Valve’s Newell: Biggest threat in the living room is Apple

Given its efforts to bring Steam into the living room, you’d think Valve would be worried about the next generation of consoles coming later this year. Yet according to Valve CEO and bearded messiah Gabe Newell, the "biggest challenge" in that space isn’t so much new console hardware—rather, it’s Apple making a play for the living room "before the PC industry . . . gets its act together."

Newell dropped that bombshell during a lecture at the University of Texas’ Lyndon B. Johnson School of Public Affairs. The folks at Polygon have posted some other choice quotes from the talk, including this interesting overview of the situation:

"The threat right now is that Apple has gained a huge amount of market share, and has a relatively obvious pathway towards entering the living room with their platform," Newell said. "I think that there’s a scenario where we see sort of a dumbed down living room platform emerging — I think Apple rolls the console guys really easily. The question is can we make enough progress in the PC space to establish ourselves there, and also figure out better ways of addressing mobile before Apple takes over the living room?"

Newell also brought up Miracast wireless display tech and Nvidia’s Project Shield. Based on his statements and the wording of the Polygon article, I’m getting the impression that the hotly anticipated Steam Box may not be a dedicated living-room PC. Now, I’m imagining more of a small, low-power system with the ability to stream games from a full-featured PC. I kind of like the idea, too—why buy a whole other gaming PC when you could just extend your current one to the living room?

I can see Newell’s point about Apple, as well. Even today, AirPlay mirroring with an iOS device and a $99 Apple TV can deliver a reasonably compelling gaming experience. If Apple makes a stronger push in that market—which the rumor mill suggests it will—then we may see more games take advantage of the technology… and more folks questioning their need for a dedicated console.

Comments closed
    • albundy
    • 7 years ago

    “Valve’s Newell: Biggest threat in the living room is Apple”

    sucks to be them. i personally wouldn’t let either next to my equipment. if i need to game, i’d prefer to use a win8 htpc with ultra fast boot for near instant on for some quality gaming, something apple and valve have yet to understand.

      • Beelzebubba9
      • 7 years ago

      Yeah, Apple certainly doesn’t understand the value of SSD based computers with short boot times and almost instant recovery from low sleep states.

      Good thing MS can show them the way. πŸ™‚

    • TaBoVilla
    • 7 years ago

    The problem is really complicated because the people involved actually want different things on their own..

    [list<][b<]Content developers[/b<] (Games, apps) want less fragmentation, lowers development cost and allows optimizing code[/list<] [list<][b<]System builders[/b<] (consoles, Apple, etc) would like their hardware to be the top seller, maximizing profits[/list<] [list<][b<]Hardware Manufacturers[/b<] (Nvidia, AMD, Intel, etc) really don't care about all of the above, they just want to be able to target all possible pockets out there, increasing market fragmentation (GPU manufacturers have different solutions at practically all price ranges because apparently that is what the customer wants, but it's not helping on the PC front overall), creating confusion[/list<]

    • joselillo_25
    • 7 years ago

    A lot of steam games use Microsoft technology instead open gl. Do not know if they are going to be capable of license this for a device that compete directly with the XBOX.

    • HisDivineOrder
    • 7 years ago

    The only real roadblock to Apple rolling the console makers is and has always been Apple itself. Jobs was (in)famous for how little he valued gaming. This is one thing that Apple could easily do and do well and just take an entire market segment by storm with very little effort.

    Look how easily they popped up on the radar of portable gaming and casual gaming. They’re a controller away from taking the desktop market with AppleTV and Airplay.

    The age of the specialized device is coming to an end. The generalized device that does everything is coming back and coming back hard. That’s why Sony and MS have been trying hard to make the case their consoles are NOT specialized, but are generalized devices. Just not computers.

    Unfortunately for them, those plans are all for naught. Why buy a $400 console IF you could buy a $400 PC that could do gaming just as well plus everything else? Why buy a $400 console if you can get an iPad for a similar amount and for a little more (but less on games) you can get an AppleTV to wirelessly connect it to your TV?

    With tablets and smartphones rapidly expanding their technical power while consoles are slowing down their own progress in terms of years to update to new systems, cost of said systems, cost of said software, and advancement of hardware, I don’t think consoles have much life left in them.

    PC’s got them on the high end with integrated GPU’s getting better and better, especially on the Intel side where advancements are barreling forward at a somewhat unexpected rate. On the casual side, tablets will have roughly similar specs within 1-2 years of the new consoles with superior resolution (1080p+) and smartphones are already walking all over 3DS with PSVita to be stepped on within the next year.

    It’s just consoles are pointless. They’re an evolutionary dead end. They always were. They were a stopgap until general devices could catch up. Now they have and so consoles will slowly wither and die, becoming a niche product until eventually the niche is just too expensive for anyone to continue with.

    The high end can live on with PC’s just as it always has. It’ll be good to cycle back to the Old Way. Back before Microsoft sold PC gaming out for 30 pieces of Xbox Live Silver and a free Games for Windows Live application that leaked memory. It won’t be MS leading the way. It’ll be Steam. Still, we’ll go back to a time when little developers spent ludicrous time making awesome games and didn’t expect, “console numbers” in order to warrant adding POV controls, advanced save mechanics, and better use of higher resolution textures.

      • Decelerate
      • 7 years ago

      Good read, well argumented even though I don’t agree 100% with all you said.

    • Arclight
    • 7 years ago

    My question is why would i want my game with added latency displayed on a inferiorly speced TV (compared to my monitor in terms of refresh rate and response time) and also using a inferior input device like a controller?

    If i were someone who played on consoles i could kind of see a desire to have a game displayed at true 1080p with higher res textures and what not, but i’m not that guy. I’m seriously questioning here when was the last time Valve thought of a PC gamer in the true sense of the word……all they do now is imagine how a PC gamer could go out of his way to play the games on a TV. Me thinks it’s all because Gabe doesn’t spend much time nowadays in a chair, his chair now is a couch, for obvious reasons.

    • kamikaziechameleon
    • 7 years ago

    Apple TV finally has arrived with its support for all apple products, true 1080p and surround sound. If valve can offer a similar proposition then develope and integrate mobile in a similar fashion they are set.

    • Bensam123
    • 7 years ago

    Oh now that has to be insulting… Consoles are so dumbed down they’re in Apple territory.

    I don’t think Apple would want to develop their very own locked down console to compete directly with Sony/Microsoft. Apple COULD enter the gaming market as a alternative to Steam and I definitely could see them doing this, but Apple more then likely has no interest in developing their own exclusive platform with exclusive titles on the level of PS/Xbox/Nintendo. They would more then likely simply bundle a system with their distribution platform, exactly like Valve is trying to do.

    I think this is more of competition between Valve and Apple, then Apple with PC gamers or console players. In other words Valve is just looking after their Steam store.

    Honestly what Valve is doing is still an abomination, by trying to transform the PC into a console and stifle the entire PC gaming industry by doing so. They could very easily do everything they’re doing with the Steambox in software and I still stipulate that. They’re the ones that need to get their act together.

    For instance they could easily certify computers based on their performance through data mining, as well as offering buyers a look at potential performance in video games. They could offer a distribution of Steambox as a standalone OS. They could offer this Steambox OS through pre-built channels as well as for free. All of this they can do through software.

    • spigzone
    • 7 years ago

    If any console gets rolled it’ll be Nintendo’s.

      • Bensam123
      • 7 years ago

      Nintendo is the only console that will live through the merger of PCs and Consoles. They’re too far outside the norm to be regarded as a PC or just another console and they’re firmly entrenched in that niche.

      • Game_boy
      • 7 years ago

      Mario, Wii Sports, Wii Fit, Nintendogs, Mario Kart, Pokemon.

      All of these games have sold 20m units on a single title for last gen. And none of them will ever come to Apple.

      An “AAA” game is lucky if it sells 2m.

      I think Nintendo is fine.

        • TaBoVilla
        • 7 years ago

        relevant username..

          • Game_boy
          • 7 years ago

          I currently hate Nintendo and everything about its direction.

    • dwc13
    • 7 years ago

    What if Apple — sitting on @$137B in cash — decided it wanted to buy Nintendo (for its IP) and a few other content providers.

      • BobbinThreadbare
      • 7 years ago

      I don’t think Apple is interested in being in a content business.

      • jstern
      • 7 years ago

      I think I read somewhere that they can’t be bought. Perhaps because they are privately held. Not an expert so I’m not sure what that means.

        • Firestarter
        • 7 years ago

        that prevents hostile takeovers AFAIK

          • tfp
          • 7 years ago

          Everyone has their price.

            • insulin_junkie72
            • 7 years ago

            …and then Apple would own the Seattle Mariners!

            Hey, Disney owned the Angels for awhile, and Fox owned the Dodgers, as well.

        • MadManOriginal
        • 7 years ago

        Nintendo is publicly traded NTDOY (it’s an OTC stock though.) However it could be that there is a single entity with a controlling stake, either by sheer share count or by some voting structure like preferred shares that vote 2:1 over other shares, or always take precedence. CBA looking it up.

          • Game_boy
          • 7 years ago

          NTDOY isn’t the publicly traded one. The correct stock is on Nikkei and NTDOY only tracks that.

          Yamauchi owns 10%, I think that’s the largest stake.

            • MadManOriginal
            • 7 years ago

            Regardless, it’s publicly traded.

      • MadManOriginal
      • 7 years ago

      So it turns out Apple’s supposedly massive ‘cash hoard’ isn’t really cash+short-term holdings – it’s total net assets (all assets-all liabilities.) At least that’s the way I read their balance sheet. I wonder if all the news outlets talking about their supposed $100B cash hoard can be held liable for this huge stretching of the truth.

    • rwburnham
    • 7 years ago

    With Microsoft’s limited support for WIndows Media Center (why is the Netflix app still so buggy?), clearly they do not take the Living Room PC concept seriously. I love my HTPC, but I don’t think I would recommend one to non-tech savvy people.

      • drfish
      • 7 years ago

      Netflix in WMC sucks but the Win8 app has become pretty nice.

        • eitje
        • 7 years ago

        faced with upgrading my 4-year-old HTPC to Windows 8, i simply purchased an AppleTV instead.

          • JustAnEngineer
          • 7 years ago

          I recently installed Windows 8 Pro and Windows Media Center on my HTPC. Once I get used to the schizophrenic UI, it’s going to be fine.

          • drfish
          • 7 years ago

          I don’t think MS’s next OS will make for a great HTPC but I have been very happy with Win8 as one. At least [url=http://www.anandtech.com/show/6674/getting-the-best-out-of-an-ivy-bridge-htpc-windows-8-madvr-and-more<]Anand agrees[/url<]. πŸ˜‰ As I've said a bunch of times, a TV is just a big computer screen IMO - I can't imagine one without a full fledged PC attached to it.

      • adisor19
      • 7 years ago

      Fun fact : If you install Windows 8 Pro from a Volume Licence ISO, you can NOT install Windows Media Center on it.

      Microsoft is really doing everything it can to make me regret installing Windows 8 on my HTPC. I’m THIS close to wiping it clean and installing Linux XBMC distro on it.

      Adi

        • MadManOriginal
        • 7 years ago

        Fun fact: wtf are you doing installing from a Volume License ISO on a personal PC?

          • curtisb
          • 7 years ago

          Because there are no scenarios where WMC could be installed on a work PC? I actually have a Win7 box at work with WMC and a capture card installed, configured, and setup to record a specific show for one of our faculty. She has an academic team that competes in a local competition that is broadcast locally.

    • someuid
    • 7 years ago

    [quote<]Now, I'm imagining more of a small, low-power system with the ability to stream games from a full-featured PC. I kind of like the idea, tooβ€”why buy a whole other gaming PC when you could just extend your current one to the living room?[/quote<] If they go this route only, it will die on delivery. The consolers will see the price of the device plus the device of a computer and have sticker shock. What they should do is offer two devices - one that operates solely by itself to play games and can stream from a pc as well as a device that is very cheap and streams only from a pc. This way both potential customers have an option. Those who already own the pc can extend it to the living room for cheap, and those with no pc can get into the action with a bit more expensive device but don't have to get into buying a pc (and if they don't already own a pc, there's probably a really good reason why.) The hardest part will be getting the pc games to run on the stand alone device well enough so that users who don't have a pc don't feel jipped, graphics wise. Steam/Valve needs some sort of ranking system for these games. A level 1 device, level 2 device, level 3 device, and the games are labeled as needing a level 1, 2, 3 device. This way the non-techies don't get burned when buying devices and games. And then Valve can continue to release the usual game specs we hard core folks already know and love. Plus, it offers a 'learning path' for the non-techies to get into pc hardware.

    • willmore
    • 7 years ago

    This has been widely discussed in other venues. The belief is that Apple is in a unique position to do this as they already have a strong set of relationships with the content providers due to their iTunes store experience.

    I’d argue that Netflix is in a good position, but, not being a hardware maker, they are at a disadvantage on this front.

    The only thing that can really be certain is that TV, as we know it, is going to change drastically in the next five years.

      • peartart
      • 7 years ago

      [quote<]The only thing that can really be certain is that TV, as we know it, is going to change drastically in the next five years.[/quote<] I was listening to the radio today and Al Gore was being interviewed about the sale of Current TV. He made the comment that cable networks wouldn't let them put a significant amount of programming on the internet, which he thought hurt their ability to draw in viewers. My point being, the content owners are big businesses with high value markets that they are trying protect and while as an industry wholesale change would probably create growth, as individual businesses there is a lot of risk, so they aren't totally wrong to be defensive. I think it's going to take a whole generation to destroy cable and satellite networks, unless Congress decides to completely rewrite copyright law (lol). Look at what Netflix has available to stream versus what it has available to mail, and even getting what they have is a struggle.

        • RDFSteve
        • 7 years ago

        But the cable companies aren’t content owners – the studios are. Right now, the cable companies have the studios by the short-n-curlies, because the studios have no other source of revenue. It’ll take some small studios who aren’t being picked up by the cable companies to start monetizing their internet offerings before the larger studios break their addiction to cable.

          • Kougar
          • 7 years ago

          [quote<]But the cable companies aren't content owners [/quote<] They aren't? Don't forget that Comcast has a majority ownership stake in NBC Universal and all its studio holdings. Or that Time Warner Cable and Warner Bros Entertainment are owned by a single company... TWC owns an incredibly long list of major prime-time channels under its Turner Broadcasting network and has joint ventures with CNN. It also owns Time and that entire content delivery franchise. Cable companies already vertically integrated by buying out major studios. Cable companies may not own all the underlying content yet, but they already own the distribution rights to most of that same content. Both already provide their own branded content delivery via on-demand services, such as Comcast's Xbox on-demand service. Comcast has already used its position as a cable company to control what content is available. For example its Xbox media streaming service is given an [url=http://arstechnica.com/tech-policy/2012/03/net-neutrality-concerns-raised-about-comcasts-xbox-on-demand-service/<]exception to Comcast's monthly bandwidth caps[/url<], while at the same time stopping competitors such as Sony from introducing a [url=http://arstechnica.com/tech-policy/2012/05/sony-warns-comcast-cap-will-hamper-video-competition/<]competing media streaming service[/url<] with said caps. In regards to the above comment regarding Netflix, Netflix has very little actual power with content delivery networks. Hence the current problems Netflix is having in trying to gain equal treatment for streaming better quality HD content over cable networks within recent weeks.

            • insulin_junkie72
            • 7 years ago

            FWIW, Time Warner Cable actually got spun off about three years ago.

            • Kougar
            • 7 years ago

            I stand corrected. I thought they were still linked after that, but apparently that was in name only.

            Well, along a similar vein: [url<]http://arstechnica.com/tech-policy/2013/01/ces-tells-cnet-youre-fired/[/url<]

    • zdw
    • 7 years ago

    I can buy this argument on portable – who wants to buy a $200 gaming-only device, when you have equal hardware in your pocket already that makes phone calls?

    But in the living room, I don’t buy it.

    Apple is fairly content to competing with SmartTV’s and Roku’s, but not much else. Yes, there are some “second screen” games that play on iOS and display on the TV, but those are the exception, not the rule. They just released keyboard support for AppleTV last monday – it’s not like controllers and downloadable games are coming anytime soon – if so, they would have done this years ago, as internally the AppleTV is just another iOS device.

      • drfish
      • 7 years ago

      [quote<]"...the AppleTV is just another iOS device."[/quote<] I think that's his point, they really just have to flip a switch. Also given the state of WMC it doesn't look like MS wants to be in the ring anymore...

        • derFunkenstein
        • 7 years ago

        MS only wants to be in the ring, so to speak, with the Xbox. Not the PC. They also want to charge $9.99/mo or $60/yr for the privilege (less if you look online).

          • drfish
          • 7 years ago

          Fair enough. Too bad they don’t see the value of both options. Of course I don’t see the value in an Xbox… I’m perfectly happy with a Nintendo console and a HTPC/Steam for everything else.

            • A_Pickle
            • 7 years ago

            The ONLY thing that Xbox has that interests me is… the game library. πŸ˜€

      • Deanjo
      • 7 years ago

      Picture this, your iDevice is your controller as is the case with already with Airplay mirroring. Refine mirroring so that it can display two iDevice airplay mirroring and all off a sudden you have head to head. Instead of one app being ran on the AppleTV, you have sold two apps, one for each iDevice and it is just mirrored on the TV.

        • sweatshopking
        • 7 years ago

        yah! then you can’t play any of your games cause touch screens lag!

          • Deanjo
          • 7 years ago

          Doesn’t seem to be much of an issue to most people who are already doing their gaming on those devices.

            • sweatshopking
            • 7 years ago

            sure, but they’re not AAA games. you’re not playing halo or sc2 on them.

            • Beelzebubba9
            • 7 years ago

            Depending on the metric – especially in revenue -, iOS is a serious force in the gaming market. Turns out there are a ton of people who want to play word and card games, or fling birds at livestock rather than be called homophobic epithets in Call of Warfare Modern Battle Ops: The Secret Script Fest 16.

            I mean *I* have a gaming PC because I like PC gaming and never really cared for any iOS game other than Angry Birds, but I can see why AAA titles not a draw for a huge portion of the population.

            • sweatshopking
            • 7 years ago

            I don’t disagree, but there is also a large market that does want more. That’s not to say people wouldn’t buy such a device, rather for “traditional” gamers, it’d suck

            • Beelzebubba9
            • 7 years ago

            Yeah I can’t find a use or an iOS gaming on TV product, but nVidia’s Project Shield could be pretty awesome…

        • derFunkenstein
        • 7 years ago

        If they’re all tied to the same iTunes account, you sold one app.

          • Deanjo
          • 7 years ago

          Ya, up to 5 devices. I’m thinking more of a “my buddy came over with his iDevice” scenario.

            • derFunkenstein
            • 7 years ago

            Not 100% sure on this because I don’t own an Apple TV any longer, but don’t you have to have both the iDevice and the ATV paired to the same iTunes account for airplay? I’m willing (and hoping, in a way) to be wrong.

            • Deanjo
            • 7 years ago

            No, you just have to allow access in the AppleTV setup to the iOS device (and enter a PIN if you have it setup that way).

            • derFunkenstein
            • 7 years ago

            well that’s not so bad.

      • superjawes
      • 7 years ago

      Consoles are growing out of their gaming-only shells and doing more things that full PCs can do. Valve is pushing features and tools that make full PCs convenient in the couch space, where consoles have ruled.

      I see where they’re coming from because trimming down a PC can reduce the cost (and MSRP) while making it capable of functioning as a console, but beefing up a console to function as a PC would probably raise the MSRP of consoles.

      Yeah, consoles would become more capable machines, but consumers are going to see that as rising prices. Meanwhile, Steamboxes would be bringing prices down.

      Apple is the perceived threat because they would be approaching the couch space from the same (or similar) direction as Valve.

    • PrincipalSkinner
    • 7 years ago

    If I already have a gaming machine, I’ll sit in front if it and play games. Not buy ANOTHER PC to play games in the living room.

      • flip-mode
      • 7 years ago

      The other way of looking at it is that you’re simply adding a video card to a media center computer. All your games, your movies, your streaming sites, your music, you photo albums, your DVD/BR player, plugged into your TV and you audio system.

      • Great_Big_Abyss
      • 7 years ago

      Certain games are conducive to sitting on the couch and playing with a controller with the family gathered around. One example would be ‘The Cave’. The wife and kids can gather round, and we can solve puzzles together. Sitting at a desk with a PC isn’t exactly family friendly, although it is the best solution for long BF3 gaming sessions.

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