'Grim PC decline' not hurting games, says Gabe Newell

Valve managing director says PC "is where the innovation is happening"

The longest ever decline in PC sales has not noticeably diminished the platform's viability as a games device, according to Valve managing director Gabe Newell.

Newell says "PC gaming is where innovation is occurring"

Speaking at the Linuxcon event in New Orleans on Monday, Newell portrayed a bleak picture for PC manufacturers and associated businesses, but pointed out that his Steam platform continues to grow.

"What do we see now? We are looking at steady, year-over-year unit declines in PC sales, and the people in the field are the deer in the headlights," he addressed the audience.

"I think we'll see significant restructurings, or market exits, by top-five companies in the PC space. It's looking pretty grim."

But Newell pulled up some statistics which suggest, in his words, that PC gaming "appears to be immune" to this downturn.

"So despite the huge declines in PC sales, on the gaming side there's growth. Steam is going up 76 per cent year-on-year while PCs are going through double-digit declines."

"I think we'll see significant restructurings, or market exits, by top-five companies in the PC space"

In July, research firm Gartner claimed that global personal computer sales had fallen for the fifth quarter in a row, marking the longest duration of decline in the history of the platform.

PC shipments had fallen by as much as 11 per cent year-on-year, the research firm claimed.

Speaking to a gathering of Linux enthusiasts and developers on Monday, Newell provided his own theories on why he believes the PC downturn has occurred, and broadly suggested that the apparently "closed" structure of PCs is the key culprit.

"Several years ago we got very concerned about directions that the PC was going. We thought there was some bad thinking," he said.

"There were these new platforms that started to emerge, and they had this nice characteristic that [they] could control access to those platforms. If you didn't like competing with Google, you just didn't let them ship on your device, or you could determine how often they update. You could have control on things like pricing, and that was a very seductive opportunity which led to some poor decisions by the key players in the PC space."

He continued: "I think they should have doubled-down on the openness of the platform, rather than going the other way."

Today, Newell speaks of the PC's downfall in a more diplomatic manner, but in the past has been outspoken about the companies which he finds responsible for the slump. In July 2012, Newell described Windows 8 as a "disaster for everyone in the PC space".

More news on the Steam Box is expected before the end of September

The Linux Future

Valve has been developing games for the rival PC operating system, Linux, and currently has about 200 games built for the platform.

"Several years ago we decided we needed to work pretty hard to ensure Linux was a good platform for gamers and games developers. It was kind of distressing, because it would be a lot of work in order to do that," Newell said.

"However, what we became convinced of is that Linux is the future of gaming."

"PC gaming is where innovation is occurring. It's not on the consoles, it's not on the closed systems"

He admitted that, currently, "the user experience of being a gamer trying to play on top of Linux has been pretty painful".

"Any metric that you use - if you're just looking at how many players there are, how much time they spend playing, how much revenue they're generating, it's very small. It's typically under 1 per cent," he added.

But the key issue comes back to closed versus open platforms. Newell claimed that in the future there will need to be far less segregation between the desktop, the smartphone and the living-room, and that customers will want games to follow them regardless of the device that's in front of them. Linux, he said, is the only platform that appears to be viable to allow for this.

Newell's comments come one week ahead of scheduled announcements regarding the Steam Box - a custom games console for the living-room that will likely run off the Linux operating system.

This future in open platforms, he suggested, would secure the future of PC games.

"The openness of the PC as a games platform has enabled us to be somewhat immunised against the broader structural decline of the PC," he added.

"PC gaming is where innovation is occurring. It's not on the consoles, it's not on the closed systems, it's happening to the extent to which a games platform is open. So on PC you have digital distribution, you have social gaming, free-to-play, MMO, trading - most interesting topics are really coming out of the PC.

"We've seen tremendous evolution of innovation in the open PC space."