Can everyone please stop claiming and speculating that Valve’s new hardware will be loss leaders? If you watch LTT and Gamers Nexus’s first videos on the announcement, they actually spoke with Valve’s engineers. And the Valve representatives already said that the new hardware WILL NOT BE LOSS LEADERS.
There isn’t even evidence that the Steam Deck was a loss leader. All GabeN said was that the lowest cost launch model was priced “painfully”, which doesn’t necessarily mean it was sold at a loss, it could easily have been sold at a very tight margin.
And no, low margins does not meet the definition of a loss leader. A loss leader is a product sold below cost, in that every unit sold actually costs the seller money.
I get the desire to speculate on new hardware. It’s fun and it helps pass the time until we hear more info from Valve. But there’s limits to what is reasonable. Valve has already stated that the new hardware won’t be loss leaders, so hoping and/or claiming they are isn’t reasonable.
Sorry for the rant, but all of the comments that seem to have only skimmed headlines are quickly getting to me
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>.> what have I done
I agree we don’t know if they’re loss leaders yet. I will say that even if the hardware is priced at a loss, though, it’ll sell more Steam games. Ultimately I don’t know if it really matters.
Though yeah, people should get past headlines. Lol
I agree we don’t know if they’re loss leaders yet.
Please actually read the body of the post. Valve has already said in an interview that they won’t be loss leaders
I’m aware of Valve being very generous with warranty/replacements of controller hardware for the Index. Even years after the warranty is up. But I think this is because of the major durability issues and known defects that the Index Controllers have.
In any case, Valve seemingly has lost money on a certain percentage of Valve Index kits/controller hardware. Based on how many people I know, including myself, who have gotten replacement hardware from Valve. Sometimes many times for recurring issues.
But I’m not aware of Valve doing the same for the Deck.
Doesn’t the new controller have internal batteries?
I think they’re referring to the Steam Frame controllers, not the Steam Controller.
The steam frame controllers use AA batteries, the steam controller has a lithium ion internal battery.
Also it does have a USB port but the primary charging method is via the pogo pins. But obviously you might want to recharge from a wall outlet so they also include a USB port. But that’s obviously going to get used far less often than it would otherwise.
I was expecting an APU
…and you got one.
AFAIK: It depends.
The Cube: No
The VR headset: Yes. But it’s rather an SoC.No, the Steam Machine has a CPU and a pcie GPU.
Even if you could argue Raphael was an ‘apu’ since it has the 2CU GPU, those are lasered off on Steam Machine’s CPU.
And honestly, we probably should have expected this from the leaked benchmarks. It was already showing hits of using a separate 7600
Yeah they said they are pricing the Steam Machine at PC market prices, but they do having to contend with reality. There are consoles on the market that are more powerful at a lower price point, it will dampen their sales for sure. I mean most pcgamers probably have more powerful hardware already, what is the incentive? Sure small form factor, but is it worth a premium price to the average pcgamer? Console peasants will turn their noses up at it, so who are they marketing to?
I can see the Steam Frames selling better due to it being a fully untethered VRPC headset that can play more than just VR games. Not to mention you can stream from a more powerful PC to the frames making the battery last much longer and better gfx fidelity.
The Steam Controller has to contend with a flooded market of users used to using one type of controller, so a little bit of an uphill battle there too.
I mean most pcgamers probably have more powerful hardware already
According to Valve, it should outperform or match 70% of current PCs owned by gamers. So while not crazy powerful, it might be an affordable (hopefully) upgrade for some more low spec gamers.
I wonder if GPU/motherboard manufacturers are not leaving money on the table by not selling an all-in-one gaming motherboard like the one in the Steam Machine.
Built-in GPU and VRAM with the CPU, RAM and cooling optional.
Built-in GPU and VRAM with the CPU, RAM and cooling optional.
I don’t think that’d be a wise idea. After watching Valve interviews, it’s clear that they designed the entire system around a specific max TDP. Apparently they figured out the TDP, picked a fan to move it, then designed the rest of the cooling system based on that.
If you start swapping out different CPU’s that’ll change the TDP and very quickly become a problem. Plus, the CPU is soldered to the board. Having a socket to allow for swapping would require a redesign of the cooling to account for the increased height
Yeah, it would probably be a better idea for AMD to sell variants of the APUs being used in the current generation of Xbox and PlayStation.
My guess is that those chips are under exclusivity contracts and/or they don’t want to undercut their lucrative discrete GPU and CPU market.
Why sell one efficient product when you can sell two more expensive ones?
Why would anyone who’s in the market for a by-itself motherboard ever want something you can get as a modular piece as a built-in to another expensive piece?
Besides, if you want everything soldered on you can just buy a laptop motherboard.
Or a Mac
For the same reason there’s other options. Having options alone is more than enough reason.
A motherboard with a built-in GPU has obvious price, cooling design and size advantages.
The only things I suggest to be soldered are the GPU and the VRAM since GPUs are extremely sensitive to their memory setup. CPUs can use off-the-shelf stuff without issue.
The niche is already filled by NUC sized PCs from China.
Where would one be able to see their stock? All I seem to find are $1500 PCs.
Try at minisforum or beelink
For the same reason that people are interested in the steam machine. It’s nice to be able to just throw some money at people and get a complete product. I can see businesses getting these things if they need a moderately powerful GPU for business reasons. Unless valve go utterly mad on the pricing here, it’s going to be much better value for money than a Mac mini, and it’ll have better compatibility with existing software as well.
We could, you know, just wait and see.
*ducks*
If you don’t have a rigid and openly hostile opinion within 3 seconds of a new product announcement, you are an anti-capitalist commie!!
But will the new valve hardware help fill the empty pit in my chest?
Sure, if you eat it.
WHY YOU LITTLE…
… Duck… Goose.
Duck Game? Goose Game? OMG … Duck Duck Goose Game! I will be a billionaire
Worked for Goose Goose Duck!
but… I want it now?
I would be happy to wait and see but idiots online keep trying to insist it’ll be $2,000 even though the hardware isn’t close to worth that much. Some of these people are big influencers and really should know better.
So what exactly does that change? Value already decided the price and that is what you will have to pay. Who cares what anyone ever predicted?
There are people online who are wrong. I can’t just ignore that, they must be told why they are wrong.
Seriously though it’s a good idea to correct people when they make stupid baseless claims because other people won’t necessarily have the technical understanding to judge whether their claims are based on reality or not.
Many of the people who are doing this are YouTube or Instagram personalities with lots of children following them, I like this product and want it to succeed, and I don’t want children to lose interest in the idea because their favourite idiot instagrammer reckons it’ll cost an absurd amount of money.
I’m utterly confused about why you are upset that people are doing that. There’s absolutely no need for you to engage in it.
I want it to be a successful product, that I can buy, and will be supported for a useful number of years. $800-1200 feels OK for that. $2000 feels like Apple Vision territory.
Jesus, man: haven’t you ever been excited about a thing before it’s on shelves? Speculated about a sports game before it’s over? Talking about your anticipation is part of the fun.
Nah, it’ll probably be $800-1k. It’s basically a 7600 CPU + RX7600 GPU or whatever, and it’s not really upgradeable. So somewhere between the Series S and X in performance, and not subsidized by game sales.
Cost aside. If they don’t price it competitively between the Xbox and the PS5, the Steam Machine will be DOA.
The Deck is a perfect example of what they should try to replicate. If they don’t do that, it will flop.
Is the machine competing with consoles? I thought it was just packaging an adorable sized pre built PC.
I think this is the goal that it would be priced competitively with the Pro or higher end consoles
They’ve built an ecosystem that gives you that console experience and if you really want to use it as a PC then you can.
The whole thing screams high quality experience for those that want it to just work or those that want to tinker
They really know their audience
I’m not sure cost can be set aside from a price discussion when they’ve explicitly stated it won’t be a Costco rotisserie chicken.
With the number of consoles sold this generation, I’m not sure where the limit is for what people will spend to play the games they want. With console pricing has trailing budget gaming PC’s, I could see a number of people getting a Steam Machine in lieu of the next Playstation or Xbox.
What would be interesting to see in the future is the split between units sold to lifelong console players making a change, and pre existing Steam users with stuffed libraries buying one for the couch. If the latter make up the majority of sales, but they priced it like a chicken, that’ll be a problem pretty quick.
Hopefully it shakes out well and indie game developers reap some well deserved rewards.
It’s a small computer, it isnt going after the Xbox or PS5 customers. It’s going for the people who want a computer in their living room.
Hard disagree. I think that’s exactly who they’re going after. That’s why they added all the console features like CEC, wake on BT, background updates, and a controller-first interface.
I think that’s pretty clearly who they’ve been targeting for >10 years with SteamOS.
This comment is so silly and yet I keep seeing it everywhere. What do you think the Xbox and Playstations are? What is it that xbox and playstation customers are looking for that this small computer isn’t?
What do you think the Xbox and Playstations are?
Consoles.
That’s a small computer my guy
No, it isn’t, in practice. Xbox and PS5 have more in common with my iPhone than my desktop PC or NAS when it comes to being able to do what I want with it.
It will be interesting to see how proprietary the Steam machine is. That’s how I’d end up classifying it as console or miniPC.
Having more features and flexibility than other consoles doesn’t take away its main function and selling point.
I’m not really following your response. Steam Machine’s feature set doesn’t make the Xbox Series X/S or PlayStation 5 into computers. Yes, they’re x86, but they’re so proprietary and locked down they’re not computers in the colloquial sense.
If the Steam Machine can dual boot Linux, which I bet it can, that’s much more a general purpose computer than either of those consoles.
The steam deck is also a small PC, just like the consoles and was priced perfectly for success
None of those consoles would directly boot into desktop Linux with just a few button presses.
As far as how most people use their computers there is little difference.
I don’t use my PS5 to surf the web. I know you can use it to watch movies and stuff, but I don’t use it for that either.
At best, it depends on what kind of user most of the console owners are.
I think the difference is that the Xbox and PlayStation are locked down to their respective ecosystems with monthly subscription and only one online store. Microsoft and Sony have almost guaranteed return based on that alone. If valve prices this as a loss leader what’s to stop a large corporation to buy 20k steam machines and use them as computers instead of consoles. Then valve is just eating that cost with no return on the other side.
The Ukraine military has been using steam decks on the front line Do you really think it’s affected their bottom line?
You are correct in that all technically fit the definition of computers. However consumers don’t care about technical definitions or think rationally about purchases. They don’t all do a rational analysis of the products on the market that would accomplish their goals and spend accordingly. They walk into GameStop and buy one of the boxes that makes call of duty show up on their living room tv. Just like the Deck fits the definition of a handheld computer with a built in screen and controllers for playing games but isn’t stealing any customers from the switch.
Deck isn’t selling millions and it’s doing just fine. The Steam Machine will be a small computer box priced as such and there won’t be a single person that decides to buy it over a ps5, and that’s fine. Valve doesn’t have to compete with consoles cause they don’t make consoles.
Valve themselves have said that the Machine will not be priced like a console but like an entry level PC whatever that means. The only people that will notice this to buy it are people who already know what a PC is.
Deck isn’t selling millions and it’s doing just fine.
I don’t have have an issue with the rest of your comment but this quote is factually wrong. The Deck actually has sold multiple millions of units.
I know my case is specific but having a Jellyfin running on a Steam computer looks to me as good case for having a computer in the living room. Adding a TV applications to Steam such as Netflix is also a case. Then there are people who have their workstation close to the TV so they can use it instead of their laptop and just switch displays with one of these HDMI branching dongles.
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Uh, it’s not speculation if OP is referencing what Valve staff have said literally and unambiguously.
Tell me you didn’t read the post before commenting without telling me
Honestly I was saving up money to get a PS5 and ditch PC gaming. But then I saw valve’s announcement about steam machine and decided to get a steam deck when I have enough.
It’s literally a no brainer because I can play my current library at no extra cost whereas with ps5 I gotta pay for online as well as the games.
Before you go in on a Steam Deck I want to give a head’s up:
While I like my Steam Deck, it does have limits. If you primarily want to play 2D indie games, it’s absolutely perfect. You get great framerate, and the battery lasts 3-4 hours or sometimes even more.
But if you want to play 3D games from the last 10-15 years, you’re going to need to compromise. Much of the time you won’t be able to get 60fps, and the battery life drops off quick. And if you want to dock it and run it on your TV you’re still going to have some performance tradeoffs due to the Steam Deck being built for 800p gaming
If you still have a powerful tower PC but want to play newer 3D games from your living room on a TV, you could run an application called Sunshine on it, allowing you to stream to a Steam Deck via Moonlight at high bitrate (4k 60fps with relatively low latency) and the Steam Deck is good for that because it has more power to encode/decode the stream than most alternatives.
Or you could wait for the Steam Machine to release. It won’t be as powerful as a PS5, but I’m expecting it to be a good value compared to most PC’s
Tbh I’m going for the steam deck due to its portability and ability to play my existing library. I’ve made some life decisions that will make me travel a lot around countries or states so steam deck is the perfect pick for me. I don’t really play more than 1-3 games that I play everyday and all of them run perfectly on the deck.
Earlier I thought of going for a PS5/6 but it wasn’t really economical plus given my frequent rate of travel, its not feasible.
Right now, I play my games on a Thinkpad that struggles to do a lot of multi tasking stuff. Its only 2 years old but took a bad beating in terms of performance. I’m gonna get the last juice out of this laptop and continue my gaming on the deck
To be fair, I don’t watch either of those youtubers. So I had no knowledge of this.
Console manufacturers sell at a loss because they need to sell the console first before they can sell anything else. They can expect to make that money back on software the user could not have bought without the console.
Valve doesn’t need people to buy Steam Machines to get them to start using Steam. In fact, I suspect most units sold will be to users who are already invested in the ecosystem. Selling at a loss would just be a straight loss to them.
Probably true, but there is a chance they might convert some console gamers…
But not enough to bet on it with a loss leader probably.
If it was a loss leader and non gamers also look to buy it and never touch steam. Doing that at a loss isn’t a great idea.
They may be trying to muscle in on traditional console territory.
Steam has a well tenured reputation for having inexpensive games. They may be leveraging this to appeal to the console players turned off by the all recent price hikes.
I suspect the gabecube may be close to if not, at cost. I don’t think it’ll be at a loss.
Gabe has previously claimed that they developed the index because they didn’t want VR to die and even gave grants the game developers who made VR titles.
So it’s established that Steam is big enough and secure enough to risk cultivating new or disrupting old markets.
Operationally steam has low overhead and insane profit margin. Unless they fuck up the steam store they’re guaranteed massive profit.
If the new hardware flops and they lose a bit of money; Gabe just buys one less yacht and steam ticks on as normal.
As you say valve are incentivised to do this because it will move more people over to Linux. I suspect that they want that more than they’re really bothered about hardware sales so while I don’t think it’ll be sold at a loss, because frankly that would be stupid even if they could afford to do it, but I don’t think it’ll be anywhere near as expensive as some people seem to be claiming.
Console manufacturers haven’t sold at a loss in a long time.
I agree, it won’t be huge gains directly for them, but even moving people off of Windows benefits them by removing control a competitor (Microsoft) has. I somewhat agree that it won’t be sold at (much of) a loss, but maybe at cost. I’m sure they expect manufacturing prices to go down over time, and engineering was a one-time investment, so sold just below cost doesn’t seem unreasonable to me at launch, which then becomes at cost or above in the future.
This all depends on if their goals for it are short-term or long. Historically, they seem to target long-term. That’s why I think it’ll be as low as they can make it, which they also said they’re doing by only having 8GB VRAM as cost savings. They want to drop the price as low as they can to compete. They won’t compete at $1k. I doubt they’d compete at $600-700. I suspect they’re targeting $400-500, which seems like a reasonable cost for the hardware too.
Console manufacturers haven’t sold at a loss in a long time.
They tend to at first launch. This article says it took 6 months for the PS4 and a bit longer for the PS5 to stop selling at a loss. It’s no longer the whole product lifecycle, but they are still sold at a loss at least at the start. I think that implies that hardware sales aren’t a major profit center, so even if they are profitable, there’s probably not a ton of margin.
…the fuck is a “loss leader”?
A product sold at a loss/very attractive price to attract customers. The idea is that they customers will come due to the cheap price of a desirable product and buy additional other stuff at the store, which should hopefully make up for the loss.
E.g. a restaurant advertise cheap burgers to attract customers, and then make the profit on alcoholic beverages that customers buy alongside the cheap burger.
So the Razor and blades model (printers) in games?
From the second sentence on the page:
It is different from loss leader marketing and product sample marketing, which do not depend on complementary products or services.
So the Razor and blades model would probably be the more accurate term for what people thought the new steam hardwate would be, yeah.
Though steam won’t lock you to their services.
It can’t be a loss leader.
The steam machine is, hardware-wise, just a regular Mini-PC. Valve even lets you put whatever OS you want on there. So if this was a loss leader, that would mean that non-gamers and even small businesses would buy these, would install Windows on them and use them as office PCs, with Steam probably not even installed on the PC.
With the Steam Deck, the form factor made it impractical or at least really weird to use them as office PCs. The steam machine doesn’t have that issue.
Lol this reminds me of that time the US Air Force built a giant compute cluster using PlayStation 3s. Idk if Sony sold those at a loss, but they certainly didn’t see any game purchases coming from the US Department of Defense
I guess this small articles provides us with the beginning of an answer? https://www.engadget.com/2010-02-05-playstation-3-still-a-loss-leader-six-cents-for-every-dollar.html
I was thinking that they might require a Steam account to order, the same way they stopped scalpers for Steam Deck, but there’d be ways around that.
It’d be hilarious if you needed something like “profile level 10” to order though.
Ohhh only allowed to buy steam level / 10 whole numbers only. I could get 9. Woot.
This part’s basically guaranteed, yeah. But there’s a secondhand market and also surely some scalping companies saw the Deck launch and went yknow what? It doesn’t cost us much in the long run to make a few hundred Steam accounts now and buy some $0.10 team fortress hat on them just in case Valve does the incredibly predictable thing of releasing more desirable hardware.
I see what you mean, but this device is a little overtuned for an office PC, at least GPU wise.
There are quite a few office jobs that benefit from a decent CPU. Anything to do with images/photos/video/rendering for example.
Plus PCs cost fuck all compared to staff, may as well get them efficient tools if they will be using them a lot.
You’re 100% correct at a sane company. At my employer the hardware team is incentivised to cut costs and impacts to productivity are someon else’s problem. Corporate metrics lead to some pretty hilarious situations.
This happens so often. The new version of the framework our frontend developers use has massive performance problems, which meant that our FE devs couldn’t test their changes locally, they had to upload a release to the cloud to test every single change. That reduces productivity to close to 0. A developer isn’t cheap, so you’d think the company would be quick to issue macbooks that we are also allowed to have so that they can work again.
Nope, it took 3 months for our manager to convince the helpdesk that they can get macbooks. Helpdesk originally said they’d have to wait for 2 years for the scheduled replacement of the laptops.
You get what you measure
Exactly, but I don’t see anything keeping them from selling the Frame at a loss or tight margin. What else are you going to use that with but Steam games?
Even the Steam Controller is useless without Steam Input, but I’d argue it won’t necessarily sell more games. Maybe they could include it with the Steam Machine for “free” to bump the price of the machine up enough to not make sense for a company, but still sell it at a tight margin to sell more games.
Why would they sell any hardware at a loss at all? Console manufacturers do it to lock people into their ecosystem and sell them games at a premium, Valve doesn’t need that, people are already overwhelmingly favoring their store.
The same reason people go into debt for a burrito. It’s easier for people to justify a smaller cost now, and valve will make than money back later with extra games sold, especially in the case of the Frame.
Was it confirmed that you can install Windows? The video said software, I don’t remember that you could install any operating system. It comes with an Arch Linux.
You can install Windows on the Steam Deck (psychos), so I imagine it’ll be like that.
“Hello chat! Today’s challenge is to make the Steam Deck lose 20% of its performance. I can’t wait to get started!”
You can install OSX on there /s
Hackingtosh Steam Machine will definitely happen.
🤮
That reaction makes sense is a gaming forum because gaming totally sucks on OSX.
OSX is a great OS. I don’t know how anyone can use Windows after 7.
OSX has several things going for it, primarily, it’s got the clowns at apple running the show, thus, it has a bunch of “natural” interface bullshit that only make sense if you intend to live like a caveman and not understand that computers can function differently to physical objects.
On top of that, they pushed themselves as an “alternative” to windows back when they were even more corporate than fucking Microsoft, while blaring out the ignorant ass ipod adverts whose goal was to make the user into consumers making computing choices based on fashion. The iphone and it’s money gated, walled garden BS was just the cherry on top.
If you wanted a fucking alternative to microsoft, linux has been there for you all along instead of the “worse but shinier” osx, which mac served to just overshadow with its increased advertising budget and psychotic CEO.
And I mean that literally, Steve Jobs was actually fucking insane and a horrible person. From firing people at random, to abandoning his kids, to stealing livers and trying to cure his cancer with smoothies.
Also, it’s basically open/free BSD with more propriety bullshit on it than you can shake a stick at.
I don’t know how anyone can use Windows after 7.
Yeah, windows 8 , 10 and 11 are toxic shitholes. You know what macs did before windows started begging you to log in and create microsoft accounts? Force you to have Icloud or whatever the fuck it is accounts. You know how I know? My work laptops suck ass and force me to have mac accounts, and is complaining that it can’t sync HEALTH DATA. MY WORK LAPTOP WANTS TO SYNC HEALTH DATA.
Apple blew the doors off for enshittification. They primed the fucking pump, and now microsoft and google are following through the door, you guys are like “yeah, putting osx on a steam box would be cool” fucking no. Ew.
It seems like you’re too emotionally invested to have a normal conversation like a person.
Health is an app you can delete. It’s not forcing you to do anything. You don’t even need iCloud for anything. You don’t even have to use their walled garden App Store. I know because I download and install shit from the internet all the time.
Yes, it’s free/bsd based. Who cares? I just want it to work and the chassis and build quality on the laptops are excellent.
I found an answer on the Steam Machine page: Yes, Steam Machine is optimized for gaming, but it’s still your PC. Install your own apps, or even another operating system. Who are we to tell you how to use your computer?
Hearing that is so refreshing. Microsoft/Google would never put something like that on their website because you are the product.
It’d be really funny if it’s designed specifically not to meet Windows 11’s arbitrary requirements. You can install Linux though! :D
They said that you can change it if you want, but did they say they will provide Windows drivers for their semi-custom Ryzen chip?
I’m pretty sure that is up to AMD and not Valve.
I just realized that “another operating system” can mean so many things that aren’t Windows.
We need to be patient and wait until some crazy people defile their Steam Machine for Internet points.
It’d be interesting seeing Microsoft in a position where the vendor isn’t automatically making their drivers for them. It’s a massive advantage they have.
Look at their website. It pretty explicitly states you can do with the Gabe Cube whatever you want. Including changing the OS.
Even if they sell at cost, they’re losing money because of the R&D costs.
…But then in turn they’ll earn money with Steam sales, so they’ll be earning money.
Yes, but that’s a different sale. My point is it can still be considered a loss leader if they sell it at cost. It took them many millions to develop it, so overall they would be losing money on the hardware sales.
That’s as opposed to something like Costco’s hot dogs. There was no R&D there, so if they sold it at cost, I wouldn’t consider it a loss leader.
