Gabe Newell Describes A Gaming Future Where Your Virtual Investment Follows You Everywhere And Plugs Into A Broad Economy

Gabe Newell, co-founder and managing director of Valve, took the stage today at the DICE gaming conference to deliver a keynote, and while he said upfront he wasn’t going to be announcing any products, he did give some hints about Valve’s future. In his keynote, he outlined in a fair amount of detail how he envisions the future of PC gaming and what it might bring to the living room that traditional consoles can’t offer.

One thing stuck out as a recurring theme in Newell’s talk: Avoid the scorched-earth policy that seems to accompany every new generation of dedicated game console launches. When new iterations of the Xbox or PlayStation come along, the slate is wiped clean in many regards: Money spent on games, the time invested in virtual communities, physical accessories and input devices, etc. are mostly rendered incompatible with the new generation. It’s an enormous waste, according to Newell, and one that can be avoided.

A PC-based living-room gaming experience, like the one his company hopes to spearhead with Valve’s Steam Box plans, should help build some more stickiness into the effort, time and resources that gamers invest in their online realities. “We think that each game should be thought of in terms of maximizing the productivity of users in creating goods and services,” Newell said in his address. “These need to be persistent, have a wide domain… and be connected to other economies.”

Since PCs come with ready-made access to an existing network of apps and services — which he said “just work” on a living room PC as opposed to other platforms like Smart TVs where they have to be custom-built — there’s an advantage over other platforms. But he singled out competing devices like the Apple TV as having big perks in terms of a smoother development cycle and massive existing installed user bases on iPhone and iPad.

Some of Newell’s ideas for swinging momentum back to the PC for living-room gaming include building an extended ecosystem where in-game efforts can extend not only to other games (as they do with Steam’s Creator Workshop), but also across software titles. He said that could mean something like Photoshop becoming a free-to-play title, where basic features are free and more advanced capabilities are earned and traded for. “There’s not really a difference between traditional applications and how they encourage productivity, and wandering around in a forest killing bears and gathering furs,” he said.

To make that work, Newell says he thinks everything from 3D modellers to task management software could start as a free-to-play app and participate in revenue-sharing arrangements with other parts of the virtual economy including games. It’s a broad, bold goal and one that makes sense as a direction for Valve when you consider that it now offers non-gaming apps through Steam, and that it recently hired an economist to be part of its staff. But Valve also wants to be less directly involved in cultivating and curating the marketplace it creates by opening up entire software stores as user-generated content and eliminating as much friction and as many intermediaries as possible between content creators and consumers. The curated or edited approach favored by others like Apple and Amazon is a hangover of the pre-Internet era, Newell said.

Newell also discussed other elements of the upcoming Steam Box plans, including how Valve is focusing particular attention on input hardware, since he believes that’s a big gaping hole in the current PC gaming picture. The goal of Valve with hardware isn’t to sell huge amounts, but rather to “move things forward,” Newell says, in areas where Valve identifies a need to do so in the PC gaming industry. To what end? Newell says the whole idea is to reinforce and help expand the openness and creative vibrancy of the Internet, which helped make Steam possible in the first place.