Valve VR: Will They or Won’t They?

As it launches its annual Steam Summer Sale, the buzz around Valve is interestingly around its potential plans for a new virtual reality headset. A patent for a “Head-Mounted Display,” originally filed in December 2021 and published last week, suggests Valve is at least exploring a successor to its 2019 Valve Index VR headset.
What We Know
Details, even rumors, on Valve’s VR plans are extremely thin. The only “confirmed” information available so far are that it’s internally named Deckard and that it will likely be a standalone device.

  • Potential Hint: Some have suggested its codename suggests some link to Valve’s well received handheld gaming PC, the Steam Deck
  • A Departure from the Index: Valve’ premium $999 Valve Index was tethered, catering to enthusiasts with money to spend on the headset and the required gaming computer.

The Case For It

  • Perks of Being Private: Valve is not unique in having Scrooge McDuck-eqsue piles of money (Thank you, Steam royalties!), but they have the advantage of being a privately owned company, unlike Sony or Meta.
    • Less pressure to deliver every quarter has given Valve the leeway to experiment, producing products such as the Steam Deck.
  • The OS Wars: VR is still the Wild West, with early adopters standing to corner the market. Meta scratched its plans to develop its own OS in favor of sticking with Android. Will Deckard be able to appeal to developers by using the same Linux OS that Valve uses for its other offerings?
  • The Steam Subsidy: The aforementioned Steam revenue gives Valve more cushion to develop and sell less profitable products.

The Case Against

  • Valve’s Lack of Focus: It’s no secret that Valve’s genius historically is more of the scatterbrained sort. It’s developed many a product internally that never saw the light of day for one reason or another.
  • Testing the Waters: Valve is known for teasing future products, and these leaks could be an attempt to take the temperature of the VR market.
  • Creature of Habit: Ultimately, the question here is how much does Valve want to branch out from its longstanding focus on software? A focus that every year rakes in steady, reliable revenue.

Sketching Deckard
Gazing into our crystal ball, we could glean a few more insights.

  • Launch Window: If it happens, don’t expect it much earlier than 2024. Valve’s manufacturing lines are still playing catch up on orders for the Steam Deck and its peripherals.
  • Price Segment: It’s unlikely to be as expensive as the Valve Index and in the $500 neighborhood. It’s going to be competing with the Meta Oculus Quest ($299/$399) and PlayStation’s similarly priced VR 2 headset.
    • The base Steam Deck was sold, if not at a loss, close to one
  • Multiple SKUs: The Steam Deck shipped with three versions, with Valve confirming most opted for pricier ones. Expect one priced less than competitors for the bragging rights and at least one more expensive SKU that consumers will gravitate toward.
  • Production Synergies: The current Steam Deck’s RDNA2 processor from AMD is likely not powerful enough. But an RDNA3 processor – AMD is launching them by year’s end – like the one expected to power a Steam Deck successor could be Valve’s choice
    • If supply and production can be properly managed, Valve is looking at appealing economies of scale and shared components that could be leveraged in pricing