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I was in the beta and I still have an account with them. If you have a halfway decent internet connection, it works great, in theory. The problem is I think they implimented the platform poorly.
If Steam Box works anything like that, this is not only a great way for Steam and Publishers to make more money, but allow people who can't afford to spend vast amounts of weath on hardware to still have access to gaming.
Are you telling me if you could play Skyrim or Far Cry 3, on medium or high settings, without having to actually buy a computer or a Xbox, you wouldn't? I know I would. I love saving money.
Though Valve have some really talented minds working for them. I would expect them to find some eye catching way to advertise their stuff.
OnLive was a fantastic idea implemented insanely poorly.
They shot to high with high skill FPS twitch games that require minimal ping and video lag which was impossible to deliver from a 100% streaming service.
That's exactly why they failed and were bought out for just $4.8 million in October after they owed $18.7 million.
The way I see it, with our current global infrastructure and technology, streaming MMOs and RPG like games are as far as we're going to get practically.
As for The Steam Box utilizing streaming services, I wouldn't put it past Valve. They already have pretty good infrastructure set up for such things, so who knows!
But this is going on the assumption something like this is in the pipes. Perhaps Valve is just going to release something that makes the experience easier. In particular, recall the patent Valve filed a few years ago for a controller with removeable modules:
http://kotaku.com/5890372/is-this-valves-control-pad-design/gallery/1
But think about it. If valve enters the hardware market, they're already most of the way there. They've got servers all over the place. They've got a huge store, that's being worked on to be ported to other platforms as they put it. They've got a fully fledged vehicle for their client capable of being used with a controller, on a TV, complete with all the benefits of the browser, overlay and community. Looking at it that way, it's not so big a step, all they need is to make the software run on the hardware they choose to run it on, be it powered by linux or whatever else.
I'm also sure there is a huge, untapped market of gamers out there who would really love to buy high-end PC's and enjoy PC gaming but simply can't afford it or aren't confident or experienced enough to build their own PC. Most gamers wouldn't want to worry about all the problems that can come along with PC gaming like any number of the components dying, compatibility issues, needing to upgrade hardware, viruses, etc. That's why people like consoles. You buy one and that's it. You just put the games in and play. It's a lot simpler and less intimidating than PC gaming.
Steambox would be a way for all those curious gamers to cross over into the world of Steam without dealing with the intimidating, deep waters of PC gaming.