Valve’s master plan for Steam Machines is finally coming into focus

If I told you that Valve could make a play to dethrone the Sony PlayStation and Microsoft Xbox in your living room this next year while simultaneously challenging the Meta Quest as the gamer’s VR headset of choice, would you believe me? Because Valve may have a lot of SteamOS hardware on the way.

If there’s fire where we currently see smoke, Valve is currently preparing a wireless VR headset codename Deckard, a pair of trackable wands codename Roy, a Steam Controller 2 gamepad codename Ibex, and a codename Fremont living room console too. (That last one now looks likelier than it did yesterday.) And Valve has also now seemingly revealed plans for partners to create third-party SteamOS hardware too.

It won’t be easy to take on Sony, Microsoft, or Meta. Those companies have a lot to lose, and they’re deeply entrenched. But the Steam Deck has revealed a massive weakness in each of their businesses that may take them years to correct — the desire to play a huge library of games anytime, anywhere.

And while they figure that out, Valve may be building an entire new ecosystem of SteamOS hardware, one that could finally let PC and peripheral makers tap into the huge and growing library of Windows games on all sorts of different hardware without relying on Microsoft or subjecting their customers to the many annoyances of Windows.

Today, every major PC company is building one or more Steam Deck rivals. But without Valve’s blessing and support, they’re saddled with a Windows OS that doesn’t start, pause, and resume games quickly and seamlessly enough to feel portable and easy. When building those handhelds, they typically rely on off-the-shelf AMD chips, too, since no other manufacturer’s parts currently compete on Windows gaming plus battery.

But Valve has long said it will open up SteamOS to other manufacturers, even recently committing to some direct support for rival handhelds like the Asus ROG Ally — and the other week, Valve quietly updated a document that may reveal its larger overarching strategy. It won’t just leave SteamOS sitting around and hope manufacturers build something — it’ll hold their hand.

Valve now has an explicit label for third parties to create “Powered by SteamOS” devices, which it explicitly defines as “hardware running the SteamOS operating system, implemented in close collaboration with Valve.”

It additionally lets companies create “Steam Compatible” hardware that ships with “Valve approved controller inputs,” as well as SteamVR hardware and Steam Link hardware that lets you stream games from one device to another.

And if the leaks are correct, manufacturers may not have to pick just one or two of those labels. It sounds like Valve’s Steam Controller 2 may contain the ingredients to be recognized and tracked in a VR environment and that Valve’s VR wands will feature enough buttons to double as a gamepad, playing Steam’s massive library of flatscreen games as well.

Valve may be putting in the work to reduce dependence on AMD’s x86 chips as well. Datamining by Brad Lynch, the Valve watcher whose community has uncovered most if not all of these leaks, showed that Valve has been testing many Steam games, including VR games, on Arm chips as well.

While Valve once told me that the Steam Deck’s AMD x86 chip might be a good candidate for a possible future standalone VR headset, Arm chips could potentially offer better battery life and lower weight for a portable product than x86 — even while Valve investigates more powerful AMD solutions than ever for a possible living room console.

When Valve asked PC manufacturers to sign onto its Steam Machines initiative over a decade ago, with the idea of building living room PC consoles, it asked for a leap of faith with very little to show and a tiny chance of success. It took years for Valve to even build the oddball living room controller for its Steam Machines, and it didn’t get far in convincing Windows game developers to port their games to Linux.

But by the time it announced the Steam Deck, Valve had hammered out a Proton software compatibility layer so good that many Windows games now run better on Linux, and created the most customizable yet familiar set of controls ever made.

If manufacturers could build their own Steam Machines rather than equivalent Windows machines, they could offer better gaming products than they do today. Maybe they’d even want to release a VR headset that isn’t tied to Microsoft or Meta if it doubled as a Steam Deck, portably playing decades of flatscreen games.

It’s not clear any of this will pan out; Valve is an exceedingly small company that tries not to chase too many things at a time. When I speak to PC industry executives about why they pick Windows over SteamOS, some say they’re concerned about whether Valve would truly be able to support them.

But it’s just as intriguing an idea as it was 12 years ago when Gabe Newell explained the initial vision to us, and this time, there’s a far better chance it’ll work.