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Alienware: Steam Machine Will Be Our 'Least Profitable' Ever

I find it interesting how Valve both is and isn’t investing a lot of time and precious, precious GabeNcoins into its Steam Machine initiative. On one hand, this is the PC juggernaut’s plan to bull-rush through the living room’s console-lined walls and play jump rope with the entrails of enemies within, but on the other Valve is hedging its bets as cautiously as possible. It’s letting countless hardware manufacturers take the risk on building and distributing these things, and it’s hoping audiences will give them some clue as to what they should do after that. It’s not a terrible strategy by any means. It’s just a very Valve-centric one. Hardware manufacturers like Alienware, then, are worried, even as they place utmost faith in Valve’s time-proven ability to prime penniless pumps until money cascades out like a Biblical flood.

The Wall Street Journal spoke with a number of said hardware manufacturers about their thoughts on Valve’s mad plan to take over the world one room of your house at a time, and many were skeptical. Alienware’s Frank Azor, especially, thinks his company will come out of this with a pretty sizable hole in its wallet.

“It’s going to be very challenging. This will absolutely be the least profitable system we ever sell.”

And yet, even with that in mind, Alienware’s leading the Steam Machine charge. This, said Azor, is because Valve has dwarfed all previous notions of PC gaming success in the past, and they could well do it again.

Falcon Northwest president Kelt Reeves and Telltale CEO Dan Connors were on the same page as Alienware. “If anyone can do this, Valve can do it,” Reeves said.

Other companies, however, weren’t so sure, with iBuyPower’s Tuan Nguyen noting that Steam Machines might lead to a fragmented living room crowd even as they stand to provide a set-in-stone-ish target spec for game developers to aim for. “It’s like the Android phone marketplace,” he explained. “You have phones all over the place with wild specs and pricing.”

In other words, Steam Machines might narrow down the PC market a little, but not enough to avoid confusing potential buyers – especially when there are so many options in so many different price and power ranges. Some will be upgradable, others won’t, etc, etc, etc.

Much like Steam Machines themselves, then, hardware manufacturers’ perspectives on Valve’s outside shot of a plan are many and varied. Has anything at all convinced you to maybe even mull over the idea of picking one up? Personally, I’m not sold. My current PC is already great, and I can use it in my living room. Steam Machines, meanwhile, don’t strike me as simple/accessible enough for console crowds or versatile enough for longtime PC gamers. I’m not sure if Alienware is right to be this worried, but I do think there’s cause for concern.

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Nathan Grayson

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