This past week Valve made public their intentions on entering the living room with their new Steam OS, Steam Machines and Steam controller.

To get a better understanding of why Valve is moving in this direction, one needs to look at the modern living room situation.

The living room

Currently, the living room experience is rather fragmented, some would say broken. The typical living room consists of an HD television with multiple HDMI inputs. These inputs are often used for our various entertainment devices: gaming consoles, set top boxes, Apple TV etc. Navigating between all these inputs and various user interfaces can be a nightmare for the average consumer: People don’t want to put up with multiple complicated UIs and yet they’re forced to learn how to use their labyrinthian television remote to watch their favourite TV shows. I would venture that a large part of why Apple TV in its current state sells so well is because of how simple it is, despite a lack of real marketing and its glaring omissions such as live TV.

Steve Jobs in an interview at the All Things D conference in 2010 summed up the television market succinctly. His statements about television then are still true today and worth quoting in their entirety. The statement starts at the 1:31:42 mark:

The problem with innovation in the television industry is the go-to-market strategy. The TV industry fundamentally has a subsidized business model that gives everyone a set top box for free, or $10 a month. That pretty much squashes any chance for innovation because nobody is willing to buy a set top box. Ask TiVo, ask ReplayTV, ask Roku, ask VuDu, ask us, ask Google in a few months… A lot of people have tried, they’ve all failed. So all you can do is add a box onto the TV system… You end up with a table full of remotes, a cluster full of boxes and a bunch of different UIs… The only way that’s ever going to change is if you go back to square one and tear up the set-top box and redesign it from scratch with a consistent UI across all these different functions and get it to the consumer in a way they’re willing to pay for it. Right now there is no way to do that… There [is] no chance to do a better TV because there is no way to get it market… The TV is going to lose until there is a viable go-to-market strategy… It’s not a problem with technology, [and] it’s not a problem with vision.

Take what he said about TV entertainment and apply that to also encompass gaming consoles.

Sidestepping the problem

The fundamental issue with Valve’s announcements this past week are that they have nothing to do with solving the fundamental problem with living room entertainment that Jobs outlined 3 years ago. What Valve is assuming is that the millions of Steam gamers who are used to playing Steam games on their PC or Mac will find gaming from the couch much more appealing now.

There is a plethora of reasons Valve’s approach is misguided but I’m going to focus on just the things they announced: the OS, the boxes and the controller.

Valve’s goal with SteamOS is to create an ecosystem around entertainment slanted towards gamers. This vision isn’t anything new, after all it is what the current and next generation consoles are already doing. How Valve differs is their approach: they believe that having an open OS in which users can build or buy their own boxes with varying specifications will fundamentally meet the needs of both general and hardcore gamers altogether.

The problem with that view is a failure to define what hardcore gamers desire. I believe hardcore gamers desire the exact same things from their experience that casual gamers desire, but are able to realize it and articulate their needs because these are the tech savvy gamers that can put together a $3000 gaming PC. There are no gamers out there, casual or otherwise, who would view reduced round trip input latency, 120hz refresh rates and frame rates in excess of 120 frames per second as negative things, despite their inability to articulate what they are. People will not be able to articulate why these things are important, but they will certainly feel them. Valve’s mistake here is letting people choose what they want rather than simply creating a breakthrough product in every detail. It’s the elusive Henry Ford quote “If I had asked people what they wanted, they would have said faster horses.”

If Valve thinks that the average consumer will care about choosing between different box specifications or installing their OS on their custom-built box then they have a very narrow vision of the massive potential of the living room market.

Perhaps the most interesting announcement, and the least deserving of criticism, is the Steam controller. For years industry experts such as John Carmack have complained that the relative time-based precision of game console joysticks were far inferior to the absolute precision offered by a decent mouse, especially for games where accuracy is crucial. Valve seems to have realized this and have developed a controller that seems to combine the absolute precision of a mouse with the friendly form factor of a typical console gamepad. This seems far more practical than the bombastic imprecise motion controllers we’ve seen Microsoft and Sony shoehorn into games. Game control is about using the least amount of physical effort to effect a digital world, so as to not break the suspension of disbelief that you the player are not part of the virtual world. In that sense, the Steam Controller retains a typical, small motion based input but uses dual touch pads to approximate the precision of a mouse. This is something that needs to be tested extensively before coming to any conclusion, but various first impressions from developers seem very positive.

Altogether, what the consumer needs is extremely difficult to actualize but not impossible. They want PC-like snappiness and the accuracy of a mouse and keyboard for games and a dead-simple UI for navigating around their content and live television in a simple packaged device at an acceptable price. Valve is simply solving a piece of the puzzle, not the whole thing. Steam in the living room, at best, will receive attenuated success because of how it is fundamentally sidestepping the problems with living room entertainment.

One of the saving graces of the PC platform in regards to gaming is the fact that every component in the entire experience has available a product designed for gamers. There are gaming input devices, monitors, video cards and headsets all designed to squeeze out every last detail and reduce all possible latency for the gamer. The television market doesn’t have such devices, TVs are still designed for general television watching and are not seriously considering things such as input latency and true 120hz refresh rates. These are things that create better experiences and console makers are focusing only on a portion of that experience.

“Next-Gen”

The next generation of consoles are attempting to broaden their horizon beyond games to become the total solution for living room entertainment. Nowhere was that vision more apparent than in Microsoft’s keynote presentation for the Xbox One, in which they focused almost exclusively on how live television, cloud based media such as music and video, and traditional gaming all blends seamlessly together in one consistent UI. It’s a difficult task and to me, seems the most complete of the available options on the market, but at the very best the Xbox One is still a box that needs a set-top box and an HDTV to function. There will always be at least 3 different user interfaces in the living room.

Where Apple comes in

By now you’re probably thinking there is a solution to this. Here are the criteria required to completely simplify the living room experience:

• A single device, the TV itself should be everything.
• PC-gaming level graphics and input latency.
• All kinds of media, offline, cloud, and live TV.
• A single user interface for everything.

Notice that any one of these things requires at least one of the other criteria to be met. You can’t have 120hz levels of input latency without also making sure the TV has a true (non-interpolated) 120hz refresh rate. You can’t have a single user interface for everything without building everything into one unit.

If there is any company that has shown us that it succeeds by controlling the entire experience from top to bottom, it’s Apple. From a distance, Apple does not seem serious about gaming, but it is serious about the living room and that is going to mean it is serious about gaming.

The iPhone 5s is hinting at something other than phones

One of the largest implications of the A7 chip in the iPhone 5s is its “desktop class architecture”. The phone has a 64 bit processor and a GPU that is looking more and more like a discrete desktop gpu with a modular architecture. What kind of device needs a tremendous amount of GPU horsepower and should address more than 4GB of system memory? A game console.

What excites me the most about the A7 and future iterations is that Apple is really taking the GPU area seriously with their chips. At the rate of progress that they seem to be making, it won’t be long before we have some sort of Apple TV with graphical capabilities within spitting distance of the next-gen consoles.

This is dangerous for Sony, Microsoft and Valve. Apple is coming at this from the opposite angle: media and entertainment first, gaming second. And as much as it pains me as a gamer to say this, that’s the correct approach.

Apple already has the content distribution pipeline for TV and Movies nailed down, all they have to do is negotiate a live streaming / live TV model and gaming will naturally fall into place with the next generation Apple TV. The army of developers that make iOS games today (big publishers like EA and Ubisoft included) will easily make the transition to developing for the same platform in the living room.

Questions remain on whether Apple will actually open up the next Apple TV for MFi controllers, create their own (which will have to be at least as good as Valve’s) , and whether or not Apple will also opt for creating the TV itself (for UI consistency / total experience control) but the vision here seems painfully obvious.

There’s also the valid question of “why gaming?” Apple has always had its flirtations with gaming. The iPod Touch was once marketed almost primarily as a handheld gaming device when Apple realized what customers and developers were doing with them. Also, the gaming market is at least as big as the TV and movie market and big budget games such as The Last of Us and Grand Theft Auto are starting to show signs of gaming’s ability to make important statements about society while also being fun at the same time. This is something everyone can relate to, good TV entertains and makes a statement about all of us at the same time. Lastly, to leave out gaming is to leave out a fundamental part of living room entertainment; a complete solution is not complete without gaming in the equation.

The days are near where interactive entertainment will be held in the same regard as cinema and TV as a vehicle for culture and art. Apple would be foolish not to realize both the artistic and economic potential of all these businesses. Something tells me they’re paying attention.