Microsoft Would Like To Remind Valve That Selling Hardware Is Hard

I said earlier this week that Microsoft and Sony should be worried about Valve's Steam Box plans, because they appear to have traditional home consoles square in their sights. Well, in an interview with Eurogamer, Microsoft's Phil Harrison seems to get awfully defensive, issuing what amounts as a warning to Valve that the hardware business is so-called because it's hard.

"Entering the hardware business is a really tough business," Harrison said. "You have to have great fortitude to be in the hardware business and you have to have deep pockets and a very strong balance sheet. It's not possible for every new hardware entrant to get to scale."

"They can be successful at small scale. But it's very rare for a new hardware entrant to get to scale, and I mean tens or hundreds of millions of units. There are a very small number of companies that can make that happen."

True! But then, of that very few, I'd wager that Valve — and other companies that specialise in selling PC hardware — can do it.

As Valve confirms the Steam Box, Microsoft's Phil Harrison issues a warning [Eurogamer]


Comments

    Unlikely, other than die-hard Valve fans - and then, only some of them.

    MS guy has a point.

      He has a very good point, and Valve undoubtedly knows this too. If any game software company can make the switch, however, it is probably Valve. I dare say Steam has made them bucketloads of cash.

        The best way to make big $$ in software is to corner the distribution and payment method. Amazon, Ebay, the Apple iTunes store and the XBox Live Marketplace know this. Steam has got a lot of traction already, and the Steam box is a risky move that could make Valve a mint.

      While true, I think we'd have to assume Valve have taken all this into account and are still confident they'll succeed. I think, ignoring scale, they'll somehow make it a success.

    I'd back Valve to pull this off, every time, although the fact that I want a steam box very, very badly has probably affected my judgement a little..

    It's been sounding like an overpriced PC run on Linux so I may pass, but we will see.

    It would be incredibly funny if the Gabecube overtakes MS's next consoles, given that Gabe became successful by leaving Microsoft.

    Sorry MS, but I cant hear you though all my money : Gabe

    In all serious, Valve by the looks of it isn't building the hardware themselves, but are doing the computer parts model of getting 3rd party to build devices to certain specifications they set out and use their software.

    Some also said that selling PC games was not a profitable business in the age of massive piracy.. how'd that turn out for Valve?

    On top of that i know a lot of people who use Valve who will want a Steambox, if 25% of users buy a Steambox that use the Steam service, thats still a high number of systems they are pushing out the door.

      That'd make 15M consoles sold - which is failure territory.

        It's only an failure if Valve doesn't make an profit.

        Failure for a traditional console, yes, because with that small an install base many games would not be released for the platform. But these units will still be PCs. The install base is however many of these are sold, plus all other PCs.

    I don't know whether this will take off, but its low risk for Valve - letting other people produce their universal platform. This is where I've wanted gaming to go for a while, rather than console wars, consoles that differ in features but are fundamentally the same i.e. DVD players.

    This is what the, stagnant, game industry needs. Kudos to Valve. Change is good.

    Valve are far more agile & responsive than MS, Sony or Nintendo are. If something didn't work they'd move pretty quickly to find a fix or alternate method, rather than just push it blindly or ignore it (see: Kinekt, Move, balance board etc).

    I'm not keen for the steam box to be honest. I'd still rather just build my own PC to use content I buy from steam.

      Valve aren't going to force you to buy their product I am sure..

        short of that I don't see how well this thing will actually sell is the point I'm making

          They have a hardcore fan base they will buy it along with the clueless/scared of trying to build their own Steam Box.

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