market with tons of programs.
* Support by a top player in the videogame industry.
* Owner of a number of wanted IPs.
And yet you call it 3DO Jr? If all you see is 3DO here (and I won't knock that there is some 3DO), then you seriously are so partisan, you can't see reality. So if Steam Machines are 3DO Jr, then what is Android based machines, Ms. 3DO? Look at how well Android is doing before you dare bring up 3DO again here.
I do want to add here, you keep beating this drum, I am going to call Nintendo "Apple" in regards to the portable market, and ask you how they are doing. Nintendo and Apple are far closer to each other than Valve and 3DO are dude.
Edit add here, to prevent 3 posts in a row:
I have a question for johnlucas, since johnlucas has declared war on Valve and Gabe Newell. johnlucas, why should people listen to you over Gabe? Why do you know more than him, and should be seen as a more reliable authority? Why should anyone take your comment about SteamOS=3D0 Jr. seriously? This is, anyone who cares to be right, and not just a console fanboy of Nintendo. Can you answer that? I fail to see anything you say that makes you a greater authority than Gabe.
Well well, richardhutnik, my ever-present debater. Here comes the counter-argument. Point by point as always.
*You say "Linux based". I say "OK nice. What does that have to do with being a competitive console?".
Consoles & PCs are different. I just made a big post earlier detailing those differences.
The operating system is supposed to be custom for each console. That goes without saying.
I am aware of Linux-based systems being behind varied platforms from consoles to smartphones already.
So in the console world this means nothing special.
In the PC world this already exists & PC owners can already opt to use Linux to run their systems.
That's the problem with the Steam Box now Steam Machine. Trying to be the best of both worlds but actually being neither.
*You say "No licensing fees". I say "Then how is Valve going to make their money from this console?".
Gabe likes to keep Valve's sales & profit-making from Steam all clandestine & secretive but ain't nothing free in this world except air & they're working on that one.
Valve takes a cut of the revenues games hosted on its service bring in. How much of a cut & how much revenues the games bring in we can only guess that but you can bet your bottom dollar there's a cut. The Steam service ain't no charity.
Is Valve selling the Steam Machine at a loss? If they are (& I'm pretty certain they are), then that loss has to be made up in SOME kind of fee from the platform.
So they don't call it specifically a "licensing fee". Bet your poker chips that the devs are paying SOME kind of fee on that platform whatever they want to name it.
I simply don't buy that bologna. No fee my 'arsenal'.
*You say "Building in market with tons of programs". I say "This is a CONSOLE. And CONSOLES are supposed to market GAMES not programs".
Yeah I guess you could say that games are a TYPE of program & that's true but I don't think that was your intent based on the context.
The first rule of the console is that the hardware serves the software. The machines serves the game. That will NEVER EVER change.
And you need killer app type games to move a console. Must haves that drive console sales.
All the fancy hardware & fancy programs mean nothing if there's no hot game drawing people to the platform.
Hardware & programs can make it easier to draw people to the platform but it's the game that does most of the work.
This sounds like some Marketing 101 spiel: "Maximizing the footprint of our IP to create synergy with our install base to upshoot retailer demand".
I'm always suspicious of marketing talk like that. Sounds phony & so removed from the heart of the product.
You say "Support by a top player in the videogame industry". I say "Just one guy? Just one company? That's it?".
Unless you're Nintendo who is proven to support themselves virtually all alone, you're gonna need much more than 'a top player' to make it.
It's good that they have this top player but it won't be enough.
Once again I point you to what I said in another post about there being a market cap for number of consoles that can compete in the market at the same time.
In the 2nd generation, a glut of various consoles helped to cause a market crash.
Many were redundant & not distinct enough to be necessary & it drove down the whole business.
Once the strong player Nintendo came in & put roots down, openings for competitors have become fewer.
The industry is almost at its end holding 3 major competitors at one time much less 4.
That's why at the time of this writing both the XBox 360 & PlayStation 3 have not broken the 80 million sales barrier in 7-8 years.
Add a 4th competitor & that number spreads even thinner.
Steam Machine's best bet in that scenario would be to try to take the place of one of the 3 competitors to become the 3rd competitor itself.
But with how Valve is aiming the Steam Machine I would say their chances of doing even that are uphill to say the least.
*You say "Owner of a number of wanted IPs". I say "OK good. But how wanted? And how many people outside & oblivious to the Steam Community will want them?".
You see, both Microsoft & Sony have run into this problem with their 7th gen platforms which seem healthy but don't have the sales comparable to the 6th generation PS2—in hardware OR software.
I guess if you put them both together they match up but doing that shows that customer interest in games either flatlined or went down when taking Wii out of the picture.
Going by VGChartz's to-date figures, the PlayStation 2 had Global Total Game Library Shipments of 1,665.95 million which is about 1.67 billion & Global Total Game Library Sales of 1,256.39 million which is about 1.26 billion. Game Library of 3,545 titles.
The XBox 360 has current Global Total Game Library Shipments of 811.81 million & Global Total Game Library Sales of 790.63 million. Game Library of 3,456 titles.
The PlayStation 3 has current Global Total Game Library Shipments of 729.43 million & Global Total Game Library Sales of 702.55 million. Game Library of 2,947 titles.
Add the 360's & PS3's totals up & you get 1,541.24 million or about 1.54 billion for Global Total Game Library Shipments & 1,493.18 million or 1.49 billion for Global Total Game Library Sales.
The 360 & PS3 are much weaker individually & not much better put together.
Especially considering the virtually equal game libraries of the PS2 & 360.
Granted the PS2 had 12 years to make those numbers while the 360 had 8 years & the PS3 had 7 years. But the PS2 made the bulk of those sales in its prime period.
Major games stopped being focused on it from about 2007-2008 which since the PS2 came out in 2000 is about the same lifespan the 360 & PS3 have now.
Wii ended up having Global Total Game Library Shipments of 893.03 million & Global Total Game Library Sales of 854.35 millon...
...but that's only because Nintendo aborted operations on the Wii early. Also its Game Library had 2,751 titles.
Much like the system itself, it did more with less.
Add Wii to the mix & you have 2,434.27 million or about 2.43 billion in Global Total Game Library Shipments & 2,347.53 million or about 2.35 billion in Global Total Game Library Sales for all three of the 7th gen consoles.
Looks a lot better toward the PS2's numbers now, doesn't it?
My point in elaborating all of this is it took Wii's focus on audience growth to get the 7th gen's total gaming audience past 6th gen levels.
Neither the XBox 360 alone nor the PlayStation 3 alone was able to come anywhere near the PlayStation 2's output.
And combining the 2 platforms together only shows a relative matchup to the PS2. No real growth.
Wii was on track to top the PS2 & it would have. ESPECIALLY if the 3rd party stopped playing political games with releasing on the Wii platform.
What's also so striking about Wii is that those numbers are largely Nintendo doing that all by themselves.
What kind of games will Steam Machine have that can not only match up to what Microsoft & Sony have to offer but can match up to what Nintendo has to offer?
This is a question you have to ask if Steam Machine really wants to be competitive.
So YES I call it 3DO Jr.! I'm sorry you take offense to the comparison but that's what it is.
The last time a PC guy tried making a console was when Electronic Arts founder Trip Hawkins created this expensive multimedia machine called the 3DO in the early 1990s.
Trip Hawkins has a LOOOOONG history hating Nintendo & the roots of it go all the way back to the battle of the home computers vs. the NES in the 1980s.
The battle which the NES (& by extension Nintendo) won.
Remember back in 2005 when Trip said Microsoft was poised to buyout Nintendo within 5 years?
Trippin' on Nintendo
In an interview with the site Xbox2 News, Electronic Arts and 3DO founder Trip Hawkins suggested that he believed Nintendo would not be a hardware player five years down the road. The outspoken executive even indicated what he thought might become of the Big N.
Asked what he thought about Nintendo's future, Hawkins replied: "My magic eight ball says they will be acquired by Microsoft within five years."
5 years later in 2010, Nintendo's record-selling Wii changes Microsoft's XBox 360 in its Kinect-laden New XBox Experience & outsells said transformed 360 that year & holiday season with a mere paint job (Mario Red).
Even Tycho from Penny Arcade mocked that foolishness from Hawkins.
Ripped from Today's Headlines, Pt. 2
Humans have brought to my attention an interview with one Trip Hawkins, one where he claims that within five years Microsoft will own Nintendo. You can do your own research on the man and determine whether or not he is in possession of mighty powers of speculation or indeed something akin to prescience. I submit that he is not. I submit that he spends his day naked in a dunk-tank, and that from time to time a man throws a fish at him which he catches in his mouth....
...As for the Nintendo thing, I mean, they’re an extremely proud company. They’re not going to sell to an American corporation because fucking Trip Hawkins says so. They didn’t come out on top of this generation - in America or Europe, at any rate - but they’re hardly destitute. They’re not up to their elbows in the couch trying to scratch together some yens.
Here's another instance of Hawkins hawking this kind of madness as he spoke at the 2011 GamesBeat conference.
Hawkins: Platform Holders Offer 'False Promises of Freedom'
"Look at the world wide web and how many great companies have been built on that open platform," he said. "Nintendo is a great, amazing company, but how many companies have been built on the back of Nintendo's platform in the past 25 years?"
He said that the games industry had been born in a golden age of open platforms, and that EA had prospered because it had ignored Nintendo and focused on the Sega Genesis, which it reverse engineered. "We fought for our freedom. We didn't accept the feudal system."...
...He said that platform holders "lure [developers] in with false promises of freedom" and argued that that developers should "focus on the browser," an open system.
Hawkins' comments echo his recent sentiment that the web browser will win out as the new ultimate platform for games.
More of Trip trippin' on Nintendo from the same conference in the same year, 2011.
Why Trip Hawkins is wrong about Nintendo and should rethink Zynga
Trip Hawkins has had a few setbacks. After leaving EA in 1991, all of his ventures have struggled. His first post-EA game company, 3DO, went bankrupt in 2003 after Sony crushed its 3DO games console with the original PlayStation. After that, he formed Digital Chocolate, a mobile games company, which has struggled to turn a profit and carve itself a niche for eight years.
Speaking at this week’s GamesBeat 2011 conference, Hawkins boldly claimed that Nintendo’s licensing model has done nothing but harm the video game industry since 1985, hurtling it into the “dark age” in the 1980s. Being that DChoc is now a Facebook developer, what Hawkin’s answer to this problem? Free social games, like those made by Zynga, will bring us out of these dark times, he claims.
"I think we actually had our golden age when game development was using floppy disks and it was open free platform when we could all make games like we wanted to make," said Hawkins at the GamesBeat conference in San Francisco. "Nintendo came along and software licensing came in and we've been in a dark age since then...How many great companies have been built on the World-Wide Web, which is an open platform. The list just goes on and on, and Nintendo's been doing things this way for 25 years and there are no great companies that have been built on the back of Nintendo."
Why all of this haterade towards Nintendo from Trip Hawkins? Because he got beat by Nintendo TWICE! Possibly even THREE times!
In 1982, Trip Hawkins' Electronic Arts (EA) was designed to be a game publisher for the home computers of the era: the Apple II, the Apple Macintosh, the Commodore 64, the Commodore Amiga, the Atari 400/800/XL/XE/ST, the Tandy TRS-80 Color Computer from Radio Shack, the Amstrad CPC, the ZX Spectrum, & any computer using DOS.
But the Nintendo Entertainment System threw off the course of history & shifted gaming's prominence from those home computers to the videogame console.
The console should have been dead but here comes this odd little playing card/toy company from Kyoto, Japan messing up EVERYTHING for those who threw their lot in with the home computers as THE place for videogaming.
Trip Hawkins was one of those who threw in his lot with the old PCs, the home computers.
You look at the history of EA's published games & you will see that for most of the 1980s EA tried to hold off on producing for the consoles for the most part...
...Until the NES could no longer be denied & then they started producing more & more for those consoles.
Skate or Die! was one of EA's first signs of defeat in the computer vs. console fight. Jordan vs. Bird: One on One was another.
By the end of the 80s & the start of the 90s, EA was porting so many of their home computer games to the consoles (Nintendo's or Sega's) that it probably compelled Trip Hawkins to leave the company he started.
EA's Board of Directors was not interested in this home computer purity nonsense. The consoles were where the money was at & they wanted a piece of that pie, Trip Hawkins be damned.
That was Defeat #1.
Then Trip Hawkins seeing this console-ruled gameworld in the early 90s decided to make a console of his own.
But he would do it HIS way.
Multimedia was the go-to catchphrase back then & you had all these companies flirting with CD add-ons to their systems like Turbo-Grafx CD, Sega-CD & what would have been the Nintendo Play Station.
Even had Phillips try to get in on the console act with its half-console/half-multimedia player called the CD-i.
Not to mention Pioneer with its similar LaserActive.
Trip said yeah this is a good idea & founded The 3DO Company (3-Dimensional Operating-system) to create the 3DO Interactive Multiplayer.
3-dimensional indeed. Movies, music, & videogames. 3 forms of media. Don't just DO it. 3DO it! Nike got it all wrong.
These boys from San Mateo trekked all over the silicon valleys to bring this idea to life.
They got all the bigwigs they could muster: LG (Goldstar), Matsushita (Panasonic), Sanyo, AT&T, Time Warner, MCA, Kleiner Perkins Caufield & Byers.
Even Steven freakin' Spielberg is making something on the system!
This was supposed to be something BETTER than a mere game console.
The press was rooting for them too. Article after article after article praising & promoting the 3DO.
Time Magazine even called it its 1994 Product of the Year! Ummm..oh that's right. Time Warner was one of 3DO's partners. Yeah.
The press was thinking, "It's about time an American made its mark on the videogame world again. Sick of all these Japanese people taking over everything. They even got the Seattle Mariners now!"
Here comes the launch! October 4, 1993. $699. 699 U.S. Dollars (a similar price point would happen 13 years later from some Tokyo-based company).
Powerful technology, powerful partners, powerful press. 3-dimensions again!
And then IT FELL FLAT ON ITS FACE!
Couldn't even beat the much weaker Sega Genesis or Super Nintendo Entertainment System.
Big powerful 3DO can't even match up to 16-bit consoles!
And Nintendo was the King of the Consoles even during the threat of Sega. Donkey Kong Country What?
Screw all that FMV nonsense! Where's the gameplay? Where's the games for that matter?
2 years later in 1995, Trip Hawkins threw in the towel by selling off 3DO's intended successor—the M2—to Matsushita & deciding to turn The 3DO Company into a developer/publisher for the console & PC markets.
Already humbled by the Nintendo & Sega through SNES & Genesis, he couldn't take any more punishment with Sony getting into the picture with the PlayStation, ANOTHER console.
The 3DO Interactive Multiplayer ended its retail run on December 31, 1996. The last day of that year.
Eventually, Matsushita cancelled what would have been the Panasonic M2 & turned the tech into what runs ATMs & coffee vending machines.
The 3DO Company as a game developer struggled to find any lasting success for years & years eventually filing for Chapter 11 Bankruptcy in May of 2003 after laying off employees WITHOUT PAY. (amazingly The 3DO Company went bankrupt on THE EXACT SAME DAY that Electronic Arts was founded, May 28th!)
That was Defeat #2.
Seeing the world of consoles consume what was left of the old PC games market, Trip decided to find refuge in the new PC market of Web browsers & mobile devices.
Here he would reclaim his lost glory & possibly get back at Nintendo who ruled the handheld gaming consoles.
In the same year The 3DO Company files for bankruptcy, Trip Hawkins founds the mobile game company Digital Chocolate.
All these little mobile devices running around just begging for games, all this potential in the Web-game market with PopCap & all that.
It's time to Seize the Minute! Perhaps after that seize a million. Whatever can fit into my money grip.
The company does pretty good. Games like Night Club Empire, Rollercoaster Rush, Brain Juice, Tower Bloxx, Brick Breaker Revolution, Tornado Mania!, Galaxy Life, & Millionaire City give Digital Chocolate a high profile.
In fact, the company has done VERY good. They win numerous awards under the categories of Best Artistic Design, Best Developer, & Game of the Year.
They had offices located all around the world from homebase San Mateo, California, USA to Mexicali, Mexico to Bangalore, India to Barcelona, Spain to St. Petersburg, Russia to Helsinki, Finland.
They got so successful that they even bought out Sandlot Games, the creators of the popular Cake Mania franchise.
Trip Hawkins was finally carving out his own empire in the face of the consoles which once shamed him.
Uh oh, prepare for more shame.
Nintendo had not only survived the PlayStation Portable threat from Sony they made a mockery of it as the DS became the best-selling handheld console—and console period—of all-time.
Then Apple, the new kings of portable media players, snuck into the handheld games market with the iPod Touch & iPhone in 2007 throwing down the gauntlet for the future of gaming.
This led to the smartphone/tablet gang of videogaming with its impulse-buy price points on games.
Nintendo first answered them with the DSi then the 3DS & just when everybody wrote off the 3DS due to its rough launch, 3DS resurges defying the new PC market. Much like a certain Entertainment System did to the old PC market nearly 30 years ago.
Reports of Nintendo's death are once again greatly exaggerated. The handheld console lives!
Meanwhile, Digital Chocolate's traffic slows down & player counts begin to fall. On the browsers & on the apps.
Reports of layoffs & office shutdowns bubble to the surface & then the unthinkable.
On the day before the 30th anniversary of Electronic Arts' founding, Trip Hawkins steps down as Chief Executive Officer of Digital Chocolate.
He says he'll continue on at Digital Chocolate in "a consulting and advisory relationship".
Chiefs only willingly become consultants & advisors when they're in their elder years & want to pass the company on to younger hands.
Otherwise it's a demotion. ESPECIALLY when that CEO is also the Founder of the company!
Digital Chocolate then follows the septic-bound trajectory of fellow Web game/app game titan Zynga as it begins selling off its remaining offices.
So much for the new PC market. But hey Trip's got a new startup called If You Can. It's all about educational games!
This is most likely Defeat #3.
This is the kind of inconsistency & flightiness that led to the industry's demise in the mid 1980s. Trip's whole mentality of this so-called free-and-open world is representative of the PC mentality: chaotic, ununified, anarchist, boundless, unstable.
That's why the console wins. That's why Nintendo wins. Because Nintendo brings some order to all of this unchecked chaos, unity to the ununified, law to the anarchy, boundaries to the boundless, stability to the unstable.
Trip Hawkins & those like Trip Hawkins such as Gabe Newell will never win this fight against the consoles.
That's why Gabe Newell's Steam Machine will end up just like Trip Hawkins' 3DO.
Google's Android & the rest will fall apart eventually because the business model of app gaming is unsustainable long term.
And don't compare Nintendo to Apple on this gaming thing. They have some similarities but the one thing that's different between Nintendo & Apple is that Nintendo is invested in the games that come to their systems while Apple is not.
Apple doesn't care to control the content on the system outside of 'family values' concerns. They're not interested in groundskeeping.
Nintendo has ALWAYS exercised discernment with most stuff that comes onto their console. They are always groundskeeping to make sure the gaming soils stay rich & fertile for future crops to harvest.
Apple itself is not a gamemaker & following co-founder Steve Jobs' mentality have no interest in being a gamemaker.
Their platforms by default are only 3rd party with no 1st party or 2nd party available.
Nintendo is ALWAYS a gamemaker & their platforms are 1st party/2nd party-centric with openings for 3rd parties to assist.
Apple also is not dependent on games to be successful so it's almost a take it or leave it kind of thing. Just an extra revenues stream.
Nintendo depends on gaming to be successful so they make sure to keep the gaming environment healthy for the health of their business.
THAT'S the difference.
And as for the last thing you said...
"johnlucas, why should people listen to you over Gabe? Why do you know more than him, and should be seen as a more reliable authority? Why should anyone take your comment about SteamOS=3D0 Jr. seriously? This is, anyone who cares to be right, and not just a console fanboy of Nintendo. Can you answer that? I fail to see anything you say that makes you a greater authority than Gabe."
Gabe ain't God, son.
The dude is out of his depth here & it doesn't seem like many people are willing enough to say it outloud.
Much like Trip Hawkins with the 3DO he has the gaming media rooting for him to succeed. But this lulls him into a false sense of security much like Trip Hawkins & his 3DO.
Gabe is just one man like I am just one man. He might know the world of PC gaming quite well but knows jack about the world of consoles.
It's like Michael Jordan & basketball vs. Michael Jordan & baseball.
Can't nobody tell Michael Jordan NOTHIN' about basketball that he don't already know. He's that good & is proven to be that good.
But in the world of baseball Michael Jordan is a lost soul.
Bo Knows Football. Bo Knows Baseball. But Gabe don't know Diddley about consoles.
And he's proving it with this execution of this Steam Machine project.
Why should you listen to me over Gabe? You don't have to do anything you don't want to do.
But my reasoning is what I stand by. My observation & my intuition. The logic of my conclusions.
Gabe Newell like every PC-centric guy before him is troubled by the existence of consoles.
He wonders why more people don't want to play on PCs or at least why more people don't want to pay for games on PCs.
But he also realizes the limitations of the PC games market & doesn't want to get caught up in its snares.
So if he's forced to go to the consoles he'll do his best to shape the console in a PC image.
And I'm not just talking about how they bend Sony & Microsoft into morphing their consoles into PCs.
He's going to the ultimate step & building his own. But like Jordan & baseball he'll end up being a lost soul.
Here's somebody else who has seen this all before. You might have heard of him. He calls himself Sean Malstrom.
He breaks down the PC developer & Nintendo in this piece from March 28, 2011. Follow him as he goes back in time in his DeLorean.
Email: Third Parties and Nintendo games
For as long as I can remember, the Western Computer Game Industry hates the idea of the video game console.
That may explain these comments from Bing Gordon, who worked at EA from its very beginning as a product marketer then later Chief Creative Officer.
He's now a partner with venture capital firm Kleiner Perkins Caufield & Byers who initially funded the founding of Electronics Arts in 1982 & was one of the partners with The 3DO Company in 1991. Interesting.
Game Industry Legends: Bing Gordon
Q: What do you think of the Wii U's chances this Christmas and beyond, especially facing tablets like the Nexus 7 for $199 that are pretty good game devices? Is that going to make it tough for the Wii U?
Bing Gordon: I think Nintendo's already on track to become primarily a software company. We saw that with Sega back in the day; Sega made some missteps and became primarily a software company. Nintendo hasn't really made missteps, Nintendo probably has better creative talent and better leadership now than Sega did. It's got the most robust business model, the best creative talent; Miyamoto's still the best in the business. Apple's most directly competitive with Nintendo. So far, when Miyamoto makes a perfect game, in his career he makes games worth $200 - it's worth buying a system for. I think the handheld is going to be under a lot of pressure. I can imagine a day when Nintendo wonders - and maybe it's generational change - when Nintendo wonders if they ought to take some of their best games and make them apps.
P.S.: Oh don't look now but DialgaMarine, one of your fellow debaters is ironically not so hot on the Steam Machine. Check his post.
Valve is making a huge mistake with the Steam Machine
Neither is Tycho from Penny Arcade.
The Tithe, Part Ten
I know that I’m supposed to, but I do not care about the Steam Box. Steam is a service that I use to get games. It is not some kind of lifestyle choice for me; I don’t feel compelled to wear the stylish universal cap. You can build a Steam Box today if you want to. Indeed, I have one, and so do you; it’s just not hooked up to your television.