Alienware's Steam Machine will be its least profitable PC system

Valve is pushing for its Linux-based SteamOS to be used inside a number of Steam Machines made by third party OEMs. The first such products are scheduled to be released later this year, but a report shows that at least one OEM isn't expecting to make a lot of money from its offering.

The Wall Street Journal quotes Frank Azor, the general manager of Dell's Alienware division, as saying it will be "very challenging" to launch its Steam Machine. He added, "This will absolutely be the least profitable system we ever sell."

That statement would seem to imply that Azor was not all that confident about the chances of success for Valve's Steam Machine efforts. In another statement sent to PC Gamer, he clarified his remarks, saying:

Alienware is very optimistic about PC gaming's future and its opportunity to extend to the TV. We have been partners with Valve since the inception of the Steam Machine over 2 years ago. Our decision to invest in developing the purpose-built Alienware Steam Machine, pairing it with incredible performance and pricing it as aggressively as possible has everything to do with how much we believe in this vision and want to see it materialize.

Alienware currently expects to launch its Steam Machine sometime in September, but has offered little information on the hardware inside its product. It has already disclosed that owners won't be able to upgrade Alienware's Steam Machines on their own as easily as their normal desktop gaming PCs, which may go without saying for any console based unit.

Source: Wall Street Journal via Polygon | Image via Alienware

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Deihmos said,
I cannot think of a reason why anyone would want a steam machine.

It's different, has Valve's backing - might turn out of be a sucessful niche market product. However, Alienware coupled with their RRP has positioned this product well out of scope for justifying buying one.

Here's just a few right off the bat:

-Can be made to run proper OSes and used as full on computers which will allow them to double up as real media stations. Even if you dislike the Linux distribution they come with they will run Windows.
-Proper control over the software meaning you install what apps YOU want to use
-No "gold" fees for basic services
-Free MP gaming
-Unlike consoles they won't stagnate and can be upgraded
-Actual 1080p graphics rather than upscaled 720p or 900p

Of course it won't make much money. Steam Machines are a stupid idea since they're just overpriced custom PCs. If they could do something that a normal PC couldn't, it might spark some interest, but they don't.

I give Valve a year before they give up on Steam OS. I just don't see any reason to use it.

Not sure who exactly they're trying to target with these things either. It's way too expensive to compete with consoles, already lost that fight, never mind going to get smushed between the PS4 and X1. PC gamers will probably balk at the thing too, unless you absolutely have to have a cute little box you can save yourself some money, never mind not being future-proof. Plus there's SteamOS itself. Not bashing the software mind you, but it's an easy matter of numbers. As a PC gamer you're going to want access to the titles, kind of the whole point. Currently, 11616 titles available to Windows, and note that's just Steam, that's ignoring a bunch of titles from elsewhere. Since SteamOS runs Linux, you're at a much smaller catalog of 1206.. missing out on ~90% of the software. Paying more for a whole lot less.. just doesn't make a lot of sense.

Valve would have been smarter to release a "Console" to compete with PS4/XBONE that just also happens to be able to play "some" PC games.... rather then what they have done, which is make a POS only people who refuse to admit it is will use. Kinda like that android console.. what was it.. the OUYA, oh how the fan boys praised it.

Xionanx said,
the OUYA, oh how the fan boys praised it.

Wait what ????? I've never seen anyone praise the OUYA for its gaming capabilities. You must be living in an alternate reality.

LaP said,

Wait what ????? I've never seen anyone praise the OUYA for its gaming capabilities. You must be living in an alternate reality.

Before it was released the Ouya fanboys preached like it would be the second coming. There was this general narrative that it was going to "turn the console world upside down" and completely change everything according to them.

Lord Method Man said,

Before it was released the Ouya fanboys preached like it would be the second coming. There was this general narrative that it was going to "turn the console world upside down" and completely change everything according to them.

I recall the same, but it was from the people/person behind the Phantom vaporware console that reinvented itself to be a craptastic lapboard - so I didn't hold my breath.

Alienware is overpriced, they know it, Valve needs a lower cost machine to compete with the consoles, Alienware not happy

They could do us all a favor and just not release one, the brand is not that good anymore

Anibal P said,
Alienware is overpriced, they know it, Valve needs a lower cost machine to compete with the consoles, Alienware not happy

They could do us all a favor and just not release one, the brand is not that good anymore

Well - either you build steam machines with a unified hardware like consoles or not like a pc. Since they didn't want unified hardware there is also a market for overprized Alienware Steam Machines. The question is how is this affecting the software released for it. Will they just offer low level software that high end machines run with 1/10th of their power or will they release proper games that make a good show on high end but lack everything on low end steam machines

Alienware is definitely over-priced, but not to somebody that wants a sexy looking computer. The build is also much better than a lot of the other computers you see around BUT you ARE paying for it.

Personally I'd recommend the Asus Gseries. Been using it for about 3-4 years and it's still going strong (minus next gen games, they play on med-low)