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Valve is a wildly successful video game company, but when they tried to make their own video game console line… perhaps it didn't work out how they expected. Is there a silver lining to this failure? Perhaps a life lesson? Let's see…
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0:00 Introduction
0:38 Valve and Steam Early History
3:09 Steam Box Rumors and Big Picture Mode
6:28 Xi3 Corporation
11:08 Valve’s Major Announcements
14:07 Valve Steam Machine Prototype
16:21 Steam Machine Partners and Delays
20:18 Controller, Steam Link, SteamOS 2
23:19 Launch and Failure
26:30 Losing Steam
28:41 Steam Deck
32:09 Something New from Me : )
#KrazyKen #ComputerClan
Shargeek 170 Amazon link: https://amzn.to/4gC36px
SHARGE Disk Plus: https://kck.st/3XAb5dY
You can support this channel on Patreon! Link below…
Valve is a wildly successful video game company, but when they tried to make their own video game console line… perhaps it didn't work out how they expected. Is there a silver lining to this failure? Perhaps a life lesson? Let's see…
More Great Episodes:
OUYA Console ● https://youtu.be/qPcPS48Wk_0
Lytro ● https://youtu.be/Zo4u578ZqrU
Pre-order my signed photo calendar! ● https://www.etsy.com/listing/1822466497
Get free wallpapers! ● https://thecomputerclan.com/wallpapers
Follow me on Twitter ● https://twitter.com/thecomputerclan
Facebook ● https://facebook.com/computerclan
😎Shop for cool stuff on my store ● https://thecomputerclan.com/etsy
⭐️Support the Computer Clan on Patreon ● https://Patreon.com/KrazyKen
👆Patrons got early ad-free access to this episode. They also got behind-the-scenes access, Discord VIP access, and their names in the credits! Pledge now to get those awesome perks, and help fund the future of the Computer Clan! Thanks for your support.
👇Lots of cool people helped make this episode possible!
Special Thanks To Folks Who Provided Game Systems and PCs:
Delicious Damian
Damian's Channel: https://www.youtube.com/@FarrOffMan
Bringus Studios
Linus Media Group / Linus Tech Tips
More Thanks To:
Savvy Sage: Research
Brainiac Brent: Assistant Editing, Recording, Linux Troubleshooting
Mirrations: Voice of Pixel Peeper 3000
And special thanks to my amazing Feedback Team!
📱Contact Us ● https://thecomputerclan.com/contact
🎬Get royalty-free stock footage with Artgrid. Sign up with my link to support the channel and get 2 extra months free: https://bit.ly/clan2Dr3M3e
🎵I also use Artlist for the music in my videos. I highly recommend them 👌 Click for 2 extra months free: https://bit.ly/clan2LBaKov
🎥Get film gear I use ● http://amzn.to/2hmJhHU
On a lower budget? ● https://amzn.to/2hLrJBL
Computer Clan is an Amazon Associate. Amazon links are powered by the Amazon Associates Program and the Computer Clan may receive a commission. Artlist and Artgrid links are also affiliate links.
0:00 Introduction
0:38 Valve and Steam Early History
3:09 Steam Box Rumors and Big Picture Mode
6:28 Xi3 Corporation
11:08 Valve’s Major Announcements
14:07 Valve Steam Machine Prototype
16:21 Steam Machine Partners and Delays
20:18 Controller, Steam Link, SteamOS 2
23:19 Launch and Failure
26:30 Losing Steam
28:41 Steam Deck
32:09 Something New from Me : )
#KrazyKen #ComputerClan
Category
🗞
NewsTranscript
00:00Valve is an eight billion dollar company, and they made some really successful video games.
00:04However, that wealth and success did not translate to the Steam machine, but why?
00:13Hey everyone, how are you all doing? If you're new here, welcome. My name is Krazy Ken, and we're gonna talk about games today.
00:18I remember when Steam first came to the Mac, and I fell in love with Portal and Half-Life,
00:24and I have a lot of good memories playing those games, and of course watching the Garry's Mod machinimas.
00:28But there was a time when Valve decided to try their hand at not just making games,
00:32but making new hardware to play those games on, called Steam Machines.
00:36So, let's see what happened. Valve was founded on August 24th, 1996 by Gabe Newell and Mike Harrington.
00:43Gabe and Mike used to work at Microsoft, and Gabe worked on the team that developed the first three major releases of Windows.
00:49He also played a key role in porting id Software's legendary Doom game to Windows 95.
00:55On November 19th, 1998, Valve launched their first game, the insanely successful first-person shooter, Half-Life,
01:02which was built with a heavily modified version of id Software's Quake engine.
01:06The point of view never leaves the player's eyes, and there's no camera cuts, which helps create an immersive environment.
01:12Combine that with great storytelling, comprehensive AI, lip-sync, and physics,
01:16Half-Life went on to revolutionize the game industry, and it's still played today.
01:20In addition, Half-Life's modability allowed Valve to create other games, like Team Fortress Classic,
01:26and it enabled the community to make their own mods, too.
01:29In short, Valve had a huge hit on their hands.
01:32It's not often you see a company knock it out of the park with their first release.
01:36In 2003, Valve relocated their offices to Bellevue, Washington, and they reincorporated under the name we know them by today,
01:43Valve Corporation.
01:44And that brings us to an important software release,
01:48Steam.
01:49Okay, so maybe not everyone loved this software when it first came out,
01:53but Steam went on to play a major role in changing the game industry.
01:57Steam was originally an online updater for Valve's games.
02:00It also offered IM features and an SDK for developers.
02:03Users could download Valve's existing games digitally, too,
02:06and the first new Valve game to launch on the Steam platform was Counter-Strike Condition Zero,
02:13if you even remember that.
02:14The first big game to launch on Steam was Half-Life 2 on November 16th, 2004,
02:19and this game actually required Steam for playing.
02:22It was not optional.
02:24Rather than offer you the illusion of free choice,
02:27I will take the liberty of choosing for you.
02:31And in 2005, Steam was opened up to third-party developers.
02:35This was a huge move because now everybody could publish games on this up-and-coming platform,
02:40not just Valve, but Valve was still making new games, too.
02:44Briefly fast-forwarding to 2014, there are now 75 million registered Steam users,
02:50and most of Valve's revenue was generated by the Steam platform,
02:54which made up over 70% of all internet-downloaded games on Windows.
02:59As you can see, Valve was wildly successful on the software side of things,
03:03but now, maybe it's time to try to venture into the hardware side.
03:10People who are really serious about software should make their own hardware.
03:14In March 2012, rumors of a Steam Box were brewing.
03:18This alleged hardware could potentially be Valve's new game console.
03:22Valve Marketing Director Doug Lombardi hinted at the possibility of new hardware,
03:26but he didn't confirm anything at the time.
03:29He did confirm, however, that Valve was working on a new user interface
03:33for Steam users who want to game in the living room.
03:35Targeting TVs and the living room makes sense because at this time,
03:39video game console sales were in the hundreds of millions.
03:42PlayStation 1 and 2 alone hit 257.4 million unit sales by March 31st, 2012.
03:49And these consoles are made for couches, TVs, living rooms,
03:53settings that are generally a little more laid-back and comfortable for playing games,
03:57as opposed to sitting at a computer desk.
04:00Moving on to July 25th, Gabe spoke at Casual Connect about open platforms,
04:04and he said a way to guarantee that open platforms survive
04:08is to make sure Linux thrives.
04:10Quick rundown, Linux is a kernel that many operating systems, or distros, run on,
04:15and many of these are free and open source.
04:18For example, Ubuntu or Mint.
04:20These are alternative operating systems to Windows or Mac OS, for example.
04:24Linux has many uses, especially for web servers,
04:27and it's even the kernel used in Android and Chrome OS.
04:30But in terms of PC home usage, it's a small slice of the market compared to Windows.
04:36Gabe stated that one of the things holding Linux back was the lack of games.
04:40So Valve was going to invest in Linux and get Steam on Linux,
04:44which means they can bring a whole bunch of games with them.
04:47So Linux was going to be a critical component to this soon-to-be Steam Machine product.
04:52But we're not quite there yet.
04:54There's still a lot of other work that has to be done before we launch.
04:56In September, Valve released a beta of a new Steam UI named Big Picture Mode.
05:01The interface featured large thumbnails and menus,
05:03and it was compatible with game controllers while still working with keyboard and mouse.
05:08This new UI allowed gamers to navigate Steam on their TV in the comfort of their living room.
05:13And that all sounds amazing, but to reap these benefits,
05:16you have to move your computer into your living room,
05:19which I guess if you had a laptop, that would be pretty easy,
05:22but not so much for a desktop tower.
05:25At this time, it seemed like Valve had some great software solutions in place,
05:29but the hardware piece of the puzzle was still missing.
05:32But Valve's Greg Coomer hinted at the future.
05:35While discussing Big Picture Mode and the living room,
05:38he also said, if it's getting involved in shipping some kind of hardware,
05:42then we will get involved in doing that if we need to.
05:45At the 2012 Video Game Awards, Kotaku's Jason Schreier briefly spoke with Gabe Newell,
05:51and Gabe said the reaction to Big Picture Mode was stronger than expected.
05:55He also said the next step is to get the Linux version of Steam out of beta,
05:59and that companies would also start selling TV-ready PCs with Steam pre-installed next year.
06:06Gabe also said these upcoming PCs would run Linux,
06:09but users could still install Windows if they want to.
06:12Now, what specific Linux operating system would they be running?
06:17We don't know yet, but maybe we'll find out soon.
06:20But at this point, we still haven't seen what any of these Steam machines would actually look like.
06:25But we didn't have to wait much longer.
06:28On January 7th, 2013 at CES, modular mini-PC maker Xi3 revealed the Piston,
06:35a tiny gaming computer specifically designed to support Steam and Big Picture Mode.
06:40I love unconventional PC designs, so this tiny, curvy case is really appealing to me.
06:46And Xi3 focused on function, not just form,
06:49so their modular computer line could attach to other modules and accessories.
06:53They could also attach to computer monitors and connect together into a server.
06:57And instead of using a single motherboard, Xi3 uses three separate boards for their components,
07:03which allowed for swapping and upgrading.
07:05Unfortunately, I couldn't get my hands on an actual Piston because they are rare,
07:09but I do have other Xi3 computers which the Piston was based on.
07:13This is a jade green Xi3 X5A with a slide storage expander.
07:17And thanks to Bringus, I have an X7A2, which is more identical to the Piston in terms of specs.
07:23Honestly, if we just desaturate the color a little bit and add the Piston logo to the front,
07:28it basically looks the same, right?
07:30Back in September 2012, Xi3 actually used Kickstarter to try and fund their new X7A
07:36and X3A modular computers, which would join their existing X5A.
07:41Unfortunately, they didn't meet their goal, but thanks to an investment from Valve,
07:45they ended up getting enough funding in the end.
07:47Thank you, Gabe!
07:48The Piston had up to 1TB of SSD storage, a 3.2GHz AMD Trinity quad-core CPU,
07:558GB of RAM, a Radeon 7000 series GPU with triple display support, and a crap ton of I.O.
08:02The Piston was made available for limited pre-orders at South by Southwest for $999,
08:08and they would ship on November 29th.
08:10However, before the launch, some misinformation needed to be cleared up.
08:15Valve's Doug Lombardi stated to Eurogamer that Valve was distancing themselves from the Piston.
08:20Doug didn't say why, at least in this particular article,
08:24but the answers might lie inside of Xi3's response to the situation.
08:30Xi3 published a press release talking about this separation.
08:34They confirmed that they did receive an investment from Valve in the past,
08:37but they also debunked misinformation about the Piston being a Steam Box,
08:42because neither Valve or Xi3 has referred to it as such.
08:46Anyway, the main reasons for the separation, in my opinion,
08:50have to do with Valve's and Xi3's visions not aligning.
08:54Xi3 positioned the Piston to be a Windows PC with support from multiple gaming platforms,
09:00whereas Valve wanted to focus on Linux and Steam.
09:03After the Xi3 separation, there wasn't much talk about the Steam Box at all.
09:08Maybe a little bit, but to the public, there wasn't much progress being made.
09:12Doug confirmed to Polygon that Valve was tinkering with other prototype hardware,
09:17but that's about it, for now.
09:20We'll talk about what happened next, right after this.
09:23So let's say you want to expand the storage of your Steam Deck, or your smartphone, perhaps.
09:27Maybe add some extra battery to them as well.
09:30Charge has the solutions for you.
09:32With the Shargeek 170 and the ChargeDisk Plus,
09:35you can bring extra storage and battery with you on the go, and it will be ready for when you need it.
09:40I've always loved Charge's clear tech, and the 170 also looks stunning.
09:44It's like something out of a Pink Floyd album cover.
09:47With two USB-C ports and one USB-A port, you can fast charge three devices at once,
09:52thanks to the 170-watt max output.
09:54And you can recharge the PowerBank super fast, up to 50% in only 20 minutes,
10:00thanks to the 140-watt max input.
10:02And the total capacity is 24,000 mAh, so you have plenty of juice to share with your devices.
10:08You'll also know the status of your 170 thanks to the built-in display,
10:12and yes, it is airline safe.
10:14And here's the ChargeDisk Plus, a slim aluminum SSD enclosure with a built-in USB-C cable.
10:20All you have to do is pop in your own SSD, up to four terabytes, and you're good to go.
10:25And here's the fun part.
10:26You can adhere the optional magnetic pad to the back,
10:29and now the SSD can attach to any magnetic surface, like the back of an iPhone.
10:33And if your device doesn't have a magnetic back, like the Steam Deck,
10:37you can take one of the magnet rings, attach it to the back,
10:40and now your SSD can attach to your Steam Deck.
10:43And you can also charge your devices while the ChargeDisk Plus is attached.
10:47So click the link in the description to get your own Shargeek 170 and ChargeDisk Plus.
10:51And when you do that, you're also supporting the Computer Clan, so thank you very much.
10:56All right, so Valve was tinkering with other prototype hardware, right?
11:00But other than that, there wasn't much Steambox news available to the public.
11:05Until September 2013.
11:08Valve had three major announcements.
11:10Number one, SteamOS.
11:13SteamOS 1.0, codenamed Alchemist, is an operating system based on Debian 7.1 Weezy, a Linux distro.
11:20It came with Steam pre-installed, and was primarily intended to be used with Big Picture mode.
11:26However, users could exit Steam and enter the Gnome desktop environment to use other applications.
11:31We'll talk more about SteamOS in a moment, because there's two other versions to cover.
11:35But first, we need to talk about Valve's second announcement, Steam Machines.
11:40Holy ship! Valve said it! They officially said the name of this new product line, Steam Machine.
11:47There were three main criteria for Steam Machines.
11:50One, different manufacturers can make them how they want, with different parts.
11:55Two, they must ship with SteamOS, and see no exclusive games.
12:01At this time, Valve didn't show any real photos of what these Steam Machines would look like.
12:06But soon, 300 lucky people were going to receive a prototype.
12:11And it was going to be a prototype of Valve's very own Steam Machine.
12:14And I... was not one of the lucky ones that received one, because I didn't enter the drawing.
12:21But I can try to find one. PixelPeeper3000?
12:23I can. How can I help you?
12:25Track down a prototype Valve Steam Machine, and ship it to me, please.
12:29I found a unit owned by an obscure indie YouTube channel.
12:33Which one?
12:34Linus Tech Tips.
12:36Huh. They must be new.
12:38Anyway, DM them and ask them if we can borrow their unit.
12:42Already on it.
12:43Cool. While PixelPeeper contacts LTT, we must talk about Valve's third big announcement.
12:51The Steam Controller.
12:53Valve went through many iterations of the controller's design.
12:56And they manufactured it with their own automated factory in Buffalo Grove, Illinois.
13:01It was designed to be compatible with every game on Steam, including old games.
13:05This controller would be included with Steam Machines,
13:08and the initial version they showed had two circular, high-fidelity touchpads,
13:12which were also clickable.
13:14It also had a touchscreen, four action buttons, two bumpers, two triggers, and built-in haptics.
13:20On November 4th, Valve said to IGN that they would be revealing the Steam Machine partners
13:24and their designs at CES 2014.
13:28But perhaps some of those partners were getting a little impatient.
13:32They wanted to beat Valve to the punch.
13:34iBUYPOWER and Digital Storm revealed their Steam Machines early.
13:38And the Digital Storm unit was liquid-cooled.
13:41Pretty neat.
13:42Good news, Ken. Your Steam Machine prototype has shipped.
13:46Thanks. What's the ETA?
13:47Three seconds.
13:49Whoa.
13:51How did you do that?
13:52I'm an AI, Ken. I can do anything.
13:56Except draw hands.
13:58True. Maybe leave art to the humans?
14:01Good idea.
14:03Great. So, let's take a look at this rare Steam Machine prototype.
14:07On December 13th, Valve shipped these units to 300 testers in the US.
14:12And it arrives in this pretty beefy wooden box.
14:15The prototype itself is a black box measuring 12 inches wide, 12.4 inches long, and 2.9 inches high.
14:21And I'll admit, it's quite a bit heavier than I thought.
14:24It's 12.6 pounds, which doesn't sound like a lot on paper.
14:29But for a computer of this size, yeah, that's pretty dense.
14:34The chassis is made of metal with a brushed texture.
14:37And the removable shell is quite thick, too.
14:40And on the front is this oversized power button with a white glowing ring, which I absolutely love.
14:45There's also tons of I.O. on the back, including USB, DisplayPort, and even a PS2 keyboard port.
14:52Looks like they're covering all bases for testing.
14:55There's also two USB ports on the front.
14:57Now let's take a look at the inside.
14:59With one screw, we can remove the outer shell.
15:02For specs, the prototype is equipped with an Intel Core i3, i5, or i7 processor,
15:07one of various NVIDIA GPUs, 16 gigabytes of RAM, a solid-state hybrid drive with one terabyte of mechanical storage,
15:14and eight gigabytes of solid-state storage, and a 450-watt power supply.
15:19The controller that came with this prototype doesn't have the touchscreen like we saw in those other press photos.
15:24Instead, it has four physical buttons in the middle.
15:27And it's not wireless yet.
15:30It's wired with USB.
15:32But to be fair, Valve did disclose that ahead of time.
15:35Another shout-out to Bringus for loaning me this prototype Steam Controller.
15:38I got to unwrap it from its condom unit and touch it before he did.
15:43But here's my favorite part about these prototype units.
15:46On the top here, there's 300 holes, and Valve shipped 300 units.
15:52And one of them is a shiny countersunk hole.
15:56The theory for this hole is it's a unique identifier for this specific unit.
16:01Assuming the numerical order follows left to right, top to bottom, this is unit number 78 of 300.
16:07I love prototype stuff, so big shout-out to Linus Media Group for letting me borrow this,
16:11because they are really hard to find.
16:14On the same day of this prototype launch, Valve released SteamOS 1.0 to the public as a free download.
16:19Now we arrive at CES 2014.
16:22At the show, Valve revealed the third-party partners for Steam Machines.
16:26Are you ready?
16:27Alienware, Alternate, CyberPowerPC, DigitalStorm, Falcon Northwest, GIGABYTE, iBUYPOWER, Maingear, Material.net,
16:34Next, OriginPC, ScanComputers, WebHallen, and Zotac.
16:39Holy crap!
16:41I certainly hope all these choices don't make it challenging for a consumer to decide what they want to buy.
16:49Hmm.
16:50Steam Machines had Intel and AMD CPU options, NVIDIA, AMD, and Intel GPU options,
16:57and the RAM configurations ranged up to 16 GB, and storage was generally up to 1 TB.
17:03Some went higher.
17:05On the lower end, prices were $500, and on the higher end, like with the Falcon Northwest Steam Machine, $6,000.
17:13I've never spent $6,000 on a computer in my life.
17:17And I'm a Mac user! That's saying something!
17:20Apple charges $700 for freaking wheels!
17:23On January 15th, Valve discussed more details at Steam Dev Days, which was closed off to the press.
17:29On the same day, Alienware announced the release month for their own Steam Machine, September 2014.
17:36And although they were pretty vague with the specs, I don't have to be.
17:41I've been to the future.
17:43I know what happens.
17:44Alienware will soon offer four configurations, which start at $449.99.
17:51All models come with an NVIDIA GeForce GTX video card with 2 GB of video memory,
17:56and the system can be maxed out with a 1 TB, 7200 RPM hard drive, 8 GB of RAM, and a 4th Gen Intel Core i7 processor.
18:05This Steam Machine also has two USB 2.0 ports on the front, and on the back, HDMI in and out, optical audio out, Ethernet, and two USB 3.0 ports.
18:15And might I add, the design of this Steam Machine is really slick.
18:19Everything from the glowing Steam logo to the alien head which pulsates during sleep mode, it's just a sexy computer.
18:27And yes, the Alienware logo is the power button.
18:31And I think it's the most iconic out of all the Steam Machines.
18:35In March 2014, Valve revealed an updated design for the Steam Controller,
18:40which replaced the center touchscreen with two physical buttons and a Steam button in between.
18:45The D-pad and action buttons were also relocated below the touchpads.
18:49We're still not at the production version of the controller yet.
18:52They're getting there, but all of these refinements and tweaking were starting to cause a couple problems.
19:00Late is temporary, suck is forever.
19:04On May 27th, Valve product designer Eric Ho posted an announcement to the Steam Universe group,
19:10stating that the controller still needs work, and they were looking at a 2015 release instead of 2014.
19:16I think that's the right thing to do.
19:18I'd rather have a good product arrive late than get a crappy product early.
19:23However, Valve wasn't the only one on this ship.
19:25There were a bunch of third-party partners getting ready to launch their hardware,
19:29but the whole Steam Machine line and brand couldn't launch until Valve was ready.
19:34But the partners were getting kind of eager.
19:36And what did some of these eager partners do?
19:39They stripped the Steam out of the machine and just repackaged their hardware with Windows.
19:44Alienware and iBUYPOWER released their systems early with Windows 8.1 instead of SteamOS.
19:50I'm still infinitely amused by the non-Steam Alienware computer,
19:54because the triangle where the Steam logo usually goes is still there.
19:58It's just empty.
20:00Despite the shift to Windows, the computers were still shipped with Steam pre-installed,
20:04and it automatically loaded into big picture mode on startup.
20:08Okay, so we have those two computers out,
20:11but unfortunately, not much else was happening for a while.
20:14So, we must fast-forward to GDC 2015.
20:18On March 3rd, at the Game Developers Conference, Valve announced the release month for Steam Machines.
20:23November 2015!
20:25The final design of the Steam Controller was also revealed, along with a retail price of $50.
20:31Compared to the last controller we examined, there's some small refinements,
20:34but the biggest change is the removal of the separate D-pad, which was replaced with an analog stick.
20:41The D-pad functionality was now combined with the left touchpad.
20:44The Steam Controller is wireless, and it features haptics, a gyroscope, accelerometer,
20:48and up to 80 hours of battery life with two AA's.
20:51Also at GDC, Valve announced their new Source 2 engine and a brand new hardware product, Steam Link.
20:59For $50, users could connect Steam Link to their TV and stream a video game from their PC or Steam Machine
21:05up to 1080p resolution and 60 frames per second with low latency.
21:10And it was cheap because it was just a streaming box, not a full-featured computer.
21:14Wait a minute.
21:16Okay, I don't have a crystal ball with me.
21:19Well, I used to, but I sold it to be able to pay for a surgery to make my head smaller.
21:23It clearly didn't work.
21:24But, I think the Steam Link could cannibalize Steam Machine sales.
21:28You can now get the Steam experience on your TV for $50 to $100 bucks, as opposed to $500 to $6,000
21:37if you were okay with the possibility of some latency, maybe once in a while.
21:41That's just me editorializing, but we'll see what happens.
21:46June 4th, 2015.
21:48After more than two years of blood, sweat, and tears, and more blood,
21:53Valve finally announced the release date for Steam Machines, including the controller and Link.
22:00Everything would come out on November 10th, 2015.
22:03The first brands to launch Steam Machines were Cyber, Zotac, and of course, Alienware.
22:10SteamOS 2 also launched, codenamed Brewmaster.
22:13SteamOS 1 received updates through its development, but it was more or less a beta.
22:182.0 was much more refined under the hood.
22:21I installed it effortlessly on my Alienware Steam Machine, but I could only use the built-in GNOME desktop environment.
22:27Getting Steam to work was a b****.
22:29I could tell it was trying to autoload big picture mode, but all I got was a black screen with a cursor.
22:35To be fair, it was kind of unrealistic of me to try to shove a 2024 Steam client onto an operating system that was based on Debian 8,
22:45which came out nine years prior.
22:47So I tried interrupting the auto-update process to see if an older version of Steam would work,
22:52but every time I did that, I just got caught in this fatal error screen.
22:56But I don't give up!
22:59Usually.
23:00Thanks to the positive responses from my community and Braniac Brent's brain,
23:05I learned a few Linux tricks to load a new GNOME session, update all the software on the system, and enable namespaces so Steam could launch.
23:13And voila!
23:14The UI is a bit laggy, but the games perform at a steady 60 frames per second.
23:19Cool! So finally, Steam Machines were off to the races.
23:22And they sold...
23:26Okay?
23:28Seven months after the launch, Valve announced they sold over 500,000 Steam Controllers, including controllers packaged with Steam Machines.
23:36And since every Steam Machine was required to be bundled with a Steam Controller, we can estimate about 500,000 Steam Machines were sold.
23:45But the controller was still sold separately.
23:48So if we factor in individual retail sales of the controller, this estimate could actually be lower than 500,000.
23:55Which is not terrible for a first try, but compared to PS4 and Xbox One sales in their first seven months,
24:03which was 15.7 million, it's a small number.
24:06And to make things even worse, only a handful of the manufacturers actually released their own Steam Machines.
24:13A lot of them didn't follow through.
24:15Things weren't looking too good for the Steam Machine, but I promise.
24:20I promise you, there was a silver lining.
24:23But before we get there, we need to examine why.
24:27Why did the Steam Machines fail?
24:29I believe there's three big reasons.
24:32Number one, too many options.
24:34On paper, more choices may seem like a good idea to offer your customers.
24:39But in reality, if a consumer is faced with too many different buying options, it can be confusing, and that can be detrimental to your business.
24:47In short, if you confuse, you'll lose.
24:50Donald Miller.
24:51I've studied this guy before.
24:52He's a smart dude.
24:53Microsoft and Sony kept it easy.
24:55They offered two, give or take, versions of their consoles, and that was it.
25:00It was simple.
25:01And on top of these problems, some people speculated that the more affordable Steam Link killed some of the Steam Machines' momentum.
25:09I guess my theory wasn't too crazy after all.
25:11Problem number two, lack of software support.
25:14Again, SteamOS is a Linux distro, and game support was lacking.
25:18At the time of launch, only 21.5% of Steam's entire catalog was compatible with SteamOS.
25:25So there's not much of a benefit there.
25:26You pay the money to get the hardware to get into the Steam universe, but when you arrive, you realize you only get access to one-fifth of it.
25:36And it's just because of a software limitation.
25:37You throw Windows on there, boom, you now have access to all of it.
25:42Just didn't seem that practical.
25:44And it got worse.
25:46SteamOS had some performance problems compared to Windows.
25:49And I know performance can vary depending on your hardware, your game settings, and what you're playing, so take this with a grain of salt.
25:56But Ars Technica did a pretty thorough analysis, and Windows came out on top.
26:02And problem number three, no killer features.
26:06While I think some of the Steam Machines looked absolutely cool, there wasn't anything special about the hardware or features.
26:13And while I think it was noble of Valve to encourage no exclusives for SteamOS, that move further killed the Steam Machines' value proposition.
26:22Because now consumers have even less of a reason to buy them.
26:25Sony and Microsoft, on the other hand, had exclusive titles on their consoles.
26:30As time passed, unfortunately, the Steam Machine line was, well, losing Steam.
26:37Some manufacturers like Alienware continued making Steam Machines into 2017, but most companies completely dropped out or switched to Windows.
26:46SteamOS was still getting updated, and more Steam games were gaining Linux support, but it was just too little too late.
26:54Then, in mid-April 2019, Valve quietly delisted the Steam Machines from its website, and the Steam Link was discontinued in November of the same year.
27:05It was replaced with a Steam Link app instead, which was originally released in May 2018.
27:11Lastly, the Steam Controller continued to sell until December 3rd, 2019, when Valve ran out of stock and discontinued it.
27:20And thus, marks the official death of the Steam Machine.
27:27Hang on. I said there was a silver lining to all this, right?
27:31I won't leave you hanging.
27:33In life, it's important to always be improving, even if it's just one small thing a day.
27:39Think about it. After a whole year, you just learned 365 new things you can use to improve your product, your business, your mission, yourself.
27:49But it's also important to know when to let something go if it's not working, and try something else.
27:55But even when you do let that thing go, you can take the lessons with you.
28:00In Valve's case, they let the Steam Machines go, but the lessons would remain with them.
28:06Much like how a young crazy Ken didn't give up trying to get SteamOS working, Valve didn't give up on hardware.
28:13They launched their own VR headset, Valve Index, on June 28th, 2019, and their wildly successful VR title, Half-Life Alyx, which leveraged the new hardware.
28:24But more importantly, Valve was about to launch an all-new hardware product, with a new form factor they've never released before.
28:31And I believe this new product was the culmination of all the lessons they learned from the failed Steam Machine line, and the Steam Controller.
28:40Steam Deck
28:41Announced on July 15th, 2021, the Steam Deck was Valve's foray into the portable gaming space.
28:48Steam Deck features a thin, rectangular design with grips on both sides, and a 7-inch 1280x800 touchscreen with a 60Hz refresh rate.
28:57And unlike the Steam Controller, Steam Deck has not one, but two analog sticks, along with dual trackpads, ABXY buttons, four grip buttons, two triggers, two bumpers, a gyroscope, microSD card slot, headphone jack, microphones, and USB-C with HDMI and Ethernet support, and a dedicated D-pad, which the Steam Controller lacked.
29:16Basically, Steam Deck was ready for almost any game you could throw at it.
29:20Inside is an AMD APU with a quad-core Zen 2 CPU and RDNA 2 graphics, plus 16GB of RAM.
29:28And for SSD storage, the low-end offered 64GB for $399, and 512GB on the higher end with faster NVMe storage for $649.
29:39And the built-in 40Wh battery could run lighter tasks like web browsing for about 7-8 hours, and games like Portal 2 for about 4.
29:47Now for software, Valve is still betting on Linux. Introducing SteamOS 3, codenamed Holo.
29:54Version 3 was a major release. It's now based on Arch Linux instead of Debian, and it uses the KDE Plasma desktop environment instead of GNOME.
30:03Just like prior releases, users could use Steam Big Picture mode, but they can also exit Steam, load a full desktop, and use Steam Deck like a portable PC, or even connect it to a keyboard, mouse, and display, and use it like a desktop.
30:15This is made possible with the USB-C port, but the docking station, which came out 7 months later, also makes it easier to use your deck as a PC or a game console on your TV.
30:25Steam Deck and SteamOS 3 will run any Linux-slash-SteamOS-compatible game, but for Windows games that don't run natively, they will run in a compatibility layer named Proton.
30:36Not every game will work 100% off the bat, so Valve has a simple webpage which summarizes your library's compatibility, and they offer in-depth details for individual games.
30:46Now with SteamOS 1 and 2, anybody could download those systems and install them on their PC, but Valve has not released SteamOS 3 to the public. They only use it for the Steam Deck.
30:57But that's where the community stepped in. Just like how fans mod Valve's games, they also mod Valve's operating system.
31:04This 2021 Atari VCS belongs to my friend Delicious Damien. Don't worry, you'll meet him in a future episode.
31:11Anyway, he installed Holo ISO on this $200 computer, and it works very smoothly. You can use Steam in big-picture mode, or switch to desktop mode with KDE Plasma, and it works pretty much the same way as it would on a Steam Deck.
31:25The Steam Deck released on February 25th, 2022, and it was a huge hit. Valve still sells the system today, including a new OLED model.
31:34Reports estimated 1.62 million sales in 2022 alone. Valve even made a cake to celebrate. Huh, I guess the cake wasn't a lie after all.
31:44And in November 2023, Valve announced they sold multiple millions of Steam Decks. And I don't think the Steam Deck would have thrived the way it did if it weren't for the lessons Valve learned through the Steam Machine journey.
31:57So although that line failed in comparison, it helped forge a new product that millions of people love. And I can't wait to see what Valve does next.
32:08So, I wanted to show you one more thing. The holidays are coming up, right? And I think this could be a cool gift for you, or for someone else who's a tech enthusiast in your life, but I'm launching a photo calendar for the year 2025!
32:20Each month features a beautiful photo I shot. I also autograph all calendars, and each calendar will come with a free wallpaper megapack download.
32:28So go ahead and pre-order today, and for every dollar spent, I will personally donate a dollar to hurricane relief efforts.
32:34You can pre-order with the link in my description, or visit my Etsy store. I hope you enjoy. Thanks for sticking with me, catch the crazy, and pass it on.