Valve Corporation’s recently announced Steam Machine is expected to launch at a price higher than that of the current-gen consoles.
According to content creator Linus Tech Tips, those hoping for the Steam Machine to have a console-like price may need to temper their expectations. In his recent video, Linus talked about his recent discussion with Valve on its upcoming hardware, where he expressed disappointment over it not following a console-style pricing model by getting subsidized. When he brought up his expected price point of 500 dollars to company, he was met with some awkward silence.
“When I said that I was disappointed it wasn’t going to follow a console-style pricing model, where the hardware is subsidized because the manufacturer takes about 30% of every game sold over the lifespan of the device, I explained that I felt that would make it a more meaningful product,” said Linus. “They asked what I meant by ‘console price,’ and I said, ‘500 dollars.’ Nobody said anything, but the energy in the room wasn’t great.”
Daniel Ahmad, Director of Research and Insights at Niko Partners, took to Twitter/X to offer some further insight into Linus’ information regarding the Steam Machine’s pricing. He began by sharing an image that read, “Please don’t say dammmn… when you hear the price”. According to the analyst, tariffs, surging memory/storage costs, supply chain volatility and an inability to subsidize to the same extent as traditional console manufacturers are all working against Valve at the moment. He believes the specs suggest that company originally intended the Steam Machine to be in line with the PS5’s pricing.
Responding to a question regarding Valve’s inability to subsidize to the same extent as a traditional console despite the company’s financial success, Ahmad said that console makers such as Sony Interactive Entertainment have “significantly more levers [they] can pull when it comes to things like recurrent revenue (paid online), closed ecosystem, large production/retail scale, and an entire business built around console distribution to begin with.”
During a recent interview, Valve engineer Yazan Aldehayyat claimed that the Steam Machine is equal to or better than around 70% of “what people have at home.” Read about it here.
