Valve's Gabe Newell Thinks Windows 8 Will Kill PC Gaming; Plans Penguin-Flavored Future

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News Posted: Wed, Jul 25 2012 11:15 PM
Valve founder Gabe Newell had a conversation with VentureBeat recently in which the company CEO dropped some rather odd predictions concerning the future of the PC market. Newell took time out of his busy day spent rolling around naked on heaps of money and thinking of things to do besides Half Life: Episode 3 to share his opinion on Windows 8. Here's the exchange as recorded by VB reporter Dean Takahashi:
Q:What are some of the projects you’re working on?

A: Wilted Flowere’re trying to make sure that Linux thrives. Our perception is that one of the big problems holding Linux back is the absence of games... I think that Windows 8 is kind of a catastrophe for everybody in the PC space. I think that we’re going to lose some of the top-tier PC [original equipment manufacturers]. They’ll exit the market. I think margins are going to be destroyed for a bunch of people.

This was a PC catastrophe

First, let's tackle that "margins are going to be destroyed for a bunch of people" idea. News flash, Gabe -- That already happened. When HP was looking to unload its PC business last August, everyone took a good hard look at the company's financials. HP's personal computing business, absent the server/workstation market, had a 4.6% operating profit. Dell's profit margin?  4.4% -- and that's actually company-wide, as opposed to being PC-specific.

I don't take much credit for calling business trends, but truthfully, I saw this coming fifteen years ago. Back then, the $999 PC was a huge deal. And it was big -- the $999 PC I bought sans monitor was the system on which I first played Half Life. It was also a time when everyone was singing the praises of Michael Dell and talking excitedly of the coming age of the $899...the $799...the gasp $599 PC.

The nagging issue of margins, and the inevitable impact on system quality kicked off by the race to the bottom was neatly kicked under the rug, lost in the dotcom boom. And here we are, fifteen years later, in a universe where Microsoft had to show OEMs how to innovate (thanks, by the way) and companies whine about processor pricing. Apple, meanwhile, has a revenue share significantly higher than its market penetration.

Next up, there's this "Windows 8 is a catastrophe for everybody in the PC space" bit. I don't like Windows 8's Desktop very much, but it's only a catastrophe for two kinds of users:  Seals...



and the Penguin from Batman Returns.


Whaddya mean, multi-finger support? What are you, racist?

If you're a the Penguin and trapped on a desert island with a Windows 8 tablet that requires a five-finger key-press to unlock it, you, my friend, have a serious catastrophe brewing. The seals will be fine once they remember they can swim and don't care about a Windows 8 tablet anyway because of fish.


FEESH. Your argument is invalid.

Now, just for the record, I think Gabe's stated goal of supporting Linux by bringing more great games to the OS is a capital idea. I admire the fortitude of any man who would step into an arena dominated by a would-be Moses who might, at any moment, send you a long, rambling email punctuated with video footage of himself snacking on detritus [Not Safe For Humanity] found between his toes.

When it comes to gaming -- actually playing games on a PC -- Windows 8 doesn't change anything. In fact, one could argue that its universal adoption of hardware acceleration at every level is the greatest vindication gamers could ask for. For years, 3D functionality was dismissed as something that only gamers cared about, even though the same cards that offered superior 3D often gave better 2D and video image quality as well.

If there was ever a Windows that threatened gaming it was Vista, though that was Nvidia's fault, not Microsoft. Documents that were unsealed as part of the "Vista Capable" lawsuit from years back illustrated this point vividly; Nvidia's Vista drivers were responsible for a whopping 28.8% of logged Vista crashes in 2007. That's not "All DX10 crashes" or "All gaming crashes." That's all crashes. Period. Since Nvidia cards were whomping all over AMD's during the 2006-2007 time frame, it's safe to conclude that Nvidia could scarcely have done more to hurt PC gaming if it'd been underwriting the legal "career" of Jack Thompson.

And yet somehow, PC gaming survived.

With all due respect to Mr. Newell, his company, and their awesome skill with pixels, Windows 8 won't stir PC gaming one iota. It won't kill the OEMs -- they killed themselves through persistent pursuit of cost-cutting at the expense of innovation. Metro may annoy a lot of people, but my games will play the same with it or without it -- and that's what I care about.

Now, if you re-skin Half-Life to turn all the guns into walkie-talkies, then we might have to talk. Otherwise, gaming is in safe hands.
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fat78 replied on Thu, Jul 26 2012 1:11 AM

I don't see windows 8 wrecking the pc market but with steam promoting linux i think it could help boost linux market share. Not by much though, at most i only seeing it gain a couple of points. I know it may make me want to use linux more because about 90% of the games i play on my computer are games i buy from steam and i have started to enjoy using linux mint after fixing a issue with my mouse (rat 9).

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OmniDeus replied on Thu, Jul 26 2012 1:34 AM

i'm with Gabe on this one. I've played around with Windows 8, and the only way it's a good OS is on a tablet enabled PC. In my opinion, there are only going to be two kinds of people that will use Win 8 though; people who don't have a choice, and people who don't know any better. I currently work for a company that has at least 8000 workstations that I know for a fact will never see windows 8, if anything we will be sticking with windows 7 Enterprise for a very long time. We've had the beta for 8, we've talked with Microsoft Representatives, and honestly 8 just isn't that stable of a system for workforce productivity. They completely re-engineered the UI and the structure of the filesystem. It's slow, filled to the brim with bloatware, and feels just down right wrong to upgrade. Some of Microsoft's tactics to force users to upgrade recently have seemed very cut-throat at times. Microsoft is slowly becoming the tyrant of a company that everyone always accused it of being, which is a shame.

I for one welcome the day when Linux has taken over a large portion of the market. Maybe then I won't have to answer so many stupid questions about why Google is broken.

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Didnt he make a very similar comment a while back, before the linux development was announced? Am I just having dejavu?

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3vi1 replied on Thu, Jul 26 2012 9:11 AM

@MayhemMatthew: Well, according to Phoronix (for as much as you're willing to trust Michael ), he did have some negative comments about Windows 8 several months prior.  So yeah, that's probably what you recall.

As for his comments - I agree with Joel; I don't think Win8 will significantly tank the PC market... I just don't think it will sell well. There are some early-adopter types (i.e. everyone here) that like to have all the new shiny stuff and will buy it. But, if most feel as I do after trying it, they'll be telling their relatives and friends that there's no significant reason to upgrade from Win7. And, corporations won't touch Win8 with a 10ft pole - it's entirely consumer oriented.

Using the Win8 interface on a desktop machine is like running the Android interface on a desktop. Not... ideal. Or, as that Gartner analyst (who got his chain yanked back hard) put it: "bad".

It is particularly interesting to see these comments from Gabe though. As a former MS employee, he's always been a big promoter of their way of doing things. I remember back when the GldSrc/Source engine was evolving from Quake, they were yanking out OpenGL support and tying everything tightly to DirectX. It took forever, but now the pendulum has finally swung the other way.

What part of "Ph'nglui mglw'nafh Cthulhu R'lyeh wgah'nagl fhtagn" don't you understand?

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Joel H replied on Thu, Jul 26 2012 10:42 AM

"I just don't think it will sell well."

Wrong. Let's not confuse "well-regarded" with "sell well." At least, not in any sane way.

Think about it this way. Windows ME was profitable. Windows Vista was profitable. Intel's Prescott, which the company admits was an enormous misstep, sold billions in revenue.

If we're talking about DX9 titles and a single GPU, games like L4D play identically on XP, Vista, 7, and 8. And as a PC gamer, even if I somehow *had* to use W8, I'm going to keep gaming.

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3vi1 replied on Thu, Jul 26 2012 10:48 AM

>> "Wrong. "

Wrong. This is the first OS in 10 years that no business should even look at. It will sell poorly by every benchmark.

Will it be profitable?  Of course - licensing deals with OEMs and Stockholm Syndrome will ensure that.  But it won't support Microsoft's existing infrastructure.  Look for more layoffs in 8 - 12 months.

What part of "Ph'nglui mglw'nafh Cthulhu R'lyeh wgah'nagl fhtagn" don't you understand?

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RTietjens replied on Thu, Jul 26 2012 2:24 PM

My take on Windows 8: Microsoft is attempting to position themselves in the PC app market as Apple has positioned themselves for iOS, and as Microsoft perceives Google's position in the Android market (which is, of course, radically different from Google's *actual* position): Microsoft wants Windows 8 to turn tablets and phones into media consumption devices which are locked into the Microsoft ecosystem, and they want all purchases of that media to be made through the Microsoft (virtual) store.

Since the hardware requirements to get barely-acceptable performance with Windows 8 are significantly higher than the hardware needed for either iOS or Android, I think Windows 8 is going to end up as a niche market; well-off consumers who aren't very computer-savvy will buy high-end Windows 8 tablets and phones, and the low-end stuff will be left moldering on shelves. This will translate to very poor market penetration.

An additional side effect will be a booming business in pirated Windows 7 and Windows XP installers, when people are forced to get a new PC with Windows 8 pre-installed by the OEM, and find themselves enraged by the horrible user interface, and disappointed by the mediocre performance.

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3vi1 replied on Thu, Jul 26 2012 2:50 PM

I think you're absolutely correct as to how MS is trying to position themselves, RTietjens. And, it wouldn't be a bad strategy... if not for the Metro limitations for truly crossplatform apps (i.e. Intel and ARM). It's this exact positioning that makes me think that companies will not only reject the new OS, but actively backlevel new machines.

I hadn't really thought about the potential increase in piracy of older versions of Windows, but I wouldn't bet against it. If it does spike, I doubt it will last too long, as I see Win9 coming 18 months after Win8.

As far as performance goes, that's the one area where I might disagree. I don't see any (performance) issues when running it in a VM, and everything I've read seems to indicate things should run as fast if not faster. I'm not sure where your perception that it needs more comes from, but maybe you've heard something I haven't as I'm not generally their most avid follower.

What part of "Ph'nglui mglw'nafh Cthulhu R'lyeh wgah'nagl fhtagn" don't you understand?

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Joel H replied on Thu, Jul 26 2012 4:14 PM

"Since the hardware requirements to get barely-acceptable performance with Windows 8 are significantly higher than the hardware needed for either iOS or Android..."

W8 is aiming at tablets, not phones. There, it will run quite well. It's been demo'd on quad-core Cortex-A9 chips as well as dual-core 28nm Qualcomm processors (which count as Cortex-A15 equivalent). While it's true that you probably wouldn't like it very much on dual-core Cortex-A9, I'd wager a guess that it would be bearable. We'll probably see some systems like this from the various no-name / whitebox Chinese companies.

Certainly it'll run just fine on the upcoming version of Atom that's aimed at tablets, Cedar Trail. That's dual-core 32nm Atom and a multi-core GPU.

TLDR: W8 is well-matched to the capabilities of the hardware it will ship with.

Now, regarding businesses? I expect pushback. But I also expect Microsoft to take a reasonable tack here. $5 says W7 will have a long phase-out, just like Windows XP did. Businesses who want W7 will be able to buy it, no questions asked. If MS can show huge gains in the tablet market, they'll be able to say "Hey, look, we had to take a chance -- and we took it. Yes, business customers were disappointed, but we remain committed to improving W8 and we're also prioritizing the business experience in W9.

If Surface works well -- and that's a recognized "if" -- I think people will bite.

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3vi1 replied on Thu, Jul 26 2012 5:23 PM

>> "If Surface works well -- and that's a recognized "if" -- I think people will bite."

Well, you wouldn't be the only one guilty of qualifying their bets here. :)

But, on this one I'll go on the record as "NO BITE". Surface has a cool looking, but totally impractical, keyboard... tied to the worst operating system of all available choices. I think it's a clear bet that it will flop with everyone except those companies that blindly pick single-vendor solutions over all other factors (In which case they might already own PlayBooks!).

At any rate, and back to the original topic, I think Win8 is an unqualified train-wreck.. though something we'll all be supporting our relatives through for several years to come.

What part of "Ph'nglui mglw'nafh Cthulhu R'lyeh wgah'nagl fhtagn" don't you understand?

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RiCoFrost replied on Thu, Jul 26 2012 7:52 PM

The negativity and narrow mindedness of people regarding one aspect of this OS is remarkable. The one and only thing that people are complaining about is the Metro UI. One thing!!! Think about it and really think about it people. Because of one aspect you’re going to write off this OS….

Window 8 is faster in just about every way, they have improved the speed from almost every aspect, and it will run faster on older hardware!!! They have designed the OS to run on Desktops, laptops, tablets and Phones. That is a huge achievement in itself. Gamers will always pick the fastest OS.

Gabe is trying to write off Windows 8 simply because of the apps store…. Competition!!! Steam has about around 6 million users, they know that windows app store will have a much much larger audience and he fears he will lose some of his users.

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DHampton replied on Fri, Jul 27 2012 4:15 AM

Honestly my loyalty to windows has been skeptical, I feel windows really had two things gaming, and the ability to create antitrust problems on a large scale forcing many people to use only their product.

Almost everyone I know is counting the days till linux is more compatible and once every new major patch we try a couple games to see how its coming. But every other aspect of linux is better, except places where microsoft can push out of market.

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3vi1 replied on Fri, Jul 27 2012 10:26 AM

Apparently, people at Blizzard feel the same way as Gabe about Win8:

http://www.computerandvideogames.com/360383/blizzard-exec-echoes-windows-8-catastrophe-comments/?cid=OTC-RSS&attr=CVG-General-RSS

What part of "Ph'nglui mglw'nafh Cthulhu R'lyeh wgah'nagl fhtagn" don't you understand?

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BSmith1 replied on Fri, Jul 27 2012 10:32 AM

Im using windows 8 right now on an old amd machine and it boots faster and runs smoother than it ever did.

Im not crazy about metro ui but honestly like everything else in life once you actually start using it, you get used to it until its weird not having it. Windows 8 is and will be great, it wont do anything but help grow pc gaming not hurt it. It's amazing how many of you take windows forgranted and don't take a moment and step back and see what windows brings to the table.

You don't have to sweat a game purchase or hardware because you know 99% of the time its going to work beautifully. No having to tweak driver files or assign irq numbers, it just works.

Anyone who says windows 8 is slow is lieing about ever using it. Its fast and I cant imagine how fast it would be on the latest hardware, ssd drives etc.

Windows 8 isn't going to change your life and it isn't the second coming, but its the best os bar none in the world. There isn't anything you cant do on it.

I agree with the other user also mr steam man knows microsofts E-store is going to cut into his market share and that's about the bottom line to understand his madness.

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sackyhack replied on Fri, Jul 27 2012 2:13 PM

I don't know. Metro looks really goofy and I doubt I'll be switching any time soon. But at the same time, Gabe really ragged on the PS3 for a while, then he waddled on stage at E3 to talk about how PS3 is getting the "best version" of Portal 2. So who knows, maybe both parties will get their act together.

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There are bigger issues with 8 than the metro inteface, that will make it easier for morons, and catastrophically irksome has people learn to use those PCs. Their efforts to remove legacy architecture under the hood means ALOT of code will no longer compile and run for windows 8, and compatibility won't really help.

PC Gaming is dying anyways.

I am avid, and I am sick to death of $70 titles, and constant hardware upgrades to keep up. Worst, processor and card lines, even hard drives aren't getting issues worked out prior to the next gen. The end result, is one minor bs hassle after another until it's just not worth it. Why would it be? XBOX360 and PS3 prices are coming down, they have hard drives, and sooner or later, someone will make a mouse and a crawlboard for FPS/RTS gaming. End of story.

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Microsoft were doing things right in my view, which is slow releases of windows (XP lasted several years), unradicla changes to its GUI since windows 95. Part of this was probably due to market domination so perhaps they never felt the need to be radical but this ended up giving microsoft a good loyal following from people who dont like radical changes. However what I see now is a new microsoft, one who is panicing. Windows 7 is barely out the door and its already all but abandoned. No more service packs for it barely 3 years after release, feature pages taken down and replaced with pages telling people to change to windows 8. Technologies built on windows 7 such as .net and silverlight made EOL. Windows 8 is effectively abandong the desktop, the desktop interface on windows 8 is now a secondary interface only existing for backwards compatability, metro is their new primary interface and its aweful. Now the start screen for windows 8 would be ok as some type of lock screen for launching desktop apps, but they have actually gone radical to the point of not just making hugge changes to the GUI but also replacing the code base so apps developed for windows 8 specificallty (ARM) are not going to work on older windows. They are clearly copying apple/google as they introduced the windows app store, they are closing up the openness of the OS (again copy google/apple) primarily designed for touch screen (again copying) and of course dumbing down the interface. My personal experience of trying it on a VM is it is slower than windows 7 as well. Not just slower but I also get various weird hangs. windows 8 will sell, there is too many who want the "latest and greatest" and the iphone has proven "novelty sells" basically people will see windows 8 as a novelty as something fun and new to play with, that alone will sell many copies. That doesnt however make it a good OS, plus I think it will fail miserably in the business sector. The really scary thing tho is now we have seen this new panicked microsoft, what I know is that if they are unhappy with windows 8 penetration, particurly in the mobile market, they wont hesistate to dump metro, they dumped windows 7 very quickly and seem to now be going for the horrible rapid release model which many software vendors are starting to use. I expect now new releases of windows every 18-24 months and if the old one is considered a failure the new one will have a rehaul of the interface. Windows 8 also feels like a beta when I use it, I have found parts of the GUI eg. which look like they half between metro and desktop basically unfinished.

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Forgive me if I favor Gabe's and Blizzard's opinion over a random sarcastic journalist.

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