Copyright Polygon
After years of slow-building hardware success thanks to the Steam Deck, Valve is finally ready to take on the home console space in earnest. The freshly announced Steam Machine revives a once-failed experiment with a promising new lease on life. The GameCube-like console will seamlessly bring your PC gaming library to a TV by way of SteamOS. It’s a moment that PC gamers have waited a long time for Valve to actually pull off, but it looks like the moment is upon us. And that might just be the nail in the coffin for Xbox. If the Steam Machine can actually deliver on its impressive specs, we may be on the verge of a shift in the “big three” console structure that we haven’t seen since the Dreamcast days. Valve’s cube could be poised to make Xbox redundant as a home console, expediting Microsoft’s long-brewing pivot into a more service-driven gaming company centered around Game Pass as its primary product. It doesn’t necessarily spell the end for Xbox as a brand, much like Sega didn’t disappear when it bowed out of the hardware market. But it does draw renewed attention to years of strategy from Microsoft that is now in danger of backfiring. It’s no secret that Microsoft has struggled to keep up with its peers this console generation. The Xbox Series X was a capable piece of tech when it launched in 2020, but Microsoft has had a hard time pushing the momentum at every turn. It started with a lack of first-party games as Microsoft put its emphasis on Game Pass over system-selling exclusives to differentiate itself from Sony. Even when it did give players those games, it couldn’t consistently deliver them at 4K and 60 frames per second. While the Series X is arguably more capable than the PlayStation 5 from a technical perspective, players needed a better sales pitch. Microsoft has spent the last five years carving that out in untraditional fashion. It has thrown the rules of war out the window in order to position Xbox as a premium lifestyle brand rather than a console. Game Pass was key to that, as Microsoft began putting the service on smart TVs, VR headsets, Amazon Fire Sticks, and more. More controversial was the company’s decision to put its first-party games on competing platforms, taking a console’s one historical ace in the hole away. Microsoft has even loosened its grip on hardware altogether. This year, the company partnered with Asus to create an Xbox-themed version of the ROG Ally, rather than creating its own in-house Steam Deck competitor. The strategy has confounded players for years, but it makes sense in a vacuum. The Series X was just one piece of a wider strategy that looked to hook players into a Microsoft gaming ecosystem, whether they were a hardcore gamer or just someone with a smart TV. Why buy a Series X even though it doesn’t have many exclusive games? Because it’s the most convenient centerpiece for a gaming lifestyle that spans interconnected apps across devices. The Steam Machine has the potential to blow that strategy out of the water when it launches in 2026. As Microsoft itself might say, this is an Xbox. It’s not just the fact that it looks like a miniature Series X — a sort of cruel design joke. It’s that you’re going to get a home console with comparable specs, targeting 4K 60fps performance, that can play just about every single Xbox game. From even a casual side-by-side comparison, it’s the same device — except one can also play your entire PC library, including first-party Sony games that have been ported to PC. The only thing that’s missing, from an outside perspective, is the iconic branding. Compelling, but why would a Steam Machine be a threat to Xbox in 2025 when previous iterations of it were a complete flop? Because Valve has changed a lot in the past five years too, and it’s slowly been building an answer to that question with each step. The one major thing a console like Xbox has always had over Valve’s hardware efforts is convenience. Xbox was engineered to be a console rather than a gaming PC. It’s easy to navigate, organized, and runs every game available on it with no tinkering necessary. By comparison, trying to use a Linux-powered mini-PC is a cumbersome experience for those used to plug-and-play devices. Valve never had an answer for it, but it does now: SteamOS. The operating system that powers Steam Deck, and even some of its competitors, has been shaped into a convenient tool that makes any PC gaming device feel almost as easy to use as a console (even with a fair share of quirks that Valve has yet to fully iron out). Now a few years into its existence, SteamOS is battle-tested. And crucially, it is already beating Microsoft at its own game in the handheld market. Look at the Xbox ROG Ally X. For its handheld, Microsoft and Asus collaborated to create a custom Windows experience for the device that would bring Xbox’s console strength to a portable form factor. It didn’t go according to plan, with early adopters finding a litany of bugs and quirks at launch that made it a far less user-friendly experience than a Steam Deck. It was a big moment for Valve’s hardware ambitions, proving that it could finally go toe-to-toe with the big boys beyond a PC monitor. With the Steam Machine, Valve aims to push that momentum right as there’s blood in the water. We’re getting a console that looks like an Xbox, runs like an Xbox, and plays the same games as an Xbox — without the compromises that have historically come with PC-console hybrids. And it’s coming from a company that enjoys far more goodwill from today’s players than a Microsoft that has shuttered celebrated studios, canceled anticipated games, and given its most valuable mascots to Sony. Valve has everything it needs to unseat Microsoft as a member of the “big three” right now. It’s still going to have to work to pull that off, though. Great specs sound good on paper, but they won’t mean anything if players are hit with inconsistent results and compatibility issues that you don’t get with an Xbox. Valve will also need to take the device to the mass market if it wants to expand beyond a big, but still niche hardware enthusiast audience. If you can only buy a Steam Machine through Valve’s website every once in a blue moon, it’s not going to pose much of a threat to the box lining Walmart shelves. (With an estimated 4 million units sold, the Steam Deck may be influential, but it has yet to become a proper Nintendo Switch killer for good reason.) And of course, price will matter too — though recent Xbox price hikes give Valve a lot of room to set a number that’s not far off. But if the stars can align and the Steam Machine can deliver, don’t be surprised if you see Microsoft bow out of the console race altogether and go all-in on Game Pass next generation. We’re already 50% there anyway; Valve may just be accelerating the inevitable.
