When it comes to predicting the cost of Valve's newly announced Steam Machine hardware, responses from gamers might vary significantly. Surprisingly, even industry analysts specializing in video games provide a broad spectrum of estimates, albeit with more informed insights.
On the higher end, analysts like Michael Futter from F-Squared predict an entry-level price between $799 and $899 for the 512GB Steam Machine, with the 2TB version potentially costing between $1,000 and $1,100. Futter suggests that the specs of these machines could rival or even exceed those of a PS5, potentially reaching PS5 Pro performance levels. Thus, a 'hefty price tag' might be expected for Valve's new console-like venture. Yet, Futter believes that since Valve is positioning this device as a dedicated and powerful gaming PC, the pricing could still be lower than that of a comparable traditional desktop.
David Cole, an analyst from DFC Intelligence, shares similar views, projecting that the Steam Machine might start at around $800 and increase to roughly $1,000 for the 2TB model. Cole speculates that Valve may opt for 'very low margins' or even break-even pricing on the hardware itself. This approach could allow for pricing that is less than a gaming PC but slightly higher than a high-end console.
A Loss Leader Strategy?
Conversely, Joost Van Dreunen, founder of Superdata Research and author of the SuperJoost newsletter, predicts a lower entry-level price of $549, with the 2TB version priced at $749, plus an additional $50 for bundles that include a Steam Controller. Van Dreunen emphasizes Valve's unique position as a private company with a dedicated fan base, suggesting that the company could 'price its hardware to hit its own strategic sweet spot rather than mirror the competition.' This approach might involve taking a 'modest' loss on the hardware to encourage more gamers to invest in SteamOS.
For Valve, the value could lie not in hardware profits but in encouraging more game purchases through SteamOS, which may outweigh any initial losses on the Steam Machine. Van Dreunen notes, 'Just like Sony and Microsoft, the real money isn’t in the box, it’s in the ecosystem you enter once you buy it.' The pivotal question, he suggests, is whether Valve is willing to accept reduced margins to expand SteamOS’s footprint rapidly, as the strategic focus is on platform growth rather than immediate hardware profit.