





A console without walls

There’s a big opportunity for Valve to capitalize on content that has never been able to penetrate the console market as effectively as big-budget titles. Unlike consoles, PCs have been an incubator for individual creativity, allowing virtually anybody with the know-how to remix existing content and give it to other people for free.

Mods

Mods range from simple tweaks to existing games, to full-blown overhauls that totally change the experience of stuff you already own. While Counter-Strike and DOTA 2 are examples of how mods with humble origins can make it to the big leagues, Valve doesn’t need to acquire and develop mods to make them valuable to players.

Modifications are in Valve’s DNA. The company has proactively supported independent creators and encouraged them to modify and remix Valve’s own software, providing them with robust game engines, content creation tools, and APIs that allow them to benefit from Steam’s backend services. Counter-Strike started off a modest first-person team-based shooter that blossomed into a worldwide hit before Valve ever touched it.

Some console gamers have also worked on getting mods and other "homebrew" content onto their platforms of choice, but console makers have actively discouraged and attempted to block that kind of content for various reasons. Valve can change all that simply by getting Steam into the living room.

Player-created content

While mods would make a great addition to the console experience, content creation doesn’t just have to come from skilled programmers and artists — it can come from the players themselves.

Intuitive content creation tools can give Valve an edge with the Steam Box, especially if they allow gamers to modify and remix their games with ease. The Portal 2 level editor, which lets players create their own test chambers and challenges, is an excellent example of the kind of tool Valve can introduce (or encourage developers to offer) to empower players and open up their creativity.

Content creation isn’t just for the PC, but it’s more of an exception on consoles. PlayStation 3’s LittleBigPlanet is a great example of where community-created content can go right, and Sony might be taking its success into account for its next console.

Stores and Sharing

Evidence of the popularity of community-created content is plainly visible. The Steam Workshop, Valve's store for extended game content and community-created DLC, is already thriving. At the time of this writing, there are 13,171 custom items available just for Skyrim. It wouldn’t be difficult to extend this to the Steam Box; it’s already on Steam.

Valve also wants to promote community generated content with more user-created stores on Steam. Newell told us that "anybody should be able to create a store, and it should be about extra entertainment value." Newell said that "an editorial filter is fine, but there should be a bunch of editorial filters. Some people will create team stores, some people will create Sony stores, some people will create stores with only games that they think will meet their quality bar. Somebody is going to create a store that says 'these are the worst games on Steam.'" That’s not available on traditional consoles, which require you to buy official games from places like Best Buy or Gamestop, or from official stores like the Xbox Games Store or the PlayStation Network Store that are managed exclusively by Microsoft and Sony.

Sony and Microsoft could certainly wise up to the potential of community generated content for next-generation consoles, but even then they’ll be playing catch-up to what’s already available on the PC.

The right hardware at the right price

Certified hardware: Better is best

For years, PC gaming has been troubled by the insane diversity of hardware on the market. There’s no guarantee that the PC game you want to buy will work on your computer, and there are lots of games that won’t work on older PCs, or PCs that are missing just a single critical component (like a graphics card with enough horsepower). As a result, PC games can have wildly different system requirements — ranging from Flash games in the browser that can be played on almost any PC, to games with next-generation graphics that push the limits of even the most expensive and capable graphics cards.

Nobody with an Xbox 360 has ever had to worry if the latest 'Call of Duty' game would be able to run on their system

This reality is encapsulated well in a meme you’ve probably come across if you’ve spent any time in online gaming forums or comment sections since 2007: "will it run Crysis?" Crysis stunned gamers with gorgeous graphics, but when it first came out, only a small set of PC gamers with the right (read: expensive) equipment could enjoy the game’s stunning visuals. Nobody with an Xbox 360 has ever had to worry if the latest Call of Duty game would be able to run on their system.

A Steam Box with certified hardware could help console players, or anyone who doesn’t really care about specs, to jump into PC gaming without fussing over which components to buy, or having to choose between endless pre-made computers from PC makers like Dell, Alienware, or HP. It’s not the first time a minimum spec been attempted — the PC Gaming Alliance promised to create a baseline for gaming PCs that would be updated every few years — but Valve has a lot of things the PC Gaming Alliance didn’t: including a killer platform in Steam, and more than 50 million users to back it up.

Key Partners

What Valve still needs are deep partnerships to make its Steam Box a reality at a $300 price point, and there are a couple of key opportunities it could take advantage of. One of those opportunities is with graphics card-maker Nvidia, which is attacking the living room in its own way with the project Shield gaming handheld. Shield can play PC games, including those on Steam, and it even supports Steam’s Big Picture Mode: you can hook the Shield up to your television and use it like a gaming console. But the Shield will be expensive, and so, like expensive gaming PCs, it’s not going to find its way into everyone’s living room. That means Nvidia could again miss out on getting its graphics cards into the next generation of living room consoles — unless it finds a promising partnership to get them there. Valve’s Steam Box could be an answer.

Another big cost-sucking component is a system’s central processor. Right now, Intel has a pretty good grip on the PC gaming market (and the consumer PC market in general), but it hasn't had chips in a major console since the original Xbox. A deep partnership between Valve and Intel could give Intel a foot in the door in the console world. There could be some cannibalization of the PC market that Intel already supplies, but if Valve can capture gamers that would otherwise buy an Xbox, PlayStation, or Wii, it could be a net gain for Intel.