Valve Steam Machine May Cost Less Than Anticipated

Valve recently sparked concern among gamers when it revealed that the Steam Machine would be priced similarly to a competitive gaming PC, with ensuing speculation resulting in up to $1,000 prices being thrown around. Likely in response to many of these concerns, Linus Tech Tips on YouTube took it upon himself to build a gaming PC with similar specifications and performance to the upcoming Steam Machine in an attempt to estimate the price of the new living room console. The build itself consists of an AMD Ryzen 8400F, an ASRock B650M motherboard, 16 GB of Crucial DDR5-5600 memory, a Kingston 500 GB SSD, a Seasonic 550 W PSU, and an ASRock AMD Radeon RX 6600 GPU. Taking the build’s cost at face value, at the time the PC was built, and with the lowest available prices, the Steam Machine will launch at somewhere around $910, with the possibility of bringing the price down by cutting certain features.

However, Valve is not a regular consumer, and economies of scale play a big role in pricing when you start talking about devices that are expected to sell hundreds of thousands or millions of units. Valve also previously said that the pricing for the entry-level Steam Deck was “painful,” suggesting that it had employed very aggressive pricing for that device. At Valve’s scale, it seems likely that the specific components that the YouTuber used in the build would come to around $700-750, but when accounting for the semi-custom nature of the Steam Machine and adjusting for the potential savings that Valve gets from its direct-to-consumer model, it seems like the Steam Machine cost as little as $600-650 in hardware. Accounting for Valve’s assumed profit of around 10% and taking into account Valve’s comments to Linus about its hardware business aiming for sustainability, the official pricing guess comes out to $699.99. This price estimate isn’t incredibly reliable, since it doesn’t account for the current DRAM shortage that has resulted in prices skyrocketing across the board, which will certainly affect Valve when the Steam Machine launches, and it assumes Valve will sell the Steam Machine at a high profit margin.

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