Compelling, but why would a Steam Machine be a threat to Xbox in 2025 when previous iterations of it were a complete flop? Because Valve has changed a lot in the past five years too, and it’s slowly been building an answer to that question with each step.

Microsoft gaming boss Phil Spencer has welcomed Valve’s next-gen Steam machine in a congratulatory message to Valve.

Valve just announced a new console and controller, and as you can expect, people were excited. Of course, they were also disappointed that there was no Half-Life 3 news, but we're used to that by now. The Steam Machine, as it's called, is a small cube-shaped console that will be able to run games on 4K at 60fps.

Credible sources report that Xbox's next console will be a PC hybrid, which would put Microsoft in direct competition with another gaming giant.

If Valve takes that affordability approach, then the new Steam Hardware is potentially disruptive to several different areas within the gaming industry. It could pose particular issues for Microsoft, which has recently begun talking about plans for its next-generation Xbox, and to Meta’s current prominence within the VR space.

Steam, Valve's industry-leading PC gaming platform, is taking a big swing with a device that could change the video game landscape forever.