Valve “Steam” Game Console

Currently there are 3 players – a fourth is now trying to enter. How are the incumbents fairing? – in general not well. So is Valve crazy?

BusinessWeek/Bloomberg notes (“Valve lines up…”) that Steam in its Half-Life and other games has the equivalent of the installed base of Xbox and PlayStation. They also encourage developers – no licensing fees, indeed no vetting process for new games. Will that be enough? They claim their current user base wants to move from their PCs to their livingrooms.

Past history suggests only 3 firms can exist in this space, though at any given time not all will be profitable. No one wants to buy a system without lots of available games, and systems aren’t compatible so a game on one won’t run on another. The bigger you are, the more attractive you are to users. Hence small numbers. Will Valve upset the current triumvirate?