Pat Pilcher: SteamOS: Console wars about to get messy

With video game titles such as Grand Theft Auto generating over a billion plus dollars in its first three days on sale, it isn't terribly surprising that tech titans Microsoft, Sony and Nintendo are duking it out for a place in our lounges, hearts and wallets. Now a new player is emerging that looks set to fundamentally shake an already messy console war up, in the form online PC games distributor Valve.

While we've been bombarded with rumours of Steam game consoles for ages, Valve has taken a slightly different approach to forming a strategic beach-head in the lounges of gamers worldwide. Where others have developed consoles at considerable expense, Valve have instead launched their own SteamOS.

According to Valve, SteamOS will work with what they say is "any living room machine," and nicer still, it'll also stream games from Macs and PCs. The move is particularly smart as Valve effectively distance themselves from the risks and costs associated with building a games console but retain the more profitable software distribution that is not only a good fit with their existing business but is also a lucrative business.

Their move is clever and in many ways similar to what Google did with Android. Where Nintendo, Microsoft and Sony tied their fortunes to a single console design, SteamOS is open source and free, which means there's likely to be a massive variety of SteamOS powered hardware that will not only have a price advantage by virtue of the off-the shelf PC componentry and open source OS being used, but there could be a SteamOS powered console with specs and features to fit most pricing and gamer niches.

This said, SteamOS also face considerable challenges. Convincing games developers to support yet another OS is likely to be challenging, and as console vendors have discovered in the past, it doesn't matter how flash the hardware is, if there's no decent games, the platform quickly dies. Valve have yet to name any game developer partners, but rumours are already circulating that Crytek are hiring a team of developers to support SteamOS.

The availability of games could however be offset by what Valve have branded "in-home streaming". With Steam installed on a PC or Mac, games can be streamed over home networks (assuming there's a fast enough wired or wireless connection available) to SteamOS powered hardware connected to a TV.

Games aside, Valve have also hinted that SteamOS will be media friendly, which could hint at Steam broadening from online games and into online video and music distribution. Given the sheer level of complexity involved in getting top shelf content up and running, it is most likely that Valve will probably partner with an existing online service - in the US this could see deals inked with Netflix and/or Hulu. How this will work beyond the US has yet to be seen.

The industry rumour mill has it that Valve has three announcements planned later this week and odds are on that they'll be announcing some OEM partners for SteamOS powered hardware. Watch this space.