So you're working on your own Steam Box hardware. Why work with so many partners when you have your own ideal design in mind?

What we see is you've got this sort of struggle going on between closed proprietary systems and open systems. We think that there are pluses and minuses to open systems that could make things a little messier, it’s much more like herding cats, so we try to take the pieces where we’re going to add the best value and then encourage other people to do it. So it tends to mean that a lot of people get involved. We’re not imposing a lot of restrictions on people on how they’re getting involved.

We've heard lots of rumors about the Steam Box, including that Valve's own hardware would be "tightly controlled." Can you tell us more about Valve's own hardware effort?

The way we sort of think of it is sort of "Good, Better," or "Best." So, Good are like these very low-cost streaming solutions that you’re going to see that are using Miracast or Grid. I think we’re talking about in-home solutions where you’ve got low latency. "Better" is to have a dedicated CPU and GPU and that’s the one that’s going to be controlled. Not because our goal is to control it; it’s been surprisingly difficult when we say to people "don’t put an optical media drive in there" and they put an optical media drive in there and you’re like "that makes it hotter, that makes it more expensive, and it makes the box bigger." Go ahead. You can always sell the Best box, and those are just whatever those guys want to manufacture. [Valve's position is]: let's build a thing that’s quiet and focuses on high performance and quiet and appropriate form factors.

Speaking of controllers, what kind of creative inputs are you working on? Valve has already confessed its dissatisfaction with existing controllers and the kinds of inputs available. Kinect? Motion?

We’ve struggled for a long time to try to think of ways to use motion input and we really haven’t. Wii Sports is still kind of the pinnacle of that. We look at that, and for us at least, as a games developer, we can’t see how it makes games fundamentally better. On the controller side, the stuff we’re thinking of is kind of super boring stuff all around latency and precision. There’s no magic there, everybody understands when you say "I want something that’s more precise and is less laggy." We think that, unlike motion input where we kind of struggled to come up with ideas, [there's potential in] biometrics. We have lots of ideas.

I think you’ll see controllers coming from us that use a lot of biometric data. Maybe the motion stuff is just failure of imagination on our part, but we’re a lot more excited about biometrics as an input method. Motion just seems to be a way of [thinking] of your body as a set of communication channels. Your hands, and your wrist muscles, and your fingers are actually your highest bandwidth -- so to try and talk to a game with your arms is essentially saying "oh we’re gonna stop using ethernet and go back to 300 baud dial-up." Maybe there are other ways to think of that. There’s more engagement when you’re using larger skeletal muscles, but whenever we go down [that path] we sort of come away unconvinced. Biometrics on the other hand is essentially adding more communication bandwidth between the game and the person playing it, especially in ways the player isn’t necessarily conscious of. Biometrics gives us more visibility. Also, gaze tracking. we think gaze tracking is gonna turn out to be super important.