Finding the PC game consumers of tomorrow

The minor drama over the removal of Valve's Steam Machines initiative from the main navigation bar of the Steam Store this week - prompting some reports that the hardware program was winding down, and a swift denial from Valve - isn't exactly the ideal way for this project to get back into the headlines.

Some attention, however, is arguably better than no attention at all; and while Valve insists that it remains committed to Steam Machines (and more generally to Steam OS and the whole 'gaming on Linux' project), there's no doubt that this has been a somewhat moribund sector for quite some time. Valve itself admits that Steam Machines "aren't exactly flying off the shelves", and there's been little noise or interest around updates to Steam Machine hardware over the past few years.

It would be unfortunate, however, if Valve or its hardware partners were to take an entirely negative lesson from this. Steam Machines were in essence an experiment, a proof of concept around the marriage of two related notions; PC gaming hardware priced and pitched to a mass market, and PC gaming without Windows. Both of those notions remain important to the future of the PC gaming market - albeit in very different regards.

"Steam Machines were in essence an experiment, a proof of concept around the marriage of two notions... both important to the future of the PC gaming market"

Hardware pitched to the mass market is essential to the future health of the market overall, while freeing up PC gaming from Microsoft's operating system may be important to the future health of Valve's business specifically. This may explain why much of Valve's attention seems to be focused on improving the viability of Linux as a gaming OS, to the detriment of its focus on hardware; it sees the directions Microsoft has taken with Windows in recent years as more of a threat to Steam than any concerns over hardware installed base.

That's an understandable position, especially since in many regards the PC gaming market is in pretty rude health. Just as consoles have enjoyed a resurgence in recent years, PC gaming also appears to be doing very well commercially. It's a little trickier to quantify, not least since high-end GPU sales, once an excellent benchmark for the size of the PC gaming market, are now being driven heavily by cryptocurrency mining, but software sales tend to suggest that the PC games market is humming along nicely right now. The need for high-quality entry-level PC gaming hardware just doesn't seem all that pressing for now - while, to Valve's mind (and likely that of several other companies), the ability to create some independence from the Windows ecosystem for gaming is significantly more clear.

One could equally argue, however, that this is pretty short-term thinking at work. The challenge for the PC gaming space is one of recruitment; lacking a central company with a fat marketing budget to drive recognition and adoption, PC gaming is something that requires accessible, ubiquitous vectors of access for young people getting into video games.

For many years, those vectors were provided by the ubiquity of "multimedia PCs" - which were just about up to the task of playing games half-decently - in family homes and students' bedrooms. PCs were purchased primarily for non-gaming purposes - for internet access, for home office or school work, and so on - but provided a gateway to gaming for a whole generation of young people. One could make a pretty compelling case that the present boom in PC gaming owes a great deal to the realisation of the "PC in every home" dream in the 1990s and 2000s; the generation now spending serious money on high-end PC hardware for gaming is the generation that was introduced to PC gaming on that era of multimedia PCs.

The problem for PC gaming, looking down the line a decade or more, is that the present generation of young people isn't having the same experience. The "home PC" is a notion rapidly being consigned to the dustbin of history; it has been replaced instead by a grab-bag of smart devices, which push users towards the very different smartphone game ecosystem rather than introducing them to PC gaming. Smartphones and iPads have taken over much of the role that used to be occupied by a family multimedia PC; the remainder has been largely taken on by a set of gaming-unfriendly devices such as Chromebooks, Apple laptops and low-powered Windows 'Ultrabooks'.

None of this means that PC gaming is "doomed", or any such thing; I've been around the block enough times to know how foolish any proclamation of that nature inevitably turns out to be. However, PC gaming is subject to the same commercial pressures and problems as any other market; PC gaming customers do not simply miraculously appear fully-formed in the world, like respawning foes in an MMORPG. As in any market of this kind, there is effectively a funnel in place, a set of experiences and exposures which transform someone who isn't a PC gaming consumer into someone who's living off instant ramen for a month in order to afford a new GeForce card. The replacement of PCs in living rooms, bedrooms and classrooms with iPads and other devices that aren't conducive to PC gaming represents a constriction of the top of that funnel; it's a commercial challenge that could have a major market impact several years down the line.

"Smartphones and iPads have taken over much of the role that used to be occupied by a family multimedia PC. The remainder has been largely taken on by a set of gaming-unfriendly devices"

A successful roll-out of Steam Machines would not be a direct solution to this issue - it's not like families who have migrated to smart devices are going to pick up a Steam Machine instead, after all - but it would mitigate the impact of young consumers' lack of exposure to PC gaming by providing an accessible and affordable on-ramp for them to hop on board and explore PC gaming later on.

The expense of getting into PC gaming and the degree of commitment it represents has, until now, been largely mitigated by two factors - a pre-existing installed base of PCs (so for many people, getting a gaming-ready setup was an upgrade rather than an outright new purchase), and a large base of consumers who engaged with PC gaming in their youth and remain committed to it as they've grown older.

Both of these factors face major challenges now; getting a gaming PC would be an outright new purchase for a lot of consumers (including a new monitor, peripherals etc., and the whole question of where to put it - which can be pretty challenging in a small apartment), and a whole generation of them have largely grown up without the kind of PC gaming exposure that might make them willing to go through all of that. Lowering the bar to entry, then, takes on a far larger commercial importance than it had before.

That there's a market for straightforward, well-made PC gaming hardware that doesn't require a lot of effort from its users - essentially PC gaming hardware that's about as easy to use and uncomplicated as a modern console - is fairly well established. Ironically, given Valve's priorities with SteamOS, the company that seems to have made the most headway in this regard in recent years is Microsoft itself; the Surface Pro, though low-powered and somewhat expensive, has become a popular device with an audience of people who want a competent piece of PC gaming hardware and are willing to be well behind the cutting edge technologically if it means good quality hardware and minimal fuss.

That's far from being an on-ramp to PC gaming - price alone means that it's more positioned at the other end of the funnel, sustaining the engagement of older gamers who can no longer justify a monster gaming rig in the house - but it's a good example of how a diversification in PC gaming hardware can make a meaningful impact on the market.

We should sincerely hope, then, that Valve's welcome assertion of commitment to the Steam Machines concept is soon backed up by concrete action. The PC market is doing fine right now, and it will continue doing fine next year and the year after; but any business should see a worrying signal in the kind of broad social and technological change that's happened at the very point when most existing PC gamers first started engaging with the platform. Steam Machines and similar initiatives shouldn't really be about today's consumers; the question they need to engage with is where tomorrow's consumers are going to come from.