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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Honestly I was saving up money to get a PS5 and ditch PC gaming. But then I saw valve’s announcement about steam machine and decided to get a steam deck when I have enough.
It’s literally a no brainer because I can play my current library at no extra cost whereas with ps5 I gotta pay for online as well as the games.
Before you go in on a Steam Deck I want to give a head’s up:
While I like my Steam Deck, it does have limits. If you primarily want to play 2D indie games, it’s absolutely perfect. You get great framerate, and the battery lasts 3-4 hours or sometimes even more.
But if you want to play 3D games from the last 10-15 years, you’re going to need to compromise. Much of the time you won’t be able to get 60fps, and the battery life drops off quick. And if you want to dock it and run it on your TV you’re still going to have some performance tradeoffs due to the Steam Deck being built for 800p gaming
If you still have a powerful tower PC but want to play newer 3D games from your living room on a TV, you could run an application called Sunshine on it, allowing you to stream to a Steam Deck via Moonlight at high bitrate (4k 60fps with relatively low latency) and the Steam Deck is good for that because it has more power to encode/decode the stream than most alternatives.
Or you could wait for the Steam Machine to release. It won’t be as powerful as a PS5, but I’m expecting it to be a good value compared to most PC’s
Tbh I’m going for the steam deck due to its portability and ability to play my existing library. I’ve made some life decisions that will make me travel a lot around countries or states so steam deck is the perfect pick for me. I don’t really play more than 1-3 games that I play everyday and all of them run perfectly on the deck.
Earlier I thought of going for a PS5/6 but it wasn’t really economical plus given my frequent rate of travel, its not feasible.
Right now, I play my games on a Thinkpad that struggles to do a lot of multi tasking stuff. Its only 2 years old but took a bad beating in terms of performance. I’m gonna get the last juice out of this laptop and continue my gaming on the deck
It sounds like a Steam Deck is a perfect fit for you then. May your frames be high and your lag minimal
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.
Lol this reminds me of that time the US Air Force built a giant compute cluster using PlayStation 3s. Idk if Sony sold those at a loss, but they certainly didn’t see any game purchases coming from the US Department of Defense
I guess this small articles provides us with the beginning of an answer? https://www.engadget.com/2010-02-05-playstation-3-still-a-loss-leader-six-cents-for-every-dollar.html
I was thinking that they might require a Steam account to order, the same way they stopped scalpers for Steam Deck, but there’d be ways around that.
It’d be hilarious if you needed something like “profile level 10” to order though.
This part’s basically guaranteed, yeah. But there’s a secondhand market and also surely some scalping companies saw the Deck launch and went yknow what? It doesn’t cost us much in the long run to make a few hundred Steam accounts now and buy some $0.10 team fortress hat on them just in case Valve does the incredibly predictable thing of releasing more desirable hardware.
Ohhh only allowed to buy steam level / 10 whole numbers only. I could get 9. Woot.
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.
Why would they sell any hardware at a loss at all? Console manufacturers do it to lock people into their ecosystem and sell them games at a premium, Valve doesn’t need that, people are already overwhelmingly favoring their store.
The same reason people go into debt for a burrito. It’s easier for people to justify a smaller cost now, and valve will make than money back later with extra games sold, especially in the case of the Frame.
As someone who loves VR gaming, isn’t that a lot of faith for the unpredictable at best market that is VR 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?
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.
I’m pretty sure that is up to AMD and not Valve.
It’d be really funny if it’s designed specifically not to meet Windows 11’s arbitrary requirements. You can install Linux though! :D
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
Hackingtosh Steam Machine will definitely happen.
🤮
That reaction makes sense is a gaming forum because gaming totally sucks on OSX.
OSX is a great OS. I don’t know how anyone can use Windows after 7.
OSX has several things going for it, primarily, it’s got the clowns at apple running the show, thus, it has a bunch of “natural” interface bullshit that only make sense if you intend to live like a caveman and not understand that computers can function differently to physical objects.
On top of that, they pushed themselves as an “alternative” to windows back when they were even more corporate than fucking Microsoft, while blaring out the ignorant ass ipod adverts whose goal was to make the user into consumers making computing choices based on fashion. The iphone and it’s money gated, walled garden BS was just the cherry on top.
If you wanted a fucking alternative to microsoft, linux has been there for you all along instead of the “worse but shinier” osx, which mac served to just overshadow with its increased advertising budget and psychotic CEO.
And I mean that literally, Steve Jobs was actually fucking insane and a horrible person. From firing people at random, to abandoning his kids, to stealing livers and trying to cure his cancer with smoothies.
Also, it’s basically open/free BSD with more propriety bullshit on it than you can shake a stick at.
I don’t know how anyone can use Windows after 7.
Yeah, windows 8 , 10 and 11 are toxic shitholes. You know what macs did before windows started begging you to log in and create microsoft accounts? Force you to have Icloud or whatever the fuck it is accounts. You know how I know? My work laptops suck ass and forces me to have mac accounts, and is complaining that it can’t sync HEALTH DATA. MY WORK LAPTOP WANTS TO SYNC HEALTH DATA.
Apple blew the doors off for enshittification. They primed the fucking pump, and now microsoft and google are following through the door, you guys are like “yeah, putting osx on a steam box would be cool” fucking no. Ew.
It seems like you’re too emotionally invested to have a normal conversation like a person.
Health is an app you can delete. It’s not forcing you to do anything. You don’t even need iCloud for anything. You don’t even have to use their walled garden App Store. I know because I download and install shit from the internet all the time.
Yes, it’s free/bsd based. Who cares? I just want it to work and the chassis and build quality on the laptops are excellent.
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.
You get what you measure
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.
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.
>.> what have I done
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
I was expecting an APU
…and you got one.
No, the Steam Machine has a CPU and a pcie GPU.
Even if you could argue Raphael was an ‘apu’ since it has the 2CU GPU, those are lasered off on Steam Machine’s CPU.
And honestly, we probably should have expected this from the leaked benchmarks. It was already showing hits of using a separate 7600
AFAIK: It depends.
The Cube: No
The VR headset: Yes. But it’s rather an SoC.
I wonder if GPU/motherboard manufacturers are not leaving money on the table by not selling an all-in-one gaming motherboard like the one in the Steam Machine.
Built-in GPU and VRAM with the CPU, RAM and cooling optional.
Why would anyone who’s in the market for a by-itself motherboard ever want something you can get as a modular piece as a built-in to another expensive piece?
Besides, if you want everything soldered on you can just buy a laptop motherboard.
Or a Mac
For the same reason that people are interested in the steam machine. It’s nice to be able to just throw some money at people and get a complete product. I can see businesses getting these things if they need a moderately powerful GPU for business reasons. Unless valve go utterly mad on the pricing here, it’s going to be much better value for money than a Mac mini, and it’ll have better compatibility with existing software as well.
“I’m not interested in that product. It is impossible for someone to be interested in that product.”
For the same reason there’s other options. Having options alone is more than enough reason.
A motherboard with a built-in GPU has obvious price, cooling design and size advantages.
The only things I suggest to be soldered are the GPU and the VRAM since GPUs are extremely sensitive to their memory setup. CPUs can use off-the-shelf stuff without issue.
The niche is already filled by NUC sized PCs from China.
Where would one be able to see their stock? All I seem to find are $1500 PCs.
Try at minisforum or beelink
I will, thanks.
Edit
Those are just mini APU based PCs meant for office work. Not really compact gaming PCs with integrated GPUs.
Built-in GPU and VRAM with the CPU, RAM and cooling optional.
I don’t think that’d be a wise idea. After watching Valve interviews, it’s clear that they designed the entire system around a specific max TDP. Apparently they figured out the TDP, picked a fan to move it, then designed the rest of the cooling system based on that.
If you start swapping out different CPU’s that’ll change the TDP and very quickly become a problem. Plus, the CPU is soldered to the board. Having a socket to allow for swapping would require a redesign of the cooling to account for the increased height
Yeah, it would probably be a better idea for AMD to sell variants of the APUs being used in the current generation of Xbox and PlayStation.
My guess is that those chips are under exclusivity contracts and/or they don’t want to undercut their lucrative discrete GPU and CPU market.
Why sell one efficient product when you can sell two more expensive ones?
On the steam hardware page it says the CPU and GPU are discrete although also “semi-custom” which I think means it’s not Gigabyte and has some cooling features that are tailored to the form factor.
…the fuck is a “loss leader”?
A product sold at a loss/very attractive price to attract customers. The idea is that they customers will come due to the cheap price of a desirable product and buy additional other stuff at the store, which should hopefully make up for the loss.
E.g. a restaurant advertise cheap burgers to attract customers, and then make the profit on alcoholic beverages that customers buy alongside the cheap burger.
So the Razor and blades model (printers) but in games?
From the second sentence on the page:
It is different from loss leader marketing and product sample marketing, which do not depend on complementary products or services.
So the Razor and blades model would probably be the more accurate term for what people thought the new steam hardwate would be, yeah.
Though steam won’t lock you to their services.
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.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
I agree we don’t know if they’re loss leaders yet. I will say that even if the hardware is priced at a loss, though, it’ll sell more Steam games. Ultimately I don’t know if it really matters.
Though yeah, people should get past headlines. Lol
I agree we don’t know if they’re loss leaders yet.
Please actually read the body of the post. Valve has already said in an interview that they won’t be loss leaders
What the hell is a “loss leader”?
When a business sells something at a lower price than it costs for the purpose of attracting more customers.
Another example is Costco rotisserie chicken.
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.
An item that is sold to you at a loss in hopes that you buy more profitable stuff from them to make up for said loss. Game consoles are usually sold at a loss in order to get people into their ecosystems, so they can buy things like games and subscription services, which are more profitable.
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.
Even if they sell at cost, they’re losing money because of the R&D costs.
Ok, but R&D on a given product eventually stops. Over the lifetime of a good, it becomes a smaller and smaller proportion of overall cost.
So, for the first unit you ship, the cost is materials + logistics + labor + R&D.
But for the 1,000 unit you ship, the cost is materials + logistics + labor + (R&D/1,000)
…But then in turn they’ll earn money with Steam sales, so they’ll be earning money.
Yes, but that’s a different sale. My point is it can still be considered a loss leader if they sell it at cost. It took them many millions to develop it, so overall they would be losing money on the hardware sales.
That’s as opposed to something like Costco’s hot dogs. There was no R&D there, so if they sold it at cost, I wouldn’t consider it a loss leader.
We could, you know, just wait and see.
*ducks*
But will the new valve hardware help fill the empty pit in my chest?
Sure, if you eat it.
I would be happy to wait and see but idiots online keep trying to insist it’ll be $2,000 even though the hardware isn’t close to worth that much. Some of these people are big influencers and really should know better.
Nah, it’ll probably be $800-1k. It’s basically a 7600 CPU + RX7600 GPU or whatever, and it’s not really upgradeable. So somewhere between the Series S and X in performance, and not subsidized by game sales.
So what exactly does that change? Valve already decided the price and that is what you will have to pay. Who cares what anyone ever predicted?
There are people online who are wrong. I can’t just ignore that, they must be told why they are wrong.
Seriously though it’s a good idea to correct people when they make stupid baseless claims because other people won’t necessarily have the technical understanding to judge whether their claims are based on reality or not.
Many of the people who are doing this are YouTube or Instagram personalities with lots of children following them, I like this product and want it to succeed, and I don’t want children to lose interest in the idea because their favourite idiot instagrammer reckons it’ll cost an absurd amount of money.
I’m utterly confused about why you are upset that people are doing that. There’s absolutely no need for you to engage in it.
Valve will have a good enough overview on the situation and if they think it will hurt sales they can simply make a statement. They can handle it.
It’s interesting to discuss about the price but being upset about „idiots“ who have wrong ideas and playing hero for a multi billion dollar corporation is something I’m confused about.
I want it to be a successful product, that I can buy, and will be supported for a useful number of years. $800-1200 feels OK for that. $2000 feels like Apple Vision territory.
Jesus, man: haven’t you ever been excited about a thing before it’s on shelves? Speculated about a sports game before it’s over? Talking about your anticipation is part of the fun.
WHY YOU LITTLE…
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.
Grey duck*
Duck Game? Goose Game? OMG … Duck Duck Goose Game! I will be a billionaire
Worked for Goose Goose Duck!
but… I want it now?
