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
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.
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.
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.
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?
It’d be really funny if it’s designed specifically not to meet Windows 11’s arbitrary requirements. You can install Linux though! :D
Hearing that is so refreshing. Microsoft/Google would never put something like that on their website because you are the product.
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 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.
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!”
Look at their website. It pretty explicitly states you can do with the Gabe Cube whatever you want. Including changing the OS.
You can install OSX on there /s
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.
Im not gonna make any statements but I think this video might have some credibility. It comes from the person who gave the early heads up for the steam hardware launch :3
We could, you know, just wait and see.
*ducks*
WHY YOU LITTLE…
But will the new valve hardware help fill the empty pit in my chest?
Sure, if you eat it.
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!!
… Duck… Goose.
Duck Game? Goose Game? OMG … Duck Duck Goose Game! I will be a billionaire
Worked for Goose Goose Duck!
They can’t sell them at a loss without a locked-down ecosystem. Sony learned that the hard way with the OtherOS support for the PS3 that lead to a ton of them being purchased to build cheap supercomputer ls and never spending a dime on games or software to cover the loss.
I think that was overstated. Sure there were some “fun” projects for fun or publicity.
However supercomputer clusters require higher performance interconnect than PS3 could do. At that time it would have been DDR infiniband (about 20 Gbps) or 10 g myrinet.
Sure gigabit was prevalent, but generally at places that would also have little tolerance for something as “weird” as the cell processor.
OtherOS was squashed out of fear of the larger jailbreak surface.
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.
Edit: and you can tell they focused really hard on making the new controllers more durable:
- No charging port to melt
- durable sticks that won’t start drifting
- No special finish on the controller that can be worn/scratched away
- No internal battery to go bad
- seemingly far fewer delicate parts
Funny point on the melting charging port. 2 years or so after the Index came out, SteamVR started warning using with a status dialog that told users to stop charging their controllers while they use them. They never accounted for long play sessions and people who would want to charge while playing.
USB-C has durability issues when used like that.
To be a loss leader doesn’t the need to lead to something?
The only way it could make sense that they’re selling these at a loss would be - oh yeah. They’re coming straight for Nintendo / Sony / Microsoft now, huh?
The day I see a steam console in wal mart is a day I will be very happy.
For Valve it would ideally lead to a new Steam account being created. Which would make sense if someone got one as a gift or something, naturally they would set up a Steam Account if they didnt already have one.
Yeah.
Also the new offerings are very much something Johnny Joe who has only ever owned a PlayStation, Nintendo, or Sony console would potentially buy.
Of course Johnny Joe would put the entire thing up his ass and die from heavy metal poisoning because he’s an idiot, but his peers would actually use them.
I guess that would depend on the front end and game support. If it is any less user friendly than Xbox or Playstation, people wont want to use it Johnny Joe and Little Timmy don’t want to fiddle with a bunch of settings and constantly change stuff to get games working. The Steam Deck does okay but I still find sometimes it needs some… coercing… to get some games to work right.
If they dial it in right, everything should work properly out of the box without needing settings changes.
I’d imagine they’re just porting over the exact sameuii that’s already on the steam deck.
It’s great.
Some of the third party steam machines from 2015 actually had some distribution to Walmart stores. I saw it in the flesh!
To be a loss leader doesn’t the need to lead to something?
https://en.wikipedia.org/wiki/Loss_leader
You have no idea what you’re talking about.
The very first line:
A loss leader (also leader) is a pricing strategy where a product is sold at a price below its market cost to stimulate other sales of more profitable goods or services.
So the answer to their question is “Yes, a loss leader needs to lead to something”. I have no idea why you think they have no idea what they’re talking about.
To be fair, I don’t watch either of those youtubers. So I had no knowledge of this.
I was expecting an APU
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.
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.
Isn’t quest 3 sold at a loss? Selling similar hardware at no loss will present a challenge.
Though, at the same time, there’s not much wrong with making low quantities of something and selling them at a profit, slowly.On the one hand, i get it. It will be for enthusiasts only if that’s the case. On the other hand, I feel like for the amount of profit this company brings in, I am a little shocked that they don’t even try to cut the price back a bit to sell more. I guess whats the point when you don’t even have to do this at all and it sounds like the entire project is just a fun way to spend some time seeing what you can come up with and sharing that with the people that can afford to buy cool things.
On the one hand, i get it. It will be for enthusiasts only if that’s the case.
Note that I haven’t said anything about what the price will be, just that Valve has stated that it won’t be a loss leader.
I’ve seen rumors that the Bill Of Materials plus Valve’s usual overhead would still result in a system valued at $500, though I haven’t seen the source and am very skeptical of it.
On the other side, XBox is allegedly targeting $1200 on their standardized custom gaming PC, which I doubt would be worth the price, especially with it running Windows.
Oh, I agree. My price is just speculation. Also, Xbox is done. They had a handful of exclusives this year that, as far as I saw, were nothing to sell systems over, and from the looks of it, only Fable is set for next year. As soon as I saw them jump ship with a console and finally share their best games like gears of war, I knew it would only be a matter of time.
That handheld is also windows only and to late to the party, and your right they just went full pc only at a price nobody will pay when you can probably get your own pc that will have little difference. They will be with Sega soon enough and probably use the companies they purchased to continue creating games for everyone else and maybe just focus on the windows store for semi exclusivity after the pc thing fizzles out.
I thought they originally started their first attempt with Alienware? They gave up. I’d have to see how their newer one is better.
Lots and lots more compatible games is probably the biggest one
What the hell is a “loss leader”?
A product sold at a loss to attract customers who hopefully buy other products with higher margins that result in a net profit for the retailer.
Gilette gives away razor handles to men to encourage them to buy their blades.
Inkjet printers are often cheaper than a change of ink cartridges.
I think it was Standard Oil, gave away hurricane lanterns in order to sell kerosene.
Most video game consoles are sold for less than they cost to make because the company expects to earn more in video game sales.
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.
