Speaking to me during a brief interview on the red carpet at the VGAs last night, Newell said Valve's current goal was to figure out how to make PCs work better in the living room. He said the reaction to Steam's TV-friendly Big Picture interface has been "stronger than expected," and that their next step is to get Steam Linux out of beta and to get Big Picture on that operating system, which would give Valve more flexibility when developing their own hardware.
He also expects companies to start selling PC packages for living rooms next year—setups that could consist of computers designed to be hooked up to your TV and run Steam right out of the gate. And yes, Newell said, they'd compete with next-gen consoles from companies like Microsoft and Sony
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